EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, October 3, 1996

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[English]

The Chairman: I'd like to call the meeting to order.

At today's meeting of the Sub-Committee on Sustainable Human Development, we'll be hearing from the Minister for International Cooperation and Minister responsible for Francophonie, the Hon. Pierre Pettigrew. We heard yesterday from the Minister of Foreign Affairs. Minister Pettigrew will be speaking about the work of CIDA and the work we've done in development cooperation as it affects child labour.

With Minister Pettigrew is Huguette Labelle, who has been with us several times before on the larger committee and on this committee, and we welcome her as always.

If Minister Pettigrew would like to begin his presentation, we would appreciate it very much.

Hon. Pierre Pettigrew (Minister for International Cooperation and Minister responsible for Francophonie): Thank you very much, Mr. Chairman. Thank you for your hospitality. I'm honoured to be here today to talk about a very important subject.

[Translation]

I want to thank you for giving me this opportunity to address members of the Sub-committee. I especially want to thank you for deciding to focus your attention, throughout the fall and winter, on an issue that speaks to us all very deeply as both citizens and consumers.

As a government, we are clearly concerned about the issue of child labour. Child labour is without a doubt a vital aspect of human development. It is a growing concern for anyone working in the field of international cooperation. Thus we look forward to the sub-committee's research, consultations, and of course your recommendations.

I realize the topic of this afternoon's panel is private sector responsibilities in the global marketplace. My own main role and direct responsibility, with respect to child labour, involve Canada's program of official development assistance. As Mr. Axworthy indicated yesterday, I will sketch for you, at least briefly, what CIDA is doing to deal with the global problem of child labour both in general and specific ways.

[English]

Where to begin? Perhaps it's best to start with scope, with the number of children and the nature of the work that they do. Statistics, especially from the developing world - and particularly those about children who work - are wildly unreliable because they just aren't collected, because officially reported figures are often absurdly low, and because some aspects of child labour are simply taboo.

There are almost 6 billion people on this planet, and nearly a third of them are aged under 15. Another half-billion are in their late teens. About 85% of these children and youths live in the developing world. Today, 400,000 babies will be born; 90% of them will be born in Asia, Africa, the Middle East, Latin America and the Caribbean. And these aren't just figures. This is our future taking shape day by day. It's vital for all these children to benefit from adequate nutrition, health care, sanitation and education, especially in the earliest years, when what is at stake forever is their human potential.

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Tragically, many of these children are quite malnourished, they suffer from unpreventable illness, and are not in school. The basic reason is global poverty, which translates for individual kids into the personal reality of child labour. But for how many? To put it mildly, estimates vary. Last year, the International Labour Organization reported that 73 million children aged between 10 and 14 were economically active. But the figures don't cover those under the age of 10 or those working in the informal sector. The UNDP gives us the bigger picture when it says: ``Hundreds of millions of children work in fields and factories, on street corners, and in garbage dumps all over the world.''

The largest numbers of working children are found in Asia, where they compose more than 10% of the labour force in some countries. The highest concentration is in Africa, where up to a reported 20% of children work, often in the obscurity of subsistence agriculture. But we shouldn't feel smug. Child labour was the norm in our own society for a long time, until just a few generations ago. And in the countries that call themselves ``developed'', there isn't a major city without its under-age workers, squeegee crews and teenage prostitutes.

[Translation]

The problem is big. Is it growing? Trends are in conflict. On the one hand, almost all countries have ratified the 1989 U.N. Convention on the Rights of the Child. Just a few weeks ago, a Declaration and an Agenda for Action were unanimously adopted in Stockholm, at the World Congress Against the Commercial Sexual Exploitation of Children which was attended by our colleague, the Minister of Foreign Affairs.

The governments of various countries are showing new signs of interest, and child labour has moved up sharply on the international agenda, even becoming an item in trade negotiations. On the other hand, the first ILO convention, supposedly prohibiting industrial work by children under 14, was adopted three-quarters of a century ago. However good their intentions, the governments of most developing countries have few resources indeed to monitor child labour. Continuing poverty, deepened in many places by cutbacks in social programs, forces children to work, for survival, while offering no other alternative, such as access to education.

One factor that has changed is the massive explosion of international trade - an eleven-fold increase in global exports of commodities and goods since mid-century. This means that there is a much greater chance for us, than for our parents' generation, that the shirt, carpet, toy or pair of shoes that we buy at the mall was fashioned by a child somewhere in the world. Globalization puts the issue of child labour in front of our eyes and on our conscience.

[English]

What happens when children work? Most often, whether it's for wages or in a family setting, they help to meet immediate basic needs. Their contribution is meaningful and essential for families living in poverty, and sometimes they acquire valuable skills and experience that will ensure a livelihood for them. But the more they work, the less likely they are to receive a basic education and all that it means in terms of forgone opportunity, lost potential and a diminished future.

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The work itself, even within the home, on a family farm or in a family enterprise, can often be exploitative in nature. Albert Thomas, the original director of the ILO when it was created by the League of Nations, put it best long ago when he said: ``The exploitation of childhood constitutes the evil the most hideous, the most unbearable to the human heart.''

In the 1990s, the ILO is still trying to overcome that evil. Four years ago, it launched IPEC, the International Program on the Elimination of Child Labour, with support from Canada and other donors. Recognizing that child labour is a vast, complex, deep-rooted reality that can only be solved in the long run from within the countries where the problem is concentrated, IPEC takes a phased approach. It supports national efforts to build the permanent capacity to tackle the problem. It gives priority to eradicating the most hazardous and exploitative types of child labour. It stresses prevention.

My colleague, Minister Axworthy, referred yesterday to CIDA and HRD's $700,000 contribution to IPEC to develop guidelines and best practices to be used in addressing child labour. Since the most urgent obligation is to help halt the intolerable, it aims its efforts at three priority target groups: children working at forced labour and in bondage; children working in hazardous conditions and occupations; and very young working children under the age of 12. The program gives special attention to working girls, because they are highly vulnerable to exploitation and abuse.

Innovative and flexible, with a substantial role for NGOs in project delivery, IPEC is the most important international program on child labour. It is operating now in more than 20 countries on three continents, and it is part of the effort that will, we can hope, lead the way to a convention on child labour, focusing on the most dangerous and exploitative forms to be considered for the world's adoption by the International Labour Conference in 1998 and 1999.

[Translation]

Apathy, greediness, feeble governance and outright corruption doubtless play their part in perpetuating child labour... but its root cause is, of course, poverty. For people with no alternatives, it's a survival strategy that works.

Aware of this reality, Canada takes a supportive and cooperative, rather than punitive, approach to reducing child labour. We don't plunge into trade sanctions, for instance, because we realize that even if such measures were effective, they might very well drive child labour underground. The children involved could end up in more hazardous circumstances or simply out on the street. Exploitation is bad; exclusion is worse.

Thus, we support international initiatives, such as IPEC, and we encourage efforts within the countries concerned, whether they come from government or civil society.

Recognizing that - for the developing countries just as for ourselves over the past century - eliminating child labour ultimately depends on overcoming poverty and giving all children access to education, we give priority to poverty reduction in Canada's aid program. Last year's foreign policy statement, Canada in the World, commits us to investing 25 per cent of official development assistance towards meeting basic human needs, with children a key target group.

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[English]

When women are involved in development efforts, both as as beneficiaries and as agents of change, children are helped very directly. CIDA has been a world leader at integrating women in development initiatives. As the president of the World Bank said recently, and as UNICEF research has documented so thoroughly, educating girls is ``the single best investment that can be made in the developing world today.'' CIDA has therefore contributed $15 million to support UNICEF's girl child education initiative to boost school enrolment among girls in fifteen countries in Africa.

Within the broad range of CIDA-funded programs to reduce poverty, we have undertaken projects that support children in such fields as primary health care, basic education, immunization, nutrition and clean water. Last year, substantial amounts went into efforts ranging from maternal and child health to micronutrients to water supply in Asia, Africa and the Americas, as well as into medical supplies and help for hospitals and orphanages in central and eastern Europe.

Many of the specific projects speak eloquently of the terrible ways in which our world abuses and exploits so many of its children. Last year Canadian taxpayers' dollars were helping to provide health care for children under the age of 2 whose families were dislocated by war in southern Lebanon; to register, protect and reunite more than 100,000 unaccompanied children in Rwanda and Burundi; to offer trauma counselling and shelter for abused girls and women in Liberia; and to reintegrate child soldiers aged 8 to 17 in Angola, in Liberia, and in Sierra Leone.

Even in a time of shrinking aid budgets, and despite the sensitivity of interventions in an area of domestic policy, we also managed to support a number of projects that directly target child labour. India, for instance, has now formulated a national policy on child labour, and Canada is helping to address related human rights issues through two funds administered by our high commission there. We have sponsored such initiatives as consultations and a workshop on child labour for government and NGO staff in Bihar, and awareness and action campaigns on child labour in the glass-making and carpet industries. And we have also undertaken training and documentation on children's rights and child labour.

There is so much to be done. We must target scarce resources and use them in strategic, innovative ways. We must help to build partnerships and coalitions of all those who are involved and who care: governments at all levels, business, the professions, unions, schools, churches, citizens, the children themselves. We work with many such partners. We are exploring, with many groups, ways of providing better education for consumers and codes of conduct for business. CIDA is also reviewing the inclusion of such codes in all of its contracts and contribution agreements, which could stipulate the executing agency's responsibilities toward eliminating child labour.

[Translation]

Child prostitution is probably the most hateful form of child labour. We have acted in this area recently, as you probably know, by amending the Criminal Code so that Canadians who take part in child sex-tourism can be prosecuted here at home. And, with like- minded countries, we are working toward a protocol to the Rights of the Child, concerning the sale of children, child pornography and child prostitution.

Exploitative child labour takes many different forms indeed, from mind-numbing drudgery and isolation to the horrors of combat, prostitution, the drug trade, and pornography. Given its global scale and its long history, we could easily despair of ever ending the abuse.

But it is within our power to work against it, step by step, if we have the will and the energy... of the kind displayed, with such impact, by Craig Kielburger.

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It's very encouraging when an individual Canadian takes action against the exploitation of the world's children. And when that Canadian is also a child himself, we should be inspired, or at the very least shamed, into doing what we all know is the right thing.

[English]

Perhaps it's appropriate in UNICEF's 50th anniversary year if I close with a few of the last words from Jim Grant, the former executive director of UNICEF. A few days before his death last year he wrote:

There is something selfish, something excluding, something cruel in the temper of recent times that deeply concerns me. It has led to an unravelling or weakening of the social fabric, of nations, communities and families... What is particularly worrisome about this mean-spiritedness is that it is gaining ground precisely when, for the first time in history, we have the means to satisfy the basic needs of each and every human being... If, through a failure of nerve, an impulse of selfishness, a confusion of priorities, a loss of self-confidence, we deny that dream and walk into the 21st century looking backward, humankind will pay for its short-sightedness... Let us all face forward toward the children, our collective future.

[Translation]

Mr. Chairman and members of the committee, thank you all for your kind attention.

The Chairman: Thank you, Mr. Pettigrew. We have a lot of questions for you.

Mrs. Debien.

Mrs. Debien (Laval East): Welcome, Minister, and thank you for agreeing to take part in the Committee's work. Over the past week, we have been hearing testimony from a variety of witnesses who have given us a pretty accurate picture of the global problem of child labour and exploitation, because there is a difference, it would seem, between child labour and exploitative child labour. As I say, we have been given a pretty complete picture of the problem.

A witness told us this morning that there was a close correlation between a recent increase in exploitative child labour and trade liberalization and globalization. I was struck by the fact that on page 2 of your written statement, you really put your finger on the root cause of this problem, since you say that the increase I just referred to is the result of the massive explosion of international trade.

This morning, the same witness also proposed a variety of solutions. Indeed, a number of witnesses have brought forward different solutions. One witness in particular listed a series of solutions that are required, referring to a mixture of trade measures and regulatory measures - and I do mean measures, rather than sanctions, because I think we need to make a distinction there as well - that countries should adopt, as well as development assistance measures.

I particularly want to ask you what you think of trade measures such as development agreements linking trade, aid and labour-related rights. Development agreements are generally bilateral or even unilateral agreements that a country may enter into with another country or in partnership with another country.

These development agreements can take several different forms. They may involve granting preferential treatment to countries that take steps to deal with the child labour problem. They can also involve additional trade incentives for countries that have eliminated child labour. Or they can include special development assistance measures to help a developing country adhere to certain standards.

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Those are some of the positive trade measures that can assist countries without penalizing them, because we know just what a disastrous effect punitive measures can have on children. It is this kind of development agreement that we discussed this morning with our witnesses. People seem to be far more supportive of that type of trade measure than of trade sanctions.

I would be interested in knowing your views, Minister.

Mr. Pettigrew: First of all, I want to thank you for drawing my attention to this. I will make a point of reading both the brief presented this morning and the committee proceedings. At first glance, it seems to be a most interesting suggestion. The reason I say that is that it is a constructive suggestion. It involves a comprehensive process that reflects the specific situation in a given country.

I see this as far more beneficial than punitive measures that might, as I think we all agree, have the effect of driving children even faster into prostitution and other kinds of work. I see this as a way of gaining some control over a situation that has long been a reality.

I must say, personally, that I am rather curious as to how the approach you have described could be implemented. At first glance, I find it very appealing. This is just the kind of initiative that I could see myself getting involved in.

The Chairman: Mr. Paré.

Mr. Paré (Louis-Hébert): As Mrs. Debien said, for the past few days, we have been having panel discussions that have shown us just how complex the problem of child labour really is. We are discovering, just as we suspected, that child labour is not a cause, but an effect, the cause being both poverty and regimes that violate human rights.

It seems to me that there are two potential solutions to this problem. One is what might be called a magic solution - that is, where you assume that globalization, the free circulation of goods, and competitiveness will solve all our problems. This morning, we put very specific questions to our witnesses. Among the five Asian tigers, where economic growth - note that I did not say development - has been massive over the past few years, what exactly is the status of the child labour problem and, more generally, of labour and social standards?

While their data was not absolutely reliable, these witnesses tended to say the problem had worsened. We cannot hide behind trade relations and globalization and expect the solution to appear on its own. Minister, you made a brief reference to that earlier when you spoke of IPEC. That organization has to work with NGOs if we are ever to begin to find a solution to this problem.

I think the real solution is to ensure basic human needs are met. You also made that comment.

In closing, I have a question for you. I really believe that is where the solution lies.

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What worries me is that under Canada's foreign policy, only 25 per cent of our official development assistance is used to meet basic human needs. Yet if that is where the real solution lies, we will clearly have to launch a fundamental review of the current distribution of Canadian ODA. I don't think bilateral aid is always the best way of satisfying those needs, because it's my impression that some regimes see no advantage in developing civil society and democracy. So, we aren't really getting any bang for our bucks.

Nor am I sure that international financial institutions, which have too often imposed structural adjustment programs, are necessarily the best vehicle for ensuring that basic human needs are met. My view is that Canada should equip itself with tools that are really effective.

Indeed, when we reviewed Canada's foreign policy, experts told us that 70 per cent of Canadian ODA should be aimed at meeting basic human needs, yet we are only at 25 per cent.

Minister, knowing that you will soon have major decisions to make since budgets are certainly not going up, would you consider at least reviewing the current distribution of funds within this envelope?

Mr. Pettigrew: First of all, I want to say that I think the work you do is absolutely wonderful; it helps us to understand the complexities of the issue. But let me try and explain my own philosophy. I will even give you arguments in support of your case. We are not even at 25 per cent. Our goal is to bring it up to 25 per cent, but we are currently at only about 21 per cent. That is a goal we have set for next year. So, you can see we are at least moving in that direction and aware of the problem.

But let me briefly explain my philosophy regarding development as it relates to that. As far as meeting basic human needs is concerned, we are clearly highly sensitive to the issue. However, the Canadian International Development Agency is a development agency. It does not only exist to ease poverty, but to help societies take control of their affairs, create their own wealth and become part of the regional and world economy. Please understand that I am not giving my blessing to globalization. You know what my views are in that respect, because we have discussed this. I am in fact well aware of its limitations, insofar as we want our development assistance policy to foster the transfer of skills, technology and expertise, as well as capacity building, so that the society can take control of its own affairs.

You sort of soft-pedalled around the issue of the civil society's role. I'm sure you would recognize, though, that there are countries where strengthening the civil society has helped tremendously - for example, when Canada helped - and I know this will bring a smile to your face - South Africans solve their constitutional problems, because of its extensive expertise in constitutional matters, indeed, in the constitutional industry.

Mr. Paré: Maybe we do a better job of it elsewhere than we do here.

Mr. Pettigrew: As you know, that was a marvellous contribution to that country's development. While I am not suggesting we should take credit for something where it's not warranted, to the extent that we did help to strengthen the South African government in terms of the legality of its constitution, that country is now able to manage its own affairs. As you know, de Klerk has gotten out. When Mandela began, no one could have imagined a government without de Klerk and his party. But they now have institutions enshrined in their constitution that allow them to protect...

While meeting basic human needs is clearly a high priority in the short term, we must maintain a continuum of aid and support these countries until they are able to get along on their own. That means transferring technology and expertise that will allow them to create their own wealth and eventually meet those basic needs.

That is why I consider Canada's aid policy so important. It is quite true that maintaining that aid is becoming difficult, because our budgets are unfortunately being severely cut back. I had a brief opportunity to speak with Mr. Chrétien, the Prime Minister, when he gave a speech last night at a dinner, and he told me that two years from now, we will probably have balanced our budget - in other words, eliminated our deficit. It was a great evening, the Minister of Finance was there and it went really well.

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Did he say in four years?

Mr. Godfrey (Don Valley West): At the end of our next mandate, if there is one.

Mr. Pettigrew: What did he say?

Mr. Bergeron (Verchères): May 1998.

Mr. Pettigrew: I am certainly hopeful that budgets will start to increase again at some point. I believe Canadians are profoundly committed to our development assistance policy. That is clearly reflected in the polls and in the mail we receive. The Canadian International Development Agency is not only an aid agency; it is a development agency. So, development is our ultimate goal and that development requires being there over the long haul so that in addition to meeting basic needs, these countries can gradually achieve a level of economic and social integration that allows them to mature. So, you can see the kind of philosophy I bring to my work.

[English]

The Chairman: Mr. Morrison.

Mr. Morrison (Swift Current - Maple Creek - Assiniboia): I have two questions, Mr. Chairman, but I won't need anything close to my ten minutes.

Mr. Minister, one thing that I think a lot of people overlook in the question of child labour is the cultural implications. Many years ago I remember talking to a couple who had engaged their 9-year-old daughter as an apprentice rug weaver - bone-racking drudgery, I can tell you, a terrible job. They did not feel they had done anything wrong. As a matter of fact, they were very pleased and proud that they had been able to put the child into an apprenticeship. They felt that now she was guaranteed that she could support herself for the rest of her life. She wouldn't have to depend upon a husband and be at his mercy. It was very important to them and they really thought this was the way to go.

Now, if at that time there had been international trade laws in effect demanding that the rugs be labelled guaranteeing that there was no child labour, this family would have had to do without what they regarded, in their culture, as something beneficial. How do you feel about this? How deeply can we intrude into the lives of people in the third world?

Mr. Pettigrew: This is why I'm saying that development is a global approach. I think we have to respect the level where they are. I mentioned that in our own country and in our developed countries not too long ago, there was that situation.

Mr. Morrison: In my life?

Mr. Pettigrew: You know that; you've seen it. This is why I say that we have to treat these matters with much respect, but we also, with the capacities we have in today's world, have to raise their expectations. We have to promote different values, such as educating their young girls if they can afford it. This is why the Canadian International Development Agency does a lot for educating their young girls. That young girl, if she were educated, would also have been independent of her husband.

So yes, we have to respect their culture, but we must accompany them to a higher level of respect of human rights and the human potential this young girl has.

Mr. Morrison: Thank you, Mr. Minister.

My second question concerns a statement made by the justice minister over the weekend. He declared that in the case of a unilateral declaration of independence, the Canadian government would try to block the recognition of Quebec and hence its admittance into international organizations and treaties. I presume this wouldn't be just NAFTA or the WTO, but organizations such as IPEC or the international financial institutions, foreign aid if you will. Do you agree with this approach, Mr. Minister?

The Chairman: Let the parliamentary secretary answer since he offered comments before.

Mr. Pettigrew: I didn't see the statement by Mr. Rock. I'm not sure I understand it.

Mr. Morrison: He said this on the show Question Period. He was asked by Mr. Oliver what Canada's reaction would be to UDI and also whether one of the aims of the Supreme Court reference would be to make it difficult for Quebec to gain international acceptance. The minister said yes, indeed. That is what I wanted to get your position on.

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[Translation]

Mr. Pettigrew: Well, that is a pretty hypothetical question. I do not believe Mr. Rock said we are referring this to the Supreme Court in order to make things more difficult for people. We are going before the Supreme Court for clarification of one word and one word only: unilateral. Our only intention is to clarify whether the government can proceed unilaterally, not whether it can or cannot become sovereign. Everyone recognizes that Quebec can become a sovereign state, but can it do so unilaterally? That is the only issue that concerns us at this juncture. There are really two things...

[English]

Mr. Morrison: No, the reference was specifically to UDI. It was not a general reference to independence but to the unilateral declaration of independence.

Mr. Pettigrew: Okay.

In any case, Mr. Chairman, I've been in politics for eight months now, and I've been told -

[Translation]

Mr. Drapeau, the former Mayor of Montreal, taught us...

[English]

- that you should never reply to a hypothetical question. Yesterday I heard another one that came from Mr. Drapeau: never comment on rumours.

Some hon. members: Oh, oh!

The Chairman: Mrs. Bakopanos.

I'm sure Mrs. Bakopanos will not pass on any rumours.

Mrs. Bakopanos (Saint-Denis): No, Mr. Chairman, and thank you very much.

I'd like to thank the minister for being with us today. I must begin by saying that in looking at your speech, and from what you've told the committee today, Canada is doing a lot. I think that's one thing that is not well known among the general public. Perhaps we should be publicizing it a lot more. But as you say also, there's lots to do.

One of the questions I asked this morning and that I'd like to ask you - I have two questions, actually, for the minister - concerns educating our young people and sensitizing them about the situation in other countries.

I also want to congratulate you for that initiative you took in terms of having young people work overseas in Canadian companies. I think that's an excellent initiative. It's one that I think will also bring back home what is happening in those countries. Our future spokesmen or ambassadors are people like Craig Kielburger, as you mentioned in your speech.

I want to know if you have any ideas on how we should actually be promoting Canada's role and what Canada is actually doing at the level of the young people. As I said, I think they are our future ambassadors, our future workers, in the other countries. Perhaps you have some ideas. Although I know education is a provincial jurisdiction - we won't get into that - I also think we can play a role as the Canadian government in terms of teaching our young people what is going on and their responsibility in terms of the global village we live in.

Mr. Pettigrew: I think it's a very good suggestion. It is important to enlist them without going into the schools or the education system, obviously. That doesn't prevent us from ensuring the commitment of younger people in our efforts and enlisting some of them in all kinds of ways. We will look into what we can do. I think it is a very good idea. Maybe we eventually should try to have kids' exchanges or things like that in one of our programs. In particular, maybe we should have a project on one particular country.

Mrs. Bakopanos: Craig would be a good person to talk to, in any case. I've spent many hours talking with him.

Second, I believe, as you stated, that the elimination of poverty is key in terms of eliminating child labour - no one would dispute that - and redistributing wealth between the rich and the poor in some of those countries.

I also liked what you said on page 3 about women involved in development efforts. I think you're right that it's through the women that we will also be helping the children.

As you well know, there is the Grameen Bank project in some countries. I think it's excellent. I mentioned this morning that perhaps we should look at that - and being from Quebec, I call it the caisse populaire of the Third World - in terms taking care of the bondage situation in some countries.

Why can't we provide funds through that type of fund in order to pay off the bondage? One of the reasons a lot of the children are sold off is to pay off debt. If we can provide moneys, through some sort of fund, to pay off the bondage, and that way liberate the children...

It's just a suggestion. I don't think it's the ultimate solution to the problem, but I know it has helped women in Third World countries develop projects.

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Mr. Pettigrew: We already do quite a lot in terms of microcredit microenterprises. I must tell you, Mrs. Bakopanos, that women are much better clients for the microcredit businesses we have than are men. Women reimburse at the level of 98%, whereas with men it's been between 60% and 65% on average. So it means that dealing and doing business with women in the microcredit business is not only fair, not only a matter of equity, but also a matter of efficiency. It is better for the company to do this with women than with men. The cultural aspects very often don't help women, but it is the contrary...

I must send you the speech I gave last Sunday at Airlie House. In the room at the Carter Centre there were 12 ministers of agriculture. I spoke on rural development in Africa and about only one subject - investing in women. All our aid programs must be in favour of women. I said it is not only a matter of equity but also one of efficiency.

Women do 70% of the agricultural work and get only 20% of the income. Women are, I understand, 14% more productive than men on the farm for the same work, 14% more productive; and women for all kinds of status reasons still own - and that includes all the developed countries - only 1% of property around the world, even though they do probably 60% or 65% of the work.

So I fully share your assumption that investing in women is extremely productive. It's not only a matter of equity but also one of productivity for the objectives we have.

Mrs. Bakopanos: Thank you very much.

The Chairman: Dr. Pagtakhan.

Mr. Pagtakhan (Winnipeg North): Thank you, Mr. Chair.

I thank you, Mr. Minister. I think you have rightly captured the essence of the issue indeed, that what's perpetrating child labour, the root cause, is poverty.

Yet, to quote Mr. Grant, ``...for the first time in history, we have the means to satisfy the basic needs of each and every human being...''. It is almost a contradiction in that we know the cause, we have the means, and yet the problem continues to persist. It is therefore indeed a challenge to human generosity.

Earlier a member from the Reform Party was asking a question that I thought was irrelevant. I'd like to say that perhaps there may be a relevance, and I would like to pursue that as the first question.

How do you see foreign aid as a tool for national unity?

Some hon. members: Oh, oh!

Mr. Pettigrew: Values. It is something Quebeckers and other Canadians share very deeply. Quebeckers and other Canadians have built an international personality that is unique in the world. There is a role that Canada alone can play in world affairs given the fact that we happen to be a bridge between the G-7 countries and the developing nations, and given the fact that we do things differently from anyone else.

[Translation]

That is our way of doing things. Wherever we are, West Africa or East Africa, we hear the same comments. What do people who know Quebeckers working in development say? They say: "You CIDA people recognize our priorities and treat us like partners. Canadian solidarity was not born of an instinctive desire for power or domination."

Quebeckers certainly reflect that when they're involved in international development. When I am in East Africa, Asia, or in Anglophone countries - where you often meet Canadians from other provinces, because there are a great many people from other provinces involved in international development - everyone says the same thing to me: "You Canadians do things differently. You respect our priorities and you treat us like partners".

What that means is that Quebeckers and other Canadians do not behave the same way the French do when they're involved in international development initiatives in West Africa. English Canadians do not behave the same way the Americans or British do when they're involved in international development. Because Quebeckers and other Canadians have had to come to terms with each other, we have developed an international personality that is characterized by respect and tolerance. We have made it a rule to be respectful of one another, and that is reflected in our work.

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What that means is that Quebeckers realize that if Canada were to cease to exist, an extremely important player would be missing on the international scene - an extremely important player in terms of ensuring an appropriate world balance, as we have proven for years.

Prime Minister Chrétien spoke yesterday of the situation in Haiti. He said that Canada had succeeded, through the Security Council, in securing China's acceptance of our contribution in Haiti and the U.N. mission. Prime Minister Chrétien was at the G-7 Summit when he got the news that the Security Council had finally gotten China to accept our work in Haiti. At that point, the president of another G-7 country turned to Jean Chrétien and said: "Thank God we have Canada". The fact is, we were able to get something from China that other countries could not.

Those values that we share deeply are a very important aspect of Canadian unity and would be completely missing from the international scene were Canada to disappear, because Canada, without Quebec, could not continue to play that role, nor could Quebec play that role alone.

We would be left with two entities that would be unable to fulfil the extremely important and unique role that Canada has played internationally. I think that is a very strong argument in favour of national unity. Thank you very much for raising a most relevant question.

The Chairman: Mr. Bergeron.

Mr. Bergeron: How wonderful that my turn follows such a relevant question! Of course it all depends on the context for assessing its relevance. From the standpoint of national unity, it may seem relevant to you as a federalist, but I hardly see its relevance to the issue of child labour. However, we will certainly forgive you that spontaneous and passionate response. We understand that kind of passion, because we are just as passionate about Quebec.

Having said that, Minister, I want to thank you for being with us. I couldn't agree more with Mrs. Bakopanos when she says that it's important to make Canadians and Quebeckers more aware of CIDA's work, and in some respects, the very important work Canada is doing in the field of international development.

It's quite astonishing to hear Mrs. Bakopanos, in the same breath, heap praise on the federal government for the efforts it has made to educate the Canadian public, when she knows full well that the government and CIDA have cut all public education programs. Since everyone seems to be doing some soft-pedalling, I'd like to do some myself with respect to Mrs. Bakopanos' excessive enthusiasm. Maybe things will change now, though, since the suggestion is coming from a Liberal M.P.

Minister, I would like to raise a question that is directly related to our theme. I would refer you to page 5 of your text, where you say that you are seeking ways of introducing codes of conduct for business.

This is an issue that was raised yesterday by Minister Axworthy. He addressed it somewhat indirectly, saying that his department was involved in consultations with the private sector with a view to eventually establishing a code of conduct.

Yesterday, we asked Mr. Axworthy how far the discussions with the private sector to develop a code of ethics had advanced, and the response was somewhat evasive. He told us that negotiations were ongoing and that he could not yet give us a more precise answer. I can certainly understand that in a negotiating process, precise answers cannot necessarily be provided.

In your text, you say that you are currently seeking ways of introducing codes of conduct for business. I would like to know just exactly what that means, coming from the Minister for International Cooperation.

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Mr. Pettigrew: Well, CIDA's Economic Policy Division is currently involved in a process where we are attempting to establish criteria or ways of identifying products, so as to avoid sanctions or other such measures. This is really the ground work for a policy or trade practice that could help us to deal with this specific problem. We don't want to do anything that might directly harm those affected, for the reasons given earlier. We don't want to drive children into prostitution, and that sort of thing.

[English]

The Chairman: I think we have time for only one final question, but since it is Mr. Godfrey, the parliamentary secretary, I know it will be very short.

Mr. Godfrey: In that same paragraph, you confirmed something that the witnesses have all said, and that is that there is a tremendous complexity and interrelationship of causes, from the most official political level right down through what unofficial groups do in a country. I guess the question is this: since only a multilayered approach is going to work in any individual country, does it make more sense for CIDA to concentrate on some critical countries, to bring to bear all of the relationships that we have in Canada with the equivalent groups, so that we have a kind of holistic approach rather than conducting our activities on a multilateral level with scattered efforts in different countries? One might take an example like India, where one would get a tremendous bang for the buck if one concentrated one's efforts on that particular problem, because we have great contacts, because they're part of the Commonwealth.

Mr. Pettigrew: In HRD, it is the second largest program that we have in terms of budgets. We're already very present in Asia. You're quite right, though. It is still the continent with the largest number of poor people, but we're very much there.

Mr. Godfrey: I was just trying to suggest that if you're going to deal with all of the elements of a society that are going to make for success, perhaps you're better off if you concentrate on fewer countries so that you can have more to say with each of those elements.

Mr. Pettigrew: I know, John. I'm just trying to avoid that long discussion that we've been having for the last eight months.

Some hon. members: Oh, oh!

Mr. Godfrey: We'll have it at another time.

The Chairman: Minister, you've been very generous with your time, especially since we've kept you longer than you had agreed to stay.

I want to follow up briefly on two points. You mentioned in your speech some of the projects in which CIDA is involved, ones that have relevance for the subjects we are studying, those of child labour and children in general. Can we have a list of those projects?

My second point, which is more of an announcement, is that Mrs. Bakopanos and some of the other members - and some previous witnesses - have made reference to hearing from younger people, from children, and from Craig Kielburger. We will attempt to respond to that request, that observation, by trying to schedule a group of children to testify on this subject at the next round table in November.

I would like to thank the minister for his excellent presentation, his commentary. The questions posed to him were valuable, and I would like to thank the members for those questions, diverse as they were.

Mr. Pettigrew: They were all very pertinent questions.

The Chairman: We very much appreciate your presentation. I'm sure you'll be getting questions as you go out the door, by the look of things. Thank you very much.

We'll take a five-minute break before we begin again.

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.1646

The Chairman: Can we resume the meeting, please?

Before we begin the next session, I'd like to ask members of the committee if they would agree to a meeting next week with members of the NGO network of the Philippines. Dr. Pagtakhan is bringing this group here next week, and they have been supported by CIDA. They would like to speak about how civil society has been strengthened in the Philippines. At that meeting next week, we have CIDA regional initiatives support program, Central America. I think these two things would fit together well. They are the same sorts of things that CIDA supports.

The clerk tells me we should be able to fit this group in. Is everyone agreeable to hearing from the Philippines about CIDA's work in that area, and about strengthening human sustainable development in the Asia-Pacific region?

[Translation]

Mrs. Debien: When would that be? On the 9th?

[English]

The Chairman: Thank you very much, Dr. Pagtakhan. You can go ahead and make those arrangements, then, and get in touch with the clerk.

Mr. Pagtakhan: Then I will cancel my other invitation to the members.

The Chairman: Okay, thanks.

Mr. Pagtakhan: Thank you.

The Chairman: Or you can invite the members to come to this hearing.

I'm sorry for that interruption. I just wanted to clarify our future meetings.

Today we're very pleased to have witnesses from various associations and companies here to talk about this question. We've had a lot of discussion previously about the role of companies and their work in the area of child labour and how they are treating that question, and have talked about what recommendations they might bring forward to deal with these questions.

We have four witnesses today. Starting with the list as it is presented on the sheet in front of you, with us are Stephen Beatty, who is executive director of the Canadian Apparel Federation; William Maroni, vice-president of government affairs and public policy at Levi Strauss & Co.; Subash Khanna, secretary-treasurer of Trio Selection Inc.; and Linda Alexanian, a buyer with Alexanian Carpet.

Could we begin the presentations in the order that they are listed here, starting with Mr. Beatty from the Canadian Apparel Federation?

Mr. Stephen Beatty (Executive Director, Canadian Apparel Federation): Thank you, Mr. Chairman. I again thank you and the members of the committee for the opportunity to appear today.

This is certainly not the first presentation that we've made on this subject, and it's just the start of a long road, I'm sure. But I must say that the members of the Canadian Apparel Federation take the matter of exploitative child labour very seriously. As Canadians and their governments choose to act on the problem of child labour, we think it is essential that we commit ourselves not merely to combating the symptoms but to dealing with the root cause, which is the crushing poverty that is, after all, at the root of the problem of child labour. In our view, the focus of public policy should not just fall on the policing of bad behaviour but on the creation of conditions that will lead to economic development. A necessary first step is to forge a consensus on an appropriate core of baseline standards here in Canada.

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The Canadian Apparel Federation is a national association comprised of the country's five provincial apparel industry associations. All told, those associations represent roughly 600 member designers, manufacturers and associated firms. Our membership is almost entirely made up of companies owned and operated here in Canada. Of the very small number of companies that operate facilities outside of Canada, perhaps half are comprised of those firms that only have operations in the United States or Mexico. The majority of our members do no importing of finished garments.

Another characteristic of our industry is this: it is particularly unforgiving to people who lose touch with consumer tastes, attitudes and requirements. Frankly, those who do lose touch go out of business, those who merely stay in touch manage to stay with the market, and those who anticipate are the ones who succeed. In the context of this subcommittee's work, that message translates as follows: Canadian consumers don't support exploitation, and they won't support goods that are the product of exploitation.

If you understand those characteristics about our industry, you quickly come to understand why you'd find no objection from our members to a complete embargo on the import of goods manufactured in countries that permit or encourage child labour of any kind. But although that's a very simple and elegant solution, it's also the wrong answer. It's the wrong answer because if we really want to address the problem of child labour, we have to take a more sophisticated and open world view.

The international trade in goods manufactured using child labour is a very small part of a very large problem. As you have heard, many industries that exploit child labour in developing countries respond to market demand for goods and services within those same countries. As a consequence, halting the flow or trade of goods may do little to resolve the overall problem of child labour, and may in fact result in children being deprived of income that they need to provide food, shelter or clothing for themselves or their families. And there is a worse alternative: it may actually force those children into other potentially worse settings.

So what can we do? Most economists will tell you that the best way to improve living and working conditions in developing countries is to open export markets. However, we don't think it's unreasonable or unwarranted to attach some conditions to the privilege of exporting goods to Canada. At the very least, we might require that exporting nations observe certain basic human rights or core standards. The problem with that approach, however, is that Canada has yet to articulate what we believe those standards might be, or whether they are situation specific. This is an area where the subcommittee's work could prove to be invaluable.

In the absence of such standards, many Canadians are turning to the private sector and are demanding that we police the marketplace and establish penalties for non-compliance of certain standards of conduct. The difficulty is that penalties for non-compliance, if any, are going to be borne by Canadian companies, not by the exporters. Additionally, assessing punitive damages against Canadian importers will do nothing to directly remedy the problem of child labour in other countries. And in the absence of a social consensus on appropriate core standards or baseline standards, there is really no meaningful way to evaluate corporate performance. Without a new government policy framework, then, the private sector really can't impose or maintain an embargo against goods originating in any given country. In a global economy, there are simply too many channels through which goods can flow for the private sector to be able to fully control the entry of such products into Canada.

So if 100% control isn't possible, what is? We believe the answer is that importers need to exercise due diligence when establishing business relationships, and must be willing to act when problems come to light. A compliance policy that is not monitored and enforced isn't worth the paper it's written on. By contrast, many companies that have no formal compliance policy routinely perform to a very high standard. So in our view, the issue isn't what your policy is, it's what standards you apply.

The first step along that road to improved performance is the education and awareness raising amongst business, and significant inroads have already been made in that area. In addition to this, some individuals and organizations are convinced that the answer to this enforcement problem lies in encouraging consumers to take direct action in the marketplace, and to thereby penalize firms that fail to observe and enforce appropriate standards. The problem with this approach, however, is that the average consumer doesn't have the access to information required to permit him or her to make an informed decision. In the absence of meaningful information, the consumer can't police the marketplace. Moreover, a general consumer boycott is a blunt instrument that typically hurts the innocent as well as the guilty.

I'll give you some examples. Just because child labour is employed in India, it doesn't mean that all Indian products should be taken off the shelves or are unfit for consumption in Canada. Equally, if you decide to boycott a certain store because it has been found to have some goods made by child labourers, the economic penalty isn't just borne by the store, it's borne by the children themselves and, indeed, by all of the other suppliers, many of whom are based here in Canada. Once again, this lack of public consensus about appropriate minimum standards means that there's no way to evaluate the seriousness of a complaint against a given company.

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In our experience, the companies at greatest risk from boycotts or other consumer actions are those with the greatest profile, brand strength or corporate identity. While I'd never attempt to suggest that all of those companies are beyond criticism, I will say that they're the firms with the greatest investment in their corporate good name, and they tend to govern themselves accordingly. Some of the worst abuses, by contrast, are conducted by firms that are nameless and virtually invisible to the average consumer. It takes very little for those businesses to be in business one day and in business under another name the next.

So how do we respond to those challenges? It seems to me there are two ways of proceeding, and I think you've heard from witnesses who have given you both options. One is the long and expensive way, and the other is the voluntary and market-driven way.

With regard to the first option, there are several steps Canada could consider as part of that approach: removal of preferential tariffs for countries that condone or do not enforce their laws against child labour, penalties for individuals or companies found to be knowingly dealing in such goods in Canada, public awareness campaigns directed at consumers, aid programs to assist development and provide education, the easing of quota restrictions for countries that meet certain minimum standards, the provision of other market access benefits for countries signing on to Canadian standards, and the taking of concrete actions to police trans-shipment of goods that would likely occur if any of those other measures were implemented.

Obviously, to ensure our legal ability to establish and enforce those measures, Canada would have to establish core labour standards under our multilateral trade agreements in international forums such as NAFTA, the WTO and the ILO. Needless to say, those options would require years to implement and the expenditure of considerable public and private resources.

The other option, in our view, is this. As I mentioned earlier, the one major problem with asking consumers to police the marketplace is that they usually don't have the data required to make informed decisions. Remedy that problem and the market can be largely self-regulating.

Although Canada may not have the legal authority to enforce an embargo against goods manufactured using exploitative child labour, there's no reason why we can't establish and articulate a baseline that we think should form the minimum standard governing the use of child labour in developing countries. There would no doubt be an intense debate here in Canada about where to establish the benchmarks, and how and when countries should be expected to graduate to a higher standard. Nonetheless, I think such a consensus could be forged and a standard agreed upon and communicated in Canada and abroad.

To complement this action, the Department of Foreign Affairs and International Trade could well establish a registry that would maintain records of foreign companies and countries that failed to meet that agreed-upon standard, as well as identifying any known to exceed the standard. As an additional service, the registry could and should maintain a list of independent commercial inspection services having a demonstrated ability to inspect and certify the performance of companies based in exporting countries.

I believe every consumer products company would see the merit in ensuring that it's not associated with parties known to exploit child labour. Equally, I believe there would be a positive incentive for firms to deal with those suppliers that were publicly identified as being good corporate citizens. Furthermore, by providing importers with the certainty that comes from holding an inspection certificate issued by a federally recognized inspection service, I believe you can ensure that this voluntary standard is monitored and enforced.

No one in Canada or an exporting country would be obliged to certify his or her performance. This would be a voluntary standard. But those who failed to seek certification would risk the marketplace consequences of their actions. Retailers, manufacturers and importers alike, in my view, would very quickly insist that their suppliers be inspected and certified. Why? Because failure to do so would mean they would have to answer to the consumer press, to unions, to interest groups, and most importantly to the Canadian consumer.

The Canadian Apparel Federation has volunteered to work with the government in developing a fair and coordinated approach to dealing with the problem of child labour. We made that commitment because it's the right thing to do, because we're members of a global community and abuses anywhere in that community diminish us all, and frankly because workers and businesses in Canada are also hurt when goods made by the sweat of child labourers enter the marketplace. Expanded trade opportunities, by contrast, are going to bring material improvements in living standards and human rights in developing countries.

That doesn't mean Canada can relax its commitment to preventing trade abuses, to providing development assistance, or to educating Canadian businesses, officials and consumers. But a market-sensitive approach to the problem isn't just about penalizing worst practices; it's about finding ways to reward the observance of high standards and best practices. It's a win-win solution for all concerned, and it's a basis on which individual corporate compliance programs can be built.

Thank you, Mr. Chairman.

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The Chairman: Thank you, Mr. Beatty.

Our next speaker is Mr. Maroni.

Mr. William J. Maroni (Vice-President, Government Affairs and Public Policy, Levi Strauss & Co.): Thank you.

Mr. Chairman and members of the subcommittee, Levi Strauss is pleased to be here today to share our experience in using strict standards to prohibit child labour. We have followed these deliberations. We have been impressed with your thorough approach. We are here because we deeply share the commitment of this subcommittee to this issue.

Levi Strauss is the world's largest apparel manufacturer. We have approximately 2,500 employees here in Canada, in 6 cities in Ontario and Alberta. In addition, we do business with approximately 30 sewing and finishing contractors throughout Canada and another 500 in more than 50 other countries.

Levi Strauss & Co. was the first firm in the apparel and textile industry to establish global standards for all of our domestic and foreign contractors and business partners. Attached to my statement, in English and in French, is a copy of our standards. They are broken into two parts: rules that govern the policies and practices of our business partners, and these are items largely under the control of our business partners; and the second part has to do with conditions that we assess in a country where we do business.

The standards that apply to our business partners address such issues as ethical behaviour, legal requirements, environmental standards, community participation and involvement, and of course employment standards, of which wages, benefits, working hours, the use of forced labour or prison labour, health and safety conditions, discrimination, discriminatory practices and child labour are a part.

We have chosen to base our child labour standard on the International Labour Organization convention. We feel it's workable, easy to understand and realistic.

In the five years we've had these standards in place we have learned many lessons. One is that it's sometimes easier to fight for principles than to live up to them. We heard a number of speakers today and yesterday talk about the complexity of addressing the child labour issue around the world. We have found that success depends on a commitment to live by and enforce the standards you have laid out as part of your corporate philosophy and corporate values. This requires constant vigilance. It requires regular on-site monitoring of business partners' facilities. It requires a commitment to continuous improvement. This job will never end. We're always looking for new ways to make improvements.

While standards must be firm, the approach must be flexible, creative and innovative if we're to seek workable solutions. Perhaps most important is education, education of our business partners and education of our employees so that all understand why these standards are an integral part of our business. Meeting our rules on child labour is no less important to Levi Strauss than the quality standards of our product or the delivery times we set for our business partners. It is simply good business. Our standards have helped us identify the most reputable and reliable contractors in the apparel industry.

How do we ensure that these standards are met? To summarize briefly, after we assess the conditions in a country, we will meet with and review a potential business partner's facilities and way of doing business. We monitor these facilities on a regular basis, at least once a year, sometimes much more often. We do spot checks and unannounced visits.

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Because our people operate, work and live in the countries where we do business around the world, we have a built-in infrastructure. Our people understand these communities. They understand the laws. They understand the culture. They know the community groups and NGOs. They're in the factories.

As a result, they talk to the workers both on-site and away, and they have a good sense of whether a factory's operating fairly. They have a good sense of whether it's safe and clean and healthy, whether it's meeting quality requirements and whether it's meeting our global standards for workplace.

We do a great deal of education and training. Every year our monitors, our auditors, receive training to increase their skills, to address new issues and new problems that arise, because we're learning every year. We're also involved in the communities where we work and provide a number of charitable contributions to activities to enhance the quality of life.

We all heard this morning how child labour does not have a single definition. The laws and enforcement practices vary widely among countries. Perhaps most troubling, most countries that have laws on the books also have extremely broad exceptions to those rules, making them almost meaningless.

To complicate the issue further, some countries have compulsory school requirements and resources for education while others do not. So there's a myriad of policies and practices that can contribute to the severity of the problem and limit the potential for solutions.

Contributing factors include the availability of schools, teachers, social programs and family support mechanisms, economic development incentives, employment opportunities for adults, and family planning and population policies. While we've heard in these deliberations that there is not a consensus among business, among child advocacy groups or among governments about how to reduce or eliminate child labour, Levi Strauss and Co. believes business has a duty to seek voluntary solutions. This is why we have selected, in general, the ILO standard convention for our standard.

In short, adhering to any kind of extraterritorial standard in different countries with various laws and practices is just plain hard work. Eliminating child labour is not an issue that lends itself to quick fixes or slogans or labels. There's no ``one size fits all'' solution.

Much has been said about international trade and global economic development. I'd like to note that in the textile and apparel industry, all trade from exporting countries is a closed and managed sector. It's controlled by quotas. This makes it especially important to work closely with suppliers and contractors, because most apparel importers must rely on a small number of producers in any particular exporting country who actually own a proportion of the quotas. The quotas are not owned by the country. They're owned by individual producers. So it's critical that partnerships be established not only with contractors but also with child advocacy groups and community and social organizations in these countries.

I'd also like to note that one of the benefits of expanded international trade is that the best companies in Canada, and the best companies in the world, are not just contributing economic growth around the world where they do business; they are also contributing their ideas and values.

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I'd like to briefly mention one example Levi Strauss and Co. was involved in. I believe it is instructive for several reasons. It tells us a little bit about what a company can and cannot do. It also tells us what a private-public partnership can and cannot do.

When we established our global standards back in 1991, we discovered that two of our contractors in Bangladesh were employing a number of girls below the age of 14. As a result, we felt we had to take unilateral action, a unilateral sanction, if you will, on the part of a private company. We couldn't allow this. This was a violation of our standards and rules. It jeopardized our corporate reputation and everything we said we stood for.

But we learned in the process that while our business partner was perfectly content to fire the young girls - he wanted to continue to do business with Levi Strauss and Co. - he also informed us that what the future held for these young girls was not pleasant. They were unlikely to find another job in a factory that had similar high standards, as we had insisted upon. The young girls and their families ran the risk of hardship, greater poverty and perhaps a life of crime or discrimination.

As a result, we called our contractors together and negotiated a different kind of solution. The contractors agreed to continue to pay the wages of these young girls. We agreed to pay for the school supplies, uniforms and a space for education. The contractors agreed that once the young girls had reached the compulsory school age in Bangladesh, they would be free to return to the factory if they so chose.

We felt this was a solution where everybody gained. It came to the light of people at UNICEF as well as the U.S. ambassador to Bangladesh. Building upon that successful model, what was negotiated with the Bangladesh Garment Manufacturers and Exporters Association was an agreement to end the use of all child labour in Bangladesh garment factories by the end of October 1995.

We felt very good about this. We felt we had contributed not just in a small way, in our own small business circle, but to a very major reform for an entire country and an entire industry. Yet while this small story exemplifies what a public-private partnership can do when government and business work together, along with NGOs and labour, it also illustrates some of the risks.

As the speaker from Save the Children this morning indicated, the ILO has found that the project in Bangladesh has not been as successful as we'd hoped. The social safety net had not been sufficient to accommodate the children who were employed in these factories and put them in school.

We believe we've learned a number of lessons at Levi Strauss over the past five years. We're more than willing to share these, and our experience, with others. We are even willing to share what we would consider to be intellectual property, or proprietary information, the kinds of audit tools and instruments we've spent a lot of time and money developing. We'd be happy to share these with other companies toward the end of eliminating child labour.

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Unfortunately there have been a number of people, not just in our industry but operating on a global basis, who have learned the wrong lessons from Levi Strauss and Co.'s experience overseas. They have learned that no good deed goes unpunished, because as big-name, trademark-branded companies like Levi's have tried to do the right thing overseas, we have often been criticized or come under greater scrutiny by the media or activist organizations. We've come to expect that in a leadership position.

Unfortunately some believe they can't afford to do what Levi's has done, that they can't afford to have global monitoring systems, that they can't afford to put in place standards. So we have been working with a number of organizations and other companies in our industry to demonstrate that companies large and small, public or private, can create standards of this kind that prohibit child labour. They can be useful, workable, affordable, and most importantly, they just make good business sense. If a business partner is going to cheat on something like a child labour rule, then he or she may be as likely to hedge on a quality requirement or a delivery time. These are things that are an integral part of our business. They are not a separate list.

Let me conclude by saying that working toward this subcommittee's goal of eliminating child labour is going to require participation from a number of different groups, including business. Business definitely has a role to play. By taking a number of voluntary approaches and solutions - and these solutions will vary, as they should, depending on the country where business is done, on the size of the company, on the influence a particular firm has or the type of industry...

In closing, I'd like to say that Levi Strauss & Co. does not often participate in public hearings of this kind. We have chosen to do so because we feel that your work has been thorough, thoughtful, and most importantly, it has shown a real and passionate commitment to this issue. We share that. If more governments, both developed and developing, had the same kind of serious approach to the issue of child labour as shown here in Canada, we would be well on our way to giving back to millions of children the childhood they deserve. Thank you.

The Chairman: Thank you, Mr. Maroni.

Our next speaker is Mr. Khanna.

Mr. Subash Khanna (Secretary-Treasurer, Trio Selection Inc. (Cream Soda Clothing)): Mr. Chairman and members of the committee, at the outset I would like to state that while the theme of this session is child labour, global commerce and the responsibility of the Canadian business community, my testimony here today will be focused on the existence of child labour in the textile and apparel industry in India.

For a moment, if you set aside the emotive dimension of exploitation and look at definitions, there are three categories that have already been defined by the United Nations and the International Labour Organization. These are child work, child labour and child slavery.

Child work is defined under the UN Convention on the Rights of the Child and the ILO minimum age convention, number 138. Child work is not necessarily exploitative and can play a positive part in a child's development. Light work is acceptable for children over the age of 12 in developing countries under regulated conditions and without interfering with their education.

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Child work becomes child labour if the child is working in conditions that interfere with schooling or that are hazardous or otherwise injurious to the child's physical, mental, social or moral well-being.

In its severest form, child labour is defined as child slavery. By definition child slavery involves a child under 18 years being taken or otherwise handed over by his or her parents or guardians and being compelled to work, or being made to pay off loans given as advances through the use of the labour. Child slavery is prohibited in virtually all countries, but unfortunately it continues to exist.

These definitions have been taken from the UN Convention on the Rights of the Child, the UN supplementary slavery convention and ILO forced labour conventions.

As an importer I do not condone any of the above, and from a moral standpoint I do not and will not import from any manufacturers and vendors who indulge in the practice of using bonded labour or slave labour.

The question arises of why any of the above exist in this day and age. As a developing country with the world's second largest population, India has introduced a number of economic reforms in the past decade. However, in spite of changes in the government's economic policies, there continue to exist long-term deficiencies that perpetuate the existence of a labour class that lives below the poverty line. There exists a class of adult labourers in the unskilled and semi-skilled categories whose combined family incomes are not sufficient to meet their basic needs of food, clothing and shelter. Their priority is survival. In the absence of a social safety net to take care of health, nutrition and education, there emerges a class of people who have to rely on their children to supplement the inadequacy of their own earnings. Abject poverty makes it an economic necessary.

Having acknowledged the existence of child labour, what could or should be the response of the Canadian business community involved in global trade? In my opinion, based on experience, the Canadian international business community can only formulate an adequate and appropriate response after having a better awareness of the situation. The main determinants of this situation have to be carefully evaluated. The supply and demand of child labour, father's education, mother's education, orphanhood, drop-out status, parental employment and combined family income have to be taken into consideration.

Armed with awareness, we should go on to decide where Canadian influence can best be exerted through participation as a trading partner with a conscience and a moral responsibility. The consequences of the response should be carefully considered. Should it be in the nature of a trade sanction, a ban, an embargo? Will it serve to assuage the Canadian conscience or will it serve to better the lot of child labourers, who are impotent to take steps towards self-help or self-improvement? If child labour is banned, will the child labourers go to school as they should, or will they be forced to seek employment in more unsavoury jobs where they cannot be regulated at all? Will the unemployed children be forced to beg, or worst of all, will they be forced into child prostitution?

As a response to the extreme of child slavery or bonded labour, legislative bans already exist in most countries. Governmental legislation against any and all parties in any way involved in bonded labour or the products thereof should definitely be enforced to the letter of the law. There should be no ambiguity about this issue.

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In the case of child labour, however, one is faced with a dilemma. While we cannot condone it, trying to eradicate it without proper alternatives in place would produce more undesirable consequences. The cure would be worse than the disease, so to speak. So what would be an enlightened response? I don't know for sure, but I can share the fruits of my experience with you today.

I am a Canadian apparel importer and I visit several factories in metropolitan cities and small towns in India. In the apparel and textile factories in the major cities, like Bombay, Delhi and Madras, I have not encountered child labour in any of the companies I deal with. The reason could be that most processes from yarn spinning through weaving, dying, printing, etc., are in the large-scale industries, which are capital-intensive and also have well-organized labour unions with a strong political lobby, whose interests would not permit child labour. However, in the small towns where garment assembly is more like an overgrown cottage industry than an industrial operation, I have witnessed the presence of child labour in several factories.

Today, after several years, due to the volume of my purchasing and the pressure I can exert from a familiarity bred over time, I can negotiate with the factory owners to institute measures in gradual steps to improve the welfare of the child labourers. Initially, though I tried to take a tough approach and walk out on one of my suppliers who wouldn't take immediate steps to do something about child labour, the end result was that he continued to employ child labour and there was nothing I could do about it because I did not have any business with him. The children continued to work under tough conditions. My conscience was clear, but I wasn't happy.

It was a valuable lesson for me. It taught me that if it is the children I really want to help, I have to stay in a position where I can observe their working conditions and intervene on their behalf, even if it is in minuscule steps to start with.

Among the factories I continue to work with, one exporter was also supplying goods to a middle European retailer who insisted that he terminate all of the child workers. He complied. His factory is still doing business and everything seems okay. But what about the laid-off labourers? They certainly didn't go to school. How did they end up? I wonder what most of them are doing today.

With time, the challenge grew for me. I started by sponsoring individual child workers by paying for their schooling and medical check-ups, but this did not seem adequate. As a second step I began negotiating with the exporters to ensure fair treatment for child labour. I am happy to say that one of my suppliers voluntarily introduced subsidized meals, periodic medical check-ups and overtime wages for his child labour.

Today it pleases me to be able to say that I continue to work with the factories that employ child labour, and simultaneously monitor their working environment whilst striving to introduce better working conditions, balanced nutrition, medical benefits and basic literacy programs.

In conclusion, I would like to suggest that as a business community with a conscience and a moral and ethical responsibility, we should individually and jointly rise to the corporate challenge and seek to put in place positive steps that would gradually make child labour redundant.

If I were to look for help from the Canadian government, I think I would like to know that the government is playing some kind of a sentinel role. If I could have a directory or list of exporters from various developing countries that employ child labour directly or indirectly, it would help me to strategize better and consider my involvement or non-involvement, as the case may be.

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In order to implement remedial measures, I would like to propose the setting up of a fund that would be administered jointly by importers, exporters and the government. Funding should be equitable, and contributions should come from the importers, exporters, as well as the governments involved. The funds could be collected by way of a levy on exports from the country of origin and an import levy in Canada imposed on the goods originating from countries where child labour exists.

The amounts could be worked out in detail, but as a benchmark, I would suggest a 0.25% export levy, a 0.25% import levy, and a similar sum to be matched by both governments. This would provide substantial amounts that could be used to implement programs that would improve and gradually eradicate child labour. Thank you.

The Chairman: Thank you very much, Mr. Khanna. Our final witness is Linda Alexanian. Would you like to make your presentation now?

Ms Linda Alexanian (Buyer, Alexanian Carpet): Thank you, Mr. Chairman, members of the subcommittee, and my colleagues.

The first thing I want to say is that I'm very impressed with the apparel representatives today. My industry does not have such an association. I'm alone in Canada as a retailer of Indian carpets who imports directly. So I don't have the support of an association as you do. I applaud your efforts.

Let me share with you a letter I received from a grade 7 student:

My class and I think it is cruel to even think of buying a carpet made by slave labour. I mean, how could you even sell them knowing they came from kids who worked hard all day all their lives for just a bit of money?

I will never know how many potential buyers become non-buyers because of their perception that all Indian carpets are made by slave labour. I would guess that anyone in this room today, when shopping for clothing, wouldn't ask the question: is this made by child slave labour? On the other hand, people quite often come into my stores - perhaps they don't even come into my stores - to buy carpets and will ask: was this woven by a child?

In a newspaper article published on September 18, Human Rights Watch cautions that much concern - perhaps there's too much concern - in the west has been placed on south Asia's carpet industry. The report estimates that 300,000 children work in India's carpet industry. Of these 300,000, many are working legally within the family unit as permissible by the child labour law. Human Rights Watch states that bonded child labour in the Indian carpet industry represents 2% of India's total bonded child labour.

Never in our company's 71-year history has widespread media attention toward the exploitation and abuse of children been more prevalent. As a result, my company has made the position to support only carpet manufacturers who work toward the 100% elimination of child labour in their production.

My comments will focus on India because this is where the media has focused its attention, and also because 50% of our imports come from India.

Carpet weaving in India, and in many other underdeveloped countries, is a cottage industry. Carpets are woven in the homes of families, not in factories or sweatshops. Thousands of individual, independent loom owners are spread over countless villages all over the country, with the largest concentration in the Varanasi-Mirzapur belt.

Estimates put the number of looms at approximately 100,000 in possibly more than 100,000 square miles. Weavers are paid on a per-carpet basis according to the size, design and number of knots, not by the age or sex of the weaver. There is no advantage for a loom owner to hire a child weaver whose output will be considerably less than an experienced adult weaver.

Then why, you may ask, is there forced child labour in India's carpet industry? We believe - it has been mentioned countless times today - that the root cause of child labour is poverty. Where there's poverty, there's desperation, and where there's desperation, there are human rights abuses such as bonded child labour.

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Two surveys conducted by the National Council for Applied Economic Research conclude that hired labour in India's carpet industry accounts for about 3% of the total number of weavers. In other words, it's estimated that one in ten children is working in the industry illegally.

I want to stress here today that the Indian carpet industry, together with its government, is making progress toward eliminating child labour.

Before I outline the three initiatives under way in India, I want to make a point about boycotts. There are two forms of boycotts: government-imposed bans on imports and consumer-based bans. The latter is already occurring, and we're seeing this in a decline in our business.

Alexanian Carpet does not support the idea of government-imposed boycotts or bans. We strongly believe that any ban imposed on the import of Indian carpets would destroy the industry and render close to 2 million adult workers unemployed, thereby devastating more than 2 million families. The adult population working legally in the carpet industry would suffer, and it follows that their children will be driven to a worse form of poverty than they may already know.

The Carpet Export Promotion Council, a government body in India, has made it compulsory for exporters to adopt a code of conduct that prohibits child labour. This is essentially a certification program. All exporters are required to register every loom and solemnly declare that no children are hired to weave. Exporters are required to contribute 0.25% of the export value of carpets for a child welfare program established by the government.

Exporters are encouraged to use the Kaleen label, a label developed by the government as the hallmark of commitment toward the total elimination of child labour, the welfare of the weaving community, the education of children, medical care for weaving families and vocational training for children. The steering committee of Kaleen is comprised of representatives of government, industry, ILO and UNICEF.

A monitoring system has been put in place to detect child labour violations. Random loom checks are done by government inspectors. Any loom owner or exporter found guilty by the inspectors will have his licence to export carpets removed and will face criminal charges.

I applaud this effort. However, I feel I need to tell you it's a new initiative. It began in 1995, so I don't think we can have 100% confidence in this initiative.

Rugmark is another initiative that's working toward the total elimination of child labour with a similar labelling program. From my recent visits to India, I gather that the Indian exporting community has not welcomed Rugmark. Rugmark is not perceived as having a reliable monitoring system to check that looms are registered and that no children are weaving carpets on them.

In general, the Indian carpet industry believes that Rugmark should support and work with the Indian government and the Carpet Export Promotion Council to eliminate child labour instead of working on a separate, private program that duplicates this effort.

Care and Fair is another organization that is collecting funds from importers, primarily in Germany, with the funds being used toward programs for children.

Alexanian Carpet supports the theory behind all of these efforts, which is the initiative taken by government, NGOs, as well as industry, to eliminate child labour; however, we do not see any of these initiatives as having a foolproof method for monitoring the 100,000-plus looms in the carpet belts of India.

We conclude that without basic anti-poverty programs for children and their families, there is no viable alternative for these children but to work. We fear that these children may be forced out of the carpet industry by a boycott, and that they may end up in another industry that may receive less or no attention from the western media.

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My last words are on the responsibility of the importer. Our company has chosen to align itself with only one supplier. We are convinced that this supplier is making every effort in monitoring so that no children are hired to weave carpets for us.

Long before the media publicized this problem, our supplier asked for our financial assistance with the medical programs for weavers and their families. For the past six years, we have helped to support a medical camp that provides free medical treatment and medicine twice a year for all the weaving families. We look forward to helping with similar programs in the future.

In addition, we visit India regularly, and encourage other importers to do the same, to make our anti-child-labour stance known. Importers of hand-knotted carpets can play a major role in providing a solution to this problem by providing much-needed funds and expertise for social welfare programs.

I will conclude by saying that my company is doing more to support the effort to eliminate child labour by purchasing Indian carpets and providing financial assistance to our supplier's welfare program than we would be by boycotting these products.

The Chairman: Thank you very much, Ms Alexanian. We have some questions.

[Translation]

Mr. Paré.

Mr. Paré: Welcome to our sub-committee. I know that your input will be valuable in these discussions.

I see rather a contrast between two points made by two different witnesses. Mr. Beatty tells us the fact Canada has not yet set minimal standards makes things difficult for businesses that would like to do so. Yet, our second witness, Mr. Maroni, has demonstrated that businesses can develop and implement their own codes of ethics. I would like to hear your views on that.

[English]

The Chairman: Mr. Beatty.

Mr. Beatty: Mr. Chairman, perhaps I could respond to that first. It's not so much a question that private enterprise can't set standards. Certainly industry can do this. The problem is that those businesses are often the subject of scrutiny or specific charges raised by individual interested parties who will claim that a business is either failing to meet its own standards or that in fact the standards set by that company should be higher.

Really, the point I was attempting to make was that we don't have a consensus in Canada as to what the appropriate level of standards should be at each development stage of an emerging economy. I think you've heard among the witnesses from the business community today a sense that in fact there are a number of different approaches one could take that are appropriate to each of those development stages.

I guess what I'm saying is, in order to measure corporate performance, there also has to be some emerging consensus in the Canadian public as to what's an appropriate approach. Otherwise, there is the potential for businesses operating in Canada to be the subject of boycotts or other consumer actions, even though they're attempting in good faith to set high standards for their own performance. I think you've heard from companies today who do in fact set about trying to create those standards.

Mr. Maroni: I would simply add that we don't simply believe a company can't set a standard and live by it; we've proven that you can do it. We've been doing this for five years.

We chose not to wait for a consensus. We felt that the ILO standard was certainly workable in our business and with our business partners. We've simply told them that no one under the age of 14, or the legal age of the country, whichever is greater, can be employed. They must keep records on all workers. They must have a birth certificate, baptismal certificate or some kind of employment history or record. They must comply with all laws of that country, including recruiting, hiring, housing, wages, hours of overtime.

.1745

These are the laws of that country; they're not our laws. We insist that they follow the laws of their own country. We also encourage them to allow young workers to participate in programs for work study or vocational training where they are available.

[Translation]

Mr. Paré: Mr. Maroni, if, as you say, your goal is to abide by the standards of the countries you operate in, how is it that child labour exists, if these countries do in fact have standards in place. I guess that would mean businesses operating in those countries do not comply with their own standards.

[English]

Mr. Maroni: In some cases, that's correct. There are also many exceptions to the standards on the books in many of these countries.

Mrs. Bakopanos: It is rather refreshing - I'm going to say it - to have members of the corporate community who show such high ethical and moral standards. I congratulate you for that.

I'm glad to know that one of them is in my riding. In fact, it's Mr. Khanna and his company. I'm very honoured to have someone of those high standards in my own riding.

I am going to address my question basically to you. I was reading an article in the Gazette recently that more or less said what you said today, but I was interested in two recommendations you made to us. One was a directory, a list of importers and exporters who employ child labour. I think that's a very good recommendation. We should certainly pass it on to the minister responsible.

On the second one, perhaps you would like to expand on the fund you would like to see, whereby there is a 0.20% levy, if I understood it properly, with the exporters and importers, and another 0.25%, which is to be used as a basis for improving and eradicating child labour. How do you see this fund? What contribution should the Canadian government be making to that fund?

Mr. Godfrey: Can I just tag onto that, because it'll be the same point. Is the kind of fund you're talking about for your industry the same as that described by Ms Alexanian? Is that the model?

Mr. Khanna: If my understanding is correct, that model was set up voluntarily by India itself. They are charging a levy of 0.25%. That is only being contributed to by the exporters.

I am recommending that there should be a levy on importers of 0.25%. The same contribution should be made also by the exporters, the exporting country, as well as the importing country. So the total fund will be about 1% of the total imports into Canada.

That fund should be monitored by a group of exporters as well as a group of importers. The government should monitor that role. It should monitor how the fund is being implemented properly so that all the benefits reach the children. That's my concern.

Mrs. Bakopanos: Would we do that through different projects? Once the fund is created -

Mr. Khanna: Here's the basic problem I foresee. I have been working with these factories for the last 10 years. There is no awareness of the kids, and they're stuck in the dark.

We can clear our conscience by telling them they're laid off and by saying we're not going to work with the factories that employ children. They will go into some other unwanted professions or professions that are not regulated properly. We all understand that.

If we regulate that fund in educating the children, making them aware of what their rights are and what role education can play in their development, I think that will be better. And that also includes a medical benefit, and making sure that the factories who employ children pay them proper wages and give them proper working conditions and other related items that go with the social benefits.

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Mrs. Bakopanos: Thank you, and please continue to sensitize other members of the corporate world in terms of your own standards.

Thank you, Mr. Chairman.

The Chairman: Thank you, Mrs. Bakopanos.

Mr. Godfrey, did you have another question?

Mr. Godfrey: It's just a quick one that would be a follow-up to what Mr. Beatty said.

Does the Canadian Apparel Federation cover people who import, as Mr. Khanna does, or are you people who actually do transformation - that is to say single or double or whatever it is? I'm just trying to show off here.

Mr. Beatty: You sound as though you've been sensitized in NAFTA.

Mr. Godfrey: I have to tell you that Parkhurst Dorothea is in my riding.

Mr. Beatty: The answer is this. If you look at the make-up of the marketplace in Canada today, you find that where imports were traditionally controlled largely by wholesale importers, increasingly the import marketplace is largely divided between Canadian manufacturers and retailers. The number of wholesalers in the marketplace is declining very rapidly. But the decline is not so rapid that we don't have 35,000 people or firms registered under the Textile Labelling Act who are distributors of textile products and apparel in Canada, which is really the point I was trying to get across. It isn't just a question of dealing with the multitude of people in other lands. It's also a problem of trying to establish some degree of standardization in the marketplace here in Canada, some means of ensuring that this very large and diffuse community begins to pay attention to the problem and reforms the manner in which it does business.

I think there are many companies that will behave because they have high ethical standards, and that will drive their business. There are many more who will respond when there is some positive incentive for them to ensure that their business operations are going to meet public scrutiny. But again, I think that happens when you have a graduated standard for imported goods that allows people to know they're meeting those minimum standards. That's really the point we're trying to make.

The Chairman: Thank you very much, Mr. Beatty.

[Translation]

Mr. Paré.

Mr. Paré: I would like to come back to Mr. Khanna's request, which was to possibly get a list of suppliers who employ children. This morning, a witness told us that only 5 per cent of goods made by children were exported. I don't know whether that's a good solution or not. It would be part of a series of other measures. However, in addition to acting on this specific part of the problem, which is certainly not minor - 5 per cent is better than nothing - what can Canadian businesses that operate in these countries do to tackle the overall problem of child labour? I guess Mr. Maroni had not just the beginning of a solution, but the whole solution, when he talked about partnerships and working with NGOs.

[English]

The Chairman: Mr. Maroni.

Mr. Maroni: Our experience has shown that a progressive partnership approach can be successful and is favourable to a punitive action. We feel that getting to know the communities, the community leaders, the people who our business partners work with and live with, gives us an advantage in helping to enlist many people's help in identifying problems before they become crises, and in seeking workable solutions. It's analogous to the work reorganization effort that has taken place among the most competitive companies all over the world. The most competitive companies in Canada and worldwide have moved responsibility, authority, decision-making and problem-solving out of the corporate suite to the factory floor.

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We are trying to do much the same thing with regard to our sourcing, or business partner, standards. We want our business partners to be the eyes and ears in their communities as well as in their factories. We want them to tell us when they see a problem or have a question, or if they have a suggestion to make their plant safer, to deal with a child labour problem. We feel we could be more successful in that kind of positive approach.

We also enlist their help in writing our contracts, our agreements, with them. For instance, we make it very clear that we will not allow our contractors to subcontract work without our knowledge. We want to know who is producing Levi Strauss and Co. products.

It is no longer - if it ever was - sufficient to say that one is against child labour but then in practice to adopt a ``Don't ask, don't tell'' philosophy toward contractors, subcontractors and sub-subcontractors. You have to take responsibility down the supply chain. You can't do that alone. You need partners, you need helpers, you need people who share your philosophy.

The Chairman: Mrs. Gaffney.

Mrs. Gaffney (Nepean): I have a very quick question.

In your presentation, Mr. Beatty, you mentioned that Canada has yet to articulate what we believe the standards might be or whether they might be situation specific, and that this made it very difficult. Without a new government policy framework, the private sector cannot impose or maintain an embargo against goods originating in any given country. I guess that's probably why we are here - to develop those standards.

One of you - I do believe it was Mr. Maroni - said that child labour does not lend itself to ``one size fits all''. So I have to assume that when we as a country are trying to set up our government policy framework and our guidelines, we have to do it country by country. It could be textiles or carpets or whatever the jobs are.

Do we have to look at each one of these things individually and develop the guidelines for this type of industry, that type of industry, this country and that country? Does it all have to be done separately?

Mr. Beatty: I guess my first answer is that a country-by-country approach might not be legal under Canada's current trading obligations. It might be the best way to go, but it may not be within the scope of federal authority. It may very well be that you have to establish that within four corners, countries at a certain level of development, that have a certain infrastructure that provides social support that in turn allows for educational support, health support and various forms of hybrid support to children who may work in the market but who may also be subject to other social programs...

I guess what I was trying to say was that when you develop a policy, it's probably not going to be a single-tier policy. It is likely going to be one that says, for example, for countries at this level of development and with this infrastructure in place, this is the minimum requirement we would set. As economies develop and progress, I would hope we wouldn't accept anything that was less than our own standards, quite frankly.

But there are stepping stones that get us there. I think those are things this committee, indeed in cooperation with business, labour and other non-governmental organizations, is going to have to help forge a consensus around.

Mrs. Gaffney: Do you have any comments on that, Mr. Maroni?

Mr. Maroni: I think we can make great progress if there is more of a dialogue within the business community about how some of these practices work. As I said, as our standard we've selected in general the ILO convention standard that below the age of 14 is unacceptable. We think it's workable. For a large company like Levi's, which does business in more than 50 countries, to try to adhere to a different set of standards based on those countries' economic development or practices or culture is probably not very workable and not very wise.

.1800

When I made the remark about how ``one size fits all'' is probably not going to work, what I meant was not that we need a different standard for every country. Clearly we don't believe that. We have a single standard that we apply everywhere in the world. But how you enforce that standard, how you work with contractors, who you pick as your partners, the way you solve problems - those things are going to vary, based on a company's ability to be involved and to devote resources.

Dealing with the child labour or prison labour problem in Los Angeles is going to be different from dealing with the Bangladesh child labour situation. That's probably going to be different from dealing with a situation in Indonesia.

There are certain constraints you face in any environment. Sometimes you're going to pick the local government as a partner because they are cooperative and they want to help solve the problem. There are other countries, quite frankly, where the last people you want to contact are the local officials.

So my remarks about one size fitting all were geared to the way we try to solve these problems, not the need for a multitude of standards.

Mrs. Gaffney: Thank you very much.

[Translation]

The Chairman: Mr. Paré.

Mr. Paré: In a study carried out by the Standing Committee on Foreign Affairs and International Trade earlier this year, that dealt with small- and medium-sized business and exports, the committee looked at how Canada might make use of its multicultural character - in other words, Canadian citizens who have been living here for a number of years. I would be interested in hearing how the business people present react to the problem we were discussing. When these Canadian citizens, who have dual citizenship, go back to their country of origin, they are treated like citizens of that country, since some of these countries do not in fact recognize Canadian citizenship.

There is the well-known case of Tran Trieu Quan, a Canadian businessman who has been in prison in Vietnam for two years now. Because Vietnam does not recognize Canadian citizenship, it considers him one of its citizens and applies its own rules to him.

Since you are operating in other countries, I would be interested to know what you have done to protect yourselves against that sort of thing?

[English]

The Chairman: Would anyone who has a background in this like to answer that?

Mr. Khanna: I would like to clarify the question. In what sense would you like us to protect ourselves?

The Chairman: Just to clarify, then, how do you handle situations where there are people who have dual citizenship, in countries where dual citizenship can create problems, if the person goes in to do business in that area?

Mr. Khanna: I haven't faced any problem as such, because India doesn't recognize dual citizenship once you adopt another citizenship. For instance, I have taken Canadian citizenship, so I had to surrender my Indian citizenship.

I haven't faced any such problems, but the majority of the countries want any Canadian businessman, whenever you are working in that particular country, to respect the laws of that particular country where you're doing the business. However, the problem is that it's very difficult to assess whether or not those laws are implemented properly. As Mr. Maroni mentioned, the last person to contact will be the government official.

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I've seen that in India there's a law that forbids kids under the age of 14 or 15 from working in any particular factories. My experience has shown otherwise. There are kids working who are under 14. They may lie about their age, or the government officials who are supposed to regulate the labour laws may overlook them because they might be bribed, paid some money under the table.

The unfortunate thing is that particularly in the garment trade, the contribution of children is very minimal. As I explained in my brief, kids cannot be employed in the yarn industry where they manufacture yarn, where they manufacture the cloth, or in processing. The majority of the kids are employed at the final stage, when garments are cut and sewn. A kid cannot be employed at the cutting stage or the sewing stage. The majority of the time the kids are employed in cutting excess threads, sewing buttons, sorting shirts by sizes or doing light packing work.

When I speak to a lot of exporters, they also feel sympathetic towards the kids, because if they lay them off they might go into more hazardous industries. They could easily have ultra-modern machinery that might cost them less money than employing the kids. For cutting excess thread, you could have one machine that could lay off 50 kids.

Again, the root cause of child labour is poverty. We have been skating around the same argument again and again. Any kind of policy that the committee recommends must look from a humanistic point of view. The kids who are working in factories may not be forced to work there, but they have to work to feed themselves or their families.

Ms Alexanian: Mr. Chairman, may I add something?

The Chairman: Yes.

Ms Alexanian: You asked a question: is it possible for people of like origin, if they have dual citizenship, to work with countries that abuse child labour? I am a non-Indian and I do a lot of work in India. When I first visited India in 1989 and raised the problem of child labour, I wasn't taken seriously. I was told by the Indian community that I was imposing my First World ideals on their system. I was taken seriously by only one of my suppliers. He was proactive and saw what the future held - proposed bans on Indian carpets woven with child labour.

I'm not sure if there's something there, but it's interesting that the study suggested that people from like communities may have influence on people in establishing international labour laws for children.

Mr. Maroni: I think that's true in the business community as well. CEOs listen to CEOs. Plant managers listen to plant managers. We all have associations in life and in work that make us feel comfortable. It's certainly an avenue that ought to be pursued more in getting the word out about what is possible.

The Chairman: Ms Alexanian, you made reference in your testimony to Rugmark and the Kaleen system. You said, if recall correctly, that Rugmark wasn't that popular in India, and when you got to India you discovered that they thought it might be better if they worked with the government and with the exporters. I wonder if you would expand on that statement.

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One of the objections to the Kaleen system is that it doesn't allow for sudden inspections that would expose exploitative child labour if it were present. There are other advantages for importers under the Kaleen system as opposed to the Rugmark system. I wonder if you would talk about that. It would be helpful to have some testimony on that subject.

Ms Alexanian: I believe that both initiatives have merit. To my knowledge, Kaleen will allow random inspections. In fact, I personally can visit any loom in any village whenever I feel like it. These are private homes where people weave carpets, but they're open on one side. From the road I can see if there is a child working there. It's been said with both programs that people who are weaving in the villages will be notified slightly before the inspector comes and will take the children from the loom. Both programs face that problem.

The Rugmark initiative has not been welcomed by the Indian carpet exporting community. They feel that their Kaleen program has a better monitoring system, and they view Rugmark as competition, so to speak. They believe the effort should be coordinated rather than competitive.

The Chairman: Do the labels make a difference? You sell wonderful carpets. When customers come into your store, do they ask about the Rugmark and Kaleen systems?

Ms Alexanian: I've had only one customer ever ask about Rugmark, and to my knowledge no questions have been asked about Kaleen. My carpets are not labelled. I have one local supplier in Canada who has the Kaleen label. I remove that label when the carpets come to me because what I want to avoid in my shops is having a Turkish carpet beside an Indian carpet beside a Chinese carpet, and someone becomes aware of this problem in India and then asks if all the carpets are woven without child labour. Chinese carpets have no child labour, so then I would have to label all those carpets.

We've decided just not to label carpets. I have a feeling that the time will come, perhaps even in the next six months, when we will choose to label our carpets.

I believe Rugmark has done a better job of publicizing its effort, but there is not a lot of consumer awareness in Canada about either program.

The Chairman: When you say it might come in the next six months, is that because of the publicity attached to the subject?

Ms Alexanian: Yes.

The Chairman: Are there any other questions?

[Translation]

Mrs. Debien: I just want to respond to the last comment made by the representative of Alexanian Carpet, who said she removes her Rugmark tags from the carpets she sells in order not to confuse consumers who might want information about these products. Do China or other countries use child labour in the carpet industry?

My reaction to that is quite negative. I am just wondering whether any good corporate citizen does not in fact have a moral duty to educate consumers. Don't you think one of the responsibilities of private enterprise is to provide that kind of information to consumers?

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[English]

Ms Alexanian: I appreciate your comment. I think you raise a good point.

First, let me say that I have knowledge that there are garments made by children, but I don't check the labels of my clothing to make sure they are made without child labour. Likewise, when I sell carpets, I would like to think that my company is taking care of this problem for my consumers, that they need not even think about it.

After sitting here today, I think I'm going to change that stance. I think it may be presumptuous of my company to think that my consumers are not aware.

[Translation]

Mrs. Debien: Your way of doing things may be excellent, but I just wanted to raise that with you. That was my reaction, but I certainly wasn't passing judgment on your way of operating. You work with people in the industry, so I guess you probably know what is the best approach to countering child labour. That was not meant to be a judgmental comment, but rather a spontaneous one. It simply occurred to me that any good corporate citizen could play a role in educating consumers, although there may also be other approaches that are equally effective, such as yours. What you're doing may be excellent, but you are really best able to determine that.

[English]

Ms Alexanian: Thank you. Maybe I can just say that when I work toward eliminating child labour in the industry, I feel I work alone. My company works alone. We don't have an association. When I've made an effort to approach either my competition or the other importers in the country, I haven't had cooperation.

When there's a newspaper article, I fax it to everybody but get no reply. Like the apparel association, I don't have an association to fall back on. Maybe if I did have an association we would all agree together to label our carpets. We don't have that now. I guess that's something I will consider for my company to do.

The Chairman: Thank you very much. I think all committee members are delighted that we've actually affected things so rapidly. We sometimes become pessimistic about our ability to effect change.

Are there any other questions from the members?

I'd like to thank the witnesses for this excellent testimony. It's been extremely helpful to us. Your comments will definitely be reflected in our report, and we'll keep you informed. If you could make further comments as this committee continues in its work, it would be most useful for us as well.

I would like to thank all of you for coming here, especially Mr. Maroni, who has come here from California. To come to Ottawa in October from California is extremely difficult.

It's even more difficult for Ms Alexanian, because she came from the wonderful city of Kitchener, which is so impossible to leave. She actually lives in Mr. Telegdi's riding, who walked in here, but I didn't get a chance to tell him he had a constituent here.

Thank you once again. This meeting is adjourned.

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