1967-02-08

JUSTICE AND LEGAL AFFAIRS

[Stage Direction]
Fourth report of standing committee on justice and legal affairs-Mr. Cameron (High Park).
{Note: Text of the foregoing report appears in today's Votes and Proceedings.']


Hon. J. R. Nicholson (Minister of Labour):: Mr. Speaker, with the permission of the house I should like to table a new rental scale for public housing in Canada; and I suggest, if the house is agreeable, that it be appended to Votes and Proceedings.
I am not going to make an extended statement, but I think I should say that a number of provincial governments have expressed concern about the rent to income scale for public housing that has been in force in Canada without material change since 1962. Central Mortgage and Housing Corporation has given careful consideration to the matter, and the rent to income scale that I ask leave to table is the result. It provides for reductions in rent averaging $16 per month per unit.
I might say, Mr. Speaker, that Ontario, the province most directly affected by the new scale, agrees with the new scale and proposes to introduce it; and as I understand it, the responsible minister is tabling it this afternoon in the legislature in Toronto. The new scale is available immediately to all provinces wishing to adopt it in public housing projects.


Mr. Speaker:: Does the house agree to appending the document to which the minister referred to Votes and Proceedings?


Some hon. Members:: Agreed.



QUESTIONS

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)

Mr. Howard: 1.	How many community development officers are employed in the service of the government of Canada?
2.	Of these, how many are (a) of Indian status (b) of Indian origin, (c) of non-Indian origin?
3.	What is the salary paid to such officers and if the salary varies, how many such officials fall within each salary group by the categories (a), (b), and (c), in part 2 hereof?
4.	How many assistant community development officers are employed in the service of the government of Canada?
5.	Of these, how many are (a) of Indian status (b) of Indian origin (e) of non-Indian origin?
6.	What is the salary paid to such assistant officers and if the salary varies, how many such officers fall within each salary group by the categories of (a), (b), and (c) in part 5 hereof?
7.	Have any community development officers resigned and, if so, how many and what reasons were given in each case?
8.	Have any assistant community development officers resigned and, if so, how many and what reasons were given in each case?


Hon. Arthur Laing (Minister of Indian Affairs and Northern Development):: 1. 32.
2.	(a) 3; (b) 0;** (c) 29.
3.	(a) 1, $7,340 to $8,096; 2, $8,363 to $9,508. (b) 0. (c) 2, $6,206 to $6,962; 4, $6,804 to $7,497; 1, $7,340 to $8,096; 9, $7,696 to $8,777; 6, $8,363 to $9,508; 7, $9,127 to $10,653.
4.	18.
5.	(a) 18; (b) 0;** (c) 0.
6.	(a) 17, $4,434 to $5,052*; 1, $2,961 to $3,456. (b) 0. (c) 0.
7.	There have been three resignations by community development officers and the reasons given were: in one case to pursue further studies and in two cases personal reasons.
8.	No.
* As a result of the classification conversion program these salaries may be increased if the incumbents qualify to fill the established positions as amended. The salaries of this group, effective from October 1, 1965, would then be $4,627 to $6,085; and effective from October 1, 1966, $5,085 to $6,693.
**The term "of Indian origin" has been interpreted as "of Indian origin but not of Indian status."


COMMUNITY DEVELOPMENT OFFICERS
Mr. Howard: 1.	What is the name of each community development officer in the employ of the government of Canada, and upon what date was each appointed?
2.	What is the name of each assistant community development officer in the employ of the government of Canada, and upon what date was each appointed?

February 8, 1967
Questions


Arthur Laing: 1. Community development officers
Mr.	Name R. G. Helbecque	Date of Appointment 30-6-65
Miss M. M. Gillis		1-3-65
Mr.	J. E. McLaughlin	17-6-65Mr.	G. Rouleau	29-9-66Mr.	M. Coquet	13-8-65Mr.	J. N. M. Samson	21-3-66Mr.	G. T. Gambill	3-8-65Mr.	W. McFarlane	2-8-66Mr.	R. W. Priestman	1-12-65Mr.	G. Grant	5-4-65Miss F. Y. Osborne	15-2-66Mr.	P. W. Smith	15-7-65Mr.	J. K. Johnston	1-9-65Mr.	I. Beaulieu	2-7-65Miss M. M. Stott	1-4-65Mr.	G. C. Crockett	1-3-65Mr.	Z. Leszczynski	1-3-65Mr.	N. Gutnick	1-4-65Mr.	W. O. Lee	17-5-65Mr.	K. D. Uppal	5-7-65Mr.	A. Spence	1-10-65Mr.	T. R. Kelly	5-5-65Mr.	E. G. Russell	24-7-66Mr.	W. J. Wacko	26-2-65Mr.	G. Stewart	30-7-65Mr.	A. J. Karch	30-7-65Mr.	B. G. Holmes	15-12-65Mr.	A. McConnell	8-7-65Mr.	C. Thompson	4-1-66Mr.	R. J. C. Ford	5-4-65Mr.	O. A. Strong	1-4-65Mr.	W. Schroeder	2-7-652. Assistant community	developmentofficers Name Mr. A. Metallic	Date of Appointment 4-10-65Miss J. M. Hoff	31-12-65Mr. M. Noganosh	13-12-65Mr.	G. F. Hill	1-12-65Mr.	L. H. Smith	1-12-65Mr.	L. Redsky	1-12-65Mr.	C. Fisher	14-12-65Mr.	G. M. Guimond	10-9-65Mr.	G. Johnston	2-10-65Mr.	J. W. Whitehawk	1-11-65Mr.	W. M. Bellegarde	1-11-65Mr.	W. McDougall	12-10-65Mr.	E. Bellerose	4-10-65Mrs	. G. Mussell	23-12-65Mr.	E. B. Kelly	4-1-66Mr.	G. Manuel	4-1-66Mr.	T. Spinks	4-1-66Mr.	R. F. Joseph	4-1-66[Mr. Howard.)


AMNESTY TO PRISONERS DURING CENTENNIAL
Mr. Saltsman: In view of the intended visit of Her Majesty during Canada's centennial, does the government intend to grant amnesty to prisoners in federal institutions in honour of the occasion?


Hon. L. T. Pennell (Solicitor General):: It
is not intended to recommend that amnesty be granted to prisoners in federal institutions on the occasion of the forthcoming visit to Canada of Her Majesty the Queen. Amnesty was granted to prisoners on the occasion of Her Majesty's visit in 1959. However, on that occasion the Minister of Justice stated that, as the operations of the newly established National Parole Board became effective, so that every inmate thereafter would receive detailed consideration, under the process of automatic review, as to his eligibility for release prior to the termination of sentence, it was not anticipated that a general amnesty would be considered on the occasion of visits of Her Majesty to Canada thereafter. It is to be noted that all sentences in federal institutions are now in fact reviewed automatically by the National Parole Board and paroles granted in appropriate cases. Prior to the visit of Her Majesty in Canada in 1964, the Minister of Justice at that time stated in the House of Commons that, in view of the implementation of the Parole Act, it would not be proper that an amnesty be granted on the occasion of that royal visit, and none was granted. For similar reasons, therefore, the government of Canada will not recommend a grant of amnesty in connection with the Queen's forthcoming visit to Canada.


MONEY GIFTS TO FOREIGN COUNTRIES
Mr. Godin: 1.	During the last ten years, did Canada make any gifts of money to foreign countries?
2.	If so (a) what amounts were involved (b) on what dates were such gifts made (c) for what purposes were they made?


Hon. Paul Martin (Secretary of State for External Affairs):: 
STUDY OF HALIFAX HARBOUR
Mr. Forreslall: 1.	Is a land-waterfrontage study of Halifax harbour and Bedford basin presently being carried out by the Atlantic Development Board?
2.	If so, what are the terms of reference for such a study?
3.	When will it be completed?
4.	Will the study be made public and, if so, when?
5.	Who is conducting the study?


Hon. J. W. Pickersgill (Minister of Transport):: I am informed by the Atlantic Development Board as follows: 1. The board has engaged consultants to carry out a study of waterfront land for industrial uses of the Halifax harbour-Bedford basin area.
2.	The terms of reference are as follows:
1.	The consultant will perform, in a manner satisfactory to the executive director, the following, hereinafter called "the project": Prepare a master plan of land use for the Halifax harbour and waterfront area, as defined in paragraph 2 hereof. For this purpose,
the consultant will: (a) examine the role and future of the port of Halifax in relation to the economic development of the Atlantic provinces and to Canada's external and inter-regional trade; (b) carry out an inventory of existing land uses in the waterfront area and assess their present and prospective economic function. The possibility of alternative land uses will also be considered and will include a review of other uses which have been proposed; (c) examine the potential land needs of harbour-related industries in the Halifax area and in particular of industries requiring waterfront land; (d) determine the potential supply of waterfront industrial land. This will involve an assessment of the industrial land presently available within the area and the possibilities of further development by appropriate government agencies and/or private interests; (e) estimate the approximate cost of developing various sites, including the cost of site preparation and layout and the installation of necessary services; (f) make recommendations concerning the extent and location of

February 8, 1967
Questions
additional waterfront industrial land to be developed and the appropriate timing of such development, taking into account such other uses as may be found under (b) above to require waterfront location and the cost of development estimated under (e); (g) make recommendations concerning the desirability of reserving for future industrial development, whether by zoning regulations or other appropriate action, any areas for which such protection appears appropriate; (h) furnish preliminary engineering estimates and make recommendations for any further studies which appear to the consultant to be desirable in order to clarify issues, particularly of detailed engineering problems; (i) submit its final report in a form acceptable to the executive director not later than August 31, 1967; and (j) furnish the board with 75 suitably bound copies of its final report.
2.	The waterfront area to be examined extends from Sandwich Point on the Halifax side north to and around Bedford Basin and continuing on the Dartmouth side south to South-End Passage, and includes McNab, Lawlor and Devil's islands.
3.	In the performance of the project the consultant will: (a) make use of all existing relevant data and studies available from government and private sources; (b) review the development plans (including urban renewal proposals and transportation plans) of the county of Halifax and the cities of Halifax and Dartmouth as they relate to the waterfront; and (c) maintain continuous liaison with local government bodies as well as provincial and federal agencies, in particular the National Harbours Board.
3.	August 31, 1967.
4.	After receiving the report, consideration will be given to the question as to whether the report should be made public.
5.	Murray V. Jones & Associates Ltd. of Toronto.


PERSONNEL ADMINISTRATION SECTION CHIEF, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who is the chief of the personnel administration section of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?
[Mr. Pickersgill.l


Arthur Laing: 1. Mr. William Kenneth Derraugh.
2.	Since December 1, 1966.
3.	(1) Carleton University, B.A. (2) University Western Ontario, M.B.A. (3) two years Canadian Hospital Association, certificate in hospital organization and management.
4.	None.
5.	His duties and responsibilities are: "to act as personnel adviser to the director, Indian affairs branch and to provide advisory service to Indian affairs branch officials and staff; to be responsible for providing a general personnel administrator service to the divisions at headquarters and to regional directors; for providing a staffing and staff relations service; for determining and providing for staff requirements in relation to programming; for implementing staff appraisal and career development programs and for determining and providing staff training requirements." Mr. Derraugh reports to the director of Indian affairs.


PROFESSOR TOOMBS-EMPLOYMENT BY INDIAN AFFAIRS DEPARTMENT
Mr. Orlikow: 1.	Did Professor Farrell Toombs of the university of Toronto work for the Department of Indian Affairs and Northern Development, either as an employee or on contract?
2.	If so (a) when and for how long (b) what were his duties (c) to whom did he report (d) is Professor Toombs still working for the department, and if not for what reason?


Arthur Laing: 1. Yes, on contract.
2.	(a) Intermittently from October 8, 1964 to January 16, 1965 and continuously from January 16, 1965 to June 30, 1966. (b) To be responsible for the administration and coordination of fiscal, professional and institutional resources needed to introduce and operate a comprehensive training program in community development for departmental staff; to plan and organize training and screening procedures for new community development staff employed by the department; to maintain close liaison at a senior level with universities and with federal, provincial or private organizations who were current or potential users of community
February 8, 1967

development staff; to analyse training requirements in Indian communities; to coordinate and direct the preparation of training material in the Indian affairs context; and to perform other related duties, (c) Assistant deputy minister, Indian affairs branch, (d) No, the term of the contract authorized by Treasury Board expired.


CHIEF OF ESTATES DIVISION, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who is the chief of the lands-membership and estates division of the administration directorate of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?


Arthur Laing: 1. This position is vacant at the present time.
2.	N/A.
3.	N/A.
4.	N/A.
5.	N/A.


SUBSIDIES FOR FISHING VESSEL CONSTRUCTION
Mr. McQuaid: 1.	What requirements must be met before subsidies can be received under the Fishing Vessel Regulations, 1964, by those fishermen who built boats in the 35 foot to 45 foot class?
2.	How many inspections have been made in Prince Edward Island of boats in this class to determine eligibility for subsidy?
3.	How many inspectors are, or have been, employed in Prince Edward Island to do this work, and who are they?
4.	How many inspection reports have been received by the department and of those received how many (a) have been approved for payment (b) have been rejected?
5.	Of those approved for payment, how many have been actually paid since February 21, 1966, and to whom have the payments been made?


Hon. H. J. Robichaud (Minister of Fisheries):: 1. Vessel to be recommended for subsidy and application made to the federal Department of Fisheries by a provincial loan board under terms of a formal agreement entered into in accordance with the conditions and requirements of the fishing vessel assist-
Questions
ance regulations, 1964, under P.C. 1964-855 as amended; vessel to be of approved experimental design reflecting improvement over conventional types for the size class; vessel to meet provincial construction standards and Department of Transport regulations in so far as the latter apply; vessel to be registered with the Department of Transport; vessel to be adequately outfitted and equipped to show sufficient evidence of diversification capability over and above lobster fishing.
2.	107.
3.	4. Mr. Bruce Parsons, marine consultant, Halifax, Nova Scotia; Mr. Islay Mutter, shipwright consultant, Victoria, British Columbia; Mr. Murray Lusher and Mr. Dick Ross on the staff of the Department of Fisheries.
4.	107. (a) 9; (b) 64.
5.	Eight payments made to the fishermen's loan board of Prince Edward Island in behalf of: Thomas Gallant, Stanley Bridge, P.E.I., Richard Sencabeugh, Sturgeon, P.E.I., Emerson McLeod, Murray Harbour, P.E.I., Austin E. Doucette, Skinners Pond, P.E.I., Gerald Mills, Malpeque, P.E.I., Hanson Gerald Smith, Alberton, P.E.I., Rubin Frederick Wall, Malpeque, P.E.I., Ulric Arsenault, Tignish, P.E.I.


PAYMENT OF TAXES BY CROWN CORPORATIONS
Mr. Gregoire: 1.	Do provincial crown corporations pay (a) excise tax (b) the 11 per cent sales tax on building materials (c) other federal taxes?
2.	Have provincial crown corporations ever protested against the payment of taxes in their capacity as agents of the crown and, if so, what was the result of such protestations?


Hon. E. J. Benson (Minister of National Revenue and President of the Treasury Board):: 1. (a) and (b) Yes, however, under specified conditions they may qualify for refund pursuant to section 46, subsection (2) of the Excise Tax Act. (c) A corporation, not less than 90 per cent of the shares of which is owned by Her Majesty in right of a province or by a Canadian municipality, or a wholly owned corporation subsidiary to such a corporation, is exempt from income tax and old age security tax by virtue of section 62(l)(c) of the Income Tax Act.
2.	Yes. Such protestations are necessarily resolved within the provisions of the law.

February 8, 1987
Questions


PAYMENT OF BUILDING MATERIALS TAX BY CROWN CORPORATIONS
Mr. Gregoire: Do the crown corporations belonging to class D of the Financial Administration Act pay the 11 per cent tax on building materials?


Edgar John Benson: Yes.


INFORMATION DIVISION CHIEF, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who is the chief of the information division of the administration directorate of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?


Arthur Laing: 1. No
such position is established.
2.	Not applicable.
3.	Not applicable.
4.	Not applicable.
5.	Not applicable.


PERPETUAL BONDS
Mr. Watson (Assiniboia): 1.	How many private citizens bought government of Canada perpetual bonds in 1936?
2.	What percentage of these bonds are still held by private citizens?
3.	What percentage of these bonds are held by corporations?
4.	Will the government consider paying those held by private citizens?


Hon. Mitchell Sharp (Minister of Finance):: 1,	2 and 3: Since almost half of the issue of perpetual bonds was and is in bearer form, it is not possible to establish the percentage of the issue originally or presently held by private citizens or by corporations.
4.	As indicated on several earlier occasions in reply to similar questions, if the government were to redeem perpetual bonds held by private citizens, or by others, it would provide those who purchased the bonds at a substantial discount with a large windfall profit. Such action would be unfair to previous holders of perpetual bonds who had sold them at any appreciable discount. It would also [Mr. Benson.)
be discriminatory vis-a-vis holders of other government of Canada bonds which are quoted at a discount. If the issue were redeemed it would have to be refinanced at current market rates and this would involve an additional interest cost to the government of approximately $1,400,000 per annum.


RESIDENTIAL SCHOOL DIVISION CHIEF, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who Is the chief of the administration and residential school division of the education directorate of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?


Arthur Laing: 1. Mr. Paul Deziel.
2.	Since September 1, 1954.
3.	Academic qualifications, (a) University of Windsor, B.A.; (b) Ontario College of Education, high school teacher's certificate.
4.	None.
5.	His duties and responsibilities are: "Under direction to administer the capital program of federal school constructions; to develop standards for the operation of residential schools; to direct the program of pupil transportation; to administer regulations relating to public service living accommodation for teaching staff; maintain an inventory system covering furnishings and equipment in over 400 Indian day schools and 60 residential schools; to supervise staff; to assume responsibility for the operation of the directorate in the absence of the director." Mr. Deziel reports to the director of education.


CHIEF OF SPECIAL SERVICES DIVISION, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who is the chief of vocational training and special services division of the education directorate of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?
February 8, 1967


Arthur Laing: 1.	Mr. Lyman Jampolsky.
2.	Since August 6, 1964.
3.	Academic qualifications, (a) University of Alberta, B. Ed.; (b) University of Alberta B.A.; (c) University of Stanford, one year post graduate studies.
4.	Four years as principal of Cardston high school attended by Indians and non-Indians. Two years as supervising principal, Indian affairs branch, for the Blackfoot and Stony reserves in Alberta. Two years as district superintendent of schools for northern Alberta. Four years as regional superintendent of schools for British Columbia and the Yukon.
5.	His duties and responsibilities are: "Under direction to develop and administer a vocational training program; to analyse submissions from the field for the purposes of assessing the value and soundness of proposed projects in both the vocational training guidance, adult education and educational assistance program; to direct supervision of adult education and guidance services and the regional superintendents of vocational training in the development of regional programs; to direct special surveys and review and co-ordinate estimates." Mr. Jampolsky reports to the director of education.


SUPPORTING SERVICES DIVISION CHIEF, INDIAN AFFAIRS
Mr. Orlikow: 1.	Who is the chief of the supporting services division of the administration directorate of the Department of Indian Affairs and Northern Development?
2.	How long has he held the position?
3.	What are his academic qualifications?
4.	What is his previous experience in working with Indians either in the department or elsewhere?
5.	What are his duties and responsibilities and to whom does he report?


Arthur Laing: 1. Mr. Marcel George Jutras.
2.	Since August 1, 1966.
3.	Academic qualifications, (a) four years of high school.
4.	Five years in clerical and field work at the Cowichan agency, B.C. Ten years as superintendent of Indian agencies in the Babine agency, B.C., Yukon agency and File Hills-Qu'Appelle agency in Saskatchewan. Five years as assistant regional supervisor, Indian agencies, Edmonton, Alberta.
Questions
5.	His duties and responsibilities are: "He is responsible for the organization, administration and efficient operation of the supporting services section, comprised of the trusts and annuities, management of records and paperwork, supplies and inventory, and the transcribing services section; to supervise and direct activities related to the administration of Indian moneys and develop procedures and systems which will facilitate the transfer of such administrative functions and responsibility to elected band councils; to analyse and co-ordinate requests for changes in field organizations; to develop standards and evaluate performance within the four sections; to maintain liaison with other government departments." Mr. Jutras reports to the director of administration.


SALES TAX ON CHILDREN'S SPORTS EQUIPMENT
Mr. Barnett: 1.	Is the federal sales tax required to be paid on children's sportswear and sports equipment?
2.	If so, at what rate?


Edgar John Benson: 1. Yes.
2. 12 per cent; prior to January 1, 1967, 11 per cent.


ADHERENCE BY CANADA TO UNESCO TREATY
Mr. Stanbury: 1.	Is Canada a party to the UNESCO treaty (sometimes referred to as the Florence agreement) concerning trade in educational, scientific and cultural materials?
2.	If not (a) for what reason (b) will the government give consideration to Canada becoming a party to this treaty?


Hon. Paul  Marlin@Secretary of Stale for External Affairs: In so far as the Department of External Affairs is concerned: 1. No.
2. Although the Florence agreement is commendable so far as it goes, it does not provide for the removal of non-tariff barriers which are by far the most important obstacles to Canadian exports of educational, scientific and cultural materials. These barriers consist of quantitative import controls and particularly protective restrictions embodied in the copyright laws of some of our major trading partners. The agreement requires only the removal of tariffs. On this point Canada already provides duty free entry

February 8, 1967
Questions
under the Tariff Act for most of the categories of materials covered by the agreement. The remaining tariffs are quite moderate.
It would therefore be of doubtful value at this time for Canada to abandon the limited protection of the residual tariff without a corresponding reduction in the most important form of protection, non-tariff barriers, employed by other countries. The unilateral removal of these Canadian tariffs would achieve little in terms of improved access for Canadian exports of educational, scientific and cultural materials and would not confer substantial benefits to the Canadian consumer.
At the same time the importance and value of the Florence agreement as a means of furthering cultural and scientific exchanges among member countries are fully recognized and the question of eventual Canadian adherence to the agreement is kept under continuing review.


CUSTOMS TARIFF ON IMPORTED CARS
Mr. Langlois (Meganlic): 1.	What are the customs tariffs on cars imported from (a) the United States (b) Great Britain (c) France, (d) Belgium?
2.	If the tariffs vary, what is the reason?


Edgar John Benson: 1. Automobiles imported under the regular provisions of the Customs Tariff are subject to the following rates of duty: (a) 17J per cent ad valorem; (b) free; (c) 17J per cent ad valorem; (d) 17J per cent ad valorem.
Automobiles imported by a manufacturer entitled to use tariff item 95001-1: free of duty from the countries named.
2. (a), (c) and (d) are under the most favoured nation tariff; (b) is under the British preferential tariff.
Importations free under item 95001-1 can be made only by a manufacturer who qualifies under the item.


FIRE DAMAGE TO FERRY ''AMBROSE SHEA&quot;
Mr. Muir (Cape Breton: North and Victoria):
1.	What was the total estimated damage as a result of fire to the vessel Ambrose Shea now being constructed at Marine Industries Limited?
2.	Was an investigation carried out to determine the cause of this fire and, if so (a) what decision was reached as to the cause (b) who carried out such an investigation?

3.	As a result of this fire and damage to the vessel under construction, will the cost of construction exceed the original contract amount?
4.	What was the original amount of the contract for the construction of the Ambrose Shea submitted by Marine Industries Limited?
5.	What were the names and amounts of all others who tendered for the construction of this vessel?
6.	What was the original estimated date of delivery of this vessel?
7.	As a result of the fire, what is the new estimated date of delivery?
8.	When is it expected that the Ambrose Shea will go into service between North Sydney, Nova Scotia and Newfoundland?
9.	Will the Ambrose Shea carry general cargo, automobiles, trucks or railway box cars between North Sydney, Nova Scotia, and Newfoundland?


Mr. J. A. Byrne (Parliamentary Secretary to Minister of Transport):: 1. The total estimated cost of the damage repairs is $4,000,000.
2.	Yes. (a) the cause has not been definitely established; (b) Amyot, Bohl & Associates, consulting engineers, Montreal, P.Q.
3.	Damage repairs will be to marine underwriters' account and the contract cost of the vessel will not be exceeded.
4.	$11,779,239.50.
5.	Port Weller Dry Dock Co., $12,131,705; Canadian Vickers Ltd., $12,288,548; Davie Shipbuilding Ltd., $12,456,000; Collingwood Shipyards, $12,910,000; Halifax Shipyards, $16,467,961.
6.	June 30, 1967.
7.	November, 1967.
8.	November, 1967.
9.	Passengers, automobiles, and trucks between North Sydney, Nova Scotia and Argen-tia, Newfoundland.


INDUSTRIAL DEVELOPMENT BANK LOANS, RIMOUSKI COUNTY, QUE.
Mr. LeBlanc (Rimouski): 1.	How many loans were granted by the Industrial Development Bank during 1965-66 in the constituency of Rimouski?
2.	What is the total amount of these loans?


Mitchell William Sharp: 1 and 2. The annual report of the Industrial Development Bank for the year ended September 30, 1966, contains information regarding the number and amount of loans by size, by province and by type of business. A further breakdown of the information is not a matter of public record.
February 8, 1967


NEW FERRY, PRINCE EDWARD ISLAND-NEW BRUNSWICK
Mr. Macquarrie: 1.	When is it expected that the new car ferry for the Prince Edward Island-New Brunswick service will be in operation?
2.	What was the previously announced target date for completion?
3.	What factors have caused the delay?
4.	What steps are being taken to minimize the delay?


James Allen (Jim) Byrne: 1. June, 1968.
2.	September, 1967.
3.	Electrical engineering and manufacturing problems during construction have resulted in considerable delay in delivery to the shipbuilder of the main diesel electric propulsion system.
4.	Constant liaison is being maintained with the main propulsion supplier by the director, shipbuilding branch of the Department of Transport in a continuing effort to improve upon delivery schedules.


TRANS-CANADA HIGHWAY, MONTREAL TO ONTARIO BOUNDARY
Mr. Isabelle: 1.	What was the cost of the section of the trans-Canada highway between Montreal and the limits of the province of Ontario, (highway No. 17)?
2.	What amount did the government of Canada contribute toward the construction of this highway?
[Translation1


Hon. G. J. Mcllrailh (Minister of Public Works):: 1. and 2. The shareable cost of trans-Canada highway construction is limited to the cost of the two-lane highway provided for in the trans-Canada highway agreements. This department keeps records only for those costs which are shareable under the agreements.
The following figures cover the trans-Canada highway section from the Western limits of the Ile-aux-Tourtes bridge to the limits of the province of Ontario: Total shareable costs approved to date, $11,142,933. Total estimated federal share, $7,218,424. Total federal payments to date, $5,044,332.


TRANS-CANADA HIGHWAY, QUEBEC TO MONTREAL
Mr. Isabelle: What was the cost of the Quebec city to the Montreal section of the trans-Canada highway and what was the contribution made by the government of Canada for the construction of this highway?
Questions
Hon. G. J. Mcllrailh (Minister of Public
Works): The shareable cost of trans-Canada highway construction is limited to the cost of the two-lane highway provided for in trans-Canada highway agreements. This department keeps records only for those costs which are shareable under the agreements.
The following figures cover the trans-Canada highway section from the point of access to the Quebec bridge, to the southern limits of the Louis Hyppolite Lafontaine bridge-tunnel: Total shareable costs approved to date, $64,463,979. Total estimated federal share, $32,796,399. Total federal payments to date, $26,942,564.


INVESTIGATION INTO DESIGN OF P.E.I. CAUSEWAY
Mr. Macquarrie: 1.	Has any department of the government commissioned O. J. McCulloch to investigate any aspect of the proposed design of the Northumberland strait crossing?
2.	Has any report of an investigation by Mr. McCulloch been made available to any department of the government?
3.	If so, what was the source of such information?
4.	Has the government of Prince Edward Island suggested any alterations in the proposed design for the Northumberland crossing?


George James McIlraith: 1. No.
2.	Mr. O. J. McCulloch sent a commentary to the Department of Public Works in July, 1966. A revised version of that commentary, under the title "Report to the Department of Public Works on the construction proposed for Prince Edward Island Crossing" was received on February 6, 1967.
3.	Mr. O. J. McCulloch.
4.	No.


FEDERAL PARTICIPATION IN B.C. TRADE FAIR
Mr. Groos: Does the Department of Trade and Commerce intend to participate in the fourth British Columbia International Trade Fair to be sponsored in May of 1967, by the government of British Columbia and, if so, what form will the participation take?


Mr. Jean-Charles Canlin (Parliamentary Secretary to Minister of Trade and Commerce):: Yes. The Department of Trade and Commerce and the centennial commission are collaborating in an information exhibit combining the themes of Canada's centennial and Canada's international trade.

February 8, 1967
Questions


SALES OF N.H.A. MORTGAGES
Mr. Bell (Carleton): 1.	How many mortgage sales of N.H.A. mortgages have been conducted by Central Mortgage and Housing Corporation and on what dates?
2.	What was the total amount of mortgages sold at each such sale?
3.	What plans has the government or Central Mortgage and Housing Corporation for further sales of N.H.A. mortgages?


John Robert (Jack) Nicholson: 1 and 2. Fourteen offerings have been made; one in June, 1962 was withdrawn. A total of $304.75 million was sold in the 13 completed auctions. Particulars of the auctions are shown below:
	Mortgage Interest	Sold
	Rate	Amount
Date	%	($ million)1961 June	6f	12.50Aug.	6*	13.50Nov.	63	15.001962 Mar.	6	15.00Nov.	6|	11.756	18.251963 Jan.	63	11.006	16.25May	63	14.506	20.501964 Feb.	63	7.756	17.25May	6i	10.256	14.75Sept.	6i	8.506	16.50Dec.	6i	9.006	16.001965 Mar.	61	14.006	16.00May	61	13.506	13.00304.75
3. Central Mortgage and Housing Corporation expects to resume sales by auction later this year.


MOTIONS FOR PAPERS
Mr. Albert Bechard (Parliamentary Secretary to Secretary of State):: Mr. Speaker, would you please call motions 191 and 193?
I ask that the remaining notices of motions be allowed to stand.


Mr. Knowles:: Could these motions stand, Mr. Speaker?


Mr. Speaker:: Stand.


CANADIAN CENTENNIAL
[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, I trust you will allow me to bring to the attention of the Prime Minister of Canada a message of true Canadianism sent to me by the student body of the General Brock School in Vancouver, the classes of which visited the centennial train. These youngsters objected strongly that Her Majesty's portrait is not displayed in any part of the centennial train. I ask the Prime Minister to bring this to the attention of the authorities. Canada is a monarchy. Her Majesty's picture should be in any train representing Canada.


Right Hon. L. B. Pearson (Prime Minister):: This is the first I have heard of this matter. I shall look into it immediately. It is most appropriate, of course, to have a picture of the Queen of Canada in our centennial train. I shall look into the matter at once.


Mr. David MacDonald (Prince):: A supplementary question, Mr. Speaker. I wonder if the minister would also investigate reports that the historical narratives are different in French and English. Might we have one authentic history in both languages on this occasion?


Lester Bowles Pearson: Yes, Mr. Speaker; I shall be glad to look into that matter too.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquitlam):: May I direct a question to the Secretary of State for External Affairs. Considering that a cease fire for the four days of the new lunar year has been arranged in Viet Nam, and considering that the Viet Cong have shown a willingness to extend this cease fire to seven days, I ask the minister whether the government of Canada has made representations to both sides to extend still further this cease fire, that a climate might be created within which it will be possible to carry on effective negotiations.


Paul Joseph James Martin: Mr. Speaker, it would be a very happy circumstance if the truce, now limited to four days, were extended not only
February 8, 1967	COMMONS
to seven days but tor an even longer period. Suggestions of that kind have been made in the ways we believe appropriate. We think this is the most effective course.


Thomas Clement (Tommy) Douglas: A supplementary question, Mr. Speaker. Considering the widespread interest and concern in this matter, can the minister not say whether representations have been made to Hanoi and Washington? If so, have they been made through diplomatic channels, through the international control commission, or both?


Mr.   Marlin@Essex East: I prefer to say that the answer I gave is stronger than any specific answer that my hon. friend may expect to the question he asks.


Thomas Clement (Tommy) Douglas: A further supplementary
question, Mr. Speaker. Considering that all people will suffer if the conflict in Viet Nam escalates into a major war, does the minister not feel there is value in mobilizing public opinion to extend the cease fire? Would it not be helpful if the people of Canada and the peoples of the world knew to whom the representations I referred to were being made, and what the reaction was to those representations?


Mr.   Marlin@Essex East: I can well understand the hon. gentleman's feelings in the matter. I am sure he will understand that we are no less interested in this situation, and we have taken the steps which we believe will be most effective in achieving the result which I hope will be realized.


Mr. Raymond Langlois (Meganlic):: Mr. Speaker, I should like to put a question to the Secretary of State for External Affairs.
Could the minister explain to the house and to the Canadian people how a cease-fire agreement can be reached for three or four days and the hostilities resume afterwards?


Mr. Speaker:: It would be difficult, I think, to answer that question. I do not feel it is in order.



INCOME TAX


[Stage Direction]
On the orders of the day:
Mr. Real Caouelle (Villeneuve):: Mr. Speaker, I wish to direct my question to the Minister of National Revenue and President of the Treasury Board.
Inquiries of the Ministry
I have here a copy of the income tax forms sent to the taxpayers in the province of Quebec. Many people complained to me because the forms they received are in English only. I would therefore ask the minister to use bilingual forms, should it be impossible for his department to send French forms to Quebec, so that the people in Quebec can read them in French and the people in the other provinces can read them in English.
Is the minister prepared to do something along those lines?


Edgar John Benson: With six and a half million tax forms to deal with each year it is inevitable that a few mistakes will be made in sending out the forms. However, we have a rule that in cases where a person files a French tax form in a particular year, he or she will receive a French tax form in the succeeding year. Similarly, when a person files a tax form in English, an English tax form will be sent the following year. When errors occur we are very sorry but, as I say, when the department is dealing with six and a half million taxpayers it is inevitable that some errors will be made.


David Réal Caouette: A supplementary question, Mr. Speaker.
I know from personal experience that until last week, there were only English forms at the Rouyn post office; it was only last week that the French forms were received. Why were the English forms sent to the Rouyn post office two or three weeks earlier than the French forms? I would like the minister to reply to this point: would it not be possible to have bilingual forms? The mistakes referred to by the minister would thus be avoided.


Edgar John Benson: One of the things we have been trying to do is to simplify these tax forms.


Some hon. Members:: Oh, oh.


Edgar John Benson: The tax legislation is difficult enough in Canada without our trying to issue the forms in both languages so they will be twice as long for people to consider. Everyone in Canada who has filed a previous tax return is sent a tax return addressed to him personally. The tax return forms sent to the various post offices are intended for people
12792	COMMONS
Inquiries of the Ministry who for some reason have not previously filed, and we send these out ordinarily, as they are available, in French and in English to post offices where they are required.


Mr. Speaker:: Order. The hon. member has already taken up five of the thirty minutes we have for the question period today. I feel it would not be fair to the other members if this discussion were allowed to continue. The hon. member knows that, according to standing orders, supplementary questions are under the exclusive control of the Chair. It is felt that a supplementary question should not be allowed at this time.


David Réal Caouette: Mr. Speaker, you allowed earlier the hon. member for Burnaby-Coquitlam (Mr. Douglas) to put four brief supplementary questions. I am only asking my third one, which would take only a few seconds, and everything would be over.


Mr. Speaker:: The hon. member for Vil-leneuve might perhaps take up the matter again later on.


David Réal Caouette: Mr. Speaker, I should like to come back to the supplementary question I wanted to put to the Minister of National Revenue.
Several accountants are complaining at this time that they have difficulty in obtaining forms from the department. A sufficient number of forms is not being sent to meet the demand in their areas.
Is the department in a position or making arrangements to have such forms readily available for the accountants? As a second part to my question a while ago the minister referred to simplification of the forms. Does he not feel that the best way to simplify would precisely be to remove income taxes?


Edgar John Benson: Mr. Speaker, if the hon. member will direct my attention to those places where accountants are unable to obtain forms I will be glad to look into the situation. If the hon. member will also indicate to me how the government of Canada can operate without imposing income tax, I should like to hear that also.


Mr. Speaker:: Order, please.
[Mr. Benson.)
DEBATES	February 8, 1967



INDUSTRY


[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Ontario):: I wish to address a question to the Minister of Industry. In view of the announced intention of General Motors to permanently lay off 100 more employees, and the serious effect of these lay-offs upon the lives of the workers who are displaced, does the hon. gentleman not think it advisable to establish a committee and refer the question of the auto pact to that committee so we might be able to find out why these people are being laid off on a permanent basis, and why work is being reduced?


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, this morning a delegation of the United Automobile Workers had a very long and very profound discussion with three government members concerned with the matter. The group was assisted by the distinguished Secretary of State for External Affairs (Mr. Martin)-


Michael Starr: It must have turned out to be a heck of a mess.


Charles Mills (Bud) Drury: -whose presence, while it contributed largely to the success of the meeting, turned out to be perhaps not as important as it might otherwise have been, in that the discussion was related mainly to the problem of Oshawa.
It was agreed that the difficulties facing those who have been laid off in quite substantial numbers in Oshawa are indeed great, and the Minister of Manpower and Immigration (Mr. Marchand), the Minister of Labour (Mr. Nicholson) and I assured the delegation that in the light of the facts they brought forward we on our part would see what steps could be taken as a matter of urgency to deal with the situation.
I outlined to them some of the parameters of the automobile agreement, and in particular pointed out that as of January this year, in relation to the operation of the automotive agreement as a whole, the levels of activity in this field were substantially in excess of the levels achieved in 1964, the year before the pact came into existence. Indeed, above the level of 1964 there was an increase represented by 60 per cent of the total increase in the Canadian market, plus a further $197 million-
February 8, 1967


John George Diefenbaker: Just what is this?


Some hon. Members:: Oh, oh.


Michael Starr: Just a lot of nonsense.


Mr. Speaker:: Order.


John George Diefenbaker: This nonsense should not be permitted.


Michael Starr: I ask the minister a supplementary question-


Mr. Speaker:: Order. There seems to be agreement in the house that the answer given by the minister is perhaps too long and the information which he is seeking to convey might have been better conveyed by way of ministerial statement. However, I understand the hon. member for Ontario has a supplementary question.


Michael Starr: In view of the fact that the 3,000 permanently laid off workers in Oshawa are not interested in the minister's propaganda, will he on behalf of the government definitely decide to set up a commission to find out why they have been laid off?


Lester Bowles Pearson: It isn't a commission they want; it's work.


Mr. Eric A. Winkler (Grey-Bruce):: Mr. Speaker, I have a supplementary question for the Minister of Trade and Commerce. I would ask him to see to it that no further steps are taken to enter into free trade agreements with the United States until the Canadian people and their interests have been served.


Paul Joseph James Martin: That is not a question.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I should like to direct a supplementary question to the Minister of Industry. If the government is not willing to set up a parliamentary committee to look into the effects of the automobile agreement upon workers, will the government at least set aside a day next week when the minister, and whatever other ministers want to, will report to the house on what measures they intend to take to help the workers, in order to give the house an opportunity to hear all the information, an opportunity such as we do not have at the present time?


Michael Starr: That is a negative approach. We want the lay-offs stopped.


Charles Mills (Bud) Drury: Mr. Speaker, I would derive much more pleasure than some members on
Inquiries of the Ministry the other side of the house from an opportunity to outline the benefits which have been flowing from this agreement to Canada-


Some hon. Members:: Hear, hear.


Michael Starr: Stop this nonsense. Tell that to the 3,000 people laid off because of your phony auto pact.


Lester Bowles Pearson: You don't want to listen to
the facts.


Paul Joseph James Martin: You should listen.


Mr. Speaker:: Order.


Michael Starr: You keep out of it, because you will only mess it up like you did external affairs.


Mr. Speaker:: Order, please. The hon. member for Burnaby-Coquitlam.


Thomas Clement (Tommy) Douglas: Mr. Speaker, may I ask the
Minister of Industry if he will answer my question. I did not ask him if he would make a statement on the general question of the auto agreement. I asked him if he or some of his colleagues would make a statement as to what steps the government intends to take to alleviate the adverse effects which this agreement has had on many of the workers not only in Oshawa but in other parts of the auto industry.


Charles Mills (Bud) Drury: Mr. Speaker, when I was about
to answer the supplementary question I was interrupted. I would be glad to discuss with my colleagues the possibility of doing this next week.


Mr. A. D. Hales (Wellington South):: Mr. Speaker, I have a supplementary question for the Minister of Industry. Did the minister discuss with the U.A.W. officials the reason that cars made in Canada and exported to the United States are sold there for $400 to $500 less than the same car is sold for here in Canada?


Charles Mills (Bud) Drury: No, Mr. Speaker, that was not
discussed.


An hon. Member:: Why not?


Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I am wondering, when the minister is looking into this matter, whether he would extend the ambit of his investigation into other related industries in places other than Oshawa. I am informed that many people in the textile industry and other industries in my constituency have been laid off because of the same thing.
February 8, 1967

Inquiries of the Ministry


John George Diefenbaker: What about Windsor?


Mr.   Marlin@Essex East: The employment situation has never been better in Windsor.


Mr. Speaker:: Order.


John George Diefenbaker: Mr. Speaker, an interruption was just made by the Secretary of State for External Affairs in respect of these widespread lay-offs in the automobile industry. He had better get up to date on the facts when he says this does not apply to Windsor. What particular measures were taken there which were not taken elsewhere?


Mr.   Marlin@Essex East: Mr. Speaker, compared to Oshawa, Windsor has a good representative.


Mr. Speaker:: Order. The Chair is very grateful that there are only 30 minutes for questions today.



INQUIRY OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to address a question to the right hon. the Prime Minister based on a sudden outburst by the premier of British Columbia in the legislature of British Columbia yesterday. Can the Prime Minister inform the house whether the premier of British Columbia has any recent basis for the statement he made in the British Columbia legislature yesterday in which he branded the Liberal party as an enemy to Canadian confederation?


Mr. Speaker:: Order, please. The question is out of order.



TEXTILES-EFFECT OF POSSIBLE IMPORTS FROM AUSTRALIA

[Stage Direction]
On the orders of the day:
Mr. Maurice Allard (Sherbrooke):: Mr. Speaker, I should like to put a question to the Minister of Trade and Commerce.
On January 17, in this house, I asked him about the intention of Australian manufacturers to glut the Canadian market with textile products, and the steps which should be taken to prevent such a threat. The minister took my question as notice. Would he be in a position to give me an answer today?
[Mr. Nesbitt.)


Hon. Robert Winters (Minister of Trade and Commerce):: Mr. Speaker, since the hon. gentleman asked the question, I believe on January 17, I did write him and gave him the information available to us. I have been looking into the matter since and I find that the amount of textiles being imported into Canada from Australia is only in the order of some $30,000 a year, and that is in a particular class of textile related to high fashion. If the hon. member has any specific instance he would like to bring to my attention, I would be glad to take up the matter with my appropriate colleagues.



TRANSPORTATION


[Stage Direction]
On the orders of the day:
Mr. J. M. Forreslall (Halifax):: Mr. Speaker, perhaps the Minister of Transport, who is bereaved today because of Moby Joe, would permit me to ask whether the report of the special study on maritime transportation is now in his hands, and if so when we might expect to have it before us in the house.


John Whitney Pickersgill: Mr. Speaker, the answer to the question is that it is not in my hands.


J. Michael Forrestall: Mr. Speaker, I have a supplementary question which perhaps I should have asked earlier. The Minister of Transport advised us that he does not have the special transportation study in his hands. I am wondering Whether he will stop pussyfooting-


Mr. Speaker:: Order, please.



ESTABLISHMENT OF RESEARCH INSTITUTE BY HYDRO QUEBEC

[Stage Direction]
On the orders of the day:
Hon. E. D. Fulton (Kamloops):: Mr. Speaker, I should like to ask the Minister of Energy, Mines and Resources whether he has had an opportunity to look into the question I asked him yesterday concerning the possible assistance by the government of Canada to the research institution which is to be established by Quebec Hydro.
February 8, 1967


Hon. Jean-Luc Pepin (Minister of Energy, Mines and Resources):: Mr. Speaker, I inquired this morning and I can say there has been no official correspondence in respect of this matter.


Edmund Davie Fulton: The minister said there was no official correspondence. I should like to ask him whether there have been any official contacts, approaches or considerations made in respect of the matter of federal assistance or co-operation.


Jean-Luc Pepin: Mr. Speaker, I should like to repeat my request of yesterday for more time in order to fully answer the question.



AIR POLLUTION


[Stage Direction]
On the orders of the day:
Jean-Luc Pepin: Mr. Speaker, perhaps I could answer the other question posed to me yesterday by the hon. member for Kamloops having to do with the SO2 content at the INCO plant at Sudbury. Officials are aware of the allegations that have been made and I understand that the environmental health division of the Department of National Health and Welfare is making inquiries in this regard. As you may know, I am responsible only in respect of water pollution, not in respect of air or soil pollution.


Edmund Davie Fulton: Mr. Speaker, I have a supplementary question. Will the minister give consideration to the suggestion made in the Ontario legislature that this government take the initiative in working out an acceptable national standard of measure in the anti-air pollution field, and will the minister refer this matter specifically to the council of resource ministers?


Jean-Luc Pepin: I intended at first to give that information, Mr. Speaker, but the Chair is quite severe on us in respect of long answers. The short answer is yes. Last November a conference was held in Montreal on air, land and water pollution. The results of that conference have now been compiled and at the next meeting of the council of resource ministers on May 5 this will be studied. I hope a cleaner understanding will be arrived at between the federal and provincial governments in the subject of the distribution of responsibility in these areas.
Inquiries of the Ministry FINANCE



DEPOSIT INSURANCE-PROPOSED LEGISLATION IN ONTARIO

[Stage Direction]
On the orders of the day:	,
Hon. Marcel Lamberl (Edmonton West):: Mr. Speaker, my question is addressed to the Minister of Finance. In the light of varying circumstances can the minister tell us whether he has had negotiations or contacts with the government of the province of Ontario in respect of the announced implementation by that government of deposit insurance? Has he been advised that this is in the nature of a gap filler until federal legislation is implemented?


Mitchell William Sharp: Yes, Mr. Speaker, I have had frequent conversations with Mr. Rowntree, the Ontario, minister concerned. Our governments are working together as far as it is possible to do so. I understand that the province of Ontario intends to introduce legislation similar to the bill we read the second time last week.
I am very happy to say that Mr. Rowntree has indicated he will require Ontario companies to insure with the federal scheme when it comes into effect. I hope we in this house will be able to proceed with our legislation as quickly as possible.


Marcel Joseph Aimé Lambert: I have a supplementary question, Mr. Speaker. Will the minister inform the house whether the same arrangements have been made with the province of Quebec?


Mitchell William Sharp: Mr. Speaker, the government of the province of Quebec has not been in touch with me recently in respect of this matter.



FARM MACHINERY


[Stage Direction]
On the orders of the day:
Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I should like to direct a question to the Minister of Agriculture and ask him whether he is prepared to indicate why he is withholding the contents of his letters addressed to the machine companies in respect of increased prices, and their replies?


Hon. J. J. Greene (Minister of Agriculture):: Mr. Speaker, as I have indicated on several occasions in the house, I am considering the reports and will announce when I make my statement whether it would be in the public interest to table these letters.
12796	COMMONS
Inquiries of the Ministry


Stanley James Korchinski: I have a supplementary question. In view of the minister's reply is he prepared to indicate whether in his letters he protested the increases, or whether he merely requested an explanation as to the necessity of the increases?


John James Greene: Mr. Speaker, the request made to the farm machinery companies was for a report as to the factual circumstances in respect of any increases that had been made.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Barry Mather (New Westminster):: Mr. Speaker, I have a question I should like to direct to the Minister of National Health and Welfare. Perhaps in his absence I may be allowed to address it to his parliamentary secretary. My question relates to the departmental report of yesterday and the minister's telecast of last night, both of which called attention to the link between heart disease and cigarette smoking.


Mr. Speaker:: Order. Would the hon. member ask his question.


Barry Mather: Having this fact in mind, will the minister consider doing what the British and United States authorities have done, namely adopting legislation as well as education to combat nicotine addiction in Canada?


Mrs. Margaret Rideout (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I will bring this matter to the attention of the minister.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. J. Chester MacRae (York-Sunbury):: Mr. Speaker, I should like to address my question to the Secretary of State for External Affairs. Is the minister in a position to report on a matter which I drew to his attention three weeks ago, regarding the case of a Canadian citizen who has been very unjustly treated by the government of India?


Paul Joseph James Martin: Mr. Speaker, this matter is being looked into, and as soon as I have a report I will reply to the hon. gentleman's question.

DEBATES	February 8, 1967


[Stage Direction]
On the orders of the day:
Mr. Robert Muir (Cape Breton North and Victoria):: Mr. Speaker, I wish to direct my question to the right hon. Prime Minister. I wonder whether he would be kind enough to inform the house whether the hon. member for Leeds has the authority and blessing of the government to negotiate the opening of a Canadian embassy in Taiwan.


Lester Bowles Pearson: No, Mr. Speaker, that is not in his terms of reference of his trip.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, I should like to pose my question to the Minister of Labour. Now that many of his symposiums with provincial authorities regarding the housing crisis have been completed, will the government announce its new housing policy soon in order that starts can get under way on time this year?


John Robert (Jack) Nicholson: Mr. Speaker, I am happy to advise the hon. member that starts are getting under way, though perhaps not as rapidly as we should like. When all the conferences have progressed to the point where we can announce a change in government policy, that will be done.


William Heward Grafftey: Mr. Speaker, I have a supplementary question for the Minister of Finance. In view of the serious housing situation is the minister considering the complete abolition of the 11 per cent tax on construction material in order to alleviate this situation?


Mitchell William Sharp: Mr. Speaker, I think the answer to that question must be no.


William Heward Grafftey: I have a further supplementary question.


Mr. Speaker:: Order, please. There are only two or three minutes left in the question period, and in fairness to other members we should allow them to ask their questions.
February 8, 1967

The Budget-Mr. Prittie
UNEMPLOYMENT INSURANCE	HOUSE OF COMMONS



POSSIBLE INCREASES IN CEILING AND BENEFIT RATES

[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, I should like to direct a question to the Minister of Labour. In view of his statement this morning to the Canadian Labour Congress, that he shares the view that the ceiling and the benefit rates under the Unemployment Insurance Act should be raised, can he say whether or not this will be done this year?


John Robert (Jack) Nicholson: Mr. Speaker, as I have already advised the house, this depends to some extent on any recommendations that might come from the Unemployment Insurance Commission, to which parliament has delegated certain responsibilities in this field. I can assure the hon. member that so far as the Minister of Labour is concerned, he meant sincerely what he said this morning, and my views are well known. I hope we will receive some recommendations shortly.


Stanley Howard Knowles: A supplementary question, Mr. Speaker. In view of the fact that the act permits the government to ask the commission for recommendations, has the government asked for such recommendations?


John Robert (Jack) Nicholson: Mr. Speaker, I have asked the chief commissioner to let me have his views and those of his fellow commissioners.



CANADA ASSISTANCE PLAN


[Stage Direction]
On the orders of the day:
Wallace Bickford (Wally) Nesbitt: Mr. Speaker, I intended to direct my question to the Minister of National Health and Welfare but in his absence perhaps I can direct it to his parliamentary secretary. Is the hon. lady in a position to tell us how soon the regulations under the Canada Assistance Act will be ready for promulgation so the many very needy cases can obtain assistance as soon as possible?


Margaret Isabel Rideout: Mr. Speaker, I will draw this matter to the attention of the minister.



PRESENCE IN GALLERY OF CENTENNIAL REPRESENTATIVES FROM EDMONTON, ALBERTA

[Stage Direction]
On the orders of the day:
Mr. R. A. Webb (Hastings-Frontenac):: Mr. Speaker, may I bring to the attention of the house the presence in the galleries of a number of truly centennial representatives from Edmonton, Alberta representing Klondike Kate. They are here in our capital for the surveyors' convention.


Some hon. Members:: Hear, hear.


Mr. Speaker:: I can assure the hon. member that this has already been noticed by all of us.



INQUIRY OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. E. Nasserden (Rosihern):: Mr. Speaker, I have a question for the Prime Minister. I would like to know whether his close friend and colleague the parliamentary secretary to the Minister of Transport was speaking for the government when he wrote a letter to several newspapers in British Columbia which contained the following reference:
The Crowsnest rate has been referred to, ad infinitum, as the Magna Carta of the western prairies. The analogy is completely erroneous.
Does that represent the government's policy?


Lester Bowles Pearson: I have not seen a report of that statement, Mr. Speaker.



THE BUDGET


[Stage Direction]
The house resumed from Tuesday, February 7, consideration of the motion of Hon. Mitchell Sharp (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Monteith.
Mr. R. W. Prittie (Burnaby-Richmond):: Mr. Speaker, when the house adjourned at ten o'clock last night I had just time to introduce the subject with which I want to deal in this budget debate. It has to do with the role of the federal government in the financing of higher education in Canada, particularly universities. I had mentioned that the government announced in October that they were

February 8, 1967
The Budget-Mr. Prittie withdrawing from this field, and that I did not like that idea. I want to point out in the course of my remarks today that the federal government has a legitimate role to play in the financing of universities and that they have abdicated this responsibility.
On October 31 the Minister of Finance, speaking for the Prime Minister, made an announcement following the tax sharing agreements with the provinces. He announced that the federal government was going to leave the field of technical and vocational education and the field of university grants and was going to transfer to the provinces four points of personal income taxes and one point of corporation income tax, so that the provinces could handle these responsibilities themselves.
As I said last night they did one positive thing in their announcement in October.


Mr. Speaker:: Order, please. May I bring to the attention of hon. members that it is very unfair to carry on conversations in the way it is being done at the moment when a member of the house if trying to deliver a speech. I suggest that conversations that are essential and urgent should be carried out behind the curtains.


Robert William Prittie: Thank you, Mr. Speaker.
Speaking on motions on October 31 I did say that there was one positive result of the government's announcement on that day. It was announced that the government would concern itself with the field of adult education, and the following definition of "adult education" was given. I will quote the remarks of the Minister of Finance from page 9290 of Hansard of October 31:
We must recognize that rapid technological and industrial change now require more and more training and retraining of adults. This is of fundamental importance if full employment and increased productivity are to be achieved. The federal government has a responsibility for ensuring that the required training is financially possible for people in the labour force.
For this purpose, the federal government proposes to pay training allowances directly to adults who are taking occupational training, in place of sharing provincial costs as we are now doing.
A little farther on he goes on to define who adults are. He says:
Our proposal was to define an adult as one who has been three years out of school and in the labour force. Several of the provinces felt this was unduly restrictive. We undertook to discuss immediately with the provinces whether some modified definition is possible which would meet more of the training needs of people who have been in

the labour force for less than three years, while still preserving the important distinction between this training program and the school system.
I agree completely with that step. 1 think that the federal government should concern itself with the field of adult education, and indeed the job cannot be done properly in any other way. Unfortunately it has taken a very narrow view of the word "education" as it is carried on in the regular institutions of learning such as elementary and secondary schools, universities, community colleges, and so on. It seems to me a very narrow point of view and one which cannot be defended.
As I have stated in the past, one can reasonably argue that the federal government has a role to play in the field of university financing. The move which the government made is wrong on two counts. It gave the provinces too great a control of the universities. I think it is a healthy thing that universities in this country should receive their money from several sources. They receive money from the provincial governments, they receive some money from the federal government, and they receive money from private sources. Furthermore they still collect, unfortunately, a great deal in student fees. I believe that if the universities of this country are to have the type of independence which they should have, their revenues should come from several sources so that no one source can have complete control over the educational institution. I realize that universities cannot be completely independent; all educational institutions have to respond in some way to the society which they serve. However, they should have as much independence as is possible, and I do not think this can be achieved if they receive all their money from one source.
The difficulties from too great a provincial control have been borne out since the government statement at the end of October. We have the example of McGill University in Montreal. This university is not receiving from the province of Quebec the amount of money which it feels it needs to operate during the next year. I do not blame the province of Quebec. They may have very good reasons for not taking out of their provincial revenues and giving to McGill as much money as that university requires. The educational responsibilities in that province are very great at the present time. It is trying to build new universities and colleges and to establish new institutes of education. However, the important point here is that McGill is not just a provincial institution. It does not just serve
February 8, 1967

the province of Quebec. It serves all of Canada. A great many of its students come from other provinces. It has specialized graduate schools to which people must come if they want that kind of education in Canada. So the point here is that McGill is a national institution serving the whole country, and therefore it should receive some of its funds from the whole nation.
[DOT] (3:20 p.m.)
My second point is in connection with my own province, British Columbia. Just the other day the premier of the province, who is also the provincial minister of finance, announced that the three universities in British Columbia will receive $53 million next year for their operating and capital building costs. Now, the president of the University of British Columbia, Dr. John B. MacDonald has said that the three universities would require as a minimum $66 million for the coming year. Under the transfer of funds which is to take place from the federal government to the provinces by means of the transfer of certain taxes, British Columbia will get for university purposes about $28.6 million during the next year. I do not know whether the provincial government is going to apply all of that to the universities of the province. It may be that they are, and it may be that they are not; I do not know. The point is that the grant is unconditional. There is no guarantee that once a province receives that money the universities will get their share. Here we have the universities of British Columbia that are going to be short $13 million this year at a time when enrolments are rising, when they are in competition with universities all over the world for staff and when they can look forward to increasing enrolments in subsequent years.
As I have pointed out in past debates, a very good case can be made for federal involvement in higher education, that is at the university level. I have stated in the house in the past that when the Fathers of Confederation used the word "education", they probably meant the type of education which existed in Canada at that time and which was mainly primary school education. We did not have very many high schools in Canada in 1867, and very few colleges and universities. Most of the schools were primarily of the one room, country school type. I am sure the Fathers of Confederation did not have in mind higher education because there was virtually none in existence in the country at that time, very few institutions.
The Budget-Mr. Prittie [Translation]


Maurice Allard: Laval University.


Robert William Prittie: Yes, it is exactly that.

I realize, Mr. Speaker, that the University of Laval existed, McGill and some others, but there were not many.
It is always interesting when you can get some good, academic support for the point of view you are trying to advance. I should like to quote rather extensively today, Mr. Speaker, from a speech made by Dr. J. A. Corry, principal of Queen's University and which was published in "University Affairs", December, 1966. This speech was delivered in October, just at the time of the federal-provincial tax-sharing conference. The Secretary of State (Miss LaMarsh) was to have spoken at that meeting, but Dr. Corry had to take her place. He said his views were probably different from those of the Secretary of State. In this case, I am very glad the Secretary of State could not speak because I very much like the views outlined by Dr. Corry. I want to quote rather extensively from this speech because I believe these views do constitute support from a very distinguished academic for the role of the federal government in education:
Let us look at first principles. On first principles, where should the responsibility for education rest in a federation? The answer is not easy.
May I interject to say that is probably the understatement of the year: The answer is not easy.
On the one hand, any denial in 1867 of provincial control of education in and for the province would have made a mockery of plans for ensuring provincial autonomy. No community, then or now, can ensure its life or mould its future unless it has the say on education in that community. In any vital federal system, the province must be able to shape the main features of education in and for the province.
On the other hand, if there is indeed a nation to be spoken for and protected, then the federal government-
Again, I interject, Mr. Speaker, to add that the word "nation" as Dr. Corry has used it is the ordinary meaning of that word in the English language. I realize this may be different from the way it is used in French. He speaks of the nation, the state or the country.
On the other hand, if there is indeed a nation to be spoken for and protected, then the federal government must speak for the nation, take steps to ensure its survival and nourish its growth. If the nation is also a living community, it cannot be shut out of all influence on the direction of education. At times, it may be that mere adding up

February 8, 1967
The Budget-Mr. Prittie
of the educational effort of ten provinces will give a sum that covers federal concern in education. At other times, it will not, and then parliament and the government of Canada must have the power to give special emphasis and some direction to selected aspects of education. When that emphasis and direction will be needed must depend on the exigencies of particular times.
I continue quoting from another part of the speech:
Let us look at this matter in the widest possible frame. The training of the militia, a citizen army, is a form of education. In 1867 the Fathers of Confederation did not hesitate to confer that authority on the federal parliament because a sturdy trained militia might well be vital to the security of the nation. Today, when a sturdy militia, whether well trained or not, seems largely irrelevant other forms of much more sophisticated skill are vital to the nation. At any rate, the arguments of the Economic Council of Canada are fully convincing to me and I shall not rehearse them here.
Now, Mr. Speaker, the following sentence is, I believe, a most important one in Dr. Corry's speech.
In the competition of nations for power, place and welfare, the prizes are going to the countries that bet on education. Can the body responsible for the peace, order and good government of Canada blandly assume that ten provincial governments, each thinking for itself and about its own needs, will produce all the highly educated skills that are needed? The government of Canada, on mandates given to parliament by the people of Canada undertakes a wide range of complex functions, many of which call for civil servants with a great variety of skills. Does the government of Canada do its duty if it fails to make sure that enough people acquire these skills?
I will not quote the next paragraph in the speech which has to do with the bilingual responsibility of the federal government. The inference is that this should be a proper concern of the federal government in bilingual education. This is an idea that I heartily support, but I will omit that paragraph at the moment. I am very glad that the hon. member for Sherbrooke (Mr. Allard) is here because he has a great interest in these matters, and I think he will want to listen particularly to the next paragraph.
But it will be asked, does not section 93 of the British North America Act give exclusive power over education to the provinces? This is correct, subject to a limitation that is likely to become more portentous as time goes on. Literally, the words of section 93 are, "in and for each province, the legislature may exclusively make laws in relation to education." If there are national needs and objectives that require concerted educational policy in two, several, or all provinces, no provincial legislature is by itself competent in the matter, and judicial interpretation on other comparable aspects of the distribution of powers under the British North America Act makes it clear that parliament is competent under "the peace, order and good government" clause.

It must be on this ground that Prime Minister Pearson, in his proposal to the federal-provincial conference now meeting asserted federal jurisdiction in the training and retraining of adults for participation in the labour force. It is to be hoped that a reading of this particular assertion along with other general disclaimers in the text of his proposal about federal authority in education will not give rise to inferences that the federal government has neither status or lively concern in the education of highly skilled and highly educated manpower in the universities. It would be incongruous to be asserting federal authority over training for run-of-the-mill jobs in the labour force and abandoning it totally for all professional, scientific and technical personnel educated by the universities. It is the latter who will be critical for national objectives in the future.
At a time when the federal government is attempting to make clear that it has a constitutional responsibility for adult retraining programs, for research, and for cultural development, and that these are not, constitutionally speaking, educational matters falling within the jurisdiction of the provinces, from which the federal authority is excluded, I think it timely to recall that in 1867 none of the newly formed provinces regarded university and college education as being a matter for provincial jurisdiction. All the universities then existing (including my own) operated under royal charters or other non-provincial authority. Since then provincially supported institutions have developed but these were not considered to be the exclusive responsibility of the provinces. Indeed it is worth noting that McGill University and Queen's University, to name only two, were in the habit of appealing from time to time to business, industry and individual benefactors on the grounds that they were private institutions catering to a national (and in some respects international) constituency.
[DOT] (3:30 p.m.)
It is only within very recent years, since the provinces have provided immensely increased support for universities that they have become concerned to exercise substantially increased control. To the best of my knowledge no province has yet claimed exclusive jurisdictional control. Universities and colleges are free to solicit funds from business, industry, foundations and benefactors inside and outside the province, inside and outside Canada. Most provinces in addition are prepared to accept a federal concern and the federal government should be reluctant to disclaim its concern.
I feel that this federal concern is there and should be exercised by the federal government.
Federal concern, Mr. Speaker, does not mean complete federal control. Regardless of its recent announcement the federal government will continue to provide some finance for universities. For example, through agencies such as the National Research Council, the Defence Research Board, the Canada Council and the Humanities Council funds do pass from Ottawa to universities across the country. But it seems to me that it is very artificial to separate this aspect of research
February 8, 1967

from the general field of university education, particularly graduate education.
I feel that there should be some agency here in Ottawa which will concern itself with this whole field of university education and post-graduate education as well as with general grants for research. If we are afraid of appellations like "department of education" or "office of education", we do not have to use them. We could call such a body a department of science and technology. I would remind you, Mr. Speaker, that Dean Bladen in making his report on higher education in Canada recommended that all of the agencies in the federal government concerned with making grants to education should be responsible to one minister. This recommendation is to be found at page 67 of the Bladen report.
I now come, Mr. Speaker, to this question: Why did the federal government take the stand it did and say that it would concern itself with adult education for people who have been out of school for three years, but that it would forget about existing universities? I think this decision was taken particularly as a result of the advice given to the government by the so-called three wise men who entered the Liberal party a year ago. I am not using those words sarcastically in referring to the hon. member for Hochelaga (Mr. Pelletier), the hon. member for Mount Royal (Mr. Trudeau) and the Minister of Manpower and Immigration (Mr. Marchand); they are all very intelligent men.
However, Mr. Speaker, these hon. members are trying to develop the theory that all of the provinces should be on exactly the same footing as the province of Quebec. For example, if there is any objection from Quebec to there being a federal concern in a certain field, then they contend the federal government should have nothing to do with that particular field. Hence they are saying to the other provinces that Quebec is withdrawing from a certain program or a certain field, and they put all provinces on the same basis.
They are arguing, Mr. Speaker, against the case which others have made during the past few years that Quebec is not a province like the others. I would agree, Mr. Speaker; I think Quebec is not a province like the others. It is a different case and we should recognize this. The very fact that Quebec has a very large language group, which carries with it its own culture, does make that province different from the others. If Quebec has to be dealt with differently in some aspects of national policy, then let us recognize this fact.
23033-810J
The Budget-Mr. Prittie
Even the United Kingdom, which is not a federal state but a unitary state, recognizes it must deal with different language groups. Take the case of Scotland. If by mistake you asked a Scotsman from which part of England he came, then you should stand back and wait for the blow. The same is true of the Welshman. This difference is recognized in the United Kingdom. Scotland has a different type of educational system from England. The British Broadcasting Corporation operates a separate Scottish service and in Wales even broadcasts in the Welsh language. Scotland has its own laws. So as I say, Mr. Speaker, the United Kingdom does recognize this fact. The parliament of Westminster, of course, makes laws for the whole of the United Kingdom; but there is recognition that the people who live in Scotland, Wales and Northern Ireland are different from those who live in England and in some respects, including education, require different treatment.
I suggest, Mr. Speaker, that there would be no great objection from most of the provinces to a continuing federal role and federal concern in university education. This concern may be directed through a government department, or could be handled in the way university grants were handled previously, through the Association of Universities and Colleges of Canada. If this is the best way then perhaps we should use that channel.
If there is a vital objection from the province of Quebec to a certain proposal then we can make a special case and treat that province differently. But it seems to me that the government is moving in the wrong direction. At a time when, as Dr. Corry has pointed out, the prizes in the world go to the best-educated nation, it seems to me that we must move in the direction of some type of federal concern. I am using the word "concern" deliberately and not the word "control". I think that the federal government has to put up some of the money and show some of the leadership.
I should like to illustrate one area where leadership in higher education is necessary. We do not have unlimited resources in Canada to give grants to all our universities. Universities are very expensive. Scientific training and graduate training are expensive. I do not think that every university in Canada can have a medical school or that every university in the country can have a nuclear physics department. Therefore some decision must be made as to where a given specialization should be located.
February 8, 1967

The Budget-Mr. Nugent
I think that this has to be done on some type of national basis, with the government in Ottawa giving some leadership. Yesterday the Department of Forestry and Rural Development issued a press release announcing that the department was making equal grants to the forestry faculties of the University of New Brunswick, Laval University, University of Toronto and the University of British Columbia. These happen to be the only four schools of forestry in Canada. Perhaps they are all we need, I do not know; but this is the sort of thing with which some federal authority has to concern itself.
We are not going to make very much progress, Mr. Speaker, if we keep surrendering any possible leadership which can be shown here to the provinces. Ten provincial systems of education-and again I specify university education-do not add up to a national system. It seems to me that we are going to fall very much behind other countries which have shown some type of national concern.
Finally, Mr. Speaker, I want to deal with the situation in the United States where the constitutional position is almost the same. It is generally recognized that the predominant authority in education in the United States is in the hands of the individual states, and they run the elementary and secondary schools. But the United States federal government has set up a federal office of education which allocates funds in very great amounts to universities throughout all the states, and as far as I can determine no great objection is taken to this. I hope that before too many years pass we will think this situation through and try to reverse the unfortunate decision taken by the present government last fall after the Conference with the provinces.
My last point, Mr. Speaker, is that I do not think there would be very great objection to a similar proposal on the part of most provinces. If we do have to make a special case let us admit the fact, and make special provision for whichever province may object.


Mr. Terence Nugent (Edmonton-Slraih-cona):: Mr. Speaker, I should like to begin my remarks today in a manner that always gives me the greatest pleasure. I should like to thank the hon. member for York East (Mr. Otto) for his courtesy in making it possible for me to be heard now, rather than himself. One of the more pleasant aspects of being a member of this house is that a political adversary, in recognizing a certain situation, can make a kind gesture of friendship such as
[Mr. Prittie.l
this. I offer my heartfelt thanks, and I am grateful.
[DOT] (3:40 p.m.)
I am pleased to have the floor at this time because today, from Edmonton, a distinguished group sits in Mr. Speaker's gallery. They are distinguished because they show that spirit that I am proud to think is Edmonton's. These people are dressed in the Klondike garb of the gay '90's. They bring to Ottawa a little of the spirit of Edmonton.
The National Surveyors Association has decided for the first time that it will hold its convention elsewhere than in Ottawa. It will hold the convention in Edmonton. In honour of this, our good friends in the gallery have the spirit to visit this city. This is something which must be encouraged.
They have brought down Klondike Kate; in fact, 26 charming people have come down. The men are dashing, gallant and handsome; the ladies beautiful, charming and gracious. I deny that these people were hand picked for these qualities; they form only a cross-section of Edmonton. If you visit our city you will find our streets filled with such beautiful, charming and gracious people.


An hon. Member:: Let's go.


Terence James (Terry) Nugent: I also want to thank hon. members of the house for their courteous consideration, for that spontaneous parade staged around the dining room today. It was not done for advertising. Because so many of my friends were interested in seeing the beautiful girls, I asked them to walk around, that my friends for a few moments might see what I enjoy so much always in Edmonton.
I am afraid, having spoken so kindly in the house, that I shall now have to fire a few volleys I have saved over a considerable period. Having spoken kindly of everybody, I shall now revert to my normal self. At times I might sound critical, and when my hon. friends on the other side hear me, it might occur to them that they have made mistakes. If I enlarge on their errors, it simply means that those errors may be more fundamental than hon. members on the other side realize. What I have to say involves the Canadian people. If I complain about this institution, about parliament, which hon. members opposite do not seem to understand, it is because of what the Liberal government is doing to Canada.
February 8, 19G7



The whole country is concerned about where it is going. Some of us are more concerned with this question than others. I, for one, cannot understand these commissions inquiring into the status of women, or into our two languages-I refer to the B and B Commission. What utter balderdash they are. Nobody married needs to be educated about the status of women. Anybody with half a brain in his head knows he has to learn two things quickly: to say "Yes, dear" when she is right, and "Yes, dear" when she is wrong. That is the situation a man has to cope with, and it needs no royal commission to tell him that. That is the situation existing.
I do not care how many reports the B and B Commission brings in, they will not help me to learn French. I shall learn far more French by meeting one of those charming ladies from Hull, Edmontons' twin city.
There are no difficulties between English and French speaking Canada. That question I settled long ago. I have a secretary from Quebec, and when I do anything wrong she tells me. She can straighten me out more effectively than any B and B Commission could.
Our charming people from Edmonton display the Canadian spirit in a way that makes us all in this country proud to be Canadians. They are prepared to travel over Canada, to the United States and to Europe advertising the existence of their city and its charms. So long as we have people like that we need not worry about who Canadians are. Canadians are individuals. A Canadian is that type of individual with the gumption to be what he wants to be. He respects his neighbour's right to be the kind of Canadian he wants to be. Who wants people stamped from a pattern? Who are those who say that Canadians should be recognizable, by our friends across the pond and by our neighbours to the south, as coming from a distinct pattern? The greatest compliment that can be paid to us is that we are not typed, not stamped. Because you can go anywhere in the world and be recognized as an individual is the greatest compliment anybody can pay you.
We have the heritage of free speech in our democratic society. We have the right to be individuals. Are these not the objectives of our society? Who are those people so afraid of being themselves? Who is afraid of not being recognized, of not being taken for a Canadian. What is wrong with us? Is it that fear in the atomic age has strenghtened the herd instinct. Has the danger in the world herded us together? Why is there this unreasoning fear
The Budget-Mr. Nugent that we shall not be recognized as Canadians? I tell you, Mr. Speaker, when the time comes that Canadians can be picked out of a crowd, when other people can say that a Canadian does this, is this, and behaves this way, I shall leave. I shall not put up with that.
I am proud of being a Canadian. I have nothing against the United States-I have many excellent friends, first cousins, in many states, and many acquaintances in that country. But I would rather be a Canadian, because here we are individuals. The individuality of the Canadian is something our neighbours envy.
In our society we have ten times the freedom that conventional types of men have. Conventionally stamped men are so restricted that they cannot appreciate the freedom of being an individual. That is the freedom I appreciate in Canada. That is what I hope every Canadian student, growing up in our land, will appreciate, care for, and cherish.
[DOT] (3:50 p.m.)
There are actions which are taken for the right motives, but which are distrusted because they are done in the wrong way. I am sure we are all familiar with one illustration which I might use in this connection; there are some people who can tell a joke well, and others who simply cannot do so. This is all I have to say by way of introduction to my next thought, which concerns the way in which this government operates. The manner in which a thing is done is just as important as the object which is being sought. I made the same observation during the flag debate. Perhaps on reflection hon. members sitting opposite will come to understand the importance of doing things the right way. Mr. Mackenzie King began with a committee of about 20 members. He gave them unlimited time, told them the government would agree with whatever the committee decided, and the result was unanimity in the committee, except for one member. Then Jean Lesage said: "If you accept that decision I will destroy the Liberal Party in Quebec." So the government could not go any further.
By contrast, the present Prime Minister (Mr. Pearson) made a political football of the issue from the start. Only after fighting positions had been taken did he refer the matter to a committee. As a result, the flag which was introduced is still associated in the minds of far too many people with the cavalier and idiotic way in which it was imposed. There-are political overtones. It is a Grit flag, rather
12804	COMMONS
The Budget-Mr. Nugent than the unifying symbol which the government said Canada would be given.
How can we in this country accomplish anything if decisions are to be taken in this way? Those who wanted to change the national flag may have been in a majority in Canada. Those of us who did not think a change was necessary were certainly prepared to follow the majority, if change was what they wanted. There is no doubt that the majority of Canadians wanted to be proud of that flag; they wanted a national symbol around which to rally. And there is no doubt that the majority of Canadians were sadly disappointed by the manner in which the change was brought about.
I am afraid that what the government is doing through the commission on bilingualism and biculturalism is having the same disturbing effect. It has never been my belief that differences can be healed by talking about them, rather than by curing their causes. If I have a quarrel with my neighbour there is no point in having a discussion as to how we express ourselves in our quarrel. But this is what the B and B commission is doing. We need to find out what it is that French Canadians resent about us in the west, and what we in the west resent about French speaking Canadians.
I suggest that despite a lack of understanding, due in part to an exaggerated importance being given to symbols, there is, in fact, complete identity of purpose between the province of Quebec and western Canada as to what both wish Canada to be. When I was in Quebec city, I found the people there living a western mode of life, if I may be excused for expressing myself in that way. Their hospitality was overwhelming-the kind of hospitality we talk about in the west but do not always find.
They were French but, if they will forgive me for saying so, they thought like westerners, and when I heard their complaints about Canada they reminded me very much of the expressions westerners used back in the 'thirties about "Bay Street crooks" hogging all the money, while we did not have enough to go around. There are one or two things which are basically wrong and which affect relations between French speaking and English speaking Canada. In the province of Quebec the ordinary labourer is paid less than his counterpart across this country, and the Quebec farmer generally receives a lower

DEBATES	February 8, 1967
income than do farmers elsewhere. Our problem, then, is very simple and its solution is: monetary justice for Quebec.
When this party formed the government it was supported by a very large number of members from western Canada. We still have most of them, thank God. But I want to tell you, Mr. Speaker, that those members from western Canada were realists. They were not unduly concerned about symbols. They wanted legislation which would put some bread on the table and ensure a few of the amenities of life for the people they represented. They wanted legislation which would put some money in their pockets and lead to a better standard of living. And that was the legislation which was brought in.
I do not want to be too critical of our French colleagues but I am afraid they were not as persuasive as they might have been. They spent too much time in the discussion of symbols, such as cheques written in both official languages. There was not forthcoming from that group in the house the necessary flow of suggestions for increasing the economic wealth of the province of Quebec.
I will admit that we did not do the great job for Quebec that we did for the rest of Canada. We did a good job for western Canada, though, and this did help all of Canada. I cannot blame the citizens of Quebec who say: Lord, how long must we wait for our turn; we are being discriminated against. It is not discrimination against Quebec. But the man whose family is going short of the amenities of life cannot be expected to appreciate the distinction between failure by intent, and failure with the best of intentions. He is not likely to be impressed by people who say: We will give you a flag and make you feel more Canadian.
I had not intended to be vehement on this subject, but I want my hon. friends from western Canada to understand something which I believe they have so far failed, to some extent, to appreciate. When you yourselves find that things are getting along much better, when westerners engaged in farming and in industry now have a real opportunity to reap a good return for their labour, it is harder to realize that there are areas in this country which are not so favoured. When the disagreement or the unhappiness in Quebec is expressed by way of symbolism that we in the west cannot understand, it leads to a widening of misunderstanding between various parts of the country. I know that French
February 8, 1967

Canadians are exactly the same type of Canadians as the western Canadians, but the people in western Canada do not know it, and the people in Quebec do not know it because we have had so much talk about the symbols, so much talk about the side effects and the politics of it.
[DOT] (4:00 p.m.)
As I have said before in this house, it is as simple as this: the people of Quebec want simple justice. You take away that core that gives them a solid complaint and then there is nothing to exaggerate on; give them simple justice, and the rabble rousers, the separatists and unreasonable people will get no audience whatsoever.
There is no basic difficulty of Canadianism between Canadians, but there is that one problem which we shall always have to watch, and the solution is a matter of simple justice. What the Conservative government did for western Canada, the pieces of legislation we brought in that were so helpful to raise the standard of living out there, must be matched for Quebec in legislation by the federal government. I cannot believe that any amount of handouts, any raise in pensions, or any raising of grants is going to do anything to help solve this problem.
I am proud to be a Canadian and the reason I believe I am like my French Canadian friends is that they do not want handouts. They do not want assistance. They only want justice. All they ask of the government is: Quit giving us pensions; quit giving us commissions and assistance; give us simple justice; give us a chance to earn that kind of living which hard work and our native ingenuity can provide and we will be very happy to say we are all equal Canadians.
Mr. Speaker, I do not think I could end on a happier note than to hope the house will agree with those last words of mine.


Mr. Steven Otto (York East):: Mr. Speaker, after listening to the kind words from the hon. member for Edmonton-Strathcona (Mr. Nugent) I rather hesitate to confess that in actual fact, since the lovely young ladies are sitting directly above him, I was trying to catch their eye and had nodded my head to them, not knowing he had been asking me for my consent to speak before me. Thus I accommodated the hon. gentleman; but I think I would do it again.
The Minister of Finance (Mr. Sharp) has left the chamber. I was going to congratulate him on his tenacity for remaining throughout
The Budget-Mr. Otto the debate, although many of the subjects touched upon have had little to do with his department. However, I wish to talk about some points which I think will be of interest to all Canadians, and especially to the minister's department, when it comes to the preparation of the financial items to be presented in the main budget.
By and large, Mr. Speaker, I believe we all recognize that for the next few years we are going to be concerned with the repatriation of our industrial destiny. I am not concerned with the amount of control, as is the Minister without Portfolio (Mr. Gordon), and neither are Canadians in general, because control is really an ambiguous thing. I believe Canadians are concerned with the goodies, the dividends, the profits. These are the things they want; and it is no great mystery, because anywhere one goes throughout Canada he cannot help noticing the great mountains of raw materials (we have.
It is no secret that we Canadians have a monopoly of uranium. It is an obvious fact that we have a seaway running into the middle of our country. We have the Churchill Falls project now developing. We are rich in hydro power and fresh water. In short, we have an advantage but are troubled that we cannot use it, that we cannot get dividends and profits from it. We know this advantage is being developed, but we also know we do not appreciably share the benefits of it, especially when we compare ourselves with countries like Germany and France, where the action is, but which do not have half the resources that we possess.
This is the problem that concerns Canadians. It is the problem that concerns the cabinet. It is the problem that concerns the Liberal party. We have these good intentions, but the problem is that we could be described as a government of innocence-


Some hon. Members:: Oh, oh.


Steven Otto: -a government of innocence, in the sense of people who are innocent, who could be naive and fail to face the realities of life. It might be said that with our good intentions we may even be paving the road to oblivion. As the hon. member for Edmonton-Strathcona said, good intentions are not enough: We have to face reality. We cannot be naive. We have to be slightly cynical. We have to be realists. This is the problem that faces us with respect to control of industry or repatriation of our industry.

February 8, 1967
The Budget-Mr. Otto
We know that 67 per cent of our industrial strength belongs to foreigners. We also know that about 80 cents out of every dollar invested in mines goes to promoters' profit and only 20 cents, if that, goes into the ground. Recent history has shown us that when we try to get Canadians enthused about buying into Canadian companies, something like the Prudential collapse or the Atlantic collapse happens. We run into problems like that of the Western Bank and the Mercantile Bank.
There is a deep rooted problem which must be solved before we can accomplish what we are trying to accomplish. Even if we had the Canadian Development Corporation and got people convinced that they should buy into Canadian industry, and even if the Minister without Portfolio, with all his restrictive measures, could force Americans to throw their shares on to the stock exchange like confetti, nobody will pick them up because of a fundamental weakness at the stock exchange and the security exchange level.
This is where we have failed. In this area we have said that the responsibility under the B.N.A. Act is given to the provinces. The blame is placed on an antiquated piece of paper, which no one has any faith in, but the provisions of which have been overcome many times. In actual fact the B.N.A. Act will permit us to do anything.
[DOT] (4:10 p.m.)
We have been able to pass hospital insurance legislation. We have passed the pension legislation, medicare, and assistance to education. We know what has to be done in this regard and I will venture to suggest-and I hope the minister gets the message-how it can be done. We must clear up this whole stock exchange fiasco. We cannot expect Canadians to put in good money and have it disappear into great mansions on Post Road in Toronto, great palaces in Bermuda, yachts, and so on. In other words, we must convince Canadians that if they invest a dollar in a Canadian company they will receive a return. They must be assured that that money will go into the industry, or into the ground, and not into someone's pockets. This is the first task which faces us.
We have already heard about the Canada Development Corporation. I do not think it will be successful if the corporation buys up shares and then tries out some method of distributing them. I think Canadians are so security conscious now, as they should be after the experiences they have had, that they want some stamp of guarantee. You know, we

do this in respect of mortgages. We have a National Housing Act and are trying to get Canadians to invest in bricks and mortar. We guarantee this: We say that if you put in $1,000 you will get it back. So, naturally we are great mortgage investors. But, when it comes to shares and equities, we are not yet becoming involved, but there is no reason why this cannot be done.
I would have introduced a private member's bill in such a way that the Canadian Development Corporation would ensure the purchase price of shares of approved companies. This is not so radical as it may seem. It is done every day. This is the job of the commercial banker. If you have a thousand shares of General Motors, General Electric, or any shares, and go to a commercial bank, they will insure them for you. The only thing is that you have to deal with million dollar lots, and a small investor cannot take advantage of that insurance. So we must make provision for this. In that way, without going to the stock exchanges and the provinces telling them that they must abide by our regulations, we can accomplish exactly the same thing by stipulating which companies will be approved by the corporation, and which shares will be approved for insurance. In that way we could control the administration of these stock exchanges.
There is the matter of the prospectus. I am sure you have read many Canadian prospectuses. You can put just about anything in them, so long as it is true. You do not include in them the fact that there is no gold in this particular moose pasture. All you say is that Dr. Jones, a famous geologist, says that in such and such an area of Tanganyika they have found 90 per cent gold, and this type of thing. They have a perfect right to do this, and this is how we get hoodwinked. If you have ever seen the United States prospectuses, especially those filed with the Securities Exchange Commission, you will know that they are not allowed to do this. It is practically a matter of true and false: Is there gold or is there no gold; what is the company's future and what is not the company's future. What we must do in our regulations, before we approve of these shares which will come within the Canadian Development Corporation, is say that we will not take them unless the prospectus follows a certain pattern and is absolutely factual.
Then, there are the financial statements. We should be able to approve of the financial statements. We do not want to see at the bottom of them a statement by the accountant
February 8, 1967

to the effect that the information supplied is only from documents given to him and therefore that he does not accept responsibility for them. Every chartered accountant firm, or any person who is doing the accounting for a public company which wants to be approved, must say that he guarantees the particulars as of that date. Then you would find there would be a big change and that we would not get into as many of these Prudential and other messes as we have.
Now, let us take the directors of the companies. In the United States, and in fact in most countries where there are successful industries and successful corporate structures at least 50 per cent or 51 per cent of the directors of the companies make their money from the companies. In Canada, except for the president, none of the directors depend on the company for a living. Some very strange disclosures came out last night in the evidence of Mr. Stevens of Westbank. He said that one of the plums of a directorship in any Canadian bank is the right to borrow about $10 million from that bank. This is what the directors are there for. They do not know the banking business, they do not know the construction business and they do not know the manufacturing business. I would say they are professional directors-the elite; they are very conservative and very cautions. How do they make their money? They make their money on the subscription of the shares, because they have control over when the shares will be issued, and by that time they have sold their own.
So, one can see that we have a faulty mechanism. If we insist, before the shares of a company are acceptable to the Canadian Development Corporation, that at least 51 per cent of the directors are internal directors, sales managers, production managers, and so on, then you would have people who would depend on that company and on that industry for a living. We would also have to simplify the procedures. There is no reason that it should cost about $250,000 or $300,000 to put a company on the stock market. By the time you get through with the bonus shares, rights and privileges, there is very little left. Out of $4 million that the investors put in, only $2 million, after the promotion costs, winds up in the treasury of the company and with this the company must try to make a profit to pay the $4 million invested. This is something which must be remedied.
Then, there is the shareholders register. I do not know whether or not anyone has ever
The Budget-Mr. Otto tried to contest the directorship of a company. The inside directors know exactly who the shareholders are and, at the expense of the company, they can send out proxies to all the shareholders and, since most of the shareholders send them back, they are in control. But if you are a shareholder and want the list of shareholders, you must give six months' notice, pay the cost, which sometimes is about $18,000, and then by the time you get it is six months behind and therefore is useless to you. You can, however, buy a directorship of a company; it is practically on the market.
This must not continue, because we will not be successful in any of our efforts in respect of the Canadian Development Corporation or in respect of getting Canadians to purchase the shares in companies unless we get this straightened away. The way in which to do it is to set up regulations with which the companies must comply before the government will accept them into the Canadian Development Corporation, and put its stamp of approval on them. When you have done that, no company will be able to opt out of this, because if they do no one will buy the shares. They will all come in; and if all the companies come in, then you will have exactly the same regulations you would have if you change the security exchange commissions.
There is no excuse at all for the government saying "Oh, we would like to do it but we cannot because of the British North America Act". The most overrated piece of dead fish I have ever heard of or read in my life is the British North America Act. It was devised at a time when we were worried about the American invasion. This was 100 years ago, when the provincial and federal rights were absolutely different from what they are now, and even the responsibilities. If we take the initiative first and do this, we can get around it, and no one will contest it; because after all Canadians, regardless of where they live, do not give a darn whether it is a provincial right or a federal right. They do not even know it. They are disgusted to know that they are electing provincial members and federal members in order that they can sit down and fight with each other.


Herbert Wilfred Herridge: Mr. Speaker, would the hon. member permit a question?


Steven Otto: Yes.


Herbert Wilfred Herridge: Does he not realize that the British North America Act to which he referred as a dead fish was drafted in Canada and was simply accepted by the British House

February 8, 1967
The Budget-Mr. Otto of Commons as a formality, and that this document was the wish of the Canadians at that time.
[DOT] (4:20 p.m.)


Steven Otto: The hon. gentleman made an important statement when he said "at that time". The gentlemen who drafted the agreement are dead, and they had no idea what Canada was going to be like today. I do not blame the British government at all, and I have not said that I do. I said that this was a dead piece of fish as far as we are concerned. I do not understand this continual harping about inherited privileges and responsibilities. To suggest that we have certain rights because our ancestors did something is one thing, but the question is what are we going to do today. That is the situation we must face.
The federal government is at this time responsible for the canal systems. This was perhaps necessary for defence purposes, but I do not understand why canal systems should now be under federal jurisdiction. I think we would be better off if they were under provincial jurisdiction.


Herbert Wilfred Herridge: That would not help us.


Steven Otto: I am suggesting that we should disregard the act and take the initial steps, because we want Canadians to buy shares in their companies. We must admit that even if the United States gave us the shares we probably would not accept them because basically we are not share buyers. We are cautious and apprehensive because our money has come to us the hard way, through sweat and saving. The only money which is invested in shares is money come by easily. Money received from dividends will be reinvested, and we need that kind of money. We must induce Canadians not to put their money into bricks and mortar and not to buy mortgages or perhaps even government bonds. Let us sell our bonds to the United States, because we want Canadians to buy equity. Equity grows and brings dividends and profits. These profits can be used for further industrial expansion.
The only way we can accomplish this is by providing some sort of guarantee, and this will not work unless we clean up this whole investment field. One cannot expect good results from good intentions if the basis is wrong. Let us make sure the basis is right. We must acknowledge that in spite of what we do we must have a clearinghouse. Canadians must be able to buy equity through a Canadian clearinghouse; but as

long as the rules of such a clearinghouse allow corruption, corruption will take place. The result will be that Canadians will lose faith and we will not accomplish what we are trying to accomplish.


Edward Nasserden: Mr. Speaker, I was intrigued by the assertion of the hon. member who has just taken his seat that we have a government of innocents. He implied that the government has not been able to deal with all the problems which have faced this country because they are innocent. The hon. gentleman has not been here as long as many members on the government front benches, but let me tell him that I recall when they sat on this side of the house and said they had all the answers to our problems. At the time the previous administration was laying the foundations for the prosperity we are now enjoying, hon. members now sitting on the government side travelled from one end of this country to the other claiming they had all the answers, and belittling the foundations for prosperity then being placed on the statute books.
This government of innocents has brought about the highest cost of living, the highest interest rates, the tightest money policy and the highest burden of debt on the individual, municipal, provincial and federal governments in the entire history of this country.
This government of innocents has created a situation in which our balance of payments is almost greater than at any other time in our history. We have a trade deficit in spite of our rising exports. Perhaps what is worse is the declining influence of this nation in the councils of the world. One must also keep in mind the labour unrest which has developed in this country in the last two years. We should also consider the number of bankruptcies and financial finaglings that have taken place furing the last two years. We must then look at those innocents opposite and ask ourselves why they did not do something during the period they have been in office to come to grips with the problems which have faced Canadians.
Only a few short years ago when those gentlemen were on this side of the house they said the pigeonholes were filled with answers to the problems of this nation. These pigeonholes are still filled, because this government has failed to supply those answers, and bring forward legislation to solve our problems.
In this centennial year, three years after the government came into office, we find the present Minister of Finance, (Mr. Sharp) still
February 8, 1967	COMMONS
faced with problems of bankruptcy, and that there are other serious problems faced by individuals in our society who are trying to find a place in this country and do something to make this the nation it should be.


Mitchell William Sharp: Just think how much more prosperous it is.


Edward Nasserden: If the minister believes that the highest consumer debt in the history of this country represents prosperity, then let him laugh and point to that with pride. If he thinks the highest interest rates in the history of our country is something to laugh about, then let him laugh.


Mitchell William Sharp: I am pleased about the lower rate of unemployment.


Edward Nasserden: Millions of Canadians today must face the increasing costs and increasing taxation which this government has brought about as a result of waste and extravagance in the administration of the affairs of this nation.


Mitchell William Sharp: I have not heard any suggestions from the hon. gentleman about how to reduce these expenditures.


Edward Nasserden: What is the government opposite doing to solve these problems? They are the ones who said the pigeonholes were filled with answers. The government has set up one royal commission after another to study these serious problems, but in the past several years they have not attempted to find a solution to them. Most of the measures adopted by the government have been window dressing.
I remember when the minister brought his budget in some months ago. Apparently at that time he did not think it would be necessary to bring in a mini-budget. At that time he pointed out the unemployment figures to show how they had gone down, but he does not talk about the unemployment situation today. In my hand I have a copy of the Ottawa Citizen of February 8 which indicates that unemployment is increasing. I do not intend to read the figures, but this is another indication of what has happened as a result of the careless administration of the government opposite.
[DOT] (4:30 p.m.)
A great deal has been said about the housing situation in Canada. I should like to congratulate the Minister of Labour (Mr. Nicholson) upon sponsoring a series of seminars
The Budget-Mr. Nasserden
in this country. I had the privilege of attending one held at Regina, the capital city of Saskatchewan. At that seminar the Minister of Labour contradicted himself in much the same way this government has contradicted itself on so many occasions. When the question of the 11 per cent sales tax and its effect on the cost of housing in this country was brought up by one of the contractors at that meeting, the Minister of Labour had the audacity to suggest that, after all, there was no reason why there should not be a tax on building supplies, since there was a tax on everything else. He forgot the important objective of successive governments in this country, to try to do something with regard to the provision of a measure of housing development which would take care of the needs of the new Canadian families which are continually entering our labour markets. When I look at what this government has done with regard to housing and when I think of this 11 per cent sales tax, I cannot help but feel that it has almost destroyed the hope of the young people in this country to own a home and build a future for themselves in the years when they will be raising their families. The Minister of Finance can laugh if he wants to, but I notice he is not laughing now because he knows it is true, and he acknowledged this in the budget last spring when the government decided to remove progressively the sales tax which they had put into effect.
I ask through you, sir, why the government does not go all the way and remove this tax at this time, so as to restore to those who wish to purchase a house some equity in their purchases. After all, these are people who need housing. All I can say to the Minister of Labour with regard to his statement today, that he will reduce the rent by $16 a month, is that this reduction in the monthly payment for rentals does not even cover the increased cost that had been put into effect by the action taken by the government through the 11 per cent sales tax, alone. I want to say to you, sir, that this apparently innocent government since it came to office has cost the individual householder and the individual family in this country a great deal of money.
I wish to speak now about the sales tax on production machinery and building supplies. I believe that in his speech on December 19 the minister estimated that the raising of the sales tax by 1 per cent would bring in revenues of approximately $155 million a year.


Mitchell William Sharp: I think it is more than that.
February 8, 1967

The Budget-Mr. Nasserden


Edward Nasserden: That is what the minister stated as reported on page 11337 of Hansard. The minister thought it would be approximately $20 million for the remaining portion of that year. If that estimation contained in the minister's statement on December 19 represented approximately the situation, then we can multiply that figure by 11 and take a look at what it has cost the average Canadian citizen in the last few years to keep in office a government which imposed a major taxation of this kind. This deliberate action by the government has cost the Canadian family approximately $400.


Mitchell William Sharp: What taxes would the hon. member substitute for that?


Edward Nasserden: If I were sitting in the minister's seat and had his responsibility I would be able to answer that question a lot better than the minister. After all it was his government which brought in the tax two and a half years ago, and then two and a half years later had to withdraw it progressively because of its effects on our economy. When this tax was brought in we on this side of the house warned the government of the dangers of inflation and of the problems involved in the increasing cost of living and the increasing cost of industrial production.


Mitchell William Sharp: Look at what we inherited.


Edward Nasserden: And what did the members on the opposite side say about our warnings? Mr. Speaker, you will recall that they almost called us the enemies of society because we dared to think that anything they would do would endanger the livelihood of the Canadian people. What has happened has been almost exactly what we had forecast, except that it was far more serious than we on this side of the house indicated at that time.
I recall suggesting during that budget debate that the former minister of finance should resign. I recall the vote that followed and the fact that the members of the New Democratic Party in this House of Commons sat in their seats voicelessly when the crucial vote came. They share with the government opposite part of the responsibility for the high cost of living we are experiencing today, for the inflation and for the danger that it presents to the institutions of this country. What happened to the sense of responsibility of the members of that party sitting in opposition, when they remained silent on that issue and refused to vote on a matter which has brought to vast numbers of Canadians an

increased cost of living, as well as privation and suffering? This is something that I will never be able to understand. I do not understand how a party which puts humanitarian-ism first could have taken the action which the New Democratic Party took on that day and in this way denied the very existence of those people whom they claim to represent here in the House of Commons. I am referring to people with limited income.
However, there are other factors which enter into the financial picture in this country. One of those is the lack of incentives in agriculture. When I look at the decreasing production of some of our dairy products and the resultant reduced take-home pay of many of our agricultural people I cannot help but wonder what this government has been thinking of in this regard. I know that the former minister of agriculture said: The Conservatives had a good agricultural policy. However, I suggest to you, sir, that any policy, whether agricultural or other, cannot stand still in this country, in view of the changing situation which is taking place on a daily basis throughout this country. If we do not improve the legislation which is brought forward from time to time, we cannot hope to cope with the problems which face our people.
This brings to my mind our defence expenditures and the fact that the Minister of National Defence (Mr. Hellyer) refused in this house to give information on one of the most vital changes in our armed services that has ever been considered by the House of Commons. I believe that Canadians are concerned about the money that is going into defence expenditures today, because it represents approximately 25 per cent of our tax dollar. There are some people who believe that the best way to economize is to say no, and there are people who believe that real economy is to spend money judiciously and to do the job that has to be done without unnecessary frills. As I survey the plans which have been put forward by the government in this regard, I cannot help but feel that the result of their policies can only endanger Canada's position in the realm of external affairs.
[DOT] (4:40 p.m.)
You, sir, know that there are other problems that face this nation. The economic problems are great and every member on the other side wants to call himself innocent, but he realizes the government has the machinery at its disposal, the studies that have been made, and if they wanted to come to grips with the economic problems they could act.
February 8, 1967

This has been one of the significant failures of the government-the failure to act, the failure to make a decision when that decision was right. This has been followed by a period of deterioration which destroyed a part of the heritage of the Canadian people. We face a situation in this country today when this failure is more significant than it ever was before, particularly when we consider the minister's reversal with regard to the problem of research.
Canada is an exporting nation. All of the nations of the world, and many of them are older than we are, are spending tremendous sums of money on research. Here in Canada, a nation with untold undeveloped resources, we have adopted the reversal of that attitude which has been taken by many other countries around the world. Canada should be putting millions and millions of dollars more into research than any other nation in the world. We have tremendous natural resources. The hon. member who spoke before me referred to them, and was worried about who was going to own them. Well, if we do not undertake any research to develop these resources for this nation, we are not going to be able to own them or to develop them. We will have to depend upon outside interests. I think that is a trend that cannot help but trouble the average Canadian, and which I cannot help but deplore.
The significant fact is that today we are discussing the mini-budget. I recall when this minister became the Minister of Finance. He was going to solve all the problems this nation had, and even when he presented the budget last spring-


Mitchell William Sharp: Can the hon. gentleman quote his authority for that extraordinary statement?


Edward Nasserden: Well, there is no better authority than the minister himself.


Mitchell William Sharp: I never said anything like that. You must have said it; I know you have a great deal of confidence in the minister.


Edward Nasserden: The minister may not have said that, but he looked it. This afternoon we saw a member of his own party rising to attack the former minister of finance. I think he was thereby aligning himself with the cohorts of the present minister. So far as I can see, there has not been much change. The change has been so small you can hardly notice it.

The Budget-Mr. Nasserden
Canadians are worried about the financial institutions of this country. I am not referring to the ones that seem to be in trouble at the moment or to those that were making he news a few months ago. If we had had this financial uncertainty in Canada in 1961 and 1962, I wonder what the attitude of hon. members opposite would have been? I wonder what their contribution to a debate of this type would have been, with a government such as we have at the present time? These are the people who said they had the answers and now, three years later we find they have not done anything substantial to uphold the financial integrity of this nation. It is a very intriguing thought, to wonder why this has not been done during these three years.
We have had references to the Bank Act, and the position taken by the minister. This position has driven interest rates up, and has encouraged interest rates to rise more rapidly than at any other time. This is one of the things for which this Minister of Finance will be remembered-the highest interest rates in Canadian history and the tightest money in Canadian history. This Minister of Finance will not even rise to the bait; he will not even defend himself against these charges, because he knows they are true. The minister knows this government is responsible for the financial chaos in this country today.


Mitchell William Sharp: Mr. Speaker, may I ask a question? Would I be permitted to make another speech at the present time without concluding the debate?


The Acting Speaker (Mr. Richard):: Will the hon. member accept the question?


Edward Nasserden: I would be glad to answer any questions.


Mitchell William Sharp: I have no questions for the hon. member. I asked whether I would be permitted to make a speech without concluding the debate now?


The Acting Speaker (Mr. Richard):: Order. I think that this type of interruption is highly unnecessary. I suggest the hon. member continue.


Edward Nasserden: It does not surprise me at all when hon. members opposite claim they are a bunch of innocents, because I believe there is a feeling across the way that they have failed in their responsibility to the Canadian people. This is one of the reasons the minister not only in the house but across the country, has failed utterly to demonstrate
February 8, 1967

The Budget-Mr. Nasserden to the Canadian people the soundness of the policies that have been followed. These policies have not been sound.


Mitchell William Sharp: The most prosperous time in our history.


Edward Nasserden: Now, he is talking about prosperity. The only thing that has permitted the continued prosperity of this country during the tenure of this government has been the tremendous sales of grain made to the communist nations. The minister cannot deny that. He said in his budget speech, I believe a year ago-pardon me, it was the former minister who said this a little over a year ago, but the same statement is contained in the annual report of the Bank of Canada.


Mitchell William Sharp: Mr. Speaker-


Edward Nasserden: I say to you, sir, the minister-


Mitchell William Sharp: May I ask the hon. gentleman to quote his authority? There is no such statement to be found by me or by the Bank of Canada?


Edward Nasserden: I have no trouble in doing that, Mr. Speaker. The statement is found in the annual report of the Bank of Canada for the year 1962 or 1963.


Mitchell William Sharp: Well, quote it.


Edward Nasserden: I do not have the report with me, but I remember it very well. I recall that the minister of finance of that day placed the statement on the record of the House of Commons during his budget remarks. I believe most members of the house recall that very well.
When we speak of prosperity in Canada today, let us not forget that a great deal of credit for that prosperity must be given to the hon. member for Ontario (Mr. Starr). During those difficult years, when we assumed the mantle of responsibility, after the people of this country threw out the Liberals, the hon. member for Ontario brought into being a vocational training program that resulted in the construction of a great number of vocational training schools across this country. I have read in the press not only of Canada but of the world that this was the greatest training program of its kind to be found anywhere. It is a tribute to the hon. member for Ontario (Mr. Starr) that he had the inspiration and the vision to bring it about. Thousands of Canadians are able to work today because they are trained and are able to meet the

challenge that industry and a modern age presents. I recall, Mr. Speaker, that when we on this side of the house formed the government hon. members opposite attacked the program as being something which was too little and came too late. Yet it has been hailed the greatest program of its kind in the entire world at any period.
[DOT] (4:50 p.m.)
The hon. member who preceded me made some remarks about the British North America Act and I think I should say something in this regard, though I had not planned to. I believe he said that it was an antiquated piece of paper which no one believes in anyway; and he called it an overrated piece of dead fish. This statement comes from a member of the Liberal party, a party which believes in the rights of the provinces and in a united Canada, a party which says it stands for national unity in this 100th year of confederation. Yet no one rose on that side of the house to deny that statement.
Let me tell you, Mr. Speaker, that perhaps all of us in this house believe that the British North America Act can be improved upon. All of us would like to see the provinces get together to restate and to re-emphasize the unity of purpose that existed in 1867. But I think the remarks of the hon. member that this founding paper of our nation is an antiquated piece of paper which no one believes in anyway, that it is an overrated piece of dead fish, are an insult not only to the members of this house but to people in every part of Canada.
The year 1967 is the centennial celebration of the founding of our nation and gives us an opportunity to re-establish the purpose of Canadian life, to re-emphasizs the role of the individual in our society, to create opportunities and incentives that will give to all of us a vital, living part in the development of our nation, and to reward individual effort. I am glad that the Prime Minister (Mr. Pearson) will present centennial awards to Canadians, because I believe we pay far too little attention to the achievements that Canadians are able to chalk up in private life, in the university and scholastic field, and also in industry and labour. I do not think it is any denial of the status of a free people to show appreciation to those who have made an achievement; to single them out and set them on a pedestal so that others may try to accomplish similar achievements.
February 8, 1967


The Acting Speaker (Mr. Richard):: Order. I regret to advise the hon. member that his time has expired.


Mr. Raynald Guay (Levis):: Mr. Speaker, for over a year now the federal government has been trying to sustain the present economic expansion, which is now entering its seventh year. This is the longest period we have ever known in peacetime. With sound administration, there is no reason to believe a recession must inevitably follow the present period of prosperity in the country.
On the other hand, if we allow certain pressures to increase, if we do not try to relieve them, prices and costs will become excessive. Capital expenditures will become too great and a period of digestion or indigestion will follow.
The government is trying at present to reduce capital expenditures in order that Canada's long-term needs may be met without causing violent fluctuations, and our present capacity to satisfy capital expenditures may not be exceeded by demand.
In its second annual review, the Economic Council of Canada shows how company investments can become a factor of instability in the economy of our country;
Declines and expansions in investment have historically been an important factor contributing to the unstable and uneven growth of the Canadian economy.
The council then goes on to point out that although
-the actual volume of such investment will need to continue to expand considerably from current levels if potential output is to be attained in 1970-
-the recent rate of expansion in investment spending is clearly not sustainable on a long-term basis to 1970 and beyond.
The council suggests that any program aimed at stabilizing expansion,
-must endeavour to encourage a growth rate of business investment related as closely as possible to the potential growth in production.
That is why the council recommends
-that serious consideration be given to the possibility of putting off or staggering certain important building projects in areas where a lack of manpower and other resources is particularly serious.
Mr. Speaker, the federal government has accepted these recommendations. In fact, in August 1965, steps had already been taken to
The Budget-Mr. Guay prevent excessive accumulation of investments. When the government took this position in August, 1965, not to mention the measures regarding its own investments and those providing assistance to the provinces and municipalities in staggering their programs, it was already asking others to do the same.
The measures announced in last year's budget speech shore up this policy which consists in deferring clearly excessive investment demands, so as to ensure stable and continued expansion.
Three complementary measures have been designed so as to supplement each other.
The measure concerning depreciation, under which businessmen can claim a lower abatement for capital costs with regard to a certain type of assets in the next three years, if they make investments in the next 18 months, is designed to prompt businessmen to defer, as far as possible, their capital expenditures until the end of that period.
The purpose of the third measure providing for a 5 per cent tax on cash profits, that is, profits after taxes, principal repaid on a long term debt, in addition to capital cost allowances, depletion allowances and some other factors, is to consolidate the other two. In view of the $30,000 exemption, it is not aimed at small concerns which, on the whole, will not be paying this tax. The purpose, however, is to temporarily deprive companies of part of the available cash they might otherwise be tempted to spend on capital expenditures. As there is already a shortage of manpower and materials in capital goods industry as well as in the construction industry, any additional expenditures would inevitably bring about an increase of costs and prices due to competition between industries for manpower and materials already in short supply.
The funds remitted to the federal government will bear interest at 5 per cent per annum and will be reimbursed at any time after 18 to 36 months; this will enable the federal government to release them when pressure weakens on supplies and will allow capital investments to maintain their advance at a rate more easily supported.
The idea of a refundable tax on cash profits is entirely new. It resembles somewhat the Swedish plan intended to regulate capital expenditures. It differs in that, apart from the $30,000 exemption, all companies must pay the tax, whereas under the Swedish plan this is optional. It differs also in that the Swedish authorities did not commit themselves to a set time limit for refunding the tax. Finally, in
February 8, 1967

The Budget-Mr. Grafftey Sweden the funds may be released only for specific purposes, that is only if they are to be used in specified areas. We believe that, in Canada, our aims will be more easily achieved through the provisions we have proposed.
I should like to point out that special attention was given to the designated areas where the rate of unemployment is usually above average and where extra help is needed. The increased capital cost allowances will still apply to ventures in the designated areas which are eligible to subsidies for new capital investments, thus giving them a double advantage. The income of new manufacturing industries located in designated areas will be eligible for a three year income tax exemption plus an exemption from the 5 per cent refundable tax.
Finally, may I point out that, apart from tax exemptions the federal government will greatly help designated areas through the Area Development Incentives Act, the Rural Development Fund and the Atlantic Development Board Fund. Through all those measures, huge amounts will be spent for the development of the areas concerned.
In closing I should like to point out to the government the urgent need for building at St. Romuald, a most important industrial centre in eastern Quebec, a deep sea wharf which will permit development of the area and cut down unemployment there.
[DOT] (5:00 p.m.)


William Heward Grafftey: Mr. Speaker, may I begin by saying that it has been brought to my attention that cabinet ministers, having consulted senior officials, have concluded that approximately 100 subject matters requiring legislation await passage through the Canadian House of Commons. Immediately we ask the perennial question, why is parliament so behind in its work? My general answer is this: First, in many instances we have adopted horse and buggy practices and attitudes in the electronic age; second-and I cast no aspersions on any political party-for a young nation, Canada has built into its legislative practices an incredible number of delay procedures.
Since 1867 we have had hundreds of royal commissions. Other speakers this afternoon have mentioned them. Many royal commission findings have been excellent, yet successive governments have implemented not more than 10 per cent of commission recommendations.


I am not an expert on the rules of the House of Commons. I am anything but an expert. Yet it seems that there is a general consensus in the house that many of our rules and procedures are suited more to a bygone age. We have not adopted the committees system of the United States. In Canada, governments continue to send urgent or embarrassing questions to house committees, often not for further study and clarification, but to postpone the necessity of deciding. Many members of parliament take an initial delight in saying that the committees system, as it works these days, serves a great purpose in shedding light on contemporary problems. Through the system members of parliament become profoundly aware of the detailed implications of problems.
I suppose the electors of my district hope that by spending more time in Ottawa I shall become more educated. That is not the raison d'etre, per se, for my presence in the House of Commons. To educate and shed light is not the raison d'etre of the committee system. Its real raison d'etre, as in the United States, should be to quicken the decision making process of government. But, in Canada, the committees system is another part, an added factor, of the built-in delay procedure developed in a supposedly young, pioneering nation.
What else have we done in Canada? We have developed inquiries of all kinds, some of which admittedly are useful. Contemporary problems facing big governments obviously need to be inquired into. The bigger government becomes, the more inquiries are necessary. It is obvious that individual members of parliament cannot be experts in everything. Of course we need some inquiries. Some have been useful; others merely serve to delay the decision making process.
Today we have a new phenomenon. The Minister of Labour has had, within his federal jurisdiction, one strike after another. The strike problem is extremely urgent, and the people of Canada want action. Of course we must study the problem. We can study many precedents in Sweden, and elsewhere in Scandinavia relating to problems under federal jurisdiction. But what do we do in Canada? The Minister of Labour sets up a task force to look into strikes under the federal jurisdiction.
We have a housing crisis such as we have never had before. Instead of action what do we get? We get study groups, symposiums-in plain language, part of the built-in delay
February 8, 1967

procedure of the Canadian approach to contemporary problems.
When President Kennedy came to power, the moment he talked about a task force, the urgency of the problem was denoted, and the tentacles of the White House went out into the nation. Every expert in the nation was told to apply his knowledge to the problem, to bring about as speedy a solution as possible. The experts were given a delay period within which to report. If they could not report within a specific delay period, under reasonable circumstances the president would grant an extension.
What do we do in Canada? Having had strike after strike within the federal jurisdiction the minister tells us we now have a task force. He sets a few able men at the university level to study the problem of strikes under the federal jurisdiction, yet he has allotted them no time within which to report. We hope that some time in 1968 the minister will report to the House of Commons.
[DOT] (5:10 p.m.)
In the meantime this house is faced with tremendous difficulties vis-a-vis strikes under the federal jurisdiction. So we have a new delay of verbiage built into the Canadian experience-the task force. As I have said, one of the real reasons we are approximately 100 pieces of legislation behind in our work is that we have developed horse and buggy attitudes and techniques in the electronic age. We are told that in this electronic age an instantaneous poll of public opinion can be made available on any given date about any given issue. What has this meant to leadership in the western world?
Obviously, if Churchill or Franklin Roosevelt had relied on such polls as these, Churchill would not have stood up to Hitler the way he did and Roosevelt would not have led America out of isolation into the second world war. Today's political leaders are relying more and more for guidance on poll soundings made possible through modern techniques. Instead of speeding up the decision-making processes of modern government, the new facilities are, in fact, delaying them.
Statesmanship and the art of government is just that-an art form. It is not a matter of trying to lead on the basis of poll soundings. Far too many leaders are reading the polls instead of going ahead on courses which they believe to be correct. Of course, they must read the polls; they must read them scientifically and intelligently so as to have a good knowledge of the obstacles they would face
The Budget-Mr. Grafftey when they try to "sell" their policies. But far too many cabinet ministers in this government, and far too many political leaders in the western world, are today being led by polls instead of reading the polls to make a scientific analysis of the kind of persuasion they will have to use in order to carry out programs and policies which they deeply believe will be good for the people. This is one of the reasons for the delay in the decisionmaking process in modern government.
I pause briefly, here. In 1867 the Fathers of Confederation faced certain basic problems as they tried to pull this country together. These included relations between Canada and the United States and the relationship between the French speaking and the English speaking people-federal-provincial relations, and the like. In 1967, both domestically and abroad, the same two basic problems face Canadian legislatures-the unity of our country and our relationship with our great neighbour to the south. It is my impression that we are not making progress in the solution of either of these two major problems, because of our horse and buggy attitudes in an electronic age.
I believe that one of the greatest causes of delay in our decision-making process here in Ottawa lies in the area of federal-provincial relations and constitutional reform. The buck is passed between Ottawa and the provinces while urgent issues are held up.

Why? Because we did not really improve the system of permanent consultations between Ottawa and the provinces and second-


Jean-Luc Pepin: That is not true.


William Heward Grafftey: It is true. The minister says that is not true, but look at what he is doing about the problem of pollution; it is one study after another. However, as far as the Canadian people are concerned, we do not need all those studies. What the people are asking for today is action and nothing is being done in the field for which the Minister of Energy, Mines and Resources is responsible, because we have not brought our constitution up to date or set up permanent consultations between Ottawa and the provinces.
It is all very well for the minister to study the problems of air and water pollution, but the time has come when the Canadian people are asking for action. Let me tell you simply
February 8, 1967

The Budget-Mr. Grafftey that this results from the fact that we did not improve the permanent consultations between Ottawa and the provinces, because we never really solved in co-operation with the provinces the problems of our economic and social priorities and also because we never did modernize our Canadian constitution, in short we did not adapt it to the present times.


Jean-Luc Pepin: Would the hon. member permit me a question?


William Heward Grafftey: Yes.


Jean-Luc Pepin: Since he is now complaining about insufficient federal-provincial relations, how is it that, in other circumstances, he and his colleagues from the Progressive Conservative party are precisely complaining about the fact that those federal-provincial conferences are so numerous and have become so important that they tend to take away powers from parliament? This is something I cannot understand.


William Heward Grafftey: I quite agree with the hon. minister, we must have conferences. The minister is very sincere and I would not like to minimize the importance of such studies, of such conferences with the provinces; but I think we have discussed this matter together outside the house.
I wish to make the task easier for the minister by suggesting a modernization in depth of our constitution. At any event, we have not modernized the Canadian constitution, and I do not want to prejudge the results of conferences that must be held with the provinces. Perhaps the British North America Act is flexible enough for our present needs; perhaps it must be amended in one way or another; perhaps it is absolutely necessary to have a new constitution adjusted to modern times, but assuredly it is high time for us to study the matter, Mr. Speaker.

What has happened in the United States where there is today a fairly good relationship between the states and the federal government? In the United States, the federal government is taking direct action on all questions affecting one important new form of government, namely metropolitan areas. Here in Canada, failure to act in terms of planning priorities, both social and economic, in conjunction with the provinces; failure to improve consultative machinery between Ottawa and the provinces, and failure to embark on the work we must do in order to

obtain a modern constitution suited to modern times means that many important contemporary problems are not being attacked by any level of government. I do not say this in any partisan way; I realize the extent of the difficulties which are involved.
What has happened in this house in the past few months? The Minister of Finance (Mr. Sharp) says we can do nothing more about the cost of living because we do not really have sufficient constitutional power. The provinces say, "That is not our responsibility, it is the federal responsibility." What is the minister in charge of C.M.H.C. saying as he goes around the country? He is saying it is really a provincial responsibility, and the provinces are saying that the federal government should take the real initiative. The buck gets passed between Ottawa and the provinces and so we have no real action on the cost of living and on prices.
[DOT] (5:20 p.m.)
We question legislators on both the provincial and federal level about the greatest housing shortage the nation has ever seen, but what is happening is that the two levels of government are bickering, one with the other, while this supposedly rich nation, with the second highest standard of living in the world-


Mitchell William Sharp: Hear, hear.


William Heward Grafftey: -is ill housed. I agree that the standard of living is high, but wouldn't the Minister of Finance agree that we are running out of housing while the Minister of Labour goes across the country having symposia, study groups, and tete-a-tetes with authorities on the provincial level? If he does not act now, we will not be building the houses that we need for Canadians this year.


Jean-Luc Pepin: Oh, oh.


William Heward Grafftey: -a young, pioneering, dynamic country going to wave the constitution over people dying on the highways?
The Canadian people will not tolerate the delay procedures built into our system, while Ottawa and the provinces pass the buck, one to the other, and we fall 100 pieces behind in legislation. We are not even dealing with many of the major problems facing modern constitutional governments.


Jean-Luc Pepin: May I ask the hon. member a question or two?


William Heward Grafftey: Yes.


Jean-Luc Pepin: Does he recognize the value of the federal system in Canada?


William Heward Grafftey: I recognize the value of the federal system in Canada.


Jean-Luc Pepin: In the federal system is it not normal that jurisdiction should be divided between two orders of government?


William Heward Grafftey: Right; jurisdiction should be divided between two orders of government.


Jean-Luc Pepin: Then is it not normal when one order of government does not do what it is supposed to do, for the other order of government to remind it of what it is supposed to <io?


William Heward Grafftey: Right. In 1867 the Fathers of Confederation did the best possible job they could, but in 1967 a whole host of new problems have arisen which they could not possibly have envisioned. I contrast this with what happened in the United States. The Americans drafted their first constitution; it did not really work so they had to do the job again. We drafted the B.N.A. Act. We passed it in England. We put it in a museum case and we are told there is something about it that we cannot touch.
Just this afternoon a supporter of the government suggested that we at the federal level cannot protect investors in Canada, and that the Minister of Finance was having trouble in that respect. I say the Minister of Finance is having real and sincere difficulties doing his part to protect the Canadian investors because of our out-moded approach to federal-provincial relations.
In Canada we shall have to do what they did in the United States. We shall have to face up to the task of drafting a new constitution. The Americans scrapped their Articles of Confederation and wrote a new constitution, which seems to be working quite well for
The Budget-Mr. Grafftey them now. We shall soon have to begin that second stage in Canada. I am not saying we should necessarily tear up the B.N.A. Act, but we should form an all-party committee of this house as soon as possible, to meet with similar bodies in the provinces. I do not minimize the difficulties which we are going to have, but I do say that every day we wait is a lost day.
The Minister of Finance is supposed to be doing some good with his counterparts in the provinces in trying to get financial agreement, but that job will be easier for him if we can get on with the job of fundamental constitutional reform first. Let us not put the cart before the horse.


Jean-Luc Pepin: That is what you are doing.


William Heward Grafftey: The Minister of Energy,
Mines and Resources (Mr. Pepin) and I are having an honest argument.


Jean-Luc Pepin: May I ask another question.


William Heward Grafftey: Yes.


Jean-Luc Pepin: Does the hon. member not recognize that in recent years we have had tremendous de facto changes in the whole balance of power and revenues between the two orders of government?


William Heward Grafftey: Of course we have. I have to agree.


Jean-Luc Pepin: Does he not recognize that this was done without formal constitutional amendment? Does he not recognize that this was done within the old B.N.A. Act as it stands now?


William Heward Grafftey: Well, supposing I admit all these things, does that get us away from the fact that we have had delay because of bickering between the federal and the provincial level? I am not saying this in a partisan way. It happened when we were in government and when other Conservative governments were in office, and it will happen again unless we do something about it. For a young, modern, so-called pioneering nation we have too many delaying procedures built into our structures, with the result that we are continually passing the buck between Ottawa and the provinces. I am sure this buck passing does not happen to the same degree in any other nation of the world.
As a government supporter said so well a few minutes ago, investors in Canadian companies do not really care whether they are protected by the federal or the provincial
February 8< 1967

The Budget-Mr. Grafftey governments. All they ask is that they be protected. Let us stop having this bickering in these areas between both levels oi government and find out some other method of tackling the problem.
If the Minister of Energy, Mines and Resources thinks my approach to constitutional reform is wrong, can he suggest some other approach to me that can minimize the effect of what is going on because of this buck passing between Ottawa and the provinces? I may say that I think the minister is doing a very remarkable job in the resource field, even under present conditions, but this buck passing is the main reason which creates disillusionment in the body politic in general.


Jean-Luc Pepin: My main reason for objecting to this colossal Congress-of-Vienna approach to constitutional reform is simply the implication placed behind it, that nothing is being done now. That approach distracts from the reality of constitutional changes now taking place in Canada. Second, faith is being planted in the minds of the people that this great conference would solve all problems.
As I said yesterday in Montreal, such a meeting would turn into a circus because you would have at it all the representatives of all the parties in Canada, all the provincial leaders, all the presidents of all the important public-minded organizations, the Saint Jean Baptiste Society, the Canadian Clubs, the universities and what not. People are being led to believe that this would be the beginning of a great constitutional reform in Canada It should be obvious that progress does not come that way. Again the population is being distracted from the real changes now taking place.


The Acting Speaker (Mr. Richard):: Order. The minister and the hon. member for Brome-Missisquoi (Mr. Grafftey) will appreciate that many of us are being entertained by this repartee or discussion, but it is hardly in order for the debate to be transferred from one side of the house to the other except through the medium of a question, and I suggest that the hon. member for Brome-Missisquoi should continue his remarks.


William Heward Grafftey: Mr. Speaker, I hope that the dialogue between the minister and I was not pure entertainment. I thought his interventions were very informative, and I welcomed them. Maybe they were not exactly in the form of questions, but we shall have to have the kind of intervention that we are having now, because basically speaking, Mr. Speaker,


whether we like it or not, constitutions are political documents and it is politicians who will have to deal with them in the end.
I would agree with much that the minister has said, but I maintain that we need to do something. We should change our horse and buggy attitude in the electronic age, and modernize federal-provincial relations so as not to give the Canadian people the impression that nobody has direct authority over questions such as the housing shortage, the cost of living, water and air pollution, questions facing modern metro government that did not exist in 1867, and even questions regarding automobile safety. If not, this country is going to fall farther and farther behind. The time to face up to this job of work is now and, as I said before, every day we delay is a lost day.
[DOT] (5:30 p.m.)


J. Michael Forrestall: Mr. Speaker, my remarks in this debate will be limited and perhaps a little parochial in nature. I trust that the house will bear with me. The first matter with which I should like to deal is in respect of a situation of which I am sure the minister is aware. This is something which arises from time to time. I should like to use a specific example so that the minister will understand just what it is I am speaking of. This is a case where an individual enters into what could be, and has been, construed as a business venture for gain. In the course of seeking advice from the local income tax authorities, he was left with a misunderstanding or unawareness in respect of the full extent of the application of the Income Tax Act with regard to what is and what is not taxable income. Subsequently, however, in making out his return he included information concerning certain money earned together with a computation of profits made, and so on. In other words, he made no attempt to hide a particular transaction; but in the computation of the tax payable he does not include this as taxable income.
His return is filed and, in this particular case, three years go by. Cases arise, either by way of automatic spot checks or accidentally, where certain returns are checked. In any event, this particular return was checked. It was determined that while indeed the taxpayer had been completely honest and factual in filling out his return, he failed to include this amount as taxable income. From his point of view there was justifiable reason for this. The whole matter then becomes a matter for review. The individual is persuaded that his
February 8, 1967

original interpretation perhaps was not correct or that the advice given him by his solicitor was not correct. He then pays the overdue tax. However, in this particular case he finds that he is subject to a 6 per cent penalty in respect of the intervening years when this tax was not paid.
1 am sure these are not rare cases and I am concerned about the unfortunate situation in which such persons find themselves when they are assessed this penalty. I suppose the question is, who ultimately is responsible. Is it not the responsibility of the people in the department to properly assess and check all income tax returns? Are we faced with a situation in which people are playing a game of Russian roulette? Are there hundreds of people-unlike this person who was honest in filing his return-who are playing a game of Russian roulette with the officials in the Department of National Revenue in an effort to escape paying taxes? Is this what is happening?
This has caused Mr. Fryer, to whose case I have been referring for the past few moments, grave concern. It has caused him concern to the point where he is asking pertinent and, I think, quite justifiable questions. I should like to read into the record part of a letter, so that we can understand the extent of his concern about this:
As a taxpayer I am convinced that inefficiency does exist in this department and I cannot accept the excuse that they do not check all the income tax files every year but only spot check them. It is a well known fact that the employees in this department are not overworked and never have their work up to date so with the number of employees they have and with all the latest computing machines available the checking of each file every year should be a very simple matter-
He raised numerous other points. There is no attempt on his part not to pay what it has been decided and determined by due process of assessment by the taxation division of the Department of National Revenue is due. What he objects to, after having acted honestly and in good faith, is that three years later he finds that he must not only pay the tax that is due but also this additional penalty. It seems that the attitude of the department is a mechanical one. The act says one thing and that is the way in which it is interpreted and enforced. There seems to be no capacity to absorb what in effect Mr. Frank Fryer of Halifax, in this particular case, understands not to have been his responsibility. I would hope that at some point in the near future the minister would be able to deal with this as a general problem.
The Budget-Mr. Forrestall
Now, Mr. Speaker, I should like to raise one other matter which has been of some continuing concern, I am sure, to all members from the maritime provinces. This is a very broad and general matter. It has to do with the whole field of government incentives and the approach which the government now is taking in a haphazard fashion to raise the standards of the people, and the opportunities for employment in the Atlantic region, up to some kind of an acceptable level in relation to the rest of Canada.
As you know, Mr. Speaker, unemployment in the maritime provinces now runs somewhere in the order of 10.5 per cent. Apart from the attempts of the previous government, over the last 25 years there has been absolutely nothing done in a positive or concrete way to overcome this difficulty. Depending upon the area, I understand that unemployment in Canada runs from about 3.8 per cent to 6.4 per cent. The average is only about half as high as it is in the maritimes. The government must accept a part of the responsibility for this situation, because of the shotgun approach which is currently in vogue in respect of incentives. On a number of occasions in this chamber arguments have been put forward in support of extending the area incentives program to embrace the Atlantic region. That argument has been shot down for a number of reasons, the paramount one being that it would establish a precedent which the government does not want established. That is a very short-range view, and shows a lack of imagination or intelligent approach.
[DOT] (5:40 p.m.)
We must appreciate the extent and magnitude of the unemployment situation in the maritime provinces. The solution to this problem has been associated with incentives to increase secondary industry. As long as the government continues to follow the shotgun approach to these problems connected with industry, fishing and farming, as well as defence, power, import and export traffic, and the broad field of transportation, no lasting solution will be found. The government must adopt one concerted plan before this extremely high level of unemployment in relation to the rest of the country will be changed.
Recently we passed a massive transportation bill. Transportation is a key factor in the lifeblood of the Atlantic provinces. A good transportation system would encourage and make possible the development of viable secondary industry, and without it secondary industry cannot even locate there, let alone
February 8, 1967

The Budget-Mr. Forrestall flourish or participate in the growth of national income. At this time we are experiencing a waiting period. This is a further frustration in our attempts to bolster a sagging economy; it is a further frustration in our attempts to catch up to the rest of Canada.
We are waiting for the conclusion of a special study of maritime transportation problems. It is hoped that this special study will have embraced the entire economic spectrum of transportation and its effect upon the economy of the maritimes. If it does not, I am sure when we reach such a debate the maritime members of parliament, regardless of their political affiliation, will band together to overcome the shortcomings and shortfalls of the recommendations.
The government must apply to this whole massive problem the philosophy that in the long run it will be good for Canada to build a viable, live and prosperous Atlantic area. I am sure no one disagrees with that philosophy; yet we find ourselves unbolstered and unsupported by any co-ordinated federal activity in this field, such as that which fires the imagination of those people who have some understanding of the situation when they contemplate the proposed Fundy tidal power development project. The conversion of this tidal power to electricity is of such tremendous magnitude that in the Bay of Fundy this could provide the greatest source of waterpower on the North American continent. The potential source of electric energy is of such tremendous magnitude it could be the largest single source of hydro power on this continent, even if only a small proportion of it was tapped. What should such a tremendous source of power mean to the maritime provinces? I could not even begin to outline the economic impact that would result, or the impact that would result if a start were made on this project some time this year.
In answer to those who object to this massive development of hydro power, let me say that I do not believe this will be a complete answer to the problems of the power hungry Atlantic provinces at this time, or perhaps even in 25 to 30 years. Let me remind hon. members that at this time United States authorities have plans to expand the power capacity of the Hoover dam complex. The United States is not only prepared to go forward with this project, it is in the advance stages of doubling or tripling the power capacity of that complex at an expenditure of some hundreds of millions of dollars.

[DOT] (5:50 p.m.)
I have no idea what it would cost the Canadian taxpayer to move into this Fundy tidal power project, but such a development would have a tremendous impact on the economy of the Atlantic provinces. We have all observed the delays in respect of the Churchill Falls development. This whole development has been a matter of attention for a considerable number of years, but we are still not using power developed there. I do not know why this is so. Many obstacles have had to be overcome. However, the point I wish to make is that it took many years to get to the stage at which we find them now. Because of these obstacles, are we not to proceed with the Fundy tidal power? We know it is a transmission route, and therefore the cost to the power-hungry centres in the northeastern United States and in central Canada, areas which are closer to it, will be a lot less. We are aware that massive investments would have to be made in order to bring this about, but if it is approached on a reasoned basis it could mean the total rejuvenation of Nova Scotia, and indeed of all the Atlantic provinces. They say that it is difficult to describe the total power potential of the tides of the Bay of Fundy.
Mr. Speaker, before I run out of time I should like to mention one other point, and this again is something that the government can do if it is not prepared to bring all of the approaches to maritime problems under one authority, and that is to take a serious look at the import-export traffic, the future of international shipping, and in particular the adequate development of the port of Halifax to absorb and accept the cargoes that will be transported by water within the very near future. Already we have seen the extension of massive ships into the bulk cargo transportation scheme, such as oil transportation. The government should be encouraging our oil industries in Canada to give consideration to the development of central depots for receiving oil from South America. It has been explained that in view of the present planning and technological developments it will always be cheaper to bring oil from South America than from the west. We are not asking for massive expenditures which would be required to put a pipe line into our area; indeed this is not what we want. We can accomplish the same thing, which would have a good effect on our balance of payments, by trading this great natural resource.
What we have to do in order to accomplish this is not only to talk about it for the next
February 8, 1967

four or five years, but to decide now to move ahead with it so that the industries and the interests that are directly concerned and involved in this kind of enterprise can themselves plan accordingly. The establishment of a central oil depot which will accommodate three, four and five hundred thousand ton bulk carriers must be considered now. We have the natural facilities in the harbour, we have the necessary depth of water and all we need is a determined decision on the part of the government to move ahead with it. It is a self-liquidating expense. I assure the minister that the cost involved would be returned much more quickly than will be the cost of the seaway.
The port of Halifax must be developed now to accept cargo ships of this magnitude. It must be designed so as to include the concept of the integral train. We must stop thinking of transportation in a dual sense; it is not. Goods moving from the source of manufacture to the source of sale must be considered as an integral transportation package. Like the Fundy power, the theory of the integral train staggers the imagination. It is a simple extension of the ship to the rail. It is the movement of cargo out of the ship and directly to a massive train which is not owned by either the C.N.R. or the C.P.R. but rather is owned by a corporate entity involved in the movement of the particular goods. It may be a consortium of interests, it may be west coast lumber interests moving lumber and lumber products into the European market, and it may be a consortium of interests which has bought the rolling stock and accepts the responsibility for everything that is involved.
Preliminary studies have demonstrated the benefits of this system of the integral train. The massive or unit train system is a slightly different concept. However, surveys have shown us that we can now accept the proposition that transportation by rail can be even cheaper than transportation by water. The salvation of the port of Halifax as a viable economic contributor to the economy of Canada depends on this. These are not rhetorical propositions. Lack of action on the part of the government can only result in a chronic unemployment situation in the mari-times. I wish the St. Lawrence would stay frozen until around 1980, at which time the government may get around to doing something about these two or three necessary developments. The number of people working on the waterfront today compared with five years ago is staggering, and the impact has
The Budget-Mr. Forrestall been felt on the economies of the two principal ports in the maritimes. May I call it six o'clock?


George James McIlraith: Go ahead.


J. Michael Forrestall: I wish to say a few more words about unemployment. Unless the government acts in these three major areas, namely the secondary industries, the Fundy tidal power and the harbour development, the maritimes will continue to suffer from a lagging economy. Unless something is done quickly our share of the national growth will not increase and we will continue to have high unemployment throughout the winter months. At present I believe it is some 10.5 to 11 per cent.


Charles Mills (Bud) Drury: Will the hon. member permit a question? I wonder if he, in relating the question of high unemployment in the maritimes to the failure adequately to develop sea transportation, is aware that the British American Oil Company is proposing to establish a $40 million refinery on tidewater in Nova Scotia?


J. Michael Forrestall: Mr. Speaker, I think the hon. member for Antigonish-Guysborough (Mr. Stewart) who for the moment is sitting on the wrong side of the house, has welcomed this announcement, just as much as I welcome it. British American Oil has been talking about this for many years. I am sorry that the Minister of Industry had not mentioned this half an hour ago, so that I could speak on it.


Robert Muir: Will the hon. member permit a question? Is he certain that the minister really knows where the Atlantic provinces are, because he has forgotten them throughout the time he has been here?


J. Michael Forrestall: May I answer this question briefly, Mr. Speaker? I am not yet sure whether the minister knows where the Atlantic provinces are, but if he made such an announcement every day he might convince some of us by the end of the year.
May I call it six o'clock.
[DOT] (6:00 p.m.)


George James McIlraith: Before we call it six o'clock, Mr. Speaker, I wonder if there would be some disposition to pass some of the resolutions and introduce the consequent bills? I have in mind items Nos. 122, 126 and 127.


Michael Starr: Agreed.

February 8, 1967
Legislation


George James McIlraith: Perhaps we could call reso- Motion agreed to and the house went into lution item No. 122.	committee, Mr. Batten in the chair.


Mr. Deputy Speaker:: Does the house give unanimous consent to proceeding with these three resolutions?


Some hon. Members:: Agreed.



GOVERNORS GENERAL OF CANADA


George James McIlraith: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to provide for the payment of a retiring annuity to Governors General of Canada and to their widows.
Motion agreed to and the house went into committee, Mr. Batten in the chair.
Resolution reported and concurred in.
Mr. Mcllrailh thereupon moved for leave to introduce Bill No. C-265, to provide for the payment of a retiring annuity to the Governor General of Canada.
Motion agreed to and bill read the first time.



PUBLIC SERVICE


George James McIlraith: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Canada Grain Act, the Income Tax Act, the International Boundary Waters Treaty Act, the National Energy Board Act, the Railway Act, the Tariff Board Act, the Canada Elections Act, the Financial Administration Act, the Representation Commissioner Act, and the Appropriation Act No. 4, 1964, with respect to the salaries of certain public officials.
Resolution reported and concurred in.
Mr. Mcllrailh thereupon moved for leave to introduce Bill No. C-266, to provide for the revision of certain salaries fixed by statute.
Motion agreed to and bill read the first time.



JUDGES ACT


Lawrence T. Pennell: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Judges Act to revise judicial salaries and certain provisions of the said act respecting the payment to judges of travelling allowances and other expenses; and to provide further for certain changes in connection with the administration of the act.
Motion agreed to and the house went into committee, Mr. Batten in the chair.
Resolution reported and concurred in.



BUSINESS OF THE HOUSE

George James McIlraith: Tomorrow, Mr. Speaker, we will continue-


Michael Starr: What about the introduction of the bill?


George James McIlraith: The Clerk informs me that the bill covering the last item is not on the table. Tomorrow we propose to continue with the budget debate, and following that the budget bill consequent upon the budget.


[Stage Direction]
It being ten minutes after six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Thursday, February 9, 1967