Legislative Assembly of Ontario

The committee met at 1400 in room 151.

Putting Consumers First Act (Consumer Protection Statute Law Amendment), 2017 Loi de 2017 donnant la priorité aux consommateurs (modifiant des lois en ce qui concerne la protection du consommateur)

Consideration of the following bill:

Bill 59, An Act to enact a new Act with respect to home inspections and to amend various Acts with respect to financial services and consumer protection / Projet de loi 59, Loi édictant une nouvelle loi concernant les inspections immobilières et modifiant diverses lois concernant les services financiers et la protection du consommateur.

The Chair (Mr. Peter Tabuns): Good afternoon, committee members. I’m calling this meeting to order for clause-by-clause consideration of Bill 59, An Act to enact a new Act with respect to home inspections and to amend various Acts with respect to financial services and consumer protection.

Mr. Michael Wood from legislative counsel is here to assist us with our work. Welcome, Mr. Wood.

A copy of the numbered amendments received on March 3, 2017, is on your desk. The amendments have been numbered in the order in which the sections appear in the bill. Are there any questions from committee members before we start? Okay.

As you’ve probably noticed, Bill 59 is comprised of only three sections, which enact two schedules. In order to deal with the bill in an orderly fashion, I suggest we postpone the three sections in order to dispose of the two schedules first. Agreed? Agreed.

The first filed amendment in your package of motions pertains to section 40 of schedule 1 of the bill. But before we go there, is there any debate or comments on sections 1 through 39, and if there is, to which section? There is none.

If the committee is agreeable, we could bundle schedule 1, section 1 to schedule 1, section 39.

Mr. Lou Rinaldi: Perfect.

The Chair (Mr. Peter Tabuns): Perfect?

Ms. Daiene Vernile: That was the plan.

The Chair (Mr. Peter Tabuns): There is great consensus. Excellent, good.

Shall schedule 1, sections 1 to 39 carry? Carried.

We go now to our first amendment, PC subsection 40(4), amendment 1: Mr. Coe.

Mr. Lorne Coe: I move that section 40 of the Home Inspection Act, 2016, as set out in schedule 1 to the bill, be amended by adding the following subsection:

“Entitlement to licence

“(4) On application in accordance with the regulations, an applicant for a licence shall be deemed to be entitled to the licence, if, as of a prescribed date, he or she is a member of, or holder of a prescribed class of licence from, a prescribed organization, association or other entity, and is in good standing.”

The Chair (Mr. Peter Tabuns): Thank you, Mr. Coe. Did you want to speak to that?

Mr. Lorne Coe: Yes, thank you, Chair. This amendment creates a grandfathering clause for those home inspectors who, in the minister’s opinion, were appropriately qualified as of a cut-off date and would therefore be admitted as full licensees into the new authority without having to undergo further screening or examinations.

Further, the minister will have the ability to designate which organizations’ members and which classes of membership are entitled to be registered in this way.

Finally, this leaves the ministry with ample options to tailor the grandfathering regime to the realities of the home inspection market today.

There are many voluntary regulatory bodies, each with their professional and educational standards. If a new authority is established, we must make sure that qualified and law-abiding professionals are not treated unfairly.

The Chair (Mr. Peter Tabuns): Any further debate? Ms. Vernile.

Ms. Daiene Vernile: I’m going to recommend voting against this motion because it goes against the intent of Bill 59. It, of course, is to protect consumers with mandatory qualifications for home inspectors.

It’s going to reduce consumer protection by allowing associations to set the qualifications for home inspectors. This goes against the advice that we received from an expert panel, which recommended that it is the province that has the authority to establish mandatory qualifications for home inspectors.

The Chair (Mr. Peter Tabuns): Thank you, Ms. Vernile. Ms. Martow.

Mrs. Gila Martow: I would just add that I think there is precedent when other pieces of legislation have come in that affect people’s livelihoods.

I remember being at this committee where we discussed the trades. We heard from many people in the trades who were, say, 55 years old, or even 60 years old. To expect them to now, at this stage of their life, somehow go and to get the qualifications and to start their whole career over—they have families that they are supporting. I think that it’s important for us to recognize those who have worked decades—decades—in the field and have no black spots on their records, that the associations are able to somehow grandfather them.

The Chair (Mr. Peter Tabuns): Thank you. Ms. Vernile.

Ms. Daiene Vernile: As we are creating new legislation, I think it’s very important, as we move forward, that there be a consistent standard for everyone, for those who are coming online for the first time as home inspectors, as well as those who have worked in this field for many years.

I don’t think it’s appropriate for us to have two kinds of standards, for those before and those who come after. We all need to be on the same page moving forward.

The Chair (Mr. Peter Tabuns): Further debate? Ms. Martow.

Mrs. Gila Martow: I’ll just say that I think that we have to consider people who are earning their livelihood in this way. I’m sure that there are ways that we can go about making it fair for them.

I think it’s understandable that, as a society, we welcome people to our country, we welcome people to our province, we welcome people to earn a living. I think to cut people off who have been providing a service in our communities—and, again, the associations would be involved. They would know if somebody has been doing home inspections for 20 or 30 years and have never had a serious complaint, to cut them off I think is a bit heartless. I just wanted to say that. Thank you.

The Chair (Mr. Peter Tabuns): Thank you, Ms. Martow. Ms. Vernile?

Ms. Daiene Vernile: Just to clarify, there is no intention to cut anyone off, and, again, to defer to the direction that we received from our expert panel who spoke to this committee.

The Chair (Mr. Peter Tabuns): You’re ready to vote? All those in favour? Opposed? The motion is lost.

Colleagues, we now have sections 41 to 50 in which we have no amendments.

Interjection.

The Chair (Mr. Peter Tabuns): Ah, I have some sage advice from the Clerk.

Shall schedule 1, section 40 carry? Opposed? It is carried. Thank you, Clerk.

We now have significant sections—up to section 50—that have no amendments. People are agreeable to bundle them? Okay.

Shall schedule 1, sections 41 to 50 carry? Carried. Done.

We now go to schedule 1, section 51, amendment number 2 by the government. Mr. Rinaldi.

Mr. Lou Rinaldi: I move that subsection 51(5) of schedule 1 to the bill be amended by striking out “of insurance” and substituting “of any prescribed insurance”.

The Chair (Mr. Peter Tabuns): Any discussion? Mr. Rinaldi?

Mr. Lou Rinaldi: Obviously, I recommend supporting this motion. This will provide some clarity to home inspectors and providers about the type of insurance that they need to disclose to their clients. It does this by allowing regulations to specify only those types of insurance that are relevant to a client when hiring a home inspector or provider.

Without this change, licensees might think they need to disclose all the insurances that they carry, most of which may not be relevant to the client, such as home insurance, car insurance, travel insurance, disability and life insurance. So this is really to clarify the issue.

The Chair (Mr. Peter Tabuns): Any further discussion? Ms. Martow.

Mrs. Gila Martow: I just wanted to recommend that we remove the “amount of insurance” rather than have just “insurance” because there was discussion when we heard presentations to the committee that there were concerns that home inspectors who felt that they had more insurance coverage than other home inspectors, that it was going to actually be detrimental to them because people would say, “Oh, look at all the insurance they’re carrying. That’s the one I’m going to sue.” They felt that it’s really nobody’s business in the public to know exactly how much insurance they’re carrying. You wouldn’t put on the back of your car how much liability insurance you’re carrying or put it in front of your house so that people decide to trip on your front lawn. So that is our recommendation from this side of the room.

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The Chair (Mr. Peter Tabuns): All right. Typically, I would ask for a written copy of it, but does everyone understand what has been proposed in this amendment to the amendment?

Mr. Lou Rinaldi: I think so.

The Chair (Mr. Peter Tabuns): All right. Any further discussion of the amendment to the amendment? There being none, those in favour of the amendment to the amendment? Those opposed to the amendment to the amendment? It’s lost.

We go to the main amendment from Mr. Rinaldi. Is there any further discussion of that amendment? There being none, you are ready for the vote. All those in favour of the amendment? All those opposed? It is carried.

With that, shall schedule 1, section 51, as amended, carry? All those in favour? Opposed? It is carried.

Colleagues, we now have from sections 52 to 83 with no amendments. With your agreement, I’ll bundle them.

Mrs. Amrit Mangat: Fifty-three?

The Chair (Mr. Peter Tabuns): From 52 to 83. You’re agreeable? Excellent.

Shall schedule 1, sections 52 to 83, carry? Carry? Opposed? Carried.

Shall schedule 1, as amended, carry? Opposed? Carried.

Now we go on to schedule 2. Schedule 2, section 1: There is no amendment. Any debate? There being none, shall schedule 2, section 1, carry? No opposition. Carried.

Now we go to PC motion 3. Mr. Coe.

Mr. Lorne Coe: I move that clauses 2(k) and (1) of the Collection and Debt Settlement Services Act, as set out in subsection 2(3) of schedule 2 to the bill, be amended by adding “or” at the end of clause (k) and by striking out clause (1).

Mrs. Gila Martow: Clause (l).

Mr. Lorne Coe: Clause (l), rather. Sorry.

The Chair (Mr. Peter Tabuns): Clause (l).

Any discussion? Ms. Martow.

Mrs. Gila Martow: Debt purchasers should be subject to the collections act, and we believe this clause, if it is not struck out, would create a class of debt collection professionals who, while engaging in the activities of collecting debt, would not be regulated by the act. We feel that this is a loophole. That’s our concern.

The Chair (Mr. Peter Tabuns): Okay. Mr. Rinaldi.

Mr. Lou Rinaldi: I recommend voting against this motion for the reason that it’s not necessary to impose the regulatory burden of registration under the act on businesses which collect debt in the name of the original creditor. Abuse of this exemption could be controlled through regulations.

The Chair (Mr. Peter Tabuns): Further debate? There being none, you’re ready to vote? All those in favour of the amendment? All those opposed? It is lost.

We go to the vote on the section. Shall schedule 2, section 2, carry? Opposed? It’s carried.

Unless you’re opposed, I will bundle the next three. That’s sections 3, 4 and 5. Shall schedule 2, sections 3, 4 and 5, carry? Opposed? Carried.

We now go to PC motion number 4. Mr. Coe.

Mr. Lorne Coe: Yes. I move that section 6 of schedule 2 to the bill be amended by adding the following subsection:

“(2) Section 22 of the act is amended by adding the following clause:

“‘(b.1) communicate or attempt to communicate with a debtor by any means without ensuring that the communication expressly states, in relation to the debt, the original creditor’s name and, if different, the name of the current creditor to whom the debt is owed in accordance with the regulations;’”

To my colleague.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: This deals with the fact that we heard from presenters at this committee how collectors can pressure consumers to pay for debts without providing any proof of how that debt came to be owed. This amendment creates an expressly prohibited practice, meaning if you can’t prove who you are collecting for or how you came to be the owner of that debt, you have no right to collect.

The Chair (Mr. Peter Tabuns): Mr. Fraser.

Mr. John Fraser: I won’t be supporting this motion. First of all, it sets out a very broad rule. As we go forward, there are another four or five sections here that I look at that I feel are best dealt with through regulation and the consultative process. The government has given an indication about the notification on first notice of the original debt agency, and so I think it’s better that we prescribe in regulations through a consultative process how we are going to handle this.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: I would just fine-tune it, that I think that one of the concerns from consumer groups is that people buy debt sometimes for pennies on the dollar. Say somebody owes $1,000 to a furniture company, and they still owe that $1,000. These companies come in and they say, “Here are a few dollars and we’ll buy that debt.”

They’re good at pressuring people, so they phone up and they don’t explain that they are a third-party debt holder. I think that if people knew that somebody bought the debt for far less than what was actually owed, they’d feel a lot more comfortable renegotiating it. A lot of times, they actually could renegotiate it. They’re just not aware of that.

I think that it’s partly that the public just is not aware. Somebody is on the phone saying that you owe them money, and they don’t even have to disclose who they are or how they came to hold that debt. They don’t have to disclose that they are not the original person that you owed that money to.

It is a little bit tricky, but it is also of concern to a lot of the consumer groups, so that’s why we’re bringing it up.

Interjection.

The Chair (Mr. Peter Tabuns): Mr. Fraser.

Mr. John Fraser: Thank you very much, Mr. Chair. Sorry, I was a bit quick there.

I agree with the principle; there’s no argument. I just think it’s best dealt through regulation in order to be able to consult with not just those consumer groups, but the industry as well, to ensure that we get the proper balance in that. People do have to know that. As we go forward, I just think that process is an important one for us to go through.

The Chair (Mr. Peter Tabuns): No further debate? You’re ready for the vote. All those in favour of the amendment? Those opposed? It is lost.

We go then to PC amendment number 5. Mr. Coe.

Mr. Lorne Coe: I move that section 6 of schedule 2 to the bill be amended by adding the following subsection:

“(3) Section 22 of the act is amended by adding the following clause:

“‘(b.2) communicate or attempt to communicate with a credit reporting agency respecting a debt before the sixth business day, or such longer period as may be prescribed, after giving the debtor a written demand for payment respecting the debt in accordance with the regulations;’”

To my colleague, please.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: This is just about that we feel the consumers should be given the opportunity to receive the written communication notifying them of their outstanding debts and contest it before any communication is made to credit reporting agencies regarding this debt.

Again, we heard from presenters to committee that a lot of companies have figured out that since there don’t seem to be regulations demanding that they submit in writing, or that nobody actually checks up on them, that they say it’s expensive to mail things out, so they decide to take their chances. Nobody is going to check up whether they mailed out or not. They just don’t even bother. They just save the money, and they just don’t bother doing the mailing.

It seems to be a bit ambiguous whether or not they have to even notify whether anybody is checking up. Again, that is the challenge in government. We make all these regulations. We keep piling them on. But what good are they if nobody is checking up whether or not they’re being enforced?

The Chair (Mr. Peter Tabuns): Any further debate? Mr. Fraser.

Mr. John Fraser: I won’t be supporting this motion either, for the reasons that I gave earlier in terms of I think this is best set out in regulation. The reason that regulators have regulations is so they can ensure that the practice that they put forward will (a) work and be enforceable, and (b) meet the needs of, in this case, consumer protection. I think it’s best handled that way. To what the member is saying, people do have to know.

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The Chair (Mr. Peter Tabuns): Further discussion? There being none, you’re ready to vote? All those in favour of this amendment? All those opposed? It is lost.

We go to PC motion number 6. Mr. Coe.

Mr. Lorne Coe: I move that section 6 of schedule 2 to the bill be amended by adding the following subsection:

“(4) Section 22 of the act is amended by adding the following clause:

“‘(b.3) make, demand, or report to a credit reporting agency a payment in respect of a debtor’s credit account, or cause any of these things to be done, if more than six years have elapsed since the last payment to the account, unless the collection agency or collector first obtains from the debtor a signed statement that the debtor understands that if the agency or collector takes the proposed action, or causes it to be taken, the debtor may be exposed to a legal claim in respect of the debt as a result;’”

To my colleague.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: This amendment acknowledges that there is a six-year federal statute of limitations on pursuing debts in court. By approving this amendment, this committee would ensure the consumer is well informed of the consequences of taking certain actions with respect to their debt and can then talk to an attorney in order to make suitable arrangements before complying with the collector’s demands.

The Ontario statute of limitations, in accordance with the Limitations Act, section 4, is two years, so we are open to changing this motion to read “two years” instead of “six years,” if the government thinks it’s wise. Again, we’re just trying to bring things in line. Thank you.

The Chair (Mr. Peter Tabuns): Thank you, Ms. Martow. Further comment? Mr. Fraser.

Mr. John Fraser: As I said earlier, I think this is best done through a consultative and regulatory process. I appreciate what the member is saying, but as I said before, that’s where I feel it’s best dealt with.

The Chair (Mr. Peter Tabuns): Further discussion? Ms. Martow.

Mrs. Gila Martow: Just to add that I think it was yesterday or the day before that it was in the news, on our First Nations communities: They’re so intimidated that people are calling from other continents saying that they owe taxes, and they’re going to their bank accounts and cleaning them out. I’m not saying that we can address that in this piece of legislation; it’s not specific to this. It’s just that it hangs over all our heads that we have a public that gets quite panicked when somebody phones them or mails them and says that they owe money. They tend to jump on it and panic—and often, it’s new Canadians who panic the most.

I think there’s a lot more work to be done in that regard by all of us.

The Chair (Mr. Peter Tabuns): Further debate? Mr. Fraser.

Mr. John Fraser: I agree wholeheartedly with the member. One of the things we have to look at in the regulatory practice is that it’s not just mailing. There are all sorts of other forms of communication, not just mail and telephone. To your point, there are a lot of things out there that are coming at people. They need the tools to be able to know what’s coming.

The Chair (Mr. Peter Tabuns): Any other debate? There being none, you’re ready for the vote? All those in favour of the motion? All those opposed? It is lost.

We go to PC motion number 7. Mr. Coe.

Mr. Lorne Coe: I move that section 6 of schedule 2 to the bill be amended by adding the following subsection:

“(5) Section 22 of the act is amended by adding the following clause:

“‘(c.1) sell, assign, transfer, purchase, receive assignment of, use as collateral or otherwise alter the ownership of and responsibility for an amount owing by a debtor for more than six years;’”

To my colleague.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: I just want to say that allowing the purchase and sale of debt that has gone beyond the statute of limitations provides incentives for debt buyers to engage in high-pressure tactics towards debtors, since only a written acknowledgement of the debt or a payment toward it can reactivate the collector’s ability to sue the debtor. This amendment takes these incentives away by preventing the sale or transfer of bad out-of-limitation debts and making them the original creditor’s responsibility.

It’s all part of the big-picture problem, which is that people aren’t necessarily aware of what the statute of limitations is, or that debt can even be bought. They are really not aware of their rights. Maybe we don’t want to start spending a lot of money trying to educate the public necessarily, but maybe there’s more we can do in terms of when we send out people’s municipal tax assessments, maybe have a note put in there, but I’m sure there’s a lot more we can do, especially with social media, it’s so inexpensive to get our message out.

The Chair (Mr. Peter Tabuns): Thank you, Ms. Martow. Further discussion? Mr. Fraser.

Mr. John Fraser: Again, I think this is best done through regulations. We’ve now not supported motions 4 and 5, so the motion is moot because of those decisions that we’ve made. I appreciate the member’s intent.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Fraser. Any other discussion?

There being none, ready for the vote? All those in favour? All those opposed? It is lost.

Colleagues, then, shall schedule 2, section 6, carry? Opposed? It is carried.

Now we have sections 7 to 11 with no amendments. I propose bundling. You’re agreeable?

Interjections.

The Chair (Mr. Peter Tabuns): Excellent. Shall schedule 2, sections 7 to 11, carry? Carried.

We now go to PC motion number 8. Ms. Martow.

Mrs. Gila Martow: We are going to be withdrawing this since none of the previous amendments passed.

The Chair (Mr. Peter Tabuns): Withdrawn.

If I can bundle then, because from sections 12 to 15 there are no amendments. You’re agreeable?

Interjections.

The Chair (Mr. Peter Tabuns): Shall schedule 2, sections 12 to 15, carry? Carried. No opposition? Carried.

We now go to NDP motion 8.1: Mr. Singh.

Mr. Jagmeet Singh: I move that section 43.1 of the Consumer Protection Act, 2002, as set out in section 16 of schedule 2 to the bill, be amended by adding the following subsection:

“Same, past agreements

“(4.1) An agreement described in subsection (3) or (4) that was entered into in the five-year period before section 16 of schedule 2 to the Putting Consumers First Act (Consumer Protection Statute Law Amendment), 2016 comes into force is deemed to be void if the entering into of the agreement would have contravened subsection (1) if that subsection, as it read on the day the Putting Consumers First Act (Consumer Protection Statute Law Amendment), 2016 received royal assent, had applied at the relevant time.”

The Chair (Mr. Peter Tabuns): Thank you, Mr. Singh. Any comments?

Mr. Jagmeet Singh: It’s a housekeeping matter that would ensure greater consideration for the consumer.

The Chair (Mr. Peter Tabuns): Ms. Martow?

Mrs. Gila Martow: We’re going to be opposing this because we feel it would send the wrong message to anybody who wants to operate a business in Ontario that, basically, you make a sale and the government can come in with some new piece of legislation or, as the member opposite says, a regulation, and just pull the wool out from under them.

We are moving forward with this piece of legislation because there are concerns about door-to-door sales, so we certainly understand where this is coming from and we’re supportive of where the idea’s coming from, but if this amendment is enacted, it would make any and all door-to-door sales agreements entered in the past five years void. This isn’t just retroactive to the date of the bill’s introduction, but it would make this section retroactive to 2012—the whole section—so we’re going to be opposing this.

The Chair (Mr. Peter Tabuns): Ms. Vernile.

Ms. Daiene Vernile: I think we all want to talk about this, don’t we?

The Chair (Mr. Peter Tabuns): I’m noticing that.

Ms. Daiene Vernile: I want to start by saying that we strongly agree with Ms. Martow on this, Chair. The reason why we are going to recommend voting against this is that the intent of the bill is to protect vulnerable consumers from aggressive, unsolicited door-to-door contractors. So, moving forward, if we were to void legally entered-into contracts, that would create a kind of uncertainty for suppliers. Moving forward, we do want to ensure that vulnerable consumers are protected, but by saying that we’re going to void all of the previous legally entered-into contracts again would create uncertainty for suppliers.

The Chair (Mr. Peter Tabuns): Further discussion?

Mr. Jagmeet Singh: Just to make it clear, if an agreement would have contravened what we’re putting forward now in terms of protections, if a previous agreement contravened those protections, then that seems to be an unfair scenario. We’re not really protecting the people who have already been exploited, the people who have already faced things that are unfair, things that we’re saying should not happen moving forward. We’re simply saying that if we don’t think they should happen moving forward, then we’re saying that they shouldn’t have happened in the past either. The people currently facing astronomical interest rates, locked into horrible contracts, shouldn’t have to face those.

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If we agree that they were unfair to begin with, then voting against this motion is simply saying that you think it’s okay for people to have been exploited; you think it’s okay for people to have been taken advantage of, and just let’s not do it moving forward.

We’re saying, hey, it happened to people. They should get some remedy. They should get some protection. That’s what this motion is suggesting.

The Chair (Mr. Peter Tabuns): Any further discussion? Ms. Vernile.

Ms. Daiene Vernile: If the intention of this amendment, though, is to void all previous contracts, that becomes very unfair for contracts that are actually legal, the ones that were entered into by reputable companies. Are you intending to want to cancel those contracts as well? Because that would be unfair and inappropriate.

The Chair (Mr. Peter Tabuns): Mr. Singh.

Mr. Jagmeet Singh: The language is very clear: It would be “deemed to be void if the entering into of the agreement would have contravened subsection (1)....”

If it contravenes what we’re putting forward; if a contract, whether it’s from a reputable or disreputable company—either way—contravenes what we’re saying should be the protections now, we’re saying that those contracts should not be valid. If we’re saying that, moving forward, they’re not allowed to do this practice—if you’re saying, moving forward, “Don’t do this”—then what about people who are already trapped into it? We should say to them that the same protections we’re saying should apply now, should apply in the past as well.

If you don’t agree with this motion, you’re essentially signalling that it’s okay that people were exploited, and that we’re just going to hope that people are not exploited, moving forward. The exact same protections that you’re saying should apply now, moving forward, should also apply to those who have already been in it. That’s all we’re saying.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: I think we have to remember that a lot of these contracts were for the purchase of equipment, such as air conditioners or furnaces. If somebody has had a brand new furnace installed, even if it was at high interest rates, even if it was not warranted or needed, they’ve been using that furnace for five years. I would suggest that it would be kind of unfair to suggest that a furnace or an air conditioner that somebody has been using for five years—the incentive is certainly there to say, “Hey, I’ve used it for five years, and now they can take it back and I can get a new one all over again,” without any repercussions for that.

I can certainly see cancelling if they’ve just ordered, and somebody takes back into their possession a brand new air conditioner that has only been used for a week or two. But taking back an air conditioner that has been used for five years seems to be bordering on the ridiculous.

The Chair (Mr. Peter Tabuns): Are we ready to vote? All those in favour—

Mr. Jagmeet Singh: Sorry, recorded vote.

The Chair (Mr. Peter Tabuns): Ah.

Mr. Jagmeet Singh: Did I get that in early enough?

The Chair (Mr. Peter Tabuns): You are a bit late, you know. You had put your hand up, so you are too late, Mr. Singh.

Mr. Jagmeet Singh: All right.

The Chair (Mr. Peter Tabuns): All those in favour? All those opposed? It is lost.

We go to PC motion 9: Mr. Coe.

Mr. Lorne Coe: I move that section 43.1 of the Consumer Protection Act, 2002, as set out in section 16 of schedule 2 to the bill, be amended by adding the following subsection:

“(8) This section is repealed on the second anniversary of the day section 16 of schedule 2 to the Putting Consumers First Act (Consumer Protection Statute Law Amendment), 2016 comes into force.”

To my colleague, please.

The Chair (Mr. Peter Tabuns): Thank you. Ms. Martow.

Mrs. Gila Martow: The PC caucus believes that banning the door-to-door sale of any good will only deter the law-abiding salespeople while the bad players will continue exploiting vulnerable consumers through fly-by-night operations.

The government’s panic about 20-day cool-off periods for water heater rentals is being reversed in this very same bill, in section 15, to the conventional 10 days, as for any other agreement.

We expect that within two years, the following might happen: Either the government will realize their bans don’t work, or the incidence of unfair practices in the door-to-door sales industry will decrease dramatically, to even lower levels than today. Either way, this ban should have an expiry date.

The Chair (Mr. Peter Tabuns): Any further comment? Mr. Rinaldi.

Mr. Lou Rinaldi: Chair, I recommend voting against this motion for the following reasons: The intent of the bill is to protect vulnerable consumers from aggressive, unsolicited door-to-door contracts. The wording in the proposed bill will allow the government the flexibility to set out requirements through regulation for door-to-door contracts, through consultation, and adjust as necessary. This amendment will revoke the government’s ability to protect consumers from aggressive door-to-door marketing after two years, Chair.

The Chair (Mr. Peter Tabuns): Any further discussion? You’re ready for the vote? All those in favour of the amendment? All those opposed? It is lost.

With that, we go to the vote on schedule 2 itself. Shall schedule 2, section 16, carry? Opposed? It is carried.

I can bundle the next two, if you’re all agreeable. Excellent. Shall schedule 2, sections 17 and 18, carry? Opposition? None. Carried.

Now we go to government motion 10: Ms. Vernile.

Ms. Daiene Vernile: Chair, I would recommend that we withdraw motion 10.

The Chair (Mr. Peter Tabuns): Withdrawn. Thank you.

We go to government motion 10.0.1: Ms. Vernile.

Ms. Daiene Vernile: I move that section 19 of schedule 2 to the bill be amended by adding the following subsection:

“(0.1) Subclause 116(1)(b)(iii) of the act is amended by striking out ‘and 36(1)’ at the end and substituting ‘36(1), 43.1(1) and 41.1(1), (5) and (6)’.”

The Chair (Mr. Peter Tabuns): Ms. Vernile, before you go on, I heard you say “41.1” instead of “47.1.”

Ms. Daiene Vernile: I stand corrected; thank you.

The Chair (Mr. Peter Tabuns): So it is “47.1.”

Ms. Daiene Vernile: Yes, it is.

The Chair (Mr. Peter Tabuns): Fine. All right, please proceed.

Ms. Daiene Vernile: I recommend that we vote in favour of this motion because the intent of the bill, as mentioned already today, is to protect consumers. The wording would strengthen consumer protection by making it an offence to violate certain rewards points rules, and protecting against time-alone expiry and violating the prohibition against proscribed unsolicited door-to-door contracts.

The Chair (Mr. Peter Tabuns): Further discussion? There being none, you’re ready—oh, Ms. Martow?

Mrs. Gila Martow: I was just going to say that we’re going to be supporting this, and that we think it’s important to make it illegal to have expiry dates for point cards and to not return expired reward points, as well. So we’re going to be supporting it.

The Chair (Mr. Peter Tabuns): Ready to vote? All those in favour? Opposed? It is carried.

We go now to government motion 10.0.2: Ms. Vernile.

Ms. Daiene Vernile: I move that section 19 of schedule 2 to the bill be amended by adding the following subsection:

“(0.2) Subclause 116(1)(b)(iii) of the act, as amended by subsection (0.1), is amended by striking out ‘(5) and (6)’ at the end.”

The Chair (Mr. Peter Tabuns): Did you want to speak to that?

Ms. Daiene Vernile: Yes. I recommend that we vote in favour of this, because after a time the question of crediting back points which expired before Bill 47’s amendments were proclaimed will be moot.

The Chair (Mr. Peter Tabuns): Further discussion? There being none, all those in favour? All those opposed? It is carried.

Now voting on the section as a whole: Shall schedule 2, section 19, as amended, carry? Opposed? None. It’s carried.

We now have schedule 2, section 20, with no amendments. Shall schedule 2, section 20, carry? Carried.

We go now to NDP motion 10.1: Mr. Singh.

Mr. Jagmeet Singh: I move that schedule 2 to the bill be amended by adding the following section:

“20.1 The Payday Loans Act, 2008 is amended by adding the following section:

“‘Borrowers bill of rights

“‘1.1(1) The Lieutenant Governor in Council shall, by regulation, establish a Borrowers Bill of Rights which shall include, at a minimum, the following rights for borrowers:

“‘1. The right to be informed about the full cost of borrowing in connection with a payday loan agreement, including information related to the cost difference to the borrower between making repayments over time as compared to paying the full outstanding balance under the agreement and entering into a new payday loan agreement.

“‘2. The right to be informed of a toll-free telephone number for the lender’s compliance department.

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“‘3. The right to be informed about how to file a consumer complaint to Consumer Protection Ontario.

“‘Display

“‘(2) Each licensee shall display the Borrowers Bill of Rights prominently in the main office and each branch office it operates as well as on the licensee’s public-facing website.’”

The Chair (Mr. Peter Tabuns): Thank you, Mr. Singh. Comments?

Mr. Jagmeet Singh: Yes. Establishing a borrowers bill of rights is an idea to ensure that there is a really clear understanding of what a borrowers’ rights are, what protections they have and what remedy and recourse they have.

Allowing clearer transparency with respect to what the cost of borrowing is would allow consumers to make informed decisions about what type of risk they’re exposing themselves to in terms of the rate of credit. Having a remedy with respect to knowing how to complain to Consumer Protection Ontario would ensure that a consumer can protect themselves, and having the toll-free number to the lenders’ compliance department could also allow them to follow up with any questions they have with an independent source.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: Just to make it clear, we’re supporting the premise of this motion. We agree with you that consumers deserve to know everything that’s relevant about their planned borrowing under a payday lending agreement. We’d love to focus on preventing the need for consumers to resort to payday lending, but we see nothing objectionable about this motion.

The Chair (Mr. Peter Tabuns): Mr. Fraser.

Mr. John Fraser: This creates a new section under the act. As I said earlier to a number of motions, the whole prospect of the act is to make sure that people are informed and that they know their choices. I believe that we can best do this through consultation and regulation. I think the idea of a borrowers’ bill of rights is a great idea. I think the best way to handle that is to do that in a way that provides consultation and the regulator with some regulations.

The Chair (Mr. Peter Tabuns): Any further discussion?

Mr. Jagmeet Singh: Recorded vote.

The Chair (Mr. Peter Tabuns): Recorded vote.

Ayes

Coe, Martow, Singh.

Nays

Fraser, Mangat, McMeekin, Rinaldi, Vernile.

The Chair (Mr. Peter Tabuns): The motion is lost.

We now go to the vote on the section as a whole. Shall schedule 2, section 20.1, carry? Opposed? It’s carried.

We now go to PC motion number 11. Mr. Coe.

Mr. Lorne Coe: I move that subsection 24(3) of the Payday Loans Act, 2008, as set out in subsection 21(2) of schedule 2 to the bill, be amended by striking out “location” wherever it appears and substituting in each case “new location”.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Coe. Did you want to speak to that? No.

Ms. Martow.

Mrs. Gila Martow: I just feel that we’re being consistent in applying the principle of non-retroactivity. We know that many cities—and we heard from some councillors who came to present to the committee—would like to restrict the operations of payday lenders within their boundaries. They have the right to want to do that and make those decisions.

These bylaws, however, should not be used to close down the payday-lending outlets that have been established legally under existing legislation. Again, if they were legal entities, they invested in the community and they did leasehold improvements—we have to be respectful of people who invest a lot of their time and their money in legal establishments in our communities.

The Chair (Mr. Peter Tabuns): Mr. Rinaldi.

Mr. Lou Rinaldi: Chair, I recommend opposing this for a number of reasons, but I’m just going to give you a couple.

This motion is overly prescriptive, removing flexibility from municipalities and preventing them from addressing the problem they have already identified. Frankly, we believe that AMO is not supportive of such a regulation. I think we need to respect our municipal governments. They’re duly elected by their citizens, and I believe that we need to respect that. So I recommend voting against this motion.

The Chair (Mr. Peter Tabuns): Further discussion? There being none, you’re ready for the vote? All those in favour? All those opposed? It is lost.

We now go to government motion number 12. Ms. Mangat.

Mrs. Amrit Mangat: I move that subsection 24(3) of the Payday Loans Act, 2008, as set out in subsection 21(2) of schedule 2 to the bill, be struck out and the following substituted:

“Location of offices

“(3) In acting as a licensee, a licensee shall not operate an office at a location if a bylaw passed under section 154.1 of the Municipal Act, 2001 or section 92.1 of the City of Toronto Act, 2006 prohibits the operation of the office at the location.”

The Chair (Mr. Peter Tabuns): Thank you, Ms. Mangat. Did you want to comment?

Mrs. Amrit Mangat: Yes. I recommend voting for this motion, Chair, because it is important that provincial licensing of payday lenders works hand in hand with municipal licences.

The Chair (Mr. Peter Tabuns): Further debate? Ms. Martow.

Mrs. Gila Martow: Again, to go to the previous motion, we believe that instead of saying “location,” it should say “new location.”

I think we heard in the House last week from the Premier that she felt she didn’t want to look at reopening energy contracts, because she said that it would make people not want to do business in Ontario if they feel that the government changes the rules on them after they’ve established a business or signed a contract with the government. I think that that applies to this as well. If people have followed the laws and have established businesses in a location and done the leasehold improvements, it should be respected that they’ve invested a lot of their time and money.

The Chair (Mr. Peter Tabuns): Further discussion? Ms. Mangat.

Mrs. Amrit Mangat: This motion clarifies the relationship between municipal and provincial licensing of payday lenders. I recommend voting in favour of this.

The Chair (Mr. Peter Tabuns): No further discussion? All those in favour of the motion? All those opposed? Carried.

Now we vote on the section as a whole. Shall schedule 2, section 21, as amended, carry? Opposed? It is carried.

Mr. Singh, we now have NDP motion 12.1.

Mr. Jagmeet Singh: Thank you. I will be requesting a recorded motion on this vote.

Mrs. Gila Martow: A recorded motion on this vote?

Mr. Jagmeet Singh: Sorry. That’s so funny. Strike that and reverse it.

The Chair (Mr. Peter Tabuns): I knew where you were headed.

Interjection.

Mr. Jagmeet Singh: Oh, that’s funny.

I move that schedule 2 to the bill be amended by adding the following section:

“21.1 The act is amended by adding the following section:

“‘Advertising re cost of borrowing

“‘26.1(1) A licensee who makes representations in respect of a payday loan, or who causes representations to be made in respect of a payday loan, shall ensure that,

“‘(a) the representation includes a prominent statement of the licensee’s annual interest rate and the chartered bank annual consumer loan rate;

“‘(b) the representation includes a description of all types of amounts that may be included in the total cost of borrowing in connection with the payday loan arrangement; and

“‘(c) the representation satisfies the prescribed requirements.

“‘Interpretation

“‘(2) In this section,

“‘“chartered bank annual consumer loan rate” means the most recent consumer loan rate offered by chartered banks as set out in table 176-0043 published by Statistics Canada.’”

The Chair (Mr. Peter Tabuns): Any comments, Mr. Singh?

Mr. Jagmeet Singh: Again, with a view to providing clear and full transparency to the consumer, this amendment would ensure that consumers understand what the annual interest rate they’re being charged is and have a comparison so that they can reference what the going rate is at a chartered bank.

This would ensure that consumers know that they are being charged a considerably higher rate than usual when they’re going through a payday loan and they can make their decision knowingly. The current manner in which loans are disclosed doesn’t really provide a way for the consumer to understand the impact of the loan: $25 per $100, or $15 per $100 doesn’t actually sound like a 300% interest rate. This would ensure that people know exactly what interest rates they are being charged.

The Chair (Mr. Peter Tabuns): Ms. Martow?

Mrs. Gila Martow: We certainly understand and agree with the third party that consumers deserve to know as much as possible about their loans, but this seems to assume that consumers just don’t know that they can get cheaper credit at the bank. I think that most of the time, they know they could borrow at a lower interest rate, but they just aren’t able to borrow at the bank, they aren’t able to get a credit card. We hear sometimes it’s people who come in from other provinces and are working here temporarily. They don’t have a bank account in this province to even—all kinds of different reasons. These are often microloans; people can’t get such small loans at the bank. They need it desperately to fix their truck so they can get to work.

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We don’t assume that everybody who goes to payday lenders is going out of ignorance. They’re there because of an urgent need that our conventional financial institutions are unable or unwilling to address.

Furthermore, this amendment creates explicit mentions in the legislation of a StatsCan table. StatsCan, we believe, can often alter the table numbers or discontinue them, meaning that this section could potentially become inapplicable.

The Chair (Mr. Peter Tabuns): Ms. Vernile.

Ms. Daiene Vernile: We are going to be recommending voting against this amendment. Although we agree with Mr. Singh that it is very important that anyone who is seeking a payday loan be well informed of the rates that they’re going to be paying, I would assert that Bill 59 and the Payday Loans Act, 2008, already provide this information, that rate information must be provided to borrowers and it must be posted inside the payday loans establishment. There is already the ability to do this.

The Chair (Mr. Peter Tabuns): Mr. Singh.

Mr. Jagmeet Singh: Just one point of clarification: The specific transparency that’s being requested by this amendment is that the annual interest rate be laid out. Currently, the disclosure doesn’t really include an annualized rate of interest. It’s framed in terms of a certain dollar amount per a certain dollar amount, and normally it’s per $100. That doesn’t really impart the full impact of the loan that a consumer is getting into.

To Ms. Martow’s concern: It’s not that consumers go to payday loan companies not knowing that there are other options and this might be the last resort. It’s important, though, even if it is the last resort, knowing just how serious and how high of an interest rate they are being charged so that in terms of repayment, they’re aware of that, and in terms of how much they should be taking out, they’re aware of that. Having it expressed in an annualized rate really drives home that this is a crazy amount of interest, and, “I’ve got to be really careful about making sure I pay this back or I’ll be caught in a cycle where I can’t afford to pay it back.”

The Chair (Mr. Peter Tabuns): Ms. Vernile.

Ms. Daiene Vernile: Chair, I want to add that the government intends to be consulting on the types and forms of information that would be most helpful to borrowers, and this is tied to Bill 59.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: We always seem to use the term “high interest” with the small loans that people get at payday loan institutions, but I really think that we should look at it a little bit differently in terms of an administrative cost. If the administrative cost of giving out the loan just to do the paperwork, pay the rent, heat the place and buy pens and paper is, say, $25 or $30 per loan, then if somebody’s borrowing $300, that $30 should come off, and if somebody’s borrowing $1,000, that $30 should come off, and then what they have to pay in terms of fees and charges. Then calculate the interest after that initial fee.

I think we would realize very quickly that the interest rate isn’t as exorbitant, because now we’re calculating the interest on these small loans without taking into account the administrative costs. Most often, the data shows that the average loan was $300. If you take $35 off of the initial fees or repayment that they have to pay on top of the capital, the interest rate isn’t as ridiculous as you might think.

The Chair (Mr. Peter Tabuns): There being no further discussion, a recorded vote was requested.

Ayes

Singh.

Nays

Mangat, McMeekin, Rinaldi, Vernile.

The Chair (Mr. Peter Tabuns): The motion is lost.

We now go to PC motion 13.

Mr. Lorne Coe: I move that schedule 2 to the bill be amended by adding the following section:

“21.1 Subsections 32(2), (3) and (4) of the act are repealed and the following substituted:

“‘Duty of lender

“‘(2) The lender under a payday loan agreement shall ensure that the cost of borrowing under the agreement does not exceed any limits set for the purpose by the Superintendent of Financial Services appointed under the Financial Services Commission of Ontario Act, 1997.

“‘Duty of loan broker

“‘(3) No loan broker shall facilitate a contravention of subsection (2).

“‘Consequence

“‘(4) If the cost of borrowing under a payday loan agreement exceeds the limits referred to in subsection (2), the borrower is only required to repay the advance to the lender and is not liable to pay the cost of borrowing.’”

The Chair (Mr. Peter Tabuns): Mr. Coe, and members of the committee, I’m ruling this amendment out of order as it is, in my opinion, beyond the scope of the bill. I’m sorry to say we won’t be having any further debate on this.

Mr. Lorne Coe: Thank you.

Mr. Lou Rinaldi: Darn.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Rinaldi.

We’ll now go to the vote on this. Shall schedule 2—oh, no, I apologize. It’s not necessary.

We now go to NDP motion 13.1: Mr. Singh?

Mr. Jagmeet Singh: Thank you, Mr. Chairperson. Could I request a recorded vote on this amendment?

The Chair (Mr. Peter Tabuns): Absolutely, sir. Absolutely.

Mr. Jagmeet Singh: I move that schedule 2 to the bill be amended by adding the following section:

“21.2 The act is amended by adding the following section:

“‘Maximum cost of borrowing

“‘32.1 Despite anything in this act, the maximum cost of borrowing under a payday loan agreement is $2.30 per $100 advanced under the agreement.’”

The Chair (Mr. Peter Tabuns): Mr. Singh.

Mr. Jagmeet Singh: Yes. This would put a hard cap on the amount of borrowing and ensure that it is an interest rate that is not exorbitant and that does not put undue stress on those who are already in a vulnerable position.

The Chair (Mr. Peter Tabuns): Ms. Martow.

Mrs. Gila Martow: This sort of ties in with what I said previously about looking at the cost to the institution per loan, per transaction. We certainly see that there are transaction fees. Oftentimes you’ll go in and they’ll say, “For a purchase under $10, there’s a transaction fee if you’re paying by debit,” or whatever.

We know that the average cost to provide a payday loan is several times what the member is mentioning. Default loans alone could account for as much as $10 per $100 borrowed. That’s the unfortunate part. It’s sort of like insurance. You’re paying for fraudulent claims, or you’re paying for all kinds of possible problems beyond the scope of what you’re asking for insurance for.

If the third party wants to abolish payday lending in Ontario, they should repeal the payday lending act altogether, instead of putting in ridiculous restrictions which mean basically the same thing. This is a tangible way of doing it, equivalent to Quebec’s cap on the annualized interest rate which made payday loans impossible in that province.

We know payday loans are an expensive way to access emergency cash. What this government consistently fails to do is to offer those in need of credit an alternative. Driving payday lenders away from the province won’t alone stem the demand for alternative credit; it will just direct it to the unregulated market.

I think we heard today on the news of a suicide of somebody who thought he was investing, as they call it, but it’s actually a form of gambling online by putting in what you’re going to sell it at, in advance. It’s completely unsecured investments. Somebody committed suicide because he lost $300,000, I believe it was.

We know that there’s online lending. In the old days, they used to call it loansharking. We have to recognize that there are people who need to access some kind of help in the short term, and quickly. The machines of government move very slowly, and that’s a difficult topic for us.

The Chair (Mr. Peter Tabuns): Mr. Rinaldi.

Mr. Lou Rinaldi: Just a question of clarification: I’m wondering whether this motion is out of order. It tends to open up sections of the Payday Loans Act, 2008, that are not part of Bill 59. It’s just a question of clarification.

The Chair (Mr. Peter Tabuns): I’ll ask legal counsel to comment.

Interjections.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Rinaldi. Between the Clerk and legal counsel—

Mr. Lou Rinaldi: It’s just a question. I could be wrong.

Interjections.

The Chair (Mr. Peter Tabuns): Thank you for asking. In fact, I’ve been advised that it is out of order.

I’m sorry, Mr. Singh, we won’t be able to proceed with it.

Mr. Jagmeet Singh: No problem.

Mr. Lou Rinaldi: Thank you, Chair.

The Chair (Mr. Peter Tabuns): You have an eagle eye, Mr. Rinaldi.

Mr. Lou Rinaldi: I won’t take full credit for that, Chair.

The Chair (Mr. Peter Tabuns): We go on, then, to NDP motion 13.2: Mr. Singh.

Mr. Jagmeet Singh: I will be asking for a recorded vote on this motion as well.

I move that schedule 2 to the bill be amended by adding the following section:

“21.3 The act is amended by adding the following section:

“‘Partial prepayment

“‘34.1 A borrower is entitled to pay part of the outstanding balance under a payday loan agreement at any time without any prepayment charge or penalty.’”

The Chair (Mr. Peter Tabuns): Mr. Singh, you wanted to comment?

Mr. Jagmeet Singh: Yes. We found that in terms of the difficulty that people are faced with when paying back a payday loan, it’s the requirement of having to pay back the entire principal and the fee/interest. This would allow a borrower to pay back in instalments, but without facing any penalty. That’s it.

The Chair (Mr. Peter Tabuns): Mr. Singh, I’ve been advised as well that this is out of order.

Mr. Jagmeet Singh: No problem.

The Chair (Mr. Peter Tabuns): A valiant try on your part.

Mr. Jagmeet Singh: The valiant effort for the fight for goodness.

The Chair (Mr. Peter Tabuns): Mr. Rinaldi?

Mr. Lou Rinaldi: I was hoping, actually, that we’d get unanimous consent. We would support it.

Mr. Jagmeet Singh: Let’s do it.

The Chair (Mr. Peter Tabuns): You’re asking for unanimous consent?

Mr. Jagmeet Singh: I’m asking for unanimous consent.

The Chair (Mr. Peter Tabuns): Yes, I now have legal counsel who would like to give some advice. Mr. Wood, please.

Mr. Michael Wood: Given that the Chair has ruled that the present motion would be out of order, I would suggest that, with unanimous consent, it would be legal for the committee to open up section 34 of the act and make the amendment in section 34, rather than create a new section. In fact, I have draft wording which I can show Mr. Singh.

Mr. Jagmeet Singh: I would love to take a look at that. That’s great, that’s great news.

The Chair (Mr. Peter Tabuns): Sure.

Mr. Jagmeet Singh: Perhaps we can make copies so that everyone could take a look at it.

The Chair (Mr. Peter Tabuns): Can we have a five-minute recess—people are agreeable?

Mr. Jagmeet Singh: I was actually going to ask for a 10-minute recess at one point. Can we just make that into 10 minutes? Is that okay for everybody? We’re zipping along.

The Chair (Mr. Peter Tabuns): If people are agreeable, we’re doing well in terms of schedule—a 10-minute recess?

Mr. Jagmeet Singh: Ten minutes.

The Chair (Mr. Peter Tabuns): Done. We are recessed.

The committee recessed from 1502 to 1512.

The Chair (Mr. Peter Tabuns): Members of the committee, we’re back in session. Mr. Singh, your motion was ruled out of order. I know that you’ve had a chance to talk with counsel. There was another motion that was put forward. I don’t know if you were planning to put it forward. You are? Please proceed, Mr. Singh.

Laughter.

Mr. Lou Rinaldi: While his mouth is full.

The Chair (Mr. Peter Tabuns): It’s dangerous to walk around with chocolate in this room.

Mr. Jagmeet Singh: Yes, sir.

The Chair (Mr. Peter Tabuns): You know that.

Mr. Jagmeet Singh: Thank you. Mr. Chair, you’re absolutely correct. I would love to put forward motion 13.3. I believe that all members have it. Thank you for the kind assistance of all parties who made this possible. I now will move this motion.

I move that schedule 2 to the bill be amended by adding the following section:

“21.1 Section 34 of the act is amended by adding ‘or any part of that outstanding balance’ after ‘agreement’.”

The Chair (Mr. Peter Tabuns): Mr. Singh, I understand that this is out of order, and it can only be debated if there is unanimous consent.

Mr. Jagmeet Singh: Right.

The Chair (Mr. Peter Tabuns): If you want to request unanimous consent, we’ll see if that’s what we have from the committee.

Mr. Jagmeet Singh: Yes, I would request unanimous consent to consider this motion.

The Chair (Mr. Peter Tabuns): Is there unanimous consent? There is.

Proceed, Mr. Singh.

Mr. Jagmeet Singh: Thank you all, once again.

This would allow, in effect, that people can pay back their loans in part, as opposed to having to pay back the entire amount, principal and fee all at once. Again, I would like to thank Mr. Rinaldi and all members present for their assistance in making sure that this was able to be brought forward.

The Chair (Mr. Peter Tabuns): Mr. Rinaldi.

Mr. Lou Rinaldi: Thank you, Chair. I’ll make it very brief. Obviously, we’ll be supportive of this.

The Chair (Mr. Peter Tabuns): Fine. Other commentary? You had asked previously for a recorded vote.

The Clerk of the Committee (Mr. Katch Koch): That was on the other one.

The Chair (Mr. Peter Tabuns): Yes. So, no further debate? All those in favour? Opposed? It is carried.

We now go to government motion 14: Ms. Mangat.

Mrs. Amrit Mangat: I move that subsection 35(1) of the Payday Loans Act, 2008, as set out in subsection 22(1) of schedule 2 to the bill, be struck out and the following substituted:

“No concurrent or replacement payday loan agreements

“(1) The lender under a payday loan agreement shall not enter into a new payday loan agreement with the borrower before the prescribed number of days have passed since the borrower has paid the full outstanding balance under the first agreement.”

The Chair (Mr. Peter Tabuns): Thank you, Ms. Mangat. Did you want to comment on that?

Mrs. Amrit Mangat: Yes, Chair. I recommend voting for this motion because our government believes that a waiting period between loans can be an effective means to protect consumers from entering into a cycle of debt.

The Chair (Mr. Peter Tabuns): Any further commentary? Mr. McDonell.

Mr. Jim McDonell: I guess I’m a little bit lost, because I don’t know how just entering a period of desperation into a time of—is going to do anything for the person, the consumer in this case. If they’re desperate enough for money to go through the payday loan system, forcing them into a waiting period does nothing to help them.

We are not seeing anything as far as counselling or any funding. We see people coming into our offices every day. They’re on social assistance; they get a surprise bill that may take a couple of pay periods to pay off, and they have no alternative. This is almost forcing them into dire straits, to do something they normally would not want to do. We just think that the government should be looking at the root causes.

The Chair (Mr. Peter Tabuns): Further discussion? Ms. Mangat.

Mrs. Amrit Mangat: Chair, the government would consult with stakeholders on what an appropriate waiting period between loans could be.

The Chair (Mr. Peter Tabuns): If there is no further discussion, we’re ready for the vote. All those in favour? Opposed? It is carried.

We go to government motion 15, then: Ms. Mangat.

Mrs. Amrit Mangat: I move that subsection 35(3) of the Payday Loans Act, 2008, as set out in subsection 22(2) of schedule 2 to the bill, be struck out and the following substituted:

“Same borrower, different lenders

“(3) No loan broker shall facilitate the making of more than one payday loan agreement between the same borrower and different lenders unless the prescribed number of days have passed since the borrower has paid the full outstanding balance under the first agreement.”

The Chair (Mr. Peter Tabuns): Thank you, Ms. Mangat. Any commentary?

Mrs. Amrit Mangat: Chair, I recommend voting for this motion.

The Chair (Mr. Peter Tabuns): Fine. Any other commentary? Mr. McDonell.

Mr. Jim McDonell: Yes. Again, we’re just forcing the consumer to go up the street or to another service. It’s not addressing the root causes of why so many people are using these services. We think that there needs to be more done to help these people who are resorting to payday loans.

The Chair (Mr. Peter Tabuns): Any further commentary? Ms. Mangat.

Mrs. Amrit Mangat: Chair, the motion removes the reference to a seven-day waiting period, and allows the waiting period to be entirely prescribed by regulation. The government would be consulting with stakeholders.

The Chair (Mr. Peter Tabuns): Okay, thank you. You’re ready for the vote? All those in favour, please indicate. Good. All those opposed? It is carried.

Now we go to the vote on this section. Shall schedule 2, section 22, as amended, carry? Opposed? It’s carried.

We now have section 23. There are no amendments there. We’ll go to the vote. Shall schedule 2, section 23, carry? Carry? Opposed? It is carried.

We now go to PC motion 16.

Mr. Lorne Coe: I move that paragraphs 17.1 and 17.2 of section 77 of the Payday Loans Act, 2008, as set out in subsection 24(2) of schedule 2 to the bill, be struck out.

To my colleague.

The Chair (Mr. Peter Tabuns): Yes, Mr. McDonell, please.

Mr. Jim McDonell: Yes. The government is trying to impose a cap on the amount of times a consumer can take out a payday loan within a one-year period. Again, denying the consumer access to emergency credit is not the solution. What we need to work towards is reducing and eliminating the need for people to resort to payday loans.

Our amendment removes an unfair cap.

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The Chair (Mr. Peter Tabuns): Any further commentary? Mr. Rinaldi.

Mr. Lou Rinaldi: Chair, I will recommend voting against this motion. The bill aims to make payday loans safer for consumers. This motion proposes to eliminate a tool to control repeat lending. This tool will also allow Ontario to require a payday lender to cut consumers off after they have borrowed repeatedly. It addresses the underlying incentive that contributes to repeat borrowing. Getting rid of this tool does not make payday loans safer and does nothing to address the problem of repeat borrowing. Thank you, Chair.

The Chair (Mr. Peter Tabuns): Further discussion? There being none, you’re ready for the vote? All those in favour? All those opposed? It is lost.

We go now to PC motion 17: Mr. Coe.

Mr. Lorne Coe: I move that subsection 24(3) of schedule 2 to the bill be struck out.

To my colleague.

The Chair (Mr. Peter Tabuns): Mr. McDonell.

Mr. Jim McDonell: This section of this bill is redundant. The minister’s power to exempt instalment loans and place conditions on this exemption already exists under subsection 77(3) of the Payday Loans Act: “exempting any person, entity or payday loan or class of persons, entities or payday loans from any provision of this act or the regulations and attaching conditions to an exemption.”

The Chair (Mr. Peter Tabuns): Thank you. Ms. Vernile.

Ms. Daiene Vernile: I’m going to recommend that we vote against this amendment. We heard through the consultation process at recent public hearings that the current lump sum payment model can make payday loans harder to repay. We also heard that repaying a loan over time in instalments helps consumers manage their debt better. It’s an approach that has proven very successful in other jurisdictions.

The Chair (Mr. Peter Tabuns): Thank you, Ms. Vernile. If there is no further discussion, we’re ready for the vote. All those in favour, please indicate. All those opposed? It is lost.

We go to PC motion 18.

Mr. Lorne Coe: I move that it be withdrawn, please.

The Chair (Mr. Peter Tabuns): Withdrawn?

Mr. Lorne Coe: Yes.

The Chair (Mr. Peter Tabuns): We go to PC motion 19.

Mr. Lorne Coe: I move that section 24 of schedule 2 to the bill be amended by adding the following subsection:

“(3.1) Paragraph 23 of section 77 of the act is repealed and the following substituted:

‘“23. providing a method for the Superintendent of Financial Services appointed under the Financial Services Commission of Ontario Act, 1997 to specify limits for the purposes of section 32 and prescribing those limits;”’

The Chair (Mr. Peter Tabuns): Commentary? Mr. McDonell.

Mr. Jim McDonell: This amendment would enable the minister to transfer the fee-setting power regarding payday loans to FSCO in a way that the minister sees fit. Again, transferring the fee-setting power from the minister’s office to an independent regulator would take the political calculations out of the process. It allows a body that’s already set up to review the requirement for the fees, if they can be lowered or if they have to be raised, to protect an industry that I think everybody agrees we would rather see not be necessary, but it is necessary. If it wasn’t, I’m sure the government would abolish it.

The Chair (Mr. Peter Tabuns): Thank you, Mr. McDonell. Mr. Rinaldi.

Mr. Lou Rinaldi: Chair, again, I would recommend voting against this motion. Retaining the ability to set a maximum cost to borrowing by regulation is an important feature of consumer protection in Ontario. The Superintendent of Financial Services does not currently have oversight over payday lending in Ontario, and the government wants to ensure that Ontario consumers are protected by having a maximum cost to borrowing that is among the lowest in Canada.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Rinaldi. Any further commentary? You’re ready for the vote? All those in favour, please indicate. All those opposed, please indicate. It is lost.

We now go to PC motion 20, Mr. Coe.

Mr. Lorne Coe: I move that subsection 24(6) of schedule 2 to the bill be struck out.

To my colleague.

The Chair (Mr. Peter Tabuns): Mr. McDonell.

Mr. Jim McDonell: This section of the bill grants the government a very broad power to ban the offering of any kind of service by locations that offer payday loans. Outlets today have a variety of products, including payday loans, cheque cashing, prepaid credit cards, money transfers etc. We do not see any reason to give the government the power to ban most, if not all, of those services from payday lending locations.

The Chair (Mr. Peter Tabuns): Ms. Vernile.

Ms. Daiene Vernile: I’m going to recommend voting against this motion because the government wants to protect consumers from harm. This motion that’s been brought before us would remove a provision that allows the Lieutenant Governor the ability to prescribe goods and services that payday lenders can’t offer. The government wants to maintain the ability to regulate other goods and services that payday lenders might offer.

The Chair (Mr. Peter Tabuns): Mr. McDonell.

Mr. Jim McDonell: Again, I state that the government is not looking at the root causes here. People come in with short-term requirements mainly because of issues with this government, issues where they’re getting hit with some really crazy bills, generally around energy. We have not seen solutions. I was talking on the weekend to somebody with an energy bill somewhere around $50, and his bill—

Ms. Daiene Vernile: Point of order, Chair.

The Chair (Mr. Peter Tabuns): Just a second. And your point of order is?

Ms. Daiene Vernile: Mr. McDonell is talking about energy costs, and I believe that we are voting—you’re talking about—

Mr. Jim McDonell: I’m talking about the reasons why you’d have to use a payday loan.

The Chair (Mr. Peter Tabuns): Yes.

Ms. Daiene Vernile: Okay. I feel that he’s talking about hydro rates, and that’s outside the scope of what we’re here to talk about.

The Chair (Mr. Peter Tabuns): Do you want to finish?

Ms. Daiene Vernile: Yes. I feel that Mr. McDonell is talking about hydro rates, and that’s outside the scope of what we’re here to do today.

The Chair (Mr. Peter Tabuns): As I heard Mr. McDonell, he was talking about the circumstances in which people seek payday loans, so I don’t see using an example as out of order. If he was talking about another piece of legislation, I would see value in your comment, but I think he actually is on point, using an illustration.

Mr. McDonell.

Mr. Jim McDonell: Thank you, Chair.

I know this is embarrassing for the government, but it’s a fact. We have people coming in needing emergency loans to cover bills, people who are trying to cut back—in this case here, a small energy cost of $50, but the bill is up over $300, $400. That’s something they don’t expect. They’re trying to cut back. They need an answer.

We find that still, last week in the riding, there are people being disconnected. They like to say, “No,” but it’s still happening. The charge to reconnect—they’d rather pay it up front to save that cost, because it’s huge. I think that by just denying that there’s—people need the help. They need the ability to get out and look after these bills before they become much more expensive.

The Chair (Mr. Peter Tabuns): Thank you. Other commentary? There being none, you’re ready to vote? Those in favour of this amendment? Those opposed? It is lost.

We go to PC motion 21. Mr. Coe.

Mr. Lorne Coe: I move that section 24 of schedule 2 to the bill be amended by adding the following subsection:

“(7) Section 77 of the act is amended by adding the following paragraph:

“‘33.2 requiring licensees to refer prescribed classes of borrowers to credit counselling or other prescribed services, in the prescribed manner;’”

To my colleague.

The Chair (Mr. Peter Tabuns): Mr. McDonell.

Mr. Jim McDonell: We know consumers who resort to multiple payday loans are in financial trouble and need to take action. Sometimes they need to be prompted or directed to services they may not know even exist. This amendment gives the government the power to ensure payday loan customers are informed of ways to take control of their debt and help that may be available to them to get their financial matters back in order.

The Chair (Mr. Peter Tabuns): Any other commentary? Ms. Mangat.

Mrs. Amrit Mangat: We recommend voting for this motion because this is supporting financial literacy, as well as ensuring consumers are aware of options to assist with financial management. That is an important objective, so we will be supporting this motion.

The Chair (Mr. Peter Tabuns): Fair enough. Further commentary? There being none, you’re ready to vote? All those in favour of the amendment, please indicate. All those opposed? It is carried.

With that, we go to vote on the section as a whole. Shall schedule 2, section 24, as amended, carry? Opposed? It’s carried.

We now go to NDP motion 21.1. Mr. Singh.

1530

Mr. Jagmeet Singh: I’ll be asking for a recorded vote on this motion as well.

The Chair (Mr. Peter Tabuns): Good. Okay.

Mr. Jagmeet Singh: I move that subsection 92.1(1) of the City of Toronto Act, 2006, as set out in section 25 of schedule 2 to the bill, be amended by striking out “may define the area of the city” and substituting “may require that advertisements or representations in respect of payday loan arrangements must include a prominent statement of the licensee’s annual interest rate and the chartered bank annual consumer loan rate and must set out all the types of amounts that may be included in the cost of borrowing in connection with a payday loan arrangement, define the area of the city”.

The Chair (Mr. Peter Tabuns): Any further commentary, Mr. Singh?

Mr. Jagmeet Singh: Yes. Just to get at the heart of the matter, one of the things that we’ve heard again and again is that people aren’t really aware of how much they’re really on the hook for when it comes to a payday loan. Providing an annualized rate of interest really clarifies just how much the interest rate will be for the payday loan.

In addition, the comparison with a chartered bank just draws home that this is a—for example, an interest rate of 300% annually versus 19% or 15% or 5%. You can create a bit of a comparison that way. This, specifically, would relate to the city of Toronto to provide that clarity, in the portion of the bill which refers to the city of Toronto.

The Chair (Mr. Peter Tabuns): Further commentary? Ms. Mangat.

Mrs. Amrit Mangat: I recommend voting against this motion because our government aims to make the payday lending marketplace safer, fairer and more informed, whereas the city of Toronto already has a broad business licensing authority, which may encompass the disclosures proposed in the bill.

The Chair (Mr. Peter Tabuns): Further commentary? Mr. McDonell.

Mr. Jim McDonell: The PC caucus opposes the amendment for two reasons. One, payday loan advertising signs are already micromanaged and regulated at the provincial level. There’s no need to impose another level of red tape on the providers. Moreover, flowing from this point, this amendment seeks to insert a provision into the City of Toronto Act that clearly doesn’t belong there.

The Chair (Mr. Peter Tabuns): Okay.

Mr. Jagmeet Singh: Just one additional comment.

The Chair (Mr. Peter Tabuns): Mr. Singh.

Mr. Jagmeet Singh: Just to clarify: Right now, the bill has a “may define the area of the city” power. This gives the city more power, so not only to define the area of the city, but also allow the city to require certain advertisements and representations requirements. This would give the city a heightened ability to protect consumers directly, giving the city more power to do so as well.

The Chair (Mr. Peter Tabuns): Ms. Mangat.

Mrs. Amrit Mangat: Chair, it’s very important that consumers have the right information at the right time so that they can make the right decisions, so we will not be supporting this.

The Chair (Mr. Peter Tabuns): Mr. Singh?

Mr. Jagmeet Singh: Ms. Mangat stated the defence of this motion, because that’s exactly what we want to do: We want to give the consumer the ability to have the right information and be able to make an informed decision. Then Ms. Mangat said that she would not be supporting the bill for that reason. I just want to point out that that’s exactly what this motion does. It gives more information and it gives more awareness to the consumer. It doesn’t actually give any less.

The Chair (Mr. Peter Tabuns): Ms. Mangat?

Mrs. Amrit Mangat: We would like to consult more on that, how to find out ways.

The Chair (Mr. Peter Tabuns): Okay. Further discussion? There being none, a recorded vote was requested.

Ayes

Singh.

Nays

Coe, Mangat, McDonell, Rinaldi, Vernile.

The Chair (Mr. Peter Tabuns): The motion is lost.

Mr. Singh, the next motion was dependent on the last one being successful.

Mr. Jagmeet Singh: Yes. I would ask that this motion be withdrawn as it was dependent on the previous motion.

The Chair (Mr. Peter Tabuns): Thank you, sir.

We go, then, to government motion 22. Ms. Vernile.

Ms. Daiene Vernile: I move that subsection 92.1(2) of the City of Toronto Act, 2006, as set out in section 25 of schedule 2 to the bill, be struck out and the following substituted:

“Exception

“(2) Despite subsection (1), a bylaw described in that subsection shall not prohibit the operation of all payday loan establishments in the city.

“Definition

“(3) In this section,

“‘payday loan establishment’ means any premises or any part of them in respect of which a licensee within the meaning of the Payday Loans Act, 2008 may operate a business pursuant to a licence issued under that act.”

Chair, I’m going to recommend that we accept this motion and vote in favour. The bill aims to make payday lending safer for consumers. We’ve heard that a high concentration of payday lenders in a particular neighbourhood has a very negative impact, and can put consumers at risk of repeat borrowing. Municipalities have asked for the authority to address these impacts and that’s what Bill 59 does.

The Chair (Mr. Peter Tabuns): Any further commentary? There being none, you’re ready for the vote? All those in favour, please indicate. All those opposed? It is carried.

We now go to the vote on the section as a whole. Shall schedule 2, section 25, as amended, carry? Opposed? It is carried.

We now go to NDP motion 22.1. Mr. Singh.

Mr. Jagmeet Singh: I’ll be asking for a recorded vote on this motion.

I move that subsection 154.1(1) of the Municipal Act, 2001, as set out in section 26 of schedule 2 to the bill, be amended by striking out “may define the area of the municipality” and substituting “may require that advertisements or representations in respect of payday loan arrangements must include a prominent statement of the licensee’s annual interest rate and the chartered bank annual consumer loan rate and must set out all the types of amounts that may be included in the cost of borrowing in connection with a payday loan arrangement, define the area of the municipality”.

The Chair (Mr. Peter Tabuns): Commentary, Mr. Singh?

Mr. Jagmeet Singh: Yes. Similar to the previous amendment, this is again to ensure that not just Toronto but all cities have the power to require advertisements and representations that disclose full transparency with respect to what the interest rates are on an annual basis and allow them to compare that to the going rates at banks, to give consumers the full impact of their decision and also to provide them with the information they need to make that decision in the first place.

The Chair (Mr. Peter Tabuns): Mr. Rinaldi?

Mr. Lou Rinaldi: I recommend voting against this particular motion. Some of the rationale is that the municipalities do not need us to specify how they can use their business licensing authority. Consumer information is not a local problem. The right way to deal with it is through provincial regulation. This lets us adapt to changing circumstances. That’s why the current Payday Loans Act, 2008, in its regulation, provides for disclosure, and it’s why Bill 59 will expand the authority to require disclosure.

The Chair (Mr. Peter Tabuns): Further commentary? Mr. McDonell.

Mr. Jim McDonell: This is already looked after—the signage. In addition, the bill talks about issues comparing banks to payday loans. They clearly aren’t the same thing. Payday loans are meant to go from payday to payday. Banks aren’t interested. If they were, then I think everybody here would agree that we’d want to walk away from this industry, but clearly, the banks aren’t interested. The credit requirements aren’t in keeping with what they look for. So this is a clientele that, because of a series of issues—it can be just a one-off, or it can be, as we hear throughout this bill, people whohave issues trying to survive on whatever support they get. It’s sad to say that in Ontario we need this type of industry, but of course, it’s clear that it is required.

The Chair (Mr. Peter Tabuns): There being no other commentary, a recorded vote was requested.

Ayes

Singh.

Nays

Coe, Mangat, McDonell, McMeekin, Rinaldi, Vernile.

The Chair (Mr. Peter Tabuns): The motion is lost.

Mr. Singh, your next motion was dependent on this one.

Mr. Jagmeet Singh: Yes, exactly. In this case, I will withdraw motion 22.2.

The Chair (Mr. Peter Tabuns): Thank you, Mr. Singh.

We go, then, to government motion 23. Ms. Vernile.

Ms. Daiene Vernile: I move that subsection 154.1(2) of the Municipal Act, 2001, as set out in section 26 of schedule 2 to the bill, be struck out and the following substituted:

“Exception

“(2) Despite subsection (1), a bylaw described in that subsection shall not prohibit the operation of all payday loan establishments in the municipality.

“Definition

“(3) In this section,

“‘payday loan establishment’ means any premises or any part of them in respect of which a licensee within the meaning of the Payday Loans Act, 2008 may operate a business pursuant to a licence issued under that act.”

The Chair (Mr. Peter Tabuns): Commentary?

Ms. Daiene Vernile: I’m going to recommend voting in favour of this motion because the bill aims to make payday lending safer for consumers.

The Chair (Mr. Peter Tabuns): Any further commentary? Mr. McDonell.

Mr. Jim McDonell: Just that we support the motion. Although it doesn’t allow municipalities to regulate these industries out directly, this bill, with all the regulations and what they’re proposing throughout the whole bill, is making the industry almost impossible to survive.

The Chair (Mr. Peter Tabuns): Other commentary? There being none, you’re ready for the vote? All those in favour of the amendment? All those opposed? It is carried.

With that, we go to the vote on the section as a whole. Shall schedule 2, section 26, as amended, carry? Carried? Opposed? It is carried.

We now go to section 27. Shall schedule 2, section 27, carry? Opposed? Carried.

Now we go to the schedule as a whole. Shall schedule 2, as amended, carry? Carried? Opposition? It is carried.

Colleagues, we now go back to the very beginning, and that’s the vote on sections.

Shall section 1 carry? Carried.

Shall section 2 carry? Carried.

Shall section 3 carry? Carried.

We go to the last section then. Shall the title of the bill carry? Carried.

Mr. Ted McMeekin: That’s my favourite part.

The Chair (Mr. Peter Tabuns): Pardon?

Mr. Ted McMeekin: That’s my favourite part.

The Chair (Mr. Peter Tabuns): I’m glad you have a favourite part.

Mr. Rinaldi?

Mr. Lou Rinaldi: A recorded vote on the last two items, please.

The Chair (Mr. Peter Tabuns): I’m sorry?

Mr. Lou Rinaldi: A recorded vote on the last two items.

The Chair (Mr. Peter Tabuns): Sure, no problem.

Shall Bill 59, as amended, carry?

Ayes

Coe, Mangat, McDonell, McMeekin, Rinaldi, Vernile.

The Chair (Mr. Peter Tabuns): It is carried.

Shall I report Bill 59, as amended, to the House? Recorded vote.

Mr. Lou Rinaldi: Sorry, skip the recorded vote.

The Chair (Mr. Peter Tabuns): Shall I report Bill 59, as amended, to the House? Yes? Opposed? Done.

Colleagues, thank you very much. It was productive. We’re done.

Mr. Lou Rinaldi: Good job, Chair.

The Chair (Mr. Peter Tabuns): Thank you all.

Mr. Lou Rinaldi: Great job, Chair.

The Chair (Mr. Peter Tabuns): Why, thank you, Lou.

The committee adjourned at 1540.

STANDING COMMITTEE ON SOCIAL POLICY

Chair / Président

Mr. Peter Tabuns (Toronto–Danforth ND)

Vice-Chair / Vice-Président

Mr. Jagmeet Singh (Bramalea–Gore–Malton ND)

Mr. Lorne Coe (Whitby–Oshawa PC)

Mr. Vic Dhillon (Brampton West / Brampton-Ouest L)

Mr. John Fraser (Ottawa South L)

Mrs. Amrit Mangat (Mississauga–Brampton South / Mississauga–Brampton-Sud L)

Mrs. Gila Martow (Thornhill PC)

Mr. Ted McMeekin (Ancaster–Dundas–Flamborough–Westdale L)

Mr. Lou Rinaldi (Northumberland–Quinte West L)

Mr. Jagmeet Singh (Bramalea–Gore–Malton ND)

Mr. Peter Tabuns (Toronto–Danforth ND)

Substitutions / Membres remplaçants

Mr. Jim McDonell (Stormont–Dundas–South Glengarry PC)

Ms. Daiene Vernile (Kitchener Centre / Kitchener-Centre L)

Clerk / Greffier

Mr. Katch Koch

Staff / Personnel

Mr. Michael Wood, legislative counsel