Finance Minister François-Philippe Champagne says he’s open to negotiations on a controversial section of the budget implementation bill that would grant new powers to cabinet to grant exemptions to some laws, but defended the changes as necessary to ensure Canada remains competitive.

Speaking to iPolitics before cabinet on Wednesday, Champagne said what the government is proposing would help create regulatory sandboxes to encourage innovation and is “something you find in other G7 jurisdictions.”

“But in the spirit of removing the obstruction that we’ve seen, I’m open minded to make sure that we move forward — we need to move forward,” he said.

Conservative House Leader Andrew Scheer said on Tuesday his party would help the government pass the budget implementation bill but only if it removes sections that he argued would give new powers to allow ministers to “ignore certain laws and regulations.”

He said those new powers would “prevent ministers from being able to completely circumvent the law without any kind of parliamentary oversight or scrutiny.”

“We know what happens when Liberals think no one’s looking. They have a long track record of funnelling cash to their friendly insiders and their political supporters,” Scheer said.

The massive bill brings in changes to laws to implement measures spelled out in last fall’s budget, the first under Prime Minister Mark Carney’s leadership.

A section of the bill amends the Red Tape Reduction Act to allow ministers to grant temporary exemptions from some laws in order to create or modify regulations to “encourage innovation, competitiveness or economic growth.”

The bill would give the minister the power to make an exemption if it was deemed to be in the public interest, the benefits outweighed the risks, an implementation plan had been developed and some oversight was in place.

The minister proposing the exemption would have to make their order public and disclose their reasoning

Heated committee exchanges

The Bloc Québécois accused the Liberals of hiding the proposal within the omnibus budget bill last fall. The section mostly flew under the radar until MPs sought more clarity in various House committees.

Conservative MP Sandra Cobena challenged Culture Minister Marc Miller Monday, saying the clause is problematic and could erode trust in the democratic process.

“I don’t find it reasonable for you to have the powers of a king, essentially,” she said.

Miller defended the clause, saying it would only be used sparingly and reasonably.

“To be quite clear, we don’t necessarily need them, but they are useful tools to have,” he said, adding that he wouldn’t be willing to remove it from the budget implementation bill.

Last week, Cobena posed the same questions to Transport Minister Steven MacKinnon, who wasn’t sure what clause the Conservative MP was referring to.

Upon clarification, he erroneously said it was related to Bill C-5, the Building Canada Act.

“That’s the law that we both voted for,” he told Cobena. “This is specifically designed at accelerating the progress and ability to move, plan, contemplate and build large projects.”

MacKinnon’s comments echoed that of Champagne, who told Conservative Mp Jasraj Singh Hallan in committee last week that the clause aligns with Conservative priorities.

“I’m sure business people watching this this morning are surprised, everyone thought in this country that the Conservatives would be business friendly, this is a request from the business sector,” he said. 

Countries like Germany have led the G7  in implementing regulatory sandbox policies, but their legislation is specifically tied to innovation, whereas Canada’s proposed law is much broader, including competitiveness and economic growth as grounds for exemptions.