1968-12-17

FINANCE


Hon. E. J. Benson (Minister of Finance):: should like to table copies of letters which were exchanged yesterday between the secretary of the United States treasury, Hon. Henry H. Fowler, and myself.
These letters review the unique financial relationship between Canada and the United States and the continuing exemption for Canada from the balance of payments programs of the United States. They repeat the judgment of both governments that a continued improvement in the international payments position of the United States is important for Canada and for the international monetary system as well as for the United States. They confirm the assurances of the Canadian government that Canada's exemption from the United States balance of payments programs will not be used in such a way as to endanger the success of those programs. In particular I have reiterated that it is not an objective of Canadian policy to achieve permanent increases in our exchange reserves through unnecessary borrowing in the United States.
At the same time the secretary of the United States treasury and 1 have agreed that the implementation of this principle does not require that Canada's reserve level be limited to any particular figure, and that our reserves may be expected to fluctuate to accommodate the adaptation of monetary policy to the changing needs of our domestic economy, seasonal influences, and other influences of a temporary nature.
I propose, Mr. Speaker, with the permission of the house that the texts of these letters be appended to Hansard.


Mr. Speaker:: Is that agreed?


Some hon. Members:: Agreed.


Hon. Marcel Lambert (Edmonton West):: wish to thank the minister for letting me have a copy of this correspondence. I do not
think it would add anything to the situation simply to say that both countries believe it is in their interest to occasion destabilizing influences on their respective currencies which might inhibit the other country in the pursuit of its own economic objectives.
I note the very general terms in which the minister has indicated that the $2.55 billion, which he calls a target figure and which has long been recognized as the ceiling, is now subject to temporary deviation. As a matter of fact it may be that for all practical purposes it has gone. If this is the true result then I would say it is a step in the right direction. For over a year now I have been saying that this restriction has been strangling us in Canada. Indeed, I would say to the minister it is very fortunate that Canada has been able to obtain this relaxation, though why a ceiling was ever imposed is something one will always question.
As I say, it is fortunate that Canada is not now caught by this limit, because before long the hon. gentleman would have been obliged to go into the market to raise funds had this ceiling not been removed. After all, we know that long term interest rates are now at the highest point ever. Last week the average rate on government long term obligations was up to 7.16, and this would have occasioned an increased movement of foreign funds into Canada.
[DOT] (2:40 p.m.)
The result would have been that the Minister of Finance, through the Bank of Canada, would have had to go into the market to sweep up these excess foreign funds, particularly United States funds, in order to limit our holdings to the $2.55 billion figure. The government would have had to go into the market to raise the cash in order to have the money to buy up this United States foreign exchange. This has been obviated. I trust the government will now have a more effective tool in dealing with the problem of inflation. As a matter of fact we are still facing that problem, but this might be allowing the government a bit more room for manoeuvre. We have not yet got rid of all the shackles that the action back in 1963 and 1964 brought on, but I am glad to see that after a
December 17, 1968

U.S. Balance of Payments lot of prodding the government has taken active steps to have this ceiling removed.


Mr. Max Sallsman (Waterloo):: These measures have seriously interfered with our ability to pursue domestic policies in this country, and the present Minister of Finance is going along with these measures as have past finance ministers. It is time we put an end to this. It is time we went to a flexible exchange rate so we could pursue domestic policies of our own without being tied hand and foot to the policies of another country which may not be in our interests.
Therefore the minister has a lot to answer beyond what is contained in these two letters. The question he has to answer to this parliament is this. Is he going to get this economy going or is he going to use these new measures to clamp down even further on the growth of this country and create higher unemployment?



BUSINESS OF THE HOUSE


Hon. Donald S. Macdonald (President of the Privy Council):: Mr. Speaker, if I may I would like to make a statement about two items of the business of the house. First, the right hon. member for Prince Albert inquired yesterday about the Christmas recess. I want to indicate to the house that I will be putting on the order paper a notice of motion for adjournment of the house until Tuesday, January 14, 1969, and it would be my proposal that the house rise for the Christmas recess with the adjournment of the sitting day this coming Friday, December 20.
The second matter concerns consultations about today's business. There have been discussions among the house leaders. I think there might be general agreement to a proposal to change the order of business for today and tomorrow so that we might bring forward the ways and means resolution dealing with anti-dumping and the bill consequent upon it. Therefore it might be appropriate for the house to make an order containing two elements; first, the antidumping resolution and the bill consequent upon it would be given priority today and if necessary tomorrow over other business under government orders; and second, if the resolution and/or the bill be not passed before the ordinary time of adjournment tomorrow, Wednesday, December 18, all questions necessary to carry the resolution and the bill would be put prior to the moment of adjournment.
December 17, 1968

If there is general agreement perhaps we could have an order to that effect made by the house right now.


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, we are in agreement to that which represents a collective effort in consultation and agreement, which we think is most appropriate to the house.


Righi Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, in view of the attitude taken now by the minister I wonder whether he would add as well to the motion to be passed today the adjournment of the house on Friday evening. Why come back again? Let us finish that up.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, with regard to the house order proposed for today and tomorrow I am happy to say that the statement made by the government house leader is correct. I may say on behalf of those in this party that we are happy to agree to it. Perhaps I might draw attention to the point that it is possible to decide these things by agreement rather than by compulsion.
f Translation]


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, we of the Ralliement Creditiste approve the changes in the procedure, in order to enable the government to pass the anti-dumping legislation which must come into force on January 1 and also to show that we understand the problems facing the government in connection with that measure as well as the others which could arise. Therefore, we are ready to co-operate even if we do not approve the terms of the proposed standing order 16A.


Mr. Speaker:: The house has heard the proposal outlined by the President of the Privy Council (Mr. Macdonald). Is it so ordered?


Some hon. Members:: Agreed.



CANADA ELECTIONS ACT


Mr. Louis-Roland Comeau (South Western Nova) moved: the first reading of Bill No. C-145, to amend the Canada Elections Act. (proxy voting).


Some hon. Members:: Explain.
Inquiries of the Ministry


Louis-Roland Comeau: Mr. Speaker, the purpose of this bill to amend the Canada Elections Act is to provide voting facilities to physically handicapped persons and aged citizens by allowing them to vote by proxy.

Many Canadians, Mr. Speaker, are unable to go to the voting poll on election day, as a result of a physical disability. This bill will enable those persons to exercise their right to vote and, in my humble opinion, it will assure them from now on a fuller participation in our democratic system.
Motion agreed to and bill read the first time.

[DOT] (2:50 p.m.)



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Lloyd R. Crouse (Souih Shore):: Mr. Speaker, yesterday I asked the Prime Minister whether he could announce any emergency measures planned by the government for the groundfish industry in view of the announcement by Unilever that four Bird's Eye plants in Newfoundland will close their doors, and he suggested I should direct my question today to the Minister of Fisheries.
In view of the serious economic situation in Newfoundland has the Minister of Fisheries any report to make to the house about the outcome of his discussions today with provincial fisheries representatives and members of the industry concerning emergency aid for the Atlantic provinces groundfish industry?


Hon. Jack Davis (Minister of Fisheries):: Mr. Speaker, as the hon. member has said we are currently holding meetings with the industry and representatives of the government of Newfoundland concerning the financial difficulties the grounfish industry in Newfoundland is in. These meetings are continuing this afternoon. We are discussing among other things a report by consultants which has been prepared over the past 12 months and which goes into detail in respect of the positions of companies in the Atlantic region.
While the discussions will be completed today and will be followed by other meetings, I do not expect we will be in a position to announce any basic solutions or make policy statements today.
December 17, 1968

Inquiries of the Ministry


Mr. James A. McGrath (St. John's East):: Mr. Speaker, I should like to ask the minister whether the government is prepared to accede to the request of the government of Newfoundland to continue the program of deficiency payments until the government can come up with a policy to meet this matter.


John (Jack) Davis: We have had a program in effect during the past summer which cost about $4,500,000. It was a crash program in a form which cannot be continued, or certainly not in that precise form. We will have to make other arrangements.


Mr. John Lundrigan (Gander-Twillingale):: Mr. Speaker, my question is directed to the Minister of Fisheries. Yesterday I asked if invitations had been extended to the members from the Atlantic region to negotiations between the federal minister and the trade. Have such invitations been extended? If so, what is the present status of this arrangement?


John (Jack) Davis: Mr. Speaker, I might take this opportunity to invite hon. members of the Atlantic region to join me tomorrow and we will discuss what took place today.



BILINGUALISM AND BICULTURALISM


[Stage Direction]
On the orders of the day:
Mr. David Lewis (York South):: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister and ask whether he and his colleagues have had the opportunity to study volume II, entitled "Education" of the final report of the B and B commission. Can he inform the house as to the company's-the government's-position on that volume? I keep hearing "board of directors" so often that I think of "company". Could he indicate the government position on the recommendations in that volume and whether it supports them?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, all I can tell the shareholder- excuse me, the hon. member of parliament- at this time is that we have not completed the study of the volume and we are not in a position to state any policy regarding it.


David Lewis: Has the chairman of the board of directors, the right hon. gentleman, been in touch with the provinces regarding this report, requesting them to study it and asking

them for their position regarding the recommendations?


Mr. Trudeau:: No, Mr. Speaker.


Mr. S. J. Korchinski (Mackenzie):: I should like to address a question to the Prime Minister. Despite the recent report of the B and B commission, will the Prime Minister give recognition to the recent thinkers' conference at Toronto which dealt with the multicultural aspects of Canada? Will he appoint a subcommittee, if necessary, to study and report on the possibility of promoting the multicultural aspect of our Canadian society?


Pierre Elliott Trudeau: Yes, Mr. Speaker, this matter of cultural minorities in Canada is very much present in the government's mind and forms an important part of our policy. On Saturday I had a most fruitful meeting with the Ukrainian organizations in Winnipeg. We discussed this question at great length, but I would remind hon. members that the B and B commission intends to make a separate report on the role of cultural minorities. It might be wiser, before laying down our policy in a final way, to await the publication of this report.


Stanley James Korchinski: A supplementary question, Mr. Speaker. Will consideration of the first report be suspended until the subsequent report is received?


Pierre Elliott Trudeau: No, Mr. Speaker, this is not necessary. I see no reason for it.



STUDY OF DEVELOPMENTS IN ALASKA AND NORTHERN CANADA

[Stage Direction]
On the orders of the day:
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to ask the Prime Minister a question I have asked on previous occasions. Some days ago the Prime Minister and the Minister of Industry, Trade and Commerce stated they thought it was a good idea to look into the setting up of an immediate commission or study task force to examine the whole petroleum picture in Canada in relation to the effect of the northern and, in particular, the Alaskan development on our industry. Has a decision been reached as yet by the government to set up such a study group, commission or task force?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, when the hon. member asked
December 17, 1968	COMMONS
his question the other day I did say I would look into it with the minister. We have had discussions on it, but I should not like to report what he has in mind at this stage. My feeling is that he is not yet prepared to set up a task force or commission. I do not think he is satisfied that the National Energy Board cannot do the job just as well. But I do not know whether he has made any final decision on this matter.


Eldon Mattison Woolliams: Mr. Speaker, I have a supplementary question for the Prime Minister. In view of the uncertainty in the industry, would the Prime Minister consider sending to Washington, after careful briefing, a committee composed of senators and members of parliament representative of all parties in the house to find out the American thinking on a new oil policy for Canada and the United States so far as it affects Canada, particularly in view of the fact that a new secretary of the interior has been appointed by the presidentelect of the United States?


Pierre Elliott Trudeau: Mr. Speaker, most suggestions made by the hon. member are worthy of consideration, and I would agree to consider this one. I do feel, however, that until the government itself is in a position to formulate its views on the whole question of a new oil policy for Canada, it might be premature to send such a delegation to Washington. In other words I would prefer, again, that the minister be in a more definite position before taking that step.
[ Translation]



CANADIAN CONSTITUTION


[Stage Direction]
On the orders of the day:
Gilbert F. Rondeau: Mr. Speaker, I wish to put a question to the right hon. Prime Minister.
In view of the fact that some of the provinces seem to agree that the federal-provincial conference should be held in February while others want it to be held as soon as possible, in January, could the right hon. Prime Minister tell us whether new arrangements have been made to hold this conference earlier than expected, as he had announced?


Right Hon.   P.-E. Trudeau@Prime Minister: Yes, Mr. Speaker. After consulting the premier of British Columbia, for whom the beginning of February was a most inconvenient
DEBATES	4031
Inquiries of the Ministry time, we suggested other dates, which also fall within the first two weeks of February, but on days which the premier of British Columbia finds more convenient. I suggested these dates to the other provinces. I have received some affirmative answers, but all the provinces have not yet answered, and so I cannot say that the date has been definitely settled.



PROCEDURE-FURTHER COMMITTEE CONSIDERATION OF CERTAIN PROPOSED CHANGES

[Stage Direction]
On the orders of the day:
Gerald William Baldwin: Mr. Speaker, I should like to ask the Prime Minister a question. Now that the advantages of sweet reason and co-operation have been demonstrated, would the right hon. gentleman not seriously consider discussing with his colleagues the possibility of withdrawing those parts of the proposed new rules which are totally unacceptable to a great many members of this house and to many people in Canada, referring them back to the committee and passing the rest of the rules, so we will come back here in the new year under a completely new regime?


Some hon. Members:: Hear, hear.


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, it seems to me the question may be a bit premature. There is still to be debate and speakers on this matter, I understand on Thursday and Friday of this week. I therefore would not want to make any commitment now. But I would be happy to hear from the opposition that the agreement reached today on one measure through co-operation, will bind them always to co-operate with our suggestions in the future.


Some hon. Members:: Hear, hear.


John George Diefenbaker: Not on behalf of tyranny.


An hon. Member:: That is not the Christmas spirit.
[ Translation]



DOMINION-PROVINCIAL RELATIONS SUGGESTED INCREASE IN TAXING POWERS OF PROVINCES

[Stage Direction]
On the orders of the day:
Hon. Martial Asselin (Charlevoix):: Mr. Speaker, I should like to direct a question to the Minister of Finance.
December 17, 1963

Inquiries of the Ministry
In view of the forthcoming federal-provincial meeting of the Ministers of Finance, would the minister tell the house whether the government intends to hand over certain taxation rights to the provinces so that they can honour their commitments, as the Quebec Minister of Finance mentioned last week-end?


Edgar John Benson: Mr. Speaker, I would simply like to say that we must retain certain taxation powers in order that we can face our responsibilities to the people of Canada.


Martial Asselin: Mr. Speaker, a supplementary question.
Is it the intention of the Minister of Finance to submit proposals to the provinces so that they can be prepared to meet their financial obligations?


Edgar John Benson: Mr. Speaker, of course I will be speaking with the ministers of finance of the provinces and with the provincial treasurers on Thursday. We will listen with understanding to their problems, and I also hope they will listen with understanding to ours.


Martial Asselin: A supplementary question, Mr. Speaker.
I would like to know whether the Minister of Finance is going to suggest, on behalf of the government, an amendment to the constitution concerning the financial jurisdiction of the federal government and the provinces, so that the provinces may honour their obligations?


Edgar John Benson: Mr. Speaker, I think this is a matter that would have to be discussed at the constitutional conference. If there is to be a reallocation of powers agreed upon under the revised constitution, then of course there must also be a reallocation of means for meeting the revised responsibilities in the hands of the provinces or of the federal government.



NATIONAL REVENUE


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, I should like to ask the


Minister of Finance a question. We are approaching Christmas, and although the Minister of Finance is not usually Santa Claus could he give some hope to the Canadian people that the confiscatory rates, which as he has announced will be imposed under inheritance and estate taxes, if parliament accepts the measure, will be considerably reduced when the legislation is presented?


Edgar John Benson: Mr. Speaker, I cannot give any hope for a reduction in the rates. The rates were designed to free from estate tax the movement of estates from husband to wife, and other rates had to be adjusted. I should like to point out to my hon. friend that on estates of $200,000 to $250,000 passing on to children in some instances the taxes are lower under the new estate tax than they were under the previous legislation.


John George Diefenbaker: Mr. Speaker, a $200,000 estate does not interest me one bit. What I am asking is, what about those tremendous rates that the minister is going to impose? After the husband dies his wife inherits his estate, and after she dies the estate will be almost completely wiped out by heavy taxation. Does the minister not think some relief is due to the Canadian people from such a hold-up?


Some hon. Members:: Hear, hear.


Edgar John Benson: Mr. Speaker, I know $200,000 to $300,000 is far below what my right hon. friend would consider as an estate. However, I should simply like to repeat what I said, that in some instances when a family farm worth $200,000 to $300,000 is passed on to children, the estate taxes under the new law will be smaller than they are at present.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. Ed Schreyer (Selkirk):: Mr. Speaker, my question is directed to the Prime Minister. There have been some news reports indicating that the Prime Minister stated at a meeting last Friday that Canada's present commitment in NATO will be maintained. I should like to ask the Prime Minister whether the government's present foreign policy review as it relates specifically to our NATO commitment has been concluded and a decision taken.
December 17, 1968	COMMONS


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, the premise is not in accordance -with the facts. I have never said that, nor have I seen it reported anywhere.


Edward Richard Schreyer: I have a supplementary question, Mr. Speaker. May I ask the Prime Minister whether the government's present review of foreign policy has been concluded in so far as it relates to our NATO commitment.


Pierre Elliott Trudeau: No, Mr. Speaker.


Mr. Andrew Brewin (Greenwood):: Mr. Speaker, I wonder if I might ask a supplementary question and address it to the Secretary of State for External Affairs. Can he tell us whether the review of our external and defence policies includes an examination of the problem posed by NATO aid being used to bolster military dictatorship which disregard the rule of law and fundamental human rights but are still within the treaty?


Mr. Speaker:: Order, please. I wonder
whether the question is not too wide in scope to be asked at the present time. However, perhaps it might be allowed and the minister permitted to reply.


Hon. Mitchell Sharp (Secretary of Stale for External Affairs):: If the hon. gentleman was referring, for example, to the question of Greece which has been in the news recently,
I can say that the only military aid we are giving to that country consists of some spare parts for training aircraft. We are not supplying any ammunition, weapons, or any kind of offensive military equipment.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Gerald Laniel (Beauharnois):: Mr. Speaker, I intended to put a question to the hon. Minister of Manpower and Immigration of which I had given him notice but, in his absence, I shall direct it to his parliamentary secretary.
Can the hon. parliamentary secretary to the Minister of Manpower and Immigration tell us whether, since this morning, the minister has had conversations with the officials of the Chemcell division of the Canadian Celanese Company with the view to minimizing as much as possible the harmful effects of the unexpected announcement of the closing
DEBATES	4033
Inquiries of the Ministry down of that company's dyeing plant at Val-leyfield which will lead to the lay-off of 150 employees next February?


Mr. Gerard Loiselle (Parliamentary Secretary to Minister of Manpower and Immigration):: Mr. Speaker, the minister was indeed advised yesterday afternoon of the closing down of that plant; as early as this morning, and even now, the officials of the department are conferring with the officials of the company to find the necessary solutions towards minimizing the problem of the workers.


Gérald Laniel: Mr. Speaker, I have a supplementary question.
As I conveyed the news myself yesterday afternoon to the minister, can the parliamentary secretary tell us whether the department might be interested in resorting to the good offices of the member for Beauharnois to draw up an efficient program to find-


Mr. Speaker:: Order.


Gérald Laniel: -without delay a solution to the problem?


Mr. Speaker:: Order. The member for Sainte-Marie.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Georges Valade (Sainte-Marie):: Mr. Speaker, I wish to put a question to the President of the Treasury Board.
Could he tell us whether he has approved the estimates necessary for the construction of Place Radio-Canada, as recently announced by the Secretary of State?


Hon. C. M. Drury (President of the Treasury Board):: A contract was approved this morning by the governor in council, Mr. Speaker.


Georges-J. Valade: I should like to ask a supplementary question, Mr. Speaker.
Could the President of the Treasury Board tell us the amount authorized by the Treasury Board and whether this amount is to cover the whole work or only part thereof?
4034	COMMONS
Inquiries of the Ministry


Mr. Speaker:: Order. The information
requested by the hon. member cannot be properly given during the question period.


Mr. Jacques Guilbault (Saint-Jacques):: Mr. Speaker, I should like to put a question to the hon. Secretary of State or to his parliamentary secretary which stems from the reply given a while ago by the President of the Treasury Board.
I should like to know whether the Secretary of State will soon announce officially the start of construction of Place Radio-Canada.


Mr. Robert D. G. Sianbury (Parliamentary Secretary to Secretary of State):: Yes, Mr. Speaker, I hope this announcement can be made either today or tomorrow.
[ English]



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. P. B. Rynard (Simcoe North):: Mr. Speaker, I should like to address a question to the Minister of Fisheries concerning the statement that the federal Fisheries Research Board is polluting 56 small lakes and 17 watersheds in northern Ontario. Would the minister care to comment on that statement and on what is the purpose of such action?


Mr. Speaker:: Order, please. The hon. member cannot simply ask the minister to make comments; he has to ask a specific question.


Philip Bernard Rynard: I should like to ask the minister, then, whether he intends to take any action in this matter.


John (Jack) Davis: Mr. Speaker, this is not a matter of pollution but rather a matter of controlled enrichment. Fertilizers such as phosphates and nitrates are being introduced into a number of small ponds. This is a controlled process. The enrichment process can be followed by a de-enrichment process whereby the lakes can be returned to their original state. This experiment is being carried out in co-operation with the department of lands and forests of Ontario, and the situation is under control.
[Mr. Valade.l
DEBATES	December 17, 1968



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, I promise not to add an ounce of pollution to the question I am about to ask of the Minister of Veterans Affairs and of which I have given him notice. The urgency arises from the approach of Christmas and the coming into effect of a certain tax on January 1. Is the department doing what it can to issue the back pay raises to its housekeeping and steward forces, recently negotiated, before the end of the year; and with what results?


Hon. Jean-Eudes Dube (Minisier of Veterans Affairs):: Mr. Speaker, I wish to thank the hon. member for giving me notice of his intention to ask this question. In the same Christmas spirit I am very happy to report that the great majority of the hospital services group have already received their retroactive pay increases, and the remainder are being processed as quickly as possible.
Mr. J. M. Forrestall (Dartmouth-Halifax
East): Mr. Speaker, I have a supplementary question directed to the Minister of National Defence and his charming seatmate. I wonder if I can ask him now if he is in a position to advise the civilian employees of the Department of National Defence whether they will get their retroactive pay before January 1. If not, would they consult their colleagues on the treasury benches to see if those cheques could not be back-dated to some date in 1968 if it is necessary to issue them in 1969.


Hon. L6o Cadieux (Minister of National Defence):: Mr. Speaker, I do not make a daily check on this question, but the last time I did check my information was that the prospects were reasonably good that these cheques would be out on time.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Robert Muir (Cape Breton-The Sydneys):: My question is for the Minister of National Health and Welfare. In view of repeated warnings from United States authorities can the minister tell us what
December 17, 1988

preparations our own federal health department has made to meet a possible epidemic of Hong Kong 'flu over the Christmas season?


Hon. John C. Munro (Minister of National Health and Welfare):: I would advise that we have not had very many cases of this particular disease in Canada. So far only about 100 cases have been reported, and they have been relatively mild. Since the summer the food and drug directorate have been doing everything possible with United States and Canadian companies to urge the manufacturer of this particular antitoxin. We hope we will have a supply in Canada by mid January.


Robert Muir: supplementary question, Mr. Speaker. Can the minister advise the house at this time whether a sufficient supply of antitoxin will be available in this country, and whether the medical profession will have a supply to deal with this very dangerous disease?


John Carr Munro: It will be distributed on a priority basis. These are subjective judgments and are very difficult, but the health authorities will have to make them, such as the elderly first and so on. The difficulty in the manufacture of this antitoxin is being overcome by companies that have permission to make it both in the United States and Canada.


Philip Bernard Rynard: I should like to ask the Minister of National Health and Welfare a supplementary question. Is he making any arrangements to have the members of the house inoculated, as they have been in the past?


John Carr Munro: It is questionable whether members of parliament are considered priority persons.



EXTERNAL AID


[Stage Direction]
On the orders of the day:
Mr. Lome Nyslrom (Yorkion-Melville):: On
Friday, Mr. Speaker, I asked the parliamentary secretary to the Secretary of State for External Affairs a question concerning the Christmas ship to Biafra. Today I want to ask the Secretary of State for External Affairs a similar question. Would the Secretary of State for External Affairs consider a donation on behalf of Canada of surplus food for Biafra which would be shipped via the Christmas ship which is scheduled to leave New York early in January?
Inquiries of the Ministry
Hon. Mitchell Sharp (Secretary of State for
External Affairs): As hon. members know, I have received a letter on behalf of members of parliament in which we were specifically asked if we could supply some surplus food. This matter is still under investigation.


Lorne Edmund Nystrom: A supplementary question, Mr. Speaker. Since this is an international project and since the government of Holland have endorsed it, does the Canadian government intend to encourage the Canadian people to support the project?


Mitchell William Sharp: If it would be any help, I should like to support it and I hope all members of parliament will support it most generously.



IVORY COAST-REPORTED REFUSAL OF GIFT OF WHEAT

[Stage Direction]
On the orders of the day:
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, may I ask the Secretary of State for External Affairs now to give a report of the circumstances surrounding the refusal by the Ivory Coast to accept Canada's shipment of wheat, as the Prime Minister suggested the minister would do today?


Mitchell William Sharp: Mr. Speaker, the matter is still under discussion with the governments concerned.



INQUIRIES OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. Rene Matte (Champlain):: Mr. Speaker, I wish to direct a question to the Minister of Indian Affairs and Northern Development.
Could he tell the house whether the former member for Champlain is employed by his department and, if so, in what capacity?


Mr. Speaker:: This question could be placed on the order paper.


Mr. Henri Latulippe (Compton):: Mr. Speaker, I wish to direct a question to the Minister of Public Works.
Could he tell the house whether the construction of post offices which had been postponed last year and promised for this year will be carried out in spite of the cancellation of winter works?
4036	COMMONS
Inquiries of the Ministry


Hon. Arthur Laing (Minister of Public Works):: Mr. Speaker, I must have some details about the post office. If the hon. member would care to give me a note about it I should be glad to make some inquiries.



PRIVILEGES AND ELECTIONS


[Stage Direction]
On the orders of the day:
James Aloysius McGrath: My question is for the house leader, but in his absence I should like to direct it to the hon. member for Montmorency in his capacity as chairman of the committee on privileges and elections. I should like to ask the hon. gentleman what became of the motion passed in this house in connection with my question of privilege, referring the report of the standing committee on transport and communications to the committee on privileges and elections. This motion was passed on December 10.


Mr. Ovide Laflamme (Montmorency):: Mr. Speaker, the report of the proceedings of the sitting on November 28 was prepared, translated, printed and distributed today only. I got in touch with the whip of the opposition who gave me the names of two members of the Conservative party who were supposed to sit on the agenda subcommittee. This afternoon the notice calling for a meeting of the subcommittee tomorrow was sent out by mail to its members. If tomorrow the members of the subcommittee express the wish to sit on Thursday or Friday, if need be, we shall do so.



BILINGUALISM AND BICULTURALISM


[Stage Direction]
On the orders of the day:
Mr. Lincoln M. Alexander (Hamilton West):: I have a question I should like to direct to the Solicitor General. In view of the fact that La Presse has published documents obviously stolen from a royal commission, is it the position of the crown that a charge of receiving stolen goods is warranted against the newspaper?
[Mr. Latulippe.)
DEBATES	December 17, 1968


Mr. Speaker:: Order, please. I have some doubts whether the question as asked is in order. The hon. member is asking for the expression of a legal opinion by the Solicitor General. Perhaps the question could be worded in some other way which might make it acceptable under the rules.


Lincoln MacCauley Alexander: I should like to raise a point of order, Mr. Speaker. I believe it is necessary at this particular time that we know in which direction the government is going. It seems that a major investigation is now taking place which involves several people and might involve the newspaper which did print the allegedly stolen material. I feel this is the type of question which should be asked and answered in order to protect those concerned. I ask Your Honour's indulgence in this regard.


Mr. Speaker:: In my view the question is clearly out of order. I do not see how I can accept it. Perhaps the hon. member might give the matter some thought and seek the information in some other way when I recognize him again.


Lincoln MacCauley Alexander: Perhaps I could rephrase this question. May I ask the Solicitor General, are there any charges to be laid as a result of the investigation now being made by the R.C.M.P., and if so, against whom?


Hon. G. J. Mcllrailh (Solicitor General):: There is an investigation going on at the present time. While that investigation is going on it would be quite improper for me to make any comment upon it. Until it is completed I have no comment to make whatever. When it is completed I will be glad to answer questions about it.


Lincoln MacCauley Alexander: A supplementary question, Mr. Speaker. Will the minister advise the house whether he obtained copies of the supporting material used to obtain the search warrants to which reference was made yesterday; and is he now ready to let the house know what this information was?


George James McIlraith: Yesterday I indicated that I would undertake to find out what information was used or what form the giving of the information took before the judge, because the form of these hearings varies rather sharply across the country. I do not have a complete report on that. I understand there was no evidence as such taken at the hearing, but I am trying to find out what if any documentation there was. If there was any I will bring it before the house as I said I would.
December 17, 1968



ADMINISTRATION OF JUSTICE

[Stage Direction]
TORONTO-HOLDING OF INDIAN GIRL IN JAIL On the orders of the day:
Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, may I address a question to the Minister of Indian Affairs and Northern Development. Will he investigate the circumstances under which an 18 year old Canadian Indian girl unable to raise bail was detained in the Don jail at Toronto for more than one month, after which time the charge was withdrawn?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I read that article and I have asked my department to investigate. As soon as I know the answer I shall be pleased to inform the house.


Alfred Pullen Gleave: A supplementary question, Mr. Speaker. Will the minister also investigate why apparently no assistance was given to this girl by the department?



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, may I direct a question to the Postmaster General. It concerns a three page application required from newspaper publishers applying for second class mailing privileges and the annual fee of $15 charged by the department to study all such applications. Would the minister take the opportunity soon to table such an interesting, costly and obviously very complex document?


Hon. Eric W. Kierans (Postmaster General):: Mr. Speaker, I would be very glad to.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Walter C. Carter (St. John's West):: Mr. Speaker, my question is for the Minister of Transport but in his absence may I direct it to his parliamentary assistant. Is it contemplated that Central Mortgage and Housing interest rates will be increased from the current 8} per cent to a new, proposed rate of 9J per cent?
Inquiries of the Ministry NATIONAL DEFENCE



SUGGESTED NEW ROLE FOR DEFENCE FORCES

[Stage Direction]
On the orders of the day:
Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, I have a question for the Prime Minister. It is concerned about the recent suggestion made by Dr. O. M. Solandt, chairman of the research council, that Canada should consider converting its armed forces into a sort of global public works corps for the underdeveloped countries. Is this suggestion being considered by the government?


Mr. Speaker:: I suggest to the hon. member that that question is of very general scope, and I do not feel it is so urgent that it should be allowed at this time. However, since the hon. member appears ready to argue in favour of allowing the question to be asked it might be wiser to allow the Prime Minister to answer.


Some hon. Members:: Oh, oh.


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I have said that our review is a general one, and that we welcome all kinds of new ideas. I must say this is a new idea, but not so new that I have not also discussed it myself with other people in the past months.


Winona Grace MacInnis: supplementary question, Mr. Speaker. In view of Dr. Solandt's past experience as founder of the research board will he be asked by the government to expand on his suggestion?



INDIAN AFFAIRS


[Stage Direction]
On the orders of the day:
Robert Muir: Mr. Speaker, my question to the Prime Minister is prompted by similar questions which were asked in the house yesterday by the hon. member for Skeena and other hon. members. The Prime Minister must be aware of the extremely difficult situation which Canadian Indians and Eskimos face as the result of an apparent breakdown of government policy.


Mr. Speaker:: Order, please. The hon. member knows he ought to ask questions and not preface his remarks by the type of statement he has made. Will he kindly ask his question.


Robert Muir: Mr. Speaker, I was just leading up to it. Will the
4038	COMMONS DEBATES	December 17, 1968
Inquiries of the Ministry
Prime Minister consider instituting a royal some specific points to make I wish he would commission of inquiry to look into the affairs contact me, or be more precise, of our native Indians so that our native popu-	.
lations in general will have the assurance that ^r* ^ose: A supplementary question, Mr. something is being done to correct these Speaker. Have the admission terms been situations which certainly smack of serious chanSed in providing the number of beds for injustice?	extended care in recent months?


Joseph Jacques Jean Chrétien: Mr. Speaker, I should like to reply to that question.
First of all, I should like to tell the hon. member that last week-end I visited the Indians of Nova Scotia and New Brunswick. They told me that it was one of the first times a minister had gone out of his way to go and meet them in their province.

Mr. Speaker, for the first time the government is having consultations with the Indian peoples of Canada.


Robert Muir: I rise on a point of order, Mr. Speaker. I should like to correct an impression the minister is trying to leave. Hon. Ellen Fairclough was the first minister who went to consult the Indian peoples.


Mr. Speaker:: Order, please. Obviously the hon. member has no point of order but he may wish to ask a supplementary question.


Robert Muir: By
way of a supplementary question may I ask whether the minister's ramblings and wanderings over the country have answered the serious situation brought to the attention of the house by hon. members yesterday and today.


Mr. Speaker:: Order, please.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Mark Rose (Fraser Valley Wesf):: Mr. Speaker, my question is directed to the Minister of Veterans Affairs. In view of complaints from British Columbia regarding cut-backs in domiciliary care provided to aging veterans at Shaughnessy hospital in Vancouver, may I ask how the minister is dealing with this urgent matter?


Jean-Eudes Dubé: Mr. Speaker, I know of no cutbacks in services. If the hon. member has


Mr. Speaker:: Order, please. Would the hon.
member please resume his seat. I suggest this is the type of question which in my view should normally be placed on the order paper. If it is urgent, then the hon. member may give appropriate notice to the Chair for the purpose of discussing it at the time of adjournment.



INQUIRY FOR RETURN

[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: Mr. Speaker, may I direct a question to whoever is charged with meeting the orders the house makes with regard to the production of documents. My question relates to a motion for the production of papers passed on October 9 relating to the British Columbia Indian Reserves Mineral Resources Act. I wish to know where the documents are and whether they are going to be tabled.


Joseph Jacques Jean Chrétien: I will look into it, Mr. Speaker.



REQUEST FOR ACCELERATED DEPRECIATION ON DRYING EQUIPMENT

[Stage Direction]
On the orders of the day:
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, my question is for the Minister of Finance. In the light of questions asked on October 24 and 25 as well as subsequently by the hon. member for Regina East (Mr. Burton) about accelerated depreciation on grain drying equipment, and in light of the suggestion three weeks ago that the question would be answered soon, may I ask the minister to advise the house when the new regulations will be published.


Edgar John Benson: Mr. Speaker, I believe the regulations were published in the normal manner by the Department of National Revenue some week or ten days ago.


Leslie Gordon Benjamin: On a question of privilege, Mr. Speaker, members of this house have been seeking this information. None of us

December 17, 1968

have received this document from the department, and I think we are entitled to be answered here because the question was asked here.


Edgar John Benson: I suggest to the hon. member and to all hon. members that copies of the depreciation regulations are available from the Department of National Revenue.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Finance. Yesterday I asked the Prime Minister if he would like to make it clear before Christmas that some time early in 1969 something would be done about the pensions of superannuated civil servants. The Prime Minister told me that it is the Minister of Finance who answers for the government on this particular matter. Would the Minister of Finance like to answer my question now?


Edgar John Benson: Mr. Speaker, before answering the question I should like to read completely what the Prime Minister said yesterday.


Stanley Howard Knowles: May
I ask a supplementary question. Surely the minister knows the answer to this. Are the recommendations which were made to this house on May 8, 1967 still under consideration by the government?


Edgar John Benson: Yes, Mr. Speaker.



WAYS AND MEANS

[Stage Direction]
The house in committee of ways and means, Mr. Bechard in the chair.

[Stage Direction]
That it is expedient to introduce a measure to provide for the imposition of anti-dumping duty including provisional duty and the establishment of an anti-dumping tribunal consistent with Canada's obligations under the "Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade" signed on behalf of Canada in June, 1967, and to provide further for certain related or consequential amendments to the Customs Act, the Customs Tariff and the Tariff Board Act.
The Deputy Chairman:: Shall the resolution
carry?


Some hon. Members:: No.
Ways and Means


Mr. Gray:: On a point of order, Mr. Chairman, I wonder whether spokesmen for the other parties would indicate whether they would prefer to make their major speeches at the resolution stage or on second reading. If the former, I would make a detailed statement at this time. If it is to be the latter, I will reserve my remarks until second reading. In either case, I would be happy to accomodate hon. gentlemen opposite.


Mr. Harkness:: So far as this party is concerned we would prefer to hear the minister's explanation and make our speeches at the resolution stage rather than on second reading.


Stanley Howard Knowles: The
members of this party who will be speaking on the subject take the same position.


Herbert Eser (Herb) Gray: Mr. Chairman, for Canada one of the important elements of the Kennedy round package was the new international code to govern the application of anti-dumping duties. Canadian representatives took an active part in negotiating the code to ensure that it would enable the application of dumping duties quickly and effectively when dumping caused or threatened injury to Canadian industry and, at the same time, protect Canadian exporters against the unreasonable use of these measures by other countries. Other signatories to the code have been complying with its provisions since July 1, 1968, as agreed at the end of the Kennedy round. It was not possible for Canada to meet that date and it was agreed with our trading partners that Canada could delay its implementation until January 1 next.
As hon. members are aware, new legislation is required for Canada to give effect to the code. It will be recalled that the white paper on anti-dumping, which was tabled in the house on September 20, incorporated a draft anti-dumping act designed to comply with the provisions of the anti-dumping code. This white paper has been subjected to a detailed examination by the standing committee on finance, trade and economic affairs which held twenty two meetings for this purpose. In the course of this study, the committee heard extensive evidence from industry representatives and government officials. This evidence forms part of the printed proceedings which have been available for some days.
The report of the committee recommends the draft bill and the white paper to this house for favourable consideration together

December 17, 1968
Ways and Means
with the changes set forth in this report. These recommendations have been incorporated into the present bill, to be based on this resolution. I should like to note the way in which members of all parties worked together on the finance committee in studying this important measure. I should certainly like to congratulate the members of the committee and its chairman, the member for Gatineau on the effort they put forward, enabling them to make a report to the house on their studies so expeditiously.
If I may, Mr. Chairman, I should like to comment briefly on the principal features of the proposed legislation. The bill relates to the imposition of anti-dumping duties including provisional duties, the establishment of an anti-dumping tribunal and certain consequential amendments to the Customs Act, the Customs Tariff and the Tariff Board Act.
Under the terms of this bill goods are considered to be dumped if the normal value exceeds the export price and the dumping duty applicable or the margin of dumping is the difference between these two amounts. Normal value is generally the price at which like goods are sold at arms length in the ordinary course of trade in the country of export at about the same time as the goods are sold to the Canadian importer, adjusted for allowances to reflect price comparability between the home market sales and the sale to the Canadian importer.
Export price is defined as an amount equal to the lesser of the exporter's sale price for the goods or the importer's purchase price for the goods on an f.o.b. basis. If the dumped goods cause injury, threat of injury or material retardation to production in Canada, dumping duties will be applied.
The Department of National Revenue is to retain responsibility for deciding whether or not goods are dumped into Canada. It will also be responsible for making preliminary determinations of dumping and the consequent levying of provisional duties. These duties would be collected after a preliminary determination by the deputy minister and would apply to all imports of such goods until there is an order or finding by the tribunal. After an order or finding the deputy minister makes a final determination and definitive duties are applied to all subsequent importations of like goods that are dumped. National Revenue's decision on the margin of dumping and the category of goods involved will be subject to appeal to the Tariff Board and, on points of law, to the Exchequer Court. These

appeal provisions are analogous to the appeal provisions set out in the Customs Act.
The most significant change required in Canadian legislation relates to the provision that there must be a formal inquiry into the impact of dumping on production in Canada. This requirement is carried forward from the anti-dumping code which provides that injury, threat of injury or material retardation to production in Canada must be determined before dumping duties are assessed. An anti-dumping tribunal to be composed of not more than five members is to be established for this purpose. The tribunal must, within three months from the date of the deputy minister's preliminary determination, make a decision on the question of injury, threat of injury or material retardation to production in Canada. If the tribunal makes an order or finding of injury, the deputy minister of national revenue must make a final determination as to the margin of dumping.
[DOT] (3:40 p.m.)
A number of enforcement provisions have been built into the proposed act to enable the Department of National Revenue and the tribunal to obtain the necessary data and arrive at decisions within the framework of the time limits provided for in the bill. Accordingly it will not be possible for importers to escape anti-dumping duties by either supplying incorrect information or withholding information. On the other hand, importers and exporters who conduct their affairs in a legitimate manner have nothing to fear from the most vigorous application of these provisions.
In so far as the consequential amendments are concerned, the only substantive revision relates to the proposed deletion of subsection 7 of section 40A of the Customs Act. This section provides for the establishment of arbitrary or fixed valuations in respect of goods which are sold to importers in Canada at prices similar to those prevailing in the country of export and therefore are not dumped but are judged to be causing injury to Canadian producers. We are proposing that this section be replaced by a new provision which will achieve the same result as the present law through the use of a surtax rather than anti-dumping duties. Emergency action of this kind is contemplated under Article XIX of the GATT.
In closing, Mr. Chairman, I would like to state, and I am stating, that in the government's view the proposed legislation reflects
December 17, 1968

the needs of the Canadian economy in this post-Kennedy round period by providing a comprehensive framework within which action can be taken swiftly to counteract dumping that is injurious to Canadian producers. I can assure hon. members that the government will see to it that the full weight of this legislation will be brought to bear to guard against unfair competitive practices of suppliers in other countries. Mr. Chairman, I urge the prompt adoption by the committee of ways and means of this resolution and the legislation for which it provides a basis.


Douglas Scott Harkness: Mr. Chairman, in view of the season of the year and the circumstances which exist at the present time in this house there is no intention on the part of this party of prolonging debate on this legislation. Perhaps even more important than that is the fact which was mentioned by the parliamentary secretary that the committee on finance, trade and economic affairs had a long series of meetings on this legislation at which we heard explanations from officials of the Department of Finance and of the Department of National Revenue, and briefs from groups representing most of the major industries in Canada, particularly all those which are likely to be especially affected by this legislation.
Dumping, Mr. Chairman, has been a problem throughout the history of our country. It can, does and will continue to cause serious injury to Canadian industry when it occurs. Dumping, or the sale of goods in Canada at a lower price than those goods are sold at in the country of export and which thereby causes injury to Canadian industry, in that simple form is very easy to define. However, the discovery of when dumping is actually taking place and the taking of effective measures to prevent it are very different matters.
The matter of determining when dumping is taking place was brought to our attention by a lot of the evidence supplied by Canadian industries that we heard in the standing committee. We also had a lot of evidence about past failure to take action after dumping had been brought to the attention of the Department of National Revenue. One of the great difficulties is that if dumping takes place it can cause serious injury to Canadian industry before it is detected. Even though the amount of dumping may not be massive, even though it may be relatively small, the entry of goods at dump prices can lower the entire market, thus putting Canadian industries into a loss position and in some cases
Ways and Means
forcing them to close down with a consequent loss of jobs, a loss of taxes to the dominion government, and so on. Therefore dumping is an extremely serious matter.
We also were given evidence in the committee that devices of many kinds are employed to conceal the fact that dumping is taking place or has taken place. In fact I think a statement was made by one of the witnesses to the effect that a manufacturer in a foreign country and an importer in Canada who knew all the ropes were in a position to evade completely our dumping laws. I would hope that the administration of this new dumping legislation which we are in process of passing will put an end to statements of that kind, which were not challenged by the officials of the departments represented at the hearings. In other words, I hope that this sort of thing will not continue.
The emphasis in most of the briefs presented by industries that were represented at the committee hearings was to the effect that improved administrative practices and greater speed are necessary to ensure that dumping does not take place, and that these are essential if this new legislation is to be effective. I would like to put on the record two statements made by industries, which are typical of the type of statements we heard in the committee. The first is to be found at page 966 of the evidence and reads as follows:
In conclusion-
That is, in concluding their brief.
-we consider the draft Canadian anti-dumping act provides the broad discretionary powers necessary to permit the authorities to apply this instrument effectively. However, its effectiveness will depend largely upon the spirit and manner in which it is administered and the calibre of the people involved.
Therefore, we consider it is of the utmost importance that the officials responsible for its administration should not only be fully qualified to properly discharge their duties, but should also be fully aware of the need to function expeditiously, aggressively and with Canada's best interest in mind.
This sort of statement was repeated in brief after brief. I think there is no question that the effectiveness of this new legislation will depend almost entirely on how well it is administered. I have hope that the administration will be improved, and later I will touch on one or two points in that connection.
I think the statement I have just quoted indicates pretty fairly the general consensus of the views of industry in regard to the legislation when it says that the draft antidumping act provides the broad discretionary

December 17, 1968
Ways and Means
powers necessary to enable effective antidumping measures to be taken. Therefore once more it comes down to the matter of administration.
I wish to quote briefly from one other brief, again under the heading of administration. It reads:
Before this new code goes into effect, the customs division should become so organized that it can proceed thoroughly and quickly, and should have the will to do so.
If the new code is to be applied "quickly and effectively", there is need for:
1.	More information on entries.
2.	More prompt reporting of entries by local ports of entry.
3.	More information relating to imports, which should be made available to the central administrative authorities more quickly.
4.	Improved mechanism for the determination of values abroad.
5.	Improved government facilities to establish facts promptly, which have been notably inadequate in the past, even when there were acceptable home market sales in an exporting country for like products.
The administrative machinery of the Department of National Revenue should be overhauled to ensure the prompt availability of all data, whether it is to be obtained from abroad or from records in Canada.
I think we cannot overemphasize the importance of improved administration and great speed in detecting dumping and in taking the proper measures to put an end to it.
[DOT] (3:50 p.m.)
Some of the evidence we were given was to the effect that more Department of National Revenue officers are required overseas to investigate the prices at which goods are being sold in various countries so that individual complaints made by Canadian producers that dumping is taking place may be investigated. The officials of the two departments who were present stated that plans were under way for an increase in the number of officials abroad. I hope the government will take action along this line in spite of the austerity program which they have been talking about to such an extent and in spite of the freeze on the size of the civil service.
One thing which I believe is absolutely essential is that Canadian industry be protected against dumping. This is essential in order to ensure that employment continues at a reasonable level and also that there is a tax base upon which the government can obtain sufficient funds to carry on all the varied activities in which the government is now engaged. Therefore this is a case in respect of

which I would hope the present freeze on increasing the number of civil servants will not apply so that a sufficient number of officers of the Department of National Revenue may be sent to overseas posts in order that proper information can be collected with which to properly administer the act.
The parliamentary secretary noted the fact that the committee recognized a considerable number of changes should be made to the draft bill contained in the white paper which was put before the committee. I believe the effect of these recommended changes will be to very greatly improve the bill. I was, therefore, happy to hear the parliamentary secretary state that these changes are being incorporated. I take it that they are incorporated or will be incorporated in full in the bill that will be produced as soon as the resolution stage is completed. I can assure him and members of the house that that in itself will of course greatly expedite the passage of the bill through the house.
I shall not refer in detail to the recommended changes, but I should like to note one of the most important. I refer to the elimination of section 30 in the draft bill which provided for a panel of deputy ministers whose view had to be secured before the tribunal set up to determine if dumping had taken place could take any action at all. I think it was quite apparent to quite a number of members of the committee and the representatives of practically every industry which mentioned the matter that this panel of deputy ministers was an unnecessary step in the procedure and one which was bound to cause delay. Therefore I am delighted that it has been eliminated. It seems to be a very peculiar sort of organization to deal with this whole matter in any event.
There is one other matter about which I should like to speak and which was referred to by the parliamentary secretary. It concerns the elimination of section 7 of the Customs Act and the substitution of section 37 as it was in the draft bill. I do not know what the number will be in the bill to be introduced until we actually receive it. The main point is that a great deal of damage can be done to Canadian industry by importations which are not dumping under the definition of that term but are importations at a fairly or very low price. This type of importation takes place at the end of a season, at the end of a run or because of something else along that line. It happens when the product is being sold in the country of manufacture or production at a
December 17, 1268

price lower than the price which has prevailed previously or which normally prevails. Or it may be that because of certain particular circumstances the product is being produced at an abnormally low price. Importations of this kind have caused more damage and have been more difficult to deal with than ordinary dumping.
One of the best examples of this type of importation is in the fruit and vegetable industry. Our position north of the United States has made us particularly vulnerable in this regard. There is the situation in respect of strawberries. The strawberry season in the United States begins some four or five weeks before the season begins in Canada. By the time the strawberry harvest has begun in Canada it is about at an end in the United States. The cream has been taken off the market, so to speak, and the price has dropped to very low levels in the United States. When the strawberries are imported into Canada at that price, although it is the price at which they are sold in the United States it means that the Canadian industry cannot operate properly. Other fruits and vegetables are affected to a greater or less extent in the same way. Thus, in order to enable Canada to maintain a healthy fruit and vegetable industry some form of protection is needed against importations of this kind.
The same thing applies so far as some manufactured goods are concerned. This situation has been covered in the present Customs Act by the special value for duty provision under which, when an importation of that kind is made, the Minister of National Revenue can apply a special value for duty on the goods coming in sufficient to bring the price up to a reasonable level and thus protect the Canadian industry. Those sections of the Customs Act are being repealed by this legislation and are being replaced by a surtax in cases of this kind. The explanation given is found in the white paper at page 101 and reads as follows:
The proposed new subsections to be added to section 7 would authorize the Governor in Council to impose a surtax on imported goods that cause or threaten serious injury to Canadian producers of goods that are like or directly competitive with the imported goods. These new subsections would replace section 40A (7) of the Customs Act and in their application would have substantially the same effect as that subsection.
My hope is that the provision will have substantially the same effect as that subsection. We were assured by some of the officials that this would be the case. I would like to have a further definite assurance from the
Ways and Means
parliamentary secretary that this is indeed the case because I think it should be emphasized and publicized that this same protection will continue to exist. I would express the further hope that the application of a surtax in these circumstances will be put into effect much more quickly than has been the case in the past so far as the imposition of the special value for duty provision is concerned.
I might mention my personal experience while minister of agriculture. On quite a number of occasions I tried to have a value for duty imposed on fruits and vegetables coming into Canada. I found that it was always a slow process to obtain agreement in respect of putting the value for duty provision into effect with the result that serious injury was caused the fruit and vegetable industry while the delay was taking place. In many instances this action was not taken at all. The reason that was always given was that it might cause some form of retribution or might be interpreted as being against the provisions of GATT or something else along that line. We were assured in the committee that this situation could be improved without coming into conflict with our commitments under GATT. Therefore I repeat that I hope that once this legislation is in effect there will not be the hesitation there has been in the past in making use of this surtax on seasonal imports, imports of fruit and other imports that come into Canada at low prices and which, by and large and as a combined group, have done more damage to Canadian industry than actual dumping has done.
[DOT] (4:00 p.m.)


Mr, Bailsman:: Mr. Chairman, my remarks this afternoon will be brief, principally because we generally agree with the position Canada and the government are taking in this regard. I must say that the way the committee operated was enough to convince anyone that all the political parties in this house can work together effectively for the improvement of legislation. I should like to pay my compliments to the hon. member for Gatineau as the chairman of the committee. He did an outstanding job. Let me compliment also the hon. member for Windsor West. Although it was sometimes difficult to know whether he was acting as a member of parliament on the committee or advising the civil service, in either capacity he did an outstanding piece of work for the committee.
I felt rather proud of our behaviour as a country in respect of the international agreement on anti-dumping. Our negotiators were

December 17, 1968
Ways and Means
tough enough to protect our interests, yet at the same time they were sufficiently forwardlooking to realize the benefits that flow from honouring international commitments. The behaviour of our people and our government stands in sharp contrast to that of the United States which seemed to take a rather ambiguous position about honouring international agreements. It seems to me the United States is prepared to honour these agreements as long as they do not conflict with their laws. This hardly seems to me to be a good way to embark on an agreement upon which many countries of the world have decided. When an international agreement is arrived at it means that each of the countries involved gives up a little of its sovereignty in return for a step toward a more harmonious and logical international structure. In this regard I think Canada has behaved well. I think our negotiators did extremely well in honouring these international agreements.
There is one aspect of the anti-dumping legislation which has perhaps been wisely left very flexible. It relates to the question of injury. The debate in committee revolved around the question of what is injury and how one goes about defining it. This has been left for the determination of a board or tribunal. There is a danger that injury could be defined in a too rigid way or in such a way it could actually do more damage than good. The nature of injury will always be difficult to determine. I suspect that in the long run the question of injury will in some way have to be a political decision. Since all types of injury are incapable of one definition I do not see how those who apply the differences can do so oblivious of the economics of this country. The implication, therefore, of what I think is one of the central parts of this legislation is the fact that the government will be left on the hook. It will not be able to say, if there is dissatisfaction with the application of the legislation, that it was a civil servant or the tribunal that made the decision.
The very application of the definition means there will have to be in some related way a political implication. That is the way it should be and I am not quarrelling with this concept. I hope there will be some attention paid to the condition of the economy when a decision is handed down. Quite frankly, what may constitute injury under conditions of full employment will be different from what we may consider constitutes injury when the unemployment rate is 5 per cent or 6 per cent

as it now is. This will have to be taken into consideration.
Since the feeling of most hon. members is that Canada should move toward a world of freer trade and a less restrictive approach, an easier definition will be more acceptable when our industries are operating at capacity, when our farmers have markets and when our people have full employment, than when there is unemployment and a reduction in production. We have not heard the last of the definition of injury, and we will not with the passage of this legislation. I think this question will continue to return and we will have to consider it from time to time. We should be aware of the government's policy at any given time in relation to the concept of injury.
One of the difficulties of this legislation involves the question of proof. Of course, this created a difficulty in the previous legislation. If anything this measure is better than the previous anti-dumping law; at least, some of the industries which appeared before the committee seemed to feel we were moving in the right direction. In this regard we have to be very much aware of loopholes in terms of selling prices or costing in exporting countries. During the committee hearings I made some suggestions to departmental officials that they consider the use of a form which would put the onus of proof on the exporters rather than having our people running around trying to figure out to what extent the prices are legitimate or camouflaged. I recognize that our existing forms to some extent fulfil this purpose, but I think we could go farther than we have. I hope that the departmental officials will put their considerable talents to the task of finding a way of putting more of the onus of proof on the exporters rather than on the limited number of investigators we have at our disposal in the department.
[DOT] (4:10 p.m.)
I began my remarks by saying I was very proud of the role our people played in the negotiations respecting anti-dumping legislation. I also pointed out that perhaps others were not honouring the spirit of the negotiations as well as they might. I think it might be worth while for us to state that we are prepared to continue to be co-operative and to be internationally-minded in regard to legislation of this type but we will not tolerate being taken advantage of if other countries disregard their responsibilities. I believe
December 17, 1968

we should make it very clear that our commitments will continue to be honoured and our good faith will be displayed, but if this is not reciprocated or if attempts are made by other parties to counteract the good intentions of this legislation, we will examine our position. We should not be afraid to say this openly and boldly. We should use this as leverage to ensure that others will observe the spirit of the negotiations to the same extent that we have.
I should like to pay tribute to the members of the committee. I can say this without indirectly flattering myself because I joined the committee only in its last few weeks; I was not a member of the committee from its inception. I have never seen a more outstanding job done by members of a committee. I would in particular like to compliment the hon. member for Edmonton West and the hon. member for Calgary Centre for the work they did in the committee. I heard one manufacturer remark as he left one of the hearings: "I had no idea that members of parliament were so knowledgeable or did their homework so well". I enjoyed the work I did in the committee. I hope I was able to make some contribution. I sincerely hope that the work of the committee and the co-operation displayed there will serve as a model to other committees of the house.


Henry P. Latulippe: Mr. Chairman, I would like to make a few remarks on the resolution respecting anti-dumping.
Detrimental anti-dumping duties are called for by many industrialists in our country. Anti-dumping regulations which formerly existed are no longer considered satisfactory by Canadian industrialists. In fact, we have witnessed a great deal of discrimination in the field of anti-dumping. The anti-dumping legislation is very complex, Mr. Chairman, because it is difficult to apply, enforce and control, in view of the volume of international trade of which each country wants its share. Every country has a production surplus that it cannot absorb and it tries to export more in order to get American dollars and balance its international payments. Since the American dollar has become the instrument of international trade and since it controls practically all international relationships, many countries are forced to import because they are hungry for American dollars.
As far as we are concerned, we would like very much to increase our imports because our warehouses are bursting with goods. Our
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industrialists would be pleased to import, but that is not always easy, because that depends on the goods we can offer. In Canada, western wheat is our most common product and the one we export on a large scale. We have a substantial surplus that we would very much like to export. But it is not always easy to export our products without accepting other products in return.
For instance, two years running Russia purchased wheat in Canada and paid for it in American dollars and gold. That enabled us to reduce our balance of payments deficit. Then, after two years, Russia asked us if we would agree to accept other goods in exchange for our wheat and I think that Canada replied that it was impossible. In view of Canada's economic situation and surpluses of products which we already had in Canada in various fields we did not agree to that deal with the Russians, and it was the same for several other countries.
[DOT] (4:20 p.m.)
At the present time, Mr. Chairman, we know that Japan is one of the great exporting countries, that its prices are competitive and that it exports a great deal of radio and television sets. In fact, we receive in Canada a large quantity of those Japanese products which not only cost much less but which are actually quite often superior to ours as far as quality is concerned.
I shall simply give the example of Japanese television sets imported into Canada which are much cheaper than our Canadian television sets although they are of a better quality according to several technicians who do not only tell us but prove that the quality of these sets is better than that of Canadian sets. Therefore, the demand for those various sets is quite strong, because the quality is good and the price is competitive. As a matter of fact, sometimes there is a difference of about $150 between a Japanese and a Canadian T.V. set and this, after having paid the duty, transportation costs, etc. In view of those facts, Canadians demand similar prices, because it seems that this is more in line with Canadian pocket-books.
In the brief it presented to the standing committee on finance, trade and economic affairs, the Canadian Shoe Manufacturers Association mentioned the white paper on anti-dumping, and I quote:
Opinions vary widely on the merits of the new international code on the application of the antidumping duties and on the necessity of revising present anti-dumping Canadian legislation that it

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might conform with the principles of the international code. However, Canada being one of the signatories of the "Anti-dumping code", it is obliged to respect it. We will therefore not discuss the merits of the international code.
Before discussing specific clauses of the bill, we should like to point out that the present antidumping act is less discretionary. The bill, because of the introduction of the concept of "injury" requires a high degree of administrative vigilance and a far greater use of judgment on the part of officials and members of the tribunal. The bill confers an administrative factor of capital importance.
As we have already mentioned, the former minister of finance, Hon. Mitchell Sharp, pointed out that when dumping caused or can cause injury to Canadian producers, the government intends to see to it that, in Canada, anti-dumping duties are applied properly and efficiently.
Under present legislation, there are no definite restrictions on the retroactivity of the application of anti-dumping duties. The bill proposes, under clause 5, a limited degree of retroactivity, namely 90 days, from the moment when the deputy minister makes a preliminary determination of dumping in respect of goods the shipments of which constitute massive imports or are part of a series of imports to Canada which, taken as a whole, are massive and take place over a relatively short period of time.
The new legislation will not permit only a first dumping shipment but also a series of dumping shipments which would be even more damageable. In addition, clause 5 requires that more judgment and more discretionary powers be exercised.
Mr. Chairman, the members should read carefully the following excerpt found on page 8 of the brief, and I quote:
What constitutes a massive importation?
What constitutes a relatively short period of time?
We recommend that the new anti-dumping legislation provide for the levying of anti-dumping duties in every case and in those cases where goods imported were dumped, thereby causing or being liable to cause injury to production in Canada.
With regard to the investigation procedure, the brief continues:
Clause 13 is the first to deal with investigation procedures. It states that the deputy minister shall "forthwith" cause an investigation to be initiated, on his own initiative, if he is of the opinion that there is evidence that the goods have been or are being dumped and if he is of the opinion that there is evidence or the tribunal advises that it is of the opinion that there is evidence the dumping has caused, is causing or is likely to cause material injury to the production in Canada.
It is proper to note that the requirement to act "forthwith" does not apply until the deputy minister has formed an opinion. The text does not specify that the deputy minister shall form a quick opinion.
Furthermore, there is no requirement under clause 13(4) that the deputy minister shall act promptly upon receipt of a notice from the tribunal.

It is very important for the members of the tribunal to have some experience of industry and the procedures followed before that tribunal should be quite simple, that is exempt from too many formalities.
Mr. Chairman, in this white paper there are a great many very complex formalities. I would not want to delay the passage of this resolution, but I think that, in Canada, as abroad, if the necessary purchasing power were available to buy the goods which are needed, importation would not be as necessary.
In the present world economic situation each country tries to rob the other of its markets through massive shipments of goods, which in several countries will finally bring about disorder. I would even say that importations could lead to war. All countries should imitate Canada which, in 1968, for example, produced $68 billion and exported and consumed $40 billion, leaving $28 billion worth of goods. It will be said that these products are capitalized, and it is true, because they are stored, they stay in warehouses, in the stores in view of the fact that the Canadian people do not have enough purchasing power to buy them. Each country must therefore find ways to enable the taxpayers to have the necessary purchasing power for domestically produced goods.
Consideration should have been given to another factor. Some countries have abundant primary products which they can manufacture or finish. I think some kind of planning should be established whereby one country could manufacture products which are appropriate to its basic resources, whereas production in another country should be based on its own wealth of primary products so that raw materials would be processed domestically. I would have appreciated studying this problem in the course of a committee meeting, but due to my being away for some time, 1 did not have this opportunity.
As I was saying before, as concerns antidumping, I think some means should be found other than producing and importing without taking into account markets in Canada and those that may exist in other countries. Distribution and consumption can be achieved without any large increase of production in our country, considering our natural resources, our technological progress and all the advantages in a country such as Canada. If more consumers are required, we are certainly in a position to accept more immigrants. Population can be increased. A greater number of immigrants can be welcomed,
December 17, 1988

since we need more consumers to dispose of those surpluses of commodities which are also found in each country.
There are some countries, and Canada could be one of them, which pay compensated discounts on their products in order to reduce prices and facilitate exports into other countries. I think that Canadians, at the present time, are purchasing goods which have been subsidized by foreign countries. Now, if this attitude is allowed in various countries, it should also be allowed here in Canada. We are capable, if we have surpluses, of granting a compensated discount in order to facilitate exportation of such surpluses and consumption by our own people. If the products cost too much, if our Canadians do not have the necessary purchasing power, we can surely enable them, through a compensated discount on prices, to consume more to their greater satisfaction.
[DOT] (4:30 p.m.)


Mr. Danson:: I think it is somewhat of a coincidence, Mr. Chairman, that this issue comes before us in the midst of the debate on the report of the committee on procedure because sitting in the committee which considered this matter was one of the most rewarding activities in which I have participated during the short time I have been here. There was a spirit of co-operation which indicated that the committee system works. If committees are provided with the facilities for which we hope, then in the future the committee system will work extremely effectively.
As has been mentioned, there were some 22 meetings of the committee and the chairman deserves credit, as does the parliamentary secretary who guided much of the deliberations of the committee during those 22 meetings. Members from the other side of the house and from this side moved along from point to point in a spirit of co-operation. It was not a debating society; no one was trying to make points. We realized we had a job to do and we got along with it.
I think this spirit is more evident in the intimate atmosphere of a committee than in the somewhat combative atmosphere we find as we face each other across the bastions of this house. I might say that we got to know one another, perhaps not to the extent we would have liked. I am afraid we did tend to sit on opposite sides of the table, but perhaps as we get to know one another better even
Ways and Means
that tendency will disappear. It was very important, since we are in the midst of a rules debate, to see and experience a committee working well. Men from all parts of the country were gaining a perspective that is only possible when they meet men from other parts of the country. This was indeed an enlightening experience for everyone who participated in the deliberations of the committee.
The committee went beyond a mere examination of the anti-dumping provisions and the white paper. As a result members gained a very excellent insight into Canadian industry as a whole. Though we perhaps strayed too frequently from the direct purposes of the committee, I believe, we all benefited from the education we received. As one industry after another presented us with completely different problems, we learned something about those industries which will help the members of the committee on finance, trade and economic affairs to function a great deal more effectively and intelligently in the future.
Perhaps one of the most interesting experiences, one of the most exciting things for all Canadians, occurred on the day we listened to the brief from the steel industry of Canada. This industry does have its dumping problems and those problems have to be looked into. However, it is an interesting industry. The rates of pay are as high as those in virtually any industry in Canada and, what is equally important, they match or exceed those paid in the same industry in the United States. The industry is highly profitable in that it generates a great deal of new investment in new plant, new technology, and so on. They have reached a technological level that is second to none in the world, and as well the industry pays its shareholders good dividends. As far as I can recall, this was the only industry that was wholly Canadian owned. It is free to move without checking with anybody else anywhere.
Sometimes there was a tendency on the part of the members of the committee and those appearing before the committee to fail to differentiate between tariffs and what is legitimate dumping. As they become more familiar with this new anti-dumping legislation I think that the people in industry, the producers, will be able to make this differentiation.
The question of injury was critical in the examination of this legislation. Injury can be very difficult to prove, and many hours and

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many meetings were spent on this issue. The interesting part was that everybody seemed to accept the fact that broad discretionary powers were needed. The legislation provides for the establishment of a panel which will have this discretionary freedom. Thus we can implement this measure in the proper spirit of the Kennedy round negotiations. We heard words and saw words in brief after brief to the effect that this must be done forthwith, expeditiously, immediately and precisely. There was a great deal of concern about this.
I can understand the apprehension that prevailed because a year or so ago I sat on the opposite side of the table during the negotiation of the Kennedy round machinery tariff. This industry, with which I was associated, had these same apprehensions. However, there is something new and exciting as a result of the Kennedy round negotiations. There is a spirit abroad which I feel has permeated the departments concerned, particularly the Department of National Revenue, and as a result there is a desire to make this plan work. The new machinery tariff has been in effect for almost a year and there has not been a single complaint during that time. This is very encouraging. I believe that the anti-dumping provisions will be implemented in the same spirit, in a highly intelligent and imaginative way.
We forget that these negotiations are a twoway street; the arrangements are reciprocal. Additional opportunities are provided to us for the protection of Canadian exporters. The spirit of the Kennedy round which is abroad will enable us to function effectively in the international trade arena. There are dangers if we sit back and try to hide behind our tariffs or what is left of our tariffs. We will be given a challenge, an opportunity to get into other markets abroad and show the entrepreneurship which is so essential to this country and from which our industry will benefit greatly.
I have not spoken for 20 minutes. I have only spoken for about 7 minutes, I think, but I have nothing more to say so I see no reason to speak for 20 minutes. I think we should bear this in mind during the rules debate as well.
[DOT] (4:40 p.m.)


Mr. Danforth:: Mr. Chairman, at the outset may I pay my respects to hon. members of the committee who dealt with this most important, intricate and technical subject. I also wish to pay my respects to the parliamentary secretary who represents Windsor
[Mr. Danson.l
West, a companion riding to mine. I am sure he is as familiar with the problems of his area as I am with the problems of mine. In the 20 minutes allocated to me I hope to place before the committee some questions that I presume we both agree ought to be asked. Perhaps he will be able to provide some of the answers which we are eager to hear. At the same time I pay tribute to the hon. member for Calgary Centre for his remarks. As an ex-minister of the crown responsible for agriculture, a field where problems have been most acute, certainly he has the right to be considered well versed in this subject. The remarks he made to the committee proved that he was familiar with all aspects of the problem. He has made some constructive suggestions in the committee and in the house in this field.
In the areas the hon. member for Windsor West and I have the honour to represent this legislation is considered to be most important. Because of past experiences our people are uneasy about what will happen. The last time there was a major overhaul in tariff regulations pertaining to international trade small industries, subcontractors and the agricultural industry in general suffered serious economic set-backs. Many of those set-backs have not been made good over the passing years.
It has been found through the years that any reduction in protection or any approach towards free trade has worked adversely in particular circumstances. I am speaking particularly about the growers of luxury crops, the fruit and vegetable growers, the canneries and allied, small industries of the area. Throughout the years they have found that existing anti-dumping legislation did not provide the protection it was felt was required and in many instances there was real hardship.
Why are our people uneasy about this legislation? They have just undergone an experience with regard to the corn industry, which is very important in my area. It seemed impossible under existing regulations to prevent corn from another country being dumped in this country. When corn was brought in the Minister of Agriculture stood up in the house and said that according to existing definitions there was no dumping, that what had happened could not be classified as dumping and therefore no action could be taken. Finally, after many weeks and after much damage had been done as a result of corn importation the government acted, and I am happy to report that in some small way the market has
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December 17, 1963
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accountants at the instigation of well-established corporations, some of them, perhaps, with international connections. I wonder how many of those briefs were from small manufacturers, the men who depend on the tariff concession to keep them in competition. I do hope it is not the policy of the government to let these men go out of business on the ground that free trade is best for all Canadians. I hope the government is concerned about certain specialized sections of the agricultural industry. In my own mind I am satisfied that reductions in tariffs on commodities entering this country will not mean a reduction in prices paid by the consumer except in perhaps a very few instances. If there is a reduction of one per cent in tariff I am sure it will be taken up by those engaged in the trade and that it will not be passed on to the consumer unless violent competition makes it necessary to do so.
I sincerely hope that the aims and objects of this legislation can and will be carried out. On the other hand, I feel it will be impossible in many cases for the terms of this measure to be applied fast enough or completely enough before damage is done, before a catastrophe has been brought about, especially in certain specialized sectors of industry and in certain particular regions of this country. We in Canada are faced by two handicaps. One of them is regional. We have specialized crops. Then, unfortunately, by the very nature of our climate, our early crops are forced to compete in many instances with the residues of crops gathered in the country to the south. Yet there is no comparison when it comes to the price needed to ensure a fair return, having regard to the different methods of production used. I sincerely hope this measure will finally be passed in a form corresponding with the realities of this situation. But I must say I have grave reservations.


Mr. Howard (Okanagan Boundary):: Mr. Chairman, I do not wish to speak for long on this measure today because we had ample opportunity in the committee to discuss all its aspects and to ask our questions and get whatever answers we could. In most cases the answers were very full and quite satisfactory. I think we owe a tribute to the chairman and to the parliamentary secretary for the way in Which they contributed to our discussion in the committee, and to all hon. members who participated.
There remains, however, one matter in connection with which I still believe we have not been able to register our opinions with
[Mr. Danforth.l
sufficient force. We need to emphasize this point again and again. It concerns the very drafting of the bill. When we discussed this matter with the departmental officials I feel we did not really succeed in impressing on them the importance of what we had in mind, and I think it is necessary to re-emphasize the point I am about to express. In our report we said:
Your committee wishes to underline the necessity of prompt and effective action to ensure the carrying out of the intent of the proposed legislation with regard to injurious dumping.
And further:
Your committee also heard much evidence with respect to certain types of low-cost imports causing serious injury and reiterates that prompt and effective action must also be taken under the pertinent section of the proposed legislation.
This has been emphasized many times. In our discussions with departmental officials we tried to get this point across and they told us: Well, we have to get someone from trade and commerce, someone from agriculture, someone from finance, someone from national revenue and someone from external affairs to discuss an application of this kind before a decision can be made.
I am thinking particularly of the difficulty which may well arise in connection with agricultural products which are the concern of the riding I represent. I may say that I have seen in my own constituency what can happen when an urgent situation arises in connection with industry. Months went by before a decision could be made by representatives of the five departments which had been brought together to consider the matter. They negotiated and discussed with the greatest of good will and the best of intention to reach a decision as soon as they could. But by the time a decision had been reached the purpose for which they had met was no longer important. I am confident we need a faster method of getting decisions made. There is one other area to which I should like to draw attention today. I am thinking of the consequences that follow arbitrary strokes of the pen, decisions of one kind or another which affect the agricultural industry. We seem to feel in this country that we can throw sections of the agricultural community to the wolves. Consider the matter of tariff protection or protection against dumping. We specifically exempt imports from certain countries from these measures .For example, we have concluded treaties with Australia which make it possible for that country to export to Canada with complete freedom
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from anti-dumping legislation. We have told Canadian peach growers: "It is too bad, but we have decided that Australia can completely ignore the regulations with regard to dumping". We have said to them: "It is too bad. Go back four squares and miss three rolls of the dice. Try some place else." In many instances when this has happened to manufacturing industries we have said to them: "We are going to give special compensation to industries that find it difficult to adjust to these new conditions." But we do not say that to the agricultural industry. To it we say, "You fellows have to take your lumps." I do not think we can continue to do this. This is something we have to look at when arbitrary strokes of the pen are made in the matter of tariffs and anti-dumping regulations.
[DOT] (5:00 p.m.)
These are points that I feel I must make, points that have not been fully dealt with so far in our discussions and negotiations. I think it is important to have them on the record for the consideration of the minister and in turn for his departmental officials who will be handling these matters at the administrative level.


Mr. Hales:: First, Mr. Chairman, I would like to compliment the government on the way it has handled this proposed legislation. Ten, 15 or 20 years ago the party in power, regardless of which one it was, would have introduced such legislation and said to the manufacturers of Canada, "Here it is; take it or leave it." But that is not so this time. The manufacturers or their associations had ample opportunity to appear before the standing committee and present their briefs, ideas and suggestions, and the members of the committee were willing to hear them. Furthermore, the committee made amendments which I understand have been almost 100 per cent accepted. So I compliment the government on its approach to this legislation. But in case members of the government might become too elated over what I have just said, I would like to remind them that the late C. D. Howe did not bend over backwards and think too favourably of Canada as an exporting country. He seemed to feel that we would not stand much of a chance as an exporting country.
However, in December, 1960, the then minister of trade and commerce, the hon. George Hees, introduced the brilliant idea of assembling our trade commissioners from all
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over the world in Ottawa and inviting Canadian manufacturers to meet with them, thus putting across the idea that if Canadian manufacturers were given an equal chance they had a wonderful opportunity to export their goods. He aroused their imagination and since that time Canadian manufacturers have realized they have an opportunity to become large exporters. Give Canadian manufacturers a fair break, give them an opportunity to play in the same ball diamond with the same set of rules and I am convinced they can compete any place throughout the world. So I am glad to see this anti-dumping legislation brought forward to give them some protection.
This anti-dumping legislation gives to the Department of National Bevenue, which will administer it, more discretionary powers than have ever been given to any department of government. We, as parliamentarians, have grave reservations about discretionary powers. It is a subject which has been debated at great length in this chamber. The standing committee felt that in order to administer this legislation discretionary powers had to be given to that department, but now that we are giving the department those powers we expect it to act quickly and to be vigorous and prompt in administering the legislation. If the officials do not do that, then the legislation is of no use. It is useless unless those administering it take hold of it, give it a new approach and bring in new people who have the ability to administer the legislation as it should be administered. I am not suggesting that they go out and build a great empire to do this. I think they already have the men in the department. It will be a matter of reorganizing the department for the application of this anti-dumping legislation.
Above all, the administrative staff will require expert chartered accountants, men who can go into the English market, the Italian market, into manufacturing plants abroad, look at their books, study their costing methods, and be able to say whether those manufacturers have arrived at the right, proper and normal value. If we send a man who does not understand his work, who is not a specialist in accounting, he will be lost and will not be able to establish the normal value for export purposes.
Great power is also given to the deputy minister, and he will have to work quickly. The legislation says he must "forthwith" do this and do that. Forthwith does not mean a week from today. It is now, and the standing

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committee was given to understand that that is just what is meant.
Sometimes it is difficult to get information from boards and commissions such as the hydro-electric power commissions of the various provinces and the Canadian National Railways. Sometimes they refuse to give the prices at which a tender is let. How can one establish the normal value if one cannot find out all the information? I am glad to note that the draft bill contains in clause 11 this provision:
Where, in the opinion of the deputy minister, sufficient information has not been furnished or is not available to enable the determination of normal value or export price under section 9 or 10, the normal value or export price, as the case may be, shall be determined in such manner as the minister prescribes.
This means that if they do not want to give this information the department has the power to demand it, and I sincerely hope it will use that power in securing all the information required.
A tribunal is to be established consisting of five men. Who will these men be? Will they be capable men? Will they be men who have great experience in commerce and industry or will they be political appointees? If they are appointed on a political basis and not on the basis of ability the tribunal will be useless and the act will not be administered as it should be. When the government picks these five men who will make up the tribunal-and it is the tribunal whose word is final on whether or not a dumping duty should be imposed-I hope it will pick men well experienced in commerce and industry. I also hope the tribunal will report its findings promptly.
The draft bill also contains a clause dealing with the terms and regulations of the tribunal. I hope we will be told who will examine these regulations or terms. Will they be cleared by parliament or by the cabinet? I am not too sure on that point.
I am also a little concerned about a situation which could very well happen in Canada. I think all hon. members are aware that many American corporations operate branches in Canada. Let us assume that a United States corporation, with a subsidiary in Canada which has 90 per cent, 95 per cent, or even more of the Canadian market in respect of one product, has branches all over the world. It is possible it might decide it could make the product it is making in Canada more cheaply at one of its foreign plants. So it would decide to manufacture this product

at another plant elsewhere in the world. Thus the Canadian plant would be closed down and many people would be out of work. Who would complain that there was dumping? It is certain that the corporate company in Canada would not complain because it would bring the product in and no dumping could be charged against it. It could continue to bring it in and no one would register a complaint. The only safety valve in this regard, and the one on which we would have to depend, would be that the union in that plant, if it felt that an injury had been caused it, would be perfectly within its rights to register a complaint with the tribunal and say that injury had been caused because the employees had been put out of work. I feel that this anti-dumping legislation is a step in the right direction. After all, our regulations have not been changed to any great degree since 1904. It is time this was done.
[DOT] (5:10 p.m.)
I sincerely hope that all the other countries which are involved in this agreement will carry their weight. It has not yet been proven to me that the United States will decide to go ahead with such legislation. I presume this will be the case, but I think Canada should know this first before it moves too fast so that we will begin anti-dumping legislation on an equal basis. Anti-dumping legislation is not the over-all answer. It is not the answer to help Canadian industry to survive. It certainly is a help but it will not correct the situation altogether. We must look at the existing non-tariff barriers and do something about them in the form of legislation. Nothing in this legislation will relieve the problem of low wage countries exporting to Canada in great quantities.
I am told that Italy, with a wage rate about one-third that in Canada, is a large manufacturer of electrical appliances. Italy will and is now exporting these products to Canada. They have other advantages, including a tax structure which the Canadian manufacturer does not have. While the Canadian manufacturer has a 50 per cent corporate income tax slapped on his profits a company in Italy may only have to pay 5 per cent in income tax and in addition is allowed to plow all its profits back into development and research. These are the type of things that are causing real problems in Canada.
Then we have the most-favoured-nation agreements. We have such an arrangement with Russia which I think expires next year. Because of this agreement heavy dump trucks
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and power shovels that are made in my riding must compete with the heavy equipment brought in from Russia because Russia was given most-favoured-nation treatment. I pause to wonder why this concession was given. When it comes up for renewal I hope the house will give very serious consideration to the facts behind it.
We also have a treaty with Australia. Australia exports canned peaches to Canada. This is causing problems for the Canadian fruit growers.
A free trade agreement in respect of agricultural machinery was made in 1944. It was a one-sided agreement. No mention was made of parts. Now we have the situation of Canadian agricultural machinery manufacturers deciding to move their plants to the United States. The Canadian plants that were supplying parts for agricultural machinery are now trying to export the parts to these plants in the United States. They find there is a duty on Canadian agricultural machinery parts and therefore they cannot send these parts into the United States without paying a duty while the United States manufacturer of agricultural parts can ship these parts into Canada duty free. I wonder what goes on here. These non-tariff barriers are certainly detrimental to the manufacturer in Canada.
Then we find that the government gives business to offshore companies. This is another thing which we should take a look at. I know for a fact that transformers used on the Nelson river project here in Canada were supplied under a contract given to the U.K. Electric Company in the United Kingdom. When that tender was given this Government knew that Canadian industries are not even allowed to quote a price in the United Kingdom. Yet we turn around and give the U.K. Electric Company an $8 million contract to supply the transformers for the Nelson river project. Because of this 1,000 men have lost work for a period of a year in my riding since the General Electric Company did not receive the contract for those transformers, and they were the second low bidder. I must not enlarge on this any more, but I did want to mention that the non-tariff barriers are just as important and perhaps more so than the anti-dumping legislation. However, the anti-dumping legislation is a step in the right direction.
I shall conclude by saying what I said at the beginning. Give the Canadian manufacturers the same set of rules. Let them play on anywhere in the world.
Ways and Means


Mr. Gillespie:: Mr. Chairman, I too intend to keep my comments brief. Much has been said about the importance of this legislation. Much has been said also about the effectiveness of the committee on which we all jointly worked together. I should like to add my comments in respect to the committee and how it worked. I express the hope that this might well serve as an inspiration to other committees which have not always found the going so smooth nor perhaps so satisfying. I think this is partly because we were well served by our chairman, the hon. member for Gatineau, by the parliamentary secretary, by the officials, and I think as well by the calibre of the briefs that were submitted to us by interested industrial groups. There was comprehensive and frank discussion at all times.
The importance of this legislation has been referred to by members from all corners of the house. We have been reminded that Canada is a trading nation and that more than most nations we depend on exports and on conditions or the climate abroad that will receive Canadian exports. Equally I think we might remind ourselves that we are a vulnerable nation from the point of view of imports.
[DOT] (5:20 p.m.)
The hon. member for Wellington spoke eloquently on the problems of non-tariff barriers. There is no question that these are serious. Other hon. members, including the hon. member for Okanagan Boundary, spoke about the problems of imports in the agricultural area and the need for protection and effective administration.
Let me for a moment refer to the international context in which we as a trading nation operate. Let me go back a little to the period immediately following the war when the hopes of mankind were focused on new international institutions, and I refer to the Bret-ton Woods agreement, the Marshall plan and the General Agreement on Tariffs and Trade. These were three international expressions of good will and faith in the idea that through increasing trade we could improve standards of life throughout the world. Since then we have seen the development of the European economic community, also an organization which recognized that by lowering tariff barriers internally you could raise the standard of life internally.
These are the sort of things which reflect the spirit of the Kennedy round, the idea that men of good will jointly could create conditions abroad which would stimulate trade and

December 17, 1968
Ways and Means
at the same time protect national interests at home. At the same time I think many of us have watched with growing concern some of the trends that have developed south of the border. I refer to the guide lines that were introduced earlier this year, at the very moment the Kennedy round was indeed instituted in many parts of the world.
On January 1 the United States took measures to restrict certain trade practices in the interests of its own balance of payments, or to offset difficulties which were perhaps more of a banking nature than of balance of payments, but that is another speech. The protectionist feeling in the United States has been growing and we have seen manifestations of it during their last election. I would hope that the sort of action that Canada has taken, that this house is taking now in supporting and passing the anti-dumping bill, will be noted by our friends south of the border and give heart to those who would stimulate rather than discourage free trading practices. It is very much in Canada's interest to pass this legislation because I think it fosters a climate and spirit of enterprise both at home and abroad. It provides conditions under which entrepreneurship can flourish. It stimulates outward-looking attitudes rather than inward-looking ones.
This is consistent with risk taking and innovation. There are, of course, dangers and we have been reminded of them, but any great opportunity involves danger. Given prompt, effective administration of this legislation we can do much to create favourable conditions abroad for our own exporters and at the same time protect the interests of all Canadians at home, consumers and producers.


Mr. Burion:: Mr. Chairman, along with other members of the standing committee of finance, trade and economic affairs I can testify to the hard work of that committee in studying the anti-dumping code as it was proposed in the white paper put before the committee by the government. I also wish to join with others in paying tribute to several members who put in a great deal of work on this study.
One thing that impressed the members of the committee was the complexity of the factors involved in dealing with the code as it was proposed. For this reason some of the provisions were left in a rather general and flexible way, thus enabling the authorities who will be charged with the administration of the code to have the necessary room to 
determine, on the basis of experience, the application of the law.
It was demonstrated during the hearings that the administration of this legislation involved a very important aspect of its operation and that it is really quite essential we do have effective and rapid administration of its provisions. Attention was drawn by the committee in its report to this particular aspect of consideration when it stated:
Your committee wishes to underline the necessity of prompt and effective action to ensure the carrying out of the intent of proposed legislation with regard to injurious dumping.
For this reason, Mr. Chairman, the composition of the anti-dumping tribunal is a very important matter. Again the committee commented on this in its report when it said:
Your committee recommends that the tribunal be duly constituted with members of the highest calibre at the earliest possible date.
I certainly concur in the wording of that recommendation because it is important that we have a representative group of people who can speak with some knowledge of the various considerations which have to be taken into account in dealing with the work of the tribunal. We need not only the viewpoint of industrialists and representatives of industrial concerns with technical knowledge; we also want to bring to bear the viewpoint of primary producer groups such as agriculture, and the interests of consumers. I would therefore urge upon the government that it obtain as wide representation as possible on the tribunal when it is appointed.
During the committee hearings it was noted there were some difficulties in respect of the interpretation of the code and the application of it in dealing with less than arm's length transactions of United States subsidiary firms operating in Canada. This is a matter which should be kept under very close study and, as well, in the future we should consider possible changes or improvements on the basis of experience.
It also seems to me that the evidence at the hearings underlined the need for rationalization of Canadian industry. We have to keep before us the effect of customs tariff amendments, the anti-dumping code and other measures which may be brought before us. They do not in themselves solve our basic economic problems. What we do need in many sectors of our economy is a restructuring and reorganization of much of our industry in order to maintain our international competitive position and to enable us to continue a rising standard of living.
December 17. 1968

The report of the committee also referred to the question of implementation of the code on an international basis. You will note that the committee report again stated:
Your committee notes that while agreement was reached on the principles of the anti-dumping code by participating governments, problems still remain with respect to the full implementation of the code among all participating nations. Your committee urges the government to continue to press for the full implementation of the code among ail nations and expresses the hope that the passage of the proposed bill will be of assistance in achieving this objective.
I suppose this part of the report arises, in part, from some comments made to the committee by officials of the Department of Finance, in particular Mr. R. Grey, the assistant deputy minister, who appeared before the committee on December 4 and stated as follows:
[DOT] (5:30 p.m.)
I think it is fact-I make this statement after some consideration-that some uncertainty has been created as to whether or not the United States tariff commission, which is an independent body of the executive, in a sense, will act in such a way on this point as to be consistent with the code.
There is nothing in the rider which requires the tariff commission to act in such a way as to be inconsistent with the code. It merely enjoins them that discretion is not limited.
They can therefore exercise their discretion to be within the code or not be within the code, depending on the facts of what by definition is likely to be a very complex case.
Mr. Grey in his further testimony quoted the words of the United States delegate at the meeting in Geneva of the committee on antidumping. He stated that in case of conflict the present provisions of United States tariff law would take precedence over the international anti-dumping code. Of course, as a point of law this is also the case in Canada. He suggested that in fact there was potential conflict in the case of the United States and some possibility that the United States may not at some time in the future comply fully with the provisions of the anti-dumping code. At the same time Mr. Grey in part, speaking on instructions also, recommended that this should in no way deter Canada from adopting the anti-dumping code. Much as I subscribe to those words, I would express the hope that the United States will comply fully with the anti-dumping code. I find myself in the rather unhappy position of noting that it seems to me that on this occasion as on others we are the country that first has to take action and then later try to persuade the United States to come along.
Ways and Means
During the course of the hearings it was also noted that there are certain problems with respect to the agricultural industry, not so much with regard to anti-dumping but depressed prices over a period of time. It was felt that perhaps some progress would be made through the new section that has been provided in the Customs Tariff Act. I would urge, however, that this matter be kept under constant study to ensure that some sectors of our agricultural industry, particularly those concerned with the growing of fruit and vegetables, are not seriously affected by continued unfair competition from United States' surplus production.
There is one further matter I should like to draw to the attention of the committee. It is that considerable time was spent on the problem of the case of one dump of goods being made in Canada. Only one dump is made, which does not enable the authorities to take action, and there is no repeat case with regard to which they can take effective action. It seems to me this is a further aspect of the problems of dumping which should be kept under review.
In conclusion, Mr. Chairman, I of course support the resolution before us and hope it will be a step forward in dealing with our problems of international trade. However, I express the hope it will not be a stopping point and that we will not take a static approach to the problems of international trade. I hope we will continue to evolve our approach to these matters and will in fact make further progress toward achieving the goal of true free trade.


Marcel Joseph Aimé Lambert: Mr. Chairman, there are a few minutes left for me to address some remarks to the committee on subjects that I do not think have been dealt with extensively by my colleagues in the house and particularly those who were members of the committee. I think that referring the white paper and the draft bill to the committee is perhaps a blueprint of what many of us have hoped would happen to much legislation. Perhaps it will serve as an example for the legislative process in changing the rules of the house.
Hon. members will find the report of the committee at page 469 of Votes and Proceedings No. 60. If hon. members turn to page 470 they will see the extensive amendments proposed by the government or accepted by the government as a result of the hearings and the observations of members of the committee. Personally I do not think they went

December 17. 1968
Ways and Means
far enough in two or three instances. I will have something more to say about this when we reach committee stage of the bill.
There are two or three things of a general nature that I should like to discuss at this time. I would refer hon. members and the general public to the proceedings of the committee which as an experiment, certainly as far as I am concerned, appeared after a certain date in both English and French. May I say that I think the staff of the committees branch must be congratulated on the efficiency and speed with which they produced the transcript of the proceedings. After all, we used to hold sessions morning, afternoon and evening sometimes on Thursdays and by Monday we had a transcript of everything that had transpired at those sessions. This is a completely new dawn as far as committee hearings are concerned and I think the officers of the house and of the committees branch must be congratulated upon it. I hope we will see this practice spread through committees.


Some hon. Members:: Hear, hear.


Marcel Joseph Aimé Lambert: Unless this is to be the practice in all committees, the hopes and aspirations of government members and others on the committee on procedure will count for nought because the committee system will break down even more than it has in the past when we sometimes waited two or three weeks for a transcript of committee proceedings.
With regard to the anti-dumping code, hon. members who wish to look for it in the proceedings will note that several members of the committee, including myself, indicated some apprehension about the code. I suggest to hon. members that because of the decision limitation of 180 days, if all proper steps are taken, there can be one free dump. Although dumping may be discovered and dumping duty imposed, it is the crown that recovers the difference between the dump price and what is deemed to be the normal value of the goods. But what of the industry that suffered? There is no way of compensating the industry.
This is almost like Marie Antoinette telling the mob in Paris that if they cannot have bread, let them eat cake. This is tantamount to telling the industry that has lost business and the workers who have become unemployed, "We did apply dumping duty and the crown got its pound of flesh". This does not provide bread and butter for the people in the industry who became unemployed as a

result of the serious effects of dumping practices. Let us not be naive. Let us realize there have been and there will continue to be efforts to dump.
[DOT] (5:40 p.m.)
I was particularly concerned with the representations made by the heavy electrical goods industry. We have heard it said in speeches made this afternoon that the effectiveness of this legislation will depend entirely on the celerity and the effectiveness of the administration. We can pass ten anti-dumping bills, but if there is not quick and effective action under the provisions of the legislation it is all for naught.
I would refer hon. members to the report for Thursday, December 5, and the evidence of the heavy electrical industry at the time in which it was graphically pointed out that in the case of heavy electrical equipment dumping takes place at the time of the submission of bids and not when the equipment may come in, say two years later. It may be that when the equipment does come in anti-dumping duty is collected but, as I have previously asked, what happens to the workers and to the firms which have lost the work as the result of a tender bid in which the dumping actually took place?
The Department of National Revenue is in a rather difficult position. The deputy minister would not have the information to initiate an investigation. In fact, the industry itself would have difficulty in getting information for him because, unfortunately, it is the practice of many utility bodies throughout this country, some of them private corporations but most of them public bodies, not to publish information with regard to tender bids. The same applies to some crown corporations such as the Canadian National Railways. It is not possible to get any information from them because it is against their bylaws to publish such information. But how on earth can one protect Canadian industry if one cannot get the information to initiate an investigation to determine whether or not dumping has taken place? I know it has been left over for further consideration as to what steps might be taken to either compel or obtain co-operation from these various bodies so they might make the information available to the Department of National Revenue or to the industry itself.
There is one further remark I would like to make briefly at this time, but I will have more comments to make during the clause by clause study later. In the Kennedy round of
December 17, 1968

negotiations it was felt that Canada's position with regard to anti-dumping legislation, that is, the power of the deputy minister of national revenue under section 6 of the Customs Tariff Act, was a form of discrimination and was, shall we say, one of the non-tariff barrier practices. In its negotiations in the Kennedy round Canada decided as part of the package deal to give up its position under the Customs Tariff Act, and agreed to the code. I wish the other trading partners in the negotiations had been as free and generous as Canada because none of their non-tariff barrier practices were the subject of negotiations and none have been corrected. It is hoped that as a result of the Kennedy round Canadian exporters or Canadian industry will have better access to foreign markets. However, let us be quite frank. Our trading partners, the British, the Swedes, the Germans, the Common Market, the Japanese, the South American countries, all have their non-tariff barrier practices, some of which are frankly nefarious. I am glad to see that the committee report recommends that the government initiate immediately negotiations for the elimination of more of these barriers. I do not think we are going to see a real improvement in trade until some of these practices disappear.
I hope we will pass this resolution very quickly, now that I have had my say, of course, but I understand that one more member wishes to speak and then we can proceed to the discussion of the bill clause by clause. I commend the resolution to the house.


Mr. Gauthier:: Mr. Chairman, I do not want to take up too much of the time of the house, but I want to point out that although I was a member of that committee, I did not attend all the meetings because I am on too many committees. When it was decided that all committees would sit at the same time, I could not attend both meetings simultaneously.
I should like to draw the attention of the house to something which I realized during the committee meeting. First of all, however,
I wish to congratulate all the members as well as the chairman of the committee. We were absolutely free to ask all the questions we wanted and to hear any witness.
I realized, Mr. Chairman, that all the evidence was given by producers. The minutes of the proceedings include a list of the main
Ways and Means
witnesses, who were the minister, the Graphic Industries Association, the Canadian Textile Institute, the Canada-Japan Trade Board, the Canadian Electrical Manufacturers Association, the Canadian Westinghouse Limited, and so on.
I would have liked the committee to sit longer, to allow us to hear the evidence of the Consumers Association, because the economy is made up not only of producers, but of consumers. However, Mr. Chairman, the Canadian anti-dumping draft legislation stems from agreements negotiated during the Kennedy Round between the participating countries, of which Canada was one. It is, in actual fact, a special act to bring our legislation into line with the international code concerning the application of anti-dumping duties.
[DOT] (5:50 p.m.)
Under our economic system, the sole objective of trade consists in realizing more and more profits at the expense of others. This financial system automatically results in lack of purchasing power on the part of the consumers. Therefore, it is clear that this legislation will afford some protection to the Canadian producers wanting to monopolize the domestic market.
Besides, Mr. Chairman, on reading the evidence gathered by the standing committee on finance, trade and economic affairs, as well as the various briefs submitted to this committee by producers, associations and groups, it can be realized that they are interested solely in protecting their customers through Canadian legislation preventing imports of foreign products that would take a larger share of the Canadian market.
Arguments put forward are indeed very persuasive. For instance, it is argued that imported products at lower prices than other similar products manufactured in Canada will jeopardize the Canadian industries, reduce the number of jobs and perhaps cause the bankruptcy of several industries. Some emphasize that it is essential for Canada to be protected against foreign exports as our trade balance with other countries may be seriously affected.
We, of the Ralliement Creditiste, do not accept these arguments because we believe in an economic system geared to the satisfaction of human requirements and to the subordination of the methods to the results we are proposing. Consequently, as we have always

December 17, 1958
Ways and Means
indicated, we are guided by the following principles.
The purpose of economic order is to ensure that the needs of the consumers are met, and nothing else.
The end is more important than the means, and the means must be subordinated to the end, and the hierarchy of the various ends must be respected.
The purpose of industry, in all its forms, is to supply goods and services, and not employment. Industrial organization is that much more perfect when it produces more while requiring less human work, leaving man free to exercise his activity in humanizing works.
Money has no other purpose than to help economic life to achieve its end without obstructing it, managing it, or conditioning it.
The nature of things, sane reason and social justice teach us that the end of economic activity should be none other than the material prosperity of society, the well-being of the whole human community. The economy must not aim towards creating wealth for its own sake, or for only a few and it must endeavour to satisfy the needs of all and to produce goods which really make richer all citizens of the country.
In economics it would be said even more plainly that the end of the economic activity is to serve the consumer first. That objective must inspire any truly social, truly human economic policy.
The aim of the economic activity is to meet the needs of the consumers. However, the needs of the consumers will be met more easily and more fully if the products they need and want to get are available to them at prices they can afford.
It can be said that the legislation under consideration affects the consumers very closely because it can deprive them of the products they could not get at the prices now in force in our economic system.
International trade is made essentially of commercial transactions between countries. Purchases of shirts from Hong Kong, shoes from Italy, wines from France, woollens from Great Britain, these are imports for Canadians, imports of goods which other countries can offer to Canadian consumers at better prices, or goods which are not produced in Canada, or which are difficult to produce here according to recognized standards.
Conversely, sales of news-print to the United States, of wheat to Soviet Union, of bacon to Great Britain, are exports for

Canada, exports designed to meet the needs of the consumers in those countries.
Thus, it can be said that international trade is a sound thing, and so we must support any measure designed to abolish hindrances, to enable consumers to satisfy their needs. In fact, if some countries produce easily and abundantly certain goods, other goods are better and more plentifully produced elsewhere. So trade between consumers of different countries is a beneficial thing.
However, we must realize that one of the greatest difficulties in international trade stems from the fact that countries want to export more than they import, to ensure a "favourable trade balance".
In fact, we know with what insistence public relations men in the Department of Industry, Trade and Commerce make every effort to show us that we export more goods and services than we import.
This philosophy, which is not that of the Social Credit, is based on the principle that gold and silver alone are desirable. If such tenets were justified, all trade between countries and even between citizens in a country should be abolished.
Assuming that gold and money were the only wealth, we could brand as madmen people who would be giving away their money to buy a suit or a car. However, today everyone realizes-and consumers are no exception -that what they need is bread, food and clothes, which are the true wealth and which will fill their every need.
Mr. Chairman, may I call it six o'clock?


Herbert Eser (Herb) Gray: Mr. Chairman, I rise on a point of order. I wonder if the committee would allow the hon. member to complete his remarks before adjourning the debate on the resolution?


The Chairman:: Is it agreed?


Some hon. Members:: Agreed.


Charles-Arthur Gauthier: Thank you very much, Mr. Chairman.
I shall simply summarize the remarks I intended to make in order that the resolution can be passed, because we want this bill to go through.
Under a finnacial system based on gold, or a system based on money and credit created by individuals who control the amount in
December 17, 1968	COMMONS
circulation, countries cannot avoid exporting some of their surplus goods which domestic consumption cannot absorb for lack of purchasing power.
They cannot avoid either imposing restrictions on imports, because domestic producers fight in order to grab for themselves whatever small share of the purchasing power the consumers have left.
It is obvious that all this boils down to a matter of sharing the existing purchasing power amongst those who have goods to dispose of.
Mr. Chairman, here are the solutions in brief, because I want to shorten my remarks: Compensated discount on Canadian goods; lower Canadian prices by removal of a lot of taxes which increase prices; reforming our financial system, of credit-debt which pushes prices upwards.
[DOT] (6:00 p.m.)

Resolution reported and concurred in.



[Stage Direction]
Hon. Donald S. Macdonald, Rosedale (for ihe Minister of Finance) moved for leave to introduce Bill No. C-146, respecting the imposition of anti-dumping duty.
Motion agreed to and bill read the first time.
Mr. Deputy Speaker:: When shall the said bill be read the second time.


Some hon. Members:: Later this day.


PROCEEDINGS ON ADJOURNMENT MOTION
Mr. Deputy Speaker:: Order, please. It is my duty, pursuant to provisional standing order 39A, to inform the house that the questions to be debated at the time of adjournment tonight are as follows: The hon. member for Fraser Valley West (Mr. Rose), Indian Affairs-Competition for position as adviser on policies and programs; the hon. member for Peel South (Mr. Chappell), Airports- Toronto-Protests against expansion of facilities; the hon. member for Regina East (Mr. Burton), Consumer Affairs-Request for investigation into price of toys.
It being six o'clock the house will now proceed to the consideration of private members'
DEBATES	4059
British Northwestern Insurance Company business as listed on today's order paper, namely, private bills, public bills.



PRIVATE BILL


Mr. Warren Allmand (Nolre-Dame-de-Grace) moved: the second reading of Bill No. S-9, respecting British Northwestern Insurance Company.
He said: Mr. Speaker, since this bill has already been before the house on three occasions I will not take very long to explain it. It was before the house on November 3, 1967, January 23, 1968 and February 29, 1968. On November 3 I made a detailed explanation of the bill, to be found at page 3813 of Hansard for that date.
The purpose of the bill is to permit the British Northwestern Insurance Company to change its name to Eagle Star Insurance Company of Canada, and to increase the authorized capital. The reason for this is that the parent company of British Northwestern is known under the name of Eagle Star Insurance Company and wants its Canadian subsidiary to be known by the same name. Another reason is that the name "Eagle Star" is well known in the insurance world and the directors of the company feel that by adopting that name substantial benefits will accrue to their operation in Canada.
As I said previously, British Northwestern Insurance Company was incorporated in Canada in 1906 and has been doing business here since that time. Although fully owned by the British company, Eagle Star Insurance Company, all but two of the directors of the Canadian company are Canadians. The company invests extensively in Canada and employs many Canadians as a result of its operations and investments. I point this out merely because some hon. members in previous debates raised objections. Despite the objections of some hon. members to the fact that this company is owned by a British parent, I point out that this bill asks for no substantial changes in the company. As I said, the company invests in Canada and most of its directors and personnel are Canadians. I hope hon. members will allow this bill to go before the committee where they may examine further the officers and directors of the company.


Frank Howard: Would the hon. member permit a question relating to the capitalization of the company? I have been
4060	COMMONS
British Northwestern Insurance Company given to understand that the company is not all that serious about the capitalization aspect of the bill and might be prepared to forgo that part of its request if that would facilitate passage of the bill through the house. Has the hon. member any knowledge of this?


William Warren Allmand: Mr. Speaker, after the bill was first debated in the house I discussed this matter with those in the company who are in charge. Since they merely wish to change the name of the company they would be willing to drop those sections of the bill relating to increased capitalization. Of course, they would have liked the increase but if there is objection to that aspect they would be willing to drop that aspect and to ask only for the change of name.


Marcel Joseph Aimé Lambert: Mr. Speaker, we would prefer to see this bill go throuh the house as rapidly as possible at this stage and go to committee where answers to certain questions might be obtained. With regard to the change in capitalization, it is evident that the company needs more capital because of expanding business and the bilingual nature of the company giving it opportunities to operate in Quebec. This is very commendable. Having said that, I do not feel that the entire operation of the company ought to be reviewed as though it were seeking incorporation. Here they merely wish to change their name.
An added reason for the company to seek increase capitalization is that besides taking into account its greater volume of business and its improved position it must also take into account the factor of inflation. That factor alone would require the company to obtain greater capitalization. It would be rather reprehensible if we held over the heads of the directors of this company and the petitioners for this bill the requirement that they drop their legitimate request for an increase in capitalization in return for changing the name of the company. I think we have to be much more responsible than that. These people are legitimate, responsible business people and as long as it is the procedure that insurance companies shall come before this house for incorporation or any changes in their charters which are required by legislation, we must meet them as responsible individuals. Therefore I hope that Bill S-9 will be sent without undue delay to the committee on finance, trade and economic affairs where perhaps more questions could be asked and where we might also clear up a number of changes with 
DEBATES	December 17, 1968
respect to insurance charters which are long overdue.
[DOT] (6:10 p.m.)


Mr. John Gilbert (Broadview):: Mr. Speaker, I am sorry I did not hear the remarks the hon. member for Notre-Dame-de-Grace (Mr. Allmand) made on an earlier occasion, which are reported on page 3813 of Hansard for an earlier session. I have not had an opportunity to read them and this puts me under a cloud when it comes to discussing this important measure. I notice that Bill S-9 has an explanatory note attached to it which says:
The purposes of this bill are to change the name of the company to Eagle Star Insurance Company of Canada, and, in French, Eagle Star Compagnie d'Assurance du Canada, and increase the capital stock of the company from $2,000,000, divided into
50.000	shares of $40 each, to $5,000,000 divided into
125.000	shares of $40 each.
So there are two main purposes. One is to change the name of the company and the other is to increase its capitalization. You will notice, Mr. Speaker, that the present name of the company is British Northwestern Insurance Company and that the change proposed is to Eagle Star Insurance Company of Canada. The company happens to be a subsidiary of Eagle Star Insurance Company which is a British company of world-wide renown-a company which is very old and very large. I understand that it sells fire and casualty insurance.
The parent company is desirous of identifying this subsidiary more closely with its operations, I understand, and to consolidate its Canadian activities through this Canadian company. I understand also that the parent company itself does business in Canada and is registered under the Canadian and British Insurance Companies Act. Another item of note is that the parent company owns all the stock of this subsidiary, and sells general insurance.
I thought we might have a dialogue between the members of my party and the hon. member who introduced this bill concerning not only the name but the question of foreign ownership. I am directing my remarks to the name, and I am sure that when I have finished the hon. member for Notre-Dame-de-Grace will gladly take part in this debate. I must say I am confounded by the change of name proposed, the proposal that a name like British Northwestern Insurance Company be changed to Eagle Star Insurance Company. When one thinks of the word "British" one thinks of the British
December 17, 1968	COMMONS
empire, one thinks of the British commonwealth-


An hon. Member:: And of the lion.


John Gilbert: Yes, one thinks of the hon. as my hon. friend has suggested, a symbol of strength and solidity. But when I think of an eagle I think of our United States friends, of the eagle they have on their coins and all that the eagle represents in terms of United States power. When I think of a star, I think of the stars and stripes. I think, too, of the red star in Russia, another connotation.
Here we have an application to change the name British Northwestern Insurance Company to Eagle Star Insurance Company of Canada. I do hope the hon. member has good and valid reasons for wanting to make this change and will not say that it is just for the purpose of consolidating the company's activities in Canada. As a person who has sprung from British parentage I would not like to think that any attempt was being made by this company to Americanize this subsidiary, to give an impression to Canadians that it is a United States company by setting forth the words Eagle and Star. It seems to me we have gone far enough already with regard to the integration of our economy and the penetration of foreign ownership. Surely we would not attempt at this stage to change British Northwestern to Eagle Star of Canada for the purpose of conveying to Canadians and to the world at large that this was a United States concern. I notice that the hon. member seems anxious to rise at this point.


William Warren Allmand: Would the hon. member answer a question? At the beginning of his remarks he mentioned that the Eagle Star Insurance Company was a world renowned British insurance company. Would he not agree there is good reason to change the name of the Canadian subsidiary to the name of its British parent so that it would be identified with the parent organization?


John Gilbert: That is an excellent question from a member who used to belong to the same party as I do. If I were to compromise, and I seldom do possibly because of my Irish background, I would prefer to do so on the basis of a name which at least had a British flavour. I have read a study of this particular company, and it shows a long list of other undertakings owned or controlled by Eagle Star. The list includes the Army, Navy and General Assurance Association, the British Crown Assurance Corporation, the Eagle Insurance Company, the Home and Overseas
DEBATES	4061
British Northwestern Insurance Company Insurance Company, the City of London Insurance Company, Jacksons of Wandsworth Limited, the Liverpool Reversionary Company, and so on. There are about 25 incorporated companies. If the hon. member were to assure me that the parent company intends to change all these names to "Eagle" so as to convey the impression that they are all under the protective wings of Eagle Insurance I would be inclined to agree with what he says. But I do not think he can give me such an assurance this evening and I doubt that the owners and directors of this privately-owned company would do so.
The study goes on and on. It deals not only with insurance companies but other types of business in which the parent company is interested. We learn that the company operates in England, in Australia, in the Bahamas, in Barbados, Canada, Jamaica, Nigeria, Zambia and South Africa. That is an impressive list.
I think we ought to consider the name Eagle Star in depth because of the serious consequences it might have in conveying to Canadians a connotation of United States ownership. Many people say: What's in a name; that which smells like a rose, that which is a rose, smells the same by any other name; Shakespeare can be the same by any name. I am sure you know that quotation, Mr. Speaker. I kicked it around a little. That which we call a rose can smell as sweet by any other name. I would be happier if I were sure that the purpose of this application was not to convey to Canadians the impression that our economy is not integrated with that of our United States friends.
[DOT] (6:20 p.m.)
I turn now to the question of ownership. When I studied the question of ownership I found, when considering the extent of foreign ownership in Canada, that 80 per cent was owned by the United States, 12 per cent by the United Kingdom and the remainder by other countries. You can see the impact that these companies have made. This is why I was so impressed with the former minister of finance, Walter Gordon, when he brought the problem of foreign ownership to the attention of Canadians.
I recall the introduction of the revisions to the Bank Act in 1966. One provision was the lifting of the ceiling on the 6 per cent interest rate. A group of young, avant-garde Liberals saw something wrong in this and they had a meeting at Peterborough under the guidance of Walter Gordon. I am inclined to think that
4062	COMMONS DEBATES	December 17, 1968
British Northwestern Insurance Company the hon. member for Notre-Dame-de-Graee was one of those avant-garde Liberals who met at Peterborough to devise ways and means of meeting this lifting of the interest rate ceiling. I am rather surprised that he has introduced this bill because I think of him as one of the young men in the Liberal party who is far ahead of the cabinet ministers in regard to the economic situation of Canada and the foreign ownership problem.
When Walter Gordon brought this problem to the attention of Canadians he did them a great service. He underlined the problems that face Canadians today. In his book, "A Choice for Canada", he set forth the balance of payments problem which foreign ownership imposes on our economy. We still have that balance of payments problem. We still have an attempt by foreign-owned companies to penetrate the Canadian economy. When one thinks of this one cannot help but think that if we lose our economic independence we may well lose our political independence.
We should also keep in mind the great change that has taken place in society. At one time a large segment of our economy was within industrial control. Some 40 per cent of our economy was geared to industry, which meant that 60 per cent was geared to the service industry. With major technological advances it will be no time at all until only 25 per cent of our economy will be taken up by industrial development and 75 per cent will be service industry.
The insurance business is a service industry. One would hope that we as Canadians would direct our attention at least to controlling our service industries. Many Canadian insurance companies have been lost to foreign ownership. We had the recent example of Excelsior Life which is owned by the Aetna Insurance Company of New York. It has a tremendous spread of ownership not only in Canada but throughout the United States.
The hon. member for Notre-Dame-de-Grace said that the directors of the company in question were mostly Canadians. He is quite right. In fact the law requires that the majority of the directors be Canadians and that they become Canadian citizens resident in Canada. The hon. member said that two of the directors were resident in Britain. We would like to see the law applied so that the majority of the shareholders would be required to reside in Canada. This company has a wide spread of ownership throughout the world. More important, its ownership is in private hands. It is not publicly owned. It [Mr. Gilbert.J
affords no opportunity to Canadians to participate in the growing service industry in Canada. This is why Walter Gordon was so emphatic about setting up the Canada Development Corporation. Through it he saw an opportunity for Canadians to buy shares in Canada.
When I see the Eagle Star Company, which is owned 100 per cent by English interests, offering no ownership to Canadians I cannot support the application of British Northwestern Insurance Company to change its name and its capitalization. The main purpose of this bill is to change its name and its capitalization. I would hope that the company would retain that great and noble name, "British", and would have the strength and courage to change its capitalization to give Canadians a right to own one of the largest service industries that we have in Canada.


Mr. Arnold Peiers (Timiskaming):: Mr. Speaker, talking about this bill is like talking about an old friend. I am surprised that this company has not taken a simple method of solving its problems. I have never noticed that Mr. Humphrys was unequivocal about anything, but I would quote the following from the minutes of the proceedings in the committee of the other place:
Senator Croll:	If I have insurance with the
British Northwestern Insurance Company now will I continue my policy with the British Northwestern Company or do they transfer me over to Eagle Star?


Mr.   Humphrys@: You will continue your policy with this company and in all respects your policy will be valid and unchanged, but the name of the company is being changed so that when your policy is renewed you would get a new policy which would carry the name of Eagle Star of Canada, but it is the same corporation, the same corporate entity with the same liabilities.
Senator Thorvaldson: Really it is just a change of name. That is all that is involved in this bill.


Mr.   Humphrys@: Exactly.
Senator Thorvaldson: Plus the increasing of the capitalization.
On a number of occasions Mr. Humphrys refers to the change in name, but the increase in the capitalization does not seem to carry any weight with him. If it is only the change of name that is important I wonder why the company does not obtain it through letters patent. Recently a number of companies changed their names by that method. But I think there is more to this matter. This is not a small company. It is a very large company. This company is being dishonest in saying it wants to bring all its companies under the Eagle banner. That is not what is intended.
December 17, 1968
COMMONS DEBATES	4063
This company, when it operates, suits itself as to what its name will be. I wonder about this. It has been very prone to change its name.


William Warren Allmand: Mr. Speaker, may I ask the hon. member a question? He just said that the company was being dishonest because it said it wanted to change all its subsidiary companies and put them under the name of Eagle Star. Would he advise where the company stated it wanted to put all its companies under the name Eagle Star?
[DOT] (6:30 p.m.)


William Arnold Peters: I gather from memory that the hon. member in his introduction said that this was the intention of the company; that is, that the reason for changing the name to Eagle Star Insurance Company of Canada was that this is the name of the company in England. If that is not so, then it is all right. Let us look at this matter of the name. This company was incorporated in 1906 as the Freehold Fire Insurance Company. Then there was an amendment in 1906 changing it to the Prince Rupert Fire Insurance Company. Then again in 1908 it was changed to the British Northwestern Fire Insurance Company. It was reincorporated in 1910 under a dominion charter which was amended in 1952 changing the name to the present form. A dominion licence was issued to this company in 1912. It has called itself the Freehold Fire Insurance Company. It has called itself the Prince Rupert Fire Insurance Company. This should interest my friend because I am sure he will wonder why they gave up that name. Then it was called the Northwestern Fire Insurance Company, and now it is called the British Northwestern Insurance Company. So, this company continually over the years has changed its name. This reminds me of the people during the difficult days of the depression who felt that it often was easier to change their address than to pay the rent.
It may be that this company, while using each of the names, received a certain amount of criticism from those who were buying insurance and changed its name for that reason. This however may not be the case; I do not know. Really I do not know the reason these companies change their names. I am not really sure why this company makes the statement that it intends to do business in Canada under its parent company while it also has several other subsidiary companies which write insurance in Canada at the present time. From the information I have I find
British Northwestern Insurance Company it difficult to sort out which of its many companies are doing business in Canada.


William Warren Allmand: Mr. Speaker, may I ask the hon. member another question?


William Arnold Peters: Yes.


William Warren Allmand: Does not the hon. member recall during one of our earlier debates when I pointed out that the Eagle Star Insurance Company intended to do all its insurance business in Canada under this one corporation, and that it was closing down the other subsidiary companies that carried out the business of insurance in Canada.


William Arnold Peters: Yes, I realize that; but this is not really what they say this year. Although they do not say which they are, they have three subsidiaries doing business in Canada. Two of them have closed down, but they still have two because the parent company is registered and is doing business in Canada as well. This company, as have other insurance companies, has done very little for the insurance business in Canada. It is interesting to note in respect of some of these companies that come before us that they do not make a suggestion concerning something they wish to do that would be for the benefit of the insurance business in Canada. I have always failed to see why we should allow the establishment of a new company or why we should allow the change in the name of a company without some legitimate explanation. I do not understand the reasons. They do not change their method of doing business, and they probably do not change their shareholders. There is no indication that the company either went bankrupt or failed to pay its liabilities. In fact there is no indication that all through the years this company even changed its capitalization. As I understand it, originally 50,000 shares of a value of $2 million were authorized. I believe the authorization is still the same. So I presume this has not changed in any shape or form. The company, however, has been doing business in Canada as has the parent company.
In looking over the report of the superintendent of insurance it is difficult to ascertain whether the Eagle Star Insurance Company of Canada was underwriting its own insurance or whether it was tied in with some other company for reinsurance purposes. It might be that the parent company was carrying some of the re-insurance. It is difficult to know what the situation is. Because we are interested in insurance I think members
December 17, 1968

British Northwestern Insurance Company would be interested in looking over some ot the types of insurance this company may write and some of the expenses the company may incur.
I should like to refer to one expense the company has, which I think is very limited. Certainly there are not too many senators on the board of directors of this company. I suggest that if this were the case the company would be paying higher directors' fees. The directors' fees amount to $7,600. Obviously these people are underpaid if the company is doing what it says it is doing. In the Senate report there was an indication that the company hired a majority of Canadians, in compliance with the act. They also had some people who came from England who were acting as directors.
We know that $7,600 is a very small wage. No senators will get fat on that. This probably is the reason they are not involved in the company-and it might be noted that this is not a very charitable company, in any case. Their charitable donations in Canada for a year amounted to only $511. Possibly the Secretary of State for External Affairs (Mr. Sharp) was talking about this kind of donation in respect of Biafra when he made the suggestion in the house this afternoon that charity begins at home. We should be interested in some of these facts because they probably give a better indication of what this company is, and some of the things that it is involved in. It does not matter whether the company changes its name, the same situation will exist because it has said it will exist.
[DOT] (6:40 p.m.)
Let us look at claims ratios incurred, less salaries and excluding adjustment expenses of some of these insurance companies. Perhaps hon. members will be surprised to find that the ratio of claims premiums earned in respect of fire insurance is 39.6 per cent to one. This means 61 per cent or almost that amount is spent on insurance claims, while over 39 per cent is returned to the company. That is a fairly sizeable amount.
My point is that if I want to do business in Canada, and a company such as this does not have a combines or monopoly, I should be able to shop around and get a better return for my money from the company in opposition to this one.
Apparently this company is also involved in the insurance business in relation to inland traffic and transportation, including, I would suppose, inland waterways. The ratio in this

regard is 910.1 to one. It seems to me that stealing is not a grave offence so long as you have a licence.
There are other insurance fields of interest to hon. members. This company in respect of automobile liability has built up a 46 to one ratio in respect of premiums earned. That is a fairly sizeable amount. The ratio in respect of automobile life liability is 48.8 to one. As I suggested, it does not matter whether this company changes its name, it is not going to do anything for Canada or the insurance business.
But let me hasten to add that this company will do something for its shareholders in England. They have not done badly in many ways. Most Canadians do not realize, although I am sure the hon. member for Trois-Rivieres (Mr. Mongrain) will agree, that there is a lot of money available in Canada for the purpose of exploiting Canadians. I think it is perhaps easier to exploit a Canadian than anyone else.
I note that one of these companies-and there are so many that this becomes complicated-owned by British and Northwestern Insurance Company is a company called Tri-zec. Hon. members will be interested in this regard. One of the major subsidiaries is the Place Ville Marie Corporation. The company also owns Triton Shopping Centres Limited, Inverness interests, which is an investment company I suppose in the maritimes, Imnoklia Incorporated, which has a controlling interest, Tri National Building Services, and National Cleaning Contractors, a division of Kinney National Services Incorporated.
Incidentally, Trizec is affiliated indirectly with Covent North American Properties Limited, which is well known to many members. In the past it has acquired office buildings and complexes, urban shopping centres and other developments in Halifax, Toronto and Vancouver, British Columbia, and now has an office building in Montreal. This is a wholly owned subsidiary of the Eagle Insurance Company, so that a lot of the money flowing to the parent company obviously finds its way to this company.
It seems to me that these companies should be owned by Canadians normally resident in Canada. This can of course, be a paper transaction. This company creates paper directors, most of whom do not own any stock. If this company has a lot of paper directors and the stock is owned by shareholders and under control of the Eagle Insurance Company, it then owns Northwestern Insurance Company
December 17, 1968
COMMONS DEBATES	4065
lock, stock and barrel. If you can work it out you can kick the stock around until you force a meeting to be held in Toronto. That stock must be brought from England by somebody who comes here to vote, this is not a real vote at all. It is a vote by a number of dummy directors in Canada who receive $6,700 per year. If we cannot do anything else, we can at least get the directors' fees increased, because while these are the people who are going to take the brunt of Canadian criticism, they have no say at all in this company.
We have an obligation as members of parliament to see that there is some competition in the insurance field. It is quite true that all insurance companies, and we will refer particularly to the fire insurance field-operate by zone areas, and consider the type of house and its construction as well as a number of other factors. They then set the rate per thousand in every given area. There is no legitimate reason a company coming into Canada, with a better system of operation, should not be allowed to deal with agents in a given area offering a better or competitive price.
We have heard a lot of talk about independent insurance agents. But they have made certain commitments, and when a new client comes into the office they reach into their file and pick out the application of the next insurance company on the list. The agent repeats this procedure, with the result that there is no competition. This involves nothing more than a search in his file drawer for the next insurance policy application. I suggest this is not in the interest of Canadians, particularly if this company is not willing to do something about it. It should make some other arrangements, and other insurance companies should be allowed to compete. I am sure they will find it not too difficulty to find money for their operations.
We are very pleased with the work of the superintendent of insurance in this field, but we must supply him with the machinery and the tools to enable him to provide us with information on which we can decide which insurance companies will work in the best interests of Canadians, for Canadians and owned by Canadians.


Frank Howard: Mr. Speaker, as the hon. member for Notre-Dame-de-Grace (Mr. Allmand) and others have said, the principal objective of the bill before us is to change the name of the company, accompanied by an ancillary objective to increase its capital from $2 million to $5 million. This is obviously frivolous; it is not a bona fide
British Northwestern Insurance Company objective. If the company is prepared or willing to drop that aspect of the bill, in the hopes of obtaining the other, in other words if it is willing to dispense with the idea of increasing its capitalization by two and a half times, I am sure there would be no objection. Either that, or the company has some assurances that it does not have to worry about the capitalization aspect; it will be able to obtain that in some other way.
[DOT] (6:50 p.m.)
I think this reflects what has become, even though it was initially a supposedly secret and confidential matter, more and more widely known, namely that this government has given a commitment to insurance companies that they need not worry any longer about going through this process of obtaining alterations to their structure, incorporations, change of name, capitalization or anything else in so far as the private bill process is concerned, because the government has sold itself to them and guaranteed insurance companies and, trust and loan companies, that in the near future they will be able to do this by the letters patent process.
The government has made the commitment to them that in the future, presumably next session or even this one if the opportunity presents itself, it will introduce appropriate amendments to the public law of Canada, whatever it might be, whether it be the Canadian and British Insurance Companies Act or the Companies Act, whereby these companies will no longer have the display to the public their involvements and ramifications in order to get their way and have their will done. It has been a standard and I think proper practice in Canadian activity to require insurance companies, which have such a stranglehold on the economy and finances of this nation, to come to a public body and in public display make whatever changes they want in their structure.
The fact that the company so easily offered to dispense with the increased share capital aspect of this bill in order to get the bill through indicates that it was frivolous in the first place, which is making a mockery of parliament, or that it has some guarantee that it will be able to accomplish the same end in another way. Surely we cannot be expected to believe that for a company of this sort, with involvement in so many aspects of the financial world, in real estate and anything you can name, the principal objective of the bill is to change the name. That is nonsense. The
4066	COMMONS
British Northwestern Insurance Company principal objective of the bill is to increase the capitalization of the company. Surely in the operation of companies their capital structure and profit picture is more important than the name. To expect parliament to believe that is asking parliament to be incredible. We simply cannot accept it.
This is an indication that government has once more sold out the interest of the Canadian people to foreign interests, not only by this procedure but even by the rule changes that are proposed. Rule 16A is a proposal which has been branded by the Conservative party-which I notice is unanimous in the house today in its view of the bill before us, and I imagine about everything else that may come before us in this hour-as the sort of rule that will remove effective parliamentary debate, as the sort of rule that only a fascist would ask for, as the sort of rule which could only be spawned in the minds of those who would be dictators. There is hardly a newspaper in the country that favours that which is contained within rule 16-A. No matter how odorous and rotten it is, it contains in its provisions the involvement of government in the affairs of this hour. So government, if it is not able to obtain the objective of favouring insurance companies, probably reflecting the degree to which campaign funds are received from them, has made the commitment to these compagnies and guaranteed that they will pass through parliament a public law-


William Warren Allmand: Mr. Speaker, I rise on a question of privilege. The hon. member seemed to indicate that campaign funds-I do not know whether he was referring to me or not-had been donated by this particular insurance company or other insurance companies. If he has any evidence to that effect, I would be pleased if the hon. member would bring it forward instead of making broad generalizations and insinuations.


Some hon. Members:: Hear, hear.


Frank Howard: Mr. Speaker, I would like to tell the hon. member for Notre-Dame-de-Grace (Mr. Allmand) that I did not seem to indicate anything of the sort. I said it outright and directly. The Liberal party is the recipient of behind the scenes, under the table campaign fund contributions that the hon. member does not even know about, because the party does not bring him into its confidence anyway.
We ask the hon. member to be as honest in this regard as other hon. members of the house and the party to which I belong. Is his

DEBATES	December 17. 1968
party willing to disclose the source of its campaign funds?


Some hon. Members:: Oh, oh.


Frank Howard: No, you are not. You haven't got the guts to do so. You would sooner be bought.


Mr. Deputy Speaker:: Order, please. I would suggest that we return to the issue before the house, which is Bill S-9.


Frank Howard: Mr. Speaker, I was well on my way to doing that when I was interrupted by a comment from the other side of the chamber. It was false and untrue, but nonetheless I was interrupted. The government has made a commitment to insurance companies and trust and loan companies that they do not have to worry about coming out into public display any longer with regard to their operations; they can do it privately.


Mr. Deputy Speaker:: Order, please. The hour appointed for the consideration of private members business having expired, the house will resume the business that was interrupted at six o'clock.
At seven o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.

[Stage Direction]
Hon. Donald S. Macdonald, Rosedale (for the Minister of Finance) moved the second reading of Bill C-146, respecting the imposition of anti-dumping.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Bechard in the chair.
On clause 2-
Herbert Eser (Herb) Gray: Mr. Chairman, perhaps I might deal very briefly with some of the very interesting points made by hon. members when they spoke on the resolution stage of the bill, and I would like to thank them all for their participation in the debate. I think that they all put forward points of view which helped to illuminate this very difficult subject.
First of all, the hon. member for Calgary Centre asked for an assurance that the same protection would exist under the new section
December 17, 19G8

7 of the Customs Act as under the former section 40(a). Perhaps I can meet his request by referring him to my comments when I opened the debate on the resolution stage. In speaking about the proposed section 7 of the Customs Act I said:
We are proposing that this section be replaced-
I was actually referring to the existing section.
-by a new provision-
-and I am referring here to the proposed section 7-
-which will achieve the same result as the present law through the use of the surtax rather than anti-dumping duties.
I went on to say:
Emergency action of this kind is contemplated under article 19 of the GATT.
I would also like to draw the attention of hon. members to page 101 of the white paper on anti-dumping tabled on behalf of the government of Canada by the Minister of Finance. In its explanatory notes the following is said with reference to the proposed section 7 of the Customs Act:
These new subsections would replace section 40(a) subsection 7 of the Customs Act and in their application would have substantially the same effect as that subsection.
The hon. member for Kent-Essex was kind enough to note that I come from the same area of the country as he does, and that I share his concern about some of the matters he mentioned. I certainly share the concern of all hon. members from the area with respect to the interests of the area's agriculture and industry, a concern shared for example by my colleagues, the hon. member for Kent-Essex and the hon. member for Windsor-Walker-ville.
Perhaps I should note, with reference to some of the very interesting comments made by the hon. member for Kent-Essex, in particular with reference to the corn situation which was very disturbing to many, that the action taken by the government with respect to corn imports was actually taken not under the existing provisions with respect to dumping but under the present value for duty section of section 40 (a) which is being replaced by the section 7 to which I have just made reference.
Often people refer to action of this type as being dumping action. If I am not mistaken, the term "dumping" has a rather precise meaning in the law of international trade, in referring to sale in one country at a price
Anti-Dumping Duties
lower than the price at which the same goods are sold in the country of export, and it is not intended to apply to the problem of low cost imports when the goods are sold at what is considered to be a rather low price in relation to domestic goods but not at a price lower than they are sold in the country of export. It is with respect to the latter situation that action under the existing value for duty section was taken, and it is with respect to these value for duty sections that the government is proposing that they be replaced by a new section 7 which will make somewhat clearer that this type of action is emergency action authorized by section 19 of the GATT, and is not really meant to be included in legislation dealing with dumping. This is one reason why the existing section is being replaced with another one. The purpose is to make more clear the nature of the action that is intended to be taken with respect to low cost imports of the type which cause injury to Canadian production.
I might also say with respect to the comments of the hon. member for Kent-Essex, when he expressed some concern about the time that will be taken under the proposed new legislation with respect to dumping, that perhaps he may be reassured if he notes that the proposed legislation imposed time limits within which action must be taken, time limits which do not exist under the existing law.
The hon. member for Okanagan Boundary also expressed concern about the problem of low cost imports of agricultural products. He had something to say about the trade agreement with Australia. I am informed that this agreement does not exempt imports from Australia from the application of our dumping law, but rather it creates an obligation to consult with the Australian authorities when a complaint of dumping is made either with respect to goods that are intended to be imported into Canada from Australia or with respect to goods that are intended to be imported from Canada to Australia. But again, as I understand it, the agreement states that the consultations must be completed within a certain time period. If mutual agreement is not reached within that time period, then action under the dumping legislation can be taken. As I say, this is a reciprocal provision which would apply also if complaints are made with respect to the export of goods from Canada to Australia.

December 17, 1968
Anti-Dumping Duties
[DOT] (8:10 p.m.)
The hon. member for Wellington also made a most interesting contribution to the debate. He was good enough to mention that if it should happen that a subsidiary is importing goods from a parent company in a way which might be considered to be dumping, than the union representing the employees in a firm could make a complaint. I might add that it is my understanding the government can undertake an investigation into alleged dumping on its own initiative. As I understand the proposed legislation, it is not necessary for the government to wait for a specific complaint to be made, although I suppose that would ordinarily be the case.
Then, the hon. member for Edmonton West, in his own very constructive and useful remarks, referred to the continuing problem of non-tariff barriers. I believe there have been recommendations from the finance committee to the government calling for the intensifying of its efforts to bring about a further elimination of them. It has been said, and I expressed this view when we debated the changes in the Customs Tariff arising out of the Kennedy round negotiations, that the anti-dumping code, which does provides the source for the legislation we are considering now has as the major aim of lessening the impact of the non-tariff barriers as used by trading nations, in which dumping legislation was applied in an unreasonable manner. I might point out that the implementation of the undertakings of the code by the various nations that have signed it, in so far as dumping legislation being used by other nations in a way that creates harrasment for Canadian exporters, would mean the lessening of this non-tariff barriers and corresponding increases in opportunity for our Canadian exporters.
Finally, I should like to remind the committee of the whole house of one other decision of the Kennedy round negotiators, and that was to set up a special working party under GATT, of which Canada is a member, to develop programs for the further elimination of non-tariff barriers. I should like now to thank members of the committee for their kind remarks with regard to my own efforts in the committee, and of course it should be made clear that these remarks would have to apply equally to other members of various parties on the committee and certainly to our distinguished chairman. I am prepared to attempt to deal with questions members may have with regard to clauses of the bill, as we proceed with the consideration of it.


Marcel Joseph Aimé Lambert: Mr. Chairman, I call on the parliamentary secretary's technical knowledge of the other official language and I call the hon. members' attention to the fact that there is a certain confusion about the terms "antidumping", "dumping" and then "dumped". If one looks at the French text, one finds that in clause 1, the present legislation is entitled:
Anti-dumping Act.
Then in paragraph (c), subclause (1) of clause 2, the word "dumped" is translated by the word "sous-evalue".
On the other hand, in subparagraph (ii), paragraph (g), subclause (1) of the same clause, one reads, and I quote:
-in the absence of any goods described in subparagraph (1), goods the characteristics of which closely resemble those-
I beg your pardon, Mr. Chairman; I wanted to quote another example, namely what is found in clause 3, and I quote:
3. There shall be levied, collected and paid upon all dumped goods entered into Canada in respect of which the tribunal has made an order or finding, before the entry of the goods, that the dumping of goods of the same description-
At line 13 of the same clause, one reads:
-an anti-dumping duty-
I wonder what is the real meaning of that text. Is it because, in a sense, one can use the adjective "dumped" goods which could be translated by "sous-evaluees", or else an "anti-dumping act" where again an adjective is used and it is called "antidumping"? Of course, I rely on the parliamentary secretary's knowledge to give us an explanation and I hope, Mr. Chairman, that he will not take that amiss.


Herbert Eser (Herb) Gray: Mr. Chairman, I want to thank the hon. member for Edmonton West. I feel that he has called the hon. members' attention to a very interesting point.
Evidently, the terms "dumping" and "antidumping" are acceptable in international French, since these words are used in what is called, 1 think, the "Anti-dumping Agreement".
For instance, section 8 of the agreement mentions anti-dumping duty and provisional measures. So it is obvious that the use, in the act itself of the terms "dumping" and "antidumping"-I speak of the French version-is entirely acceptable, because if the French version of the agreement entered into under
December 17, 1968

GATT uses the terms "dumping" and "antidumping", these terms are evidently acceptable, and not only in the international sense.
But the hon. member raised a more complex question. He called our attention to the use of the term "dumped", and I think it might be wise to withhold our final decision on that and resort to the advice of the parliamentary law clerk and counsel, who is usually in the house, nearby, in order to have a fuller explanation. The term "dumped" might be in the Customs Tariff now in force. We should perhaps withhold the final decision on that matter, because I will try to go more deeply into that question.


James Hugh Faulkner: Shall clause 2 carry?
[DOT] (8:20 p.m.)


Mr. Howe:: I should like to bring to the attention of the parliamentary secretary a problem that has cropped up within the last six weeks or two months. As he may know, some farmers went over to England and were able to buy tractors there, then bring them back to Canada. In one case, according to newspaper articles, farmers imported seven tractors at a saving to them of about $20,000. We know that not too many tractors are being manufactured in Canada, and I wonder whether what the farmers did is being frowned on by the government. My information is that some of the machinery companies have gone to the government and asked it to do something about this sort of practice. Since the farmer is having so much difficulty with the cost price squeeze I think that instead of frowning on what has happened the government ought to condone it. After all, when speaking in Winnipeg the other day the Prime Minister said that the farmers should do more for themselves. In my riding farmers are doing just that. Some are going to England to buy their tractors and are hoping to get away with it. They hope to make tremendous savings.
The cost of farm machinery is an important factor in farming costs and the government must assure these farmers that no taxes or duties will be imposed on the machinery that is brought into Canada because they are bringing it in on their own initiative. I think the government should allow this practice to be carried on in order that farmers may meet their commitments with regard to farm machinery and the costs of operation. It is tremendously helpful to them when they can go to England to buy tractors at great sav-
Anti-Dumping Duties
ings. The government ought to consider that point and not throw any roadblocks in their way. Could the parliamentary secretary give us some idea of what the government is to do in this regard?


Herbert Eser (Herb) Gray: Mr. Chairman, I think the hon. member has raised a very interesting point. It is my understanding that under our tariff regulations, farm machinery and that includes tractors, has entered duty free. Certainly that law remains the same. Unless the nature of the transaction contravenes the provisions of the laws with respect to dumping or with respect to low cost imports, the practice in my opinion at least would not be stopped by the customs authorities. If the price farmers pay is the price these tractors are ordinarily sold for in England, my understanding is that the transaction does not constitute dumping. Under the proposed law there would have to be not only a determination of dumping by the Department of National Revenue, but a finding of injury to Canadian production as well by the proposed injury tribunal. So, the provisions of the proposed law at least with respect to price would not be sufficient to interfere, in my opinion, with the type of transaction which has been mentioned unless, in the course of proceedings under the proposed law, the injury tribunal also found injury to Canadian production under the terms set forth in it.


William Marvin Howe: Mr. Chairman, it is my understanding that practically all the tractors bought in Canada are not made in Canada. Hence I cannot see that there is too much injury to any company in Canada in this regard.


Herbert Eser (Herb) Gray: I thank the hon. member for making this additional point. That is something which the farmers who are interested in this transaction will no doubt bring to the attention of the customs authorities, if complaints from Canadian manufacturers are brought forward.


[Stage Direction]
Clause agreed to.
On clause 3-Anti-dumping duty payable.
Lincoln MacCauley Alexander: Mr. Chairman, I want to take a few moments of the committee's time to speak on this matter. First I wish to congratulate the parliamentary secretary upon the magnificent job he has done in this connection. Of course credit is owing to the distinguished chairman. I intervene at this time, Mr. Chairman, to say that I represent a steel city. It is significant that on September 20

December 17, 1968
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when I made my maiden speech I was concerned with the anti-dumping legislation which would be presented to the committee and I said, as reported on page 289 of Hansard:
It is interesting to note that iron and steel industry sales all across Canada make up approximately 2.7 per cent of the gross national product, therefore being even greater than wheat which is 1.7 per cent.
This clause, which establishes liability for dumping duty, is the most significant clause of the bill because under its provisions any organization or corporation that dumps anything in this country may be found liable. I also wish to point out that industry recognizes that competition on a fair trade basis is customary and challenging. In my speech of September 20 I went on to say:
However, competition at less than fair market value is disturbing and cannot be considered fair. In fact it may result in irreparable damage to the domestic industry and to the economy. It is suggested that the onus of preventing undue disruption from dumping into the domestic market rests completely on the importing country.
Anti-dumping legislation should be regarded as an extension into the international field of principles expressed nationally by statutes restricting discriminatory or predatory trade practices. Dumping is an unfair trade practice, and I wish to emphasize this point to the parliamentary secretary. It is a lessening of free competition, and sometimes it destroys free competition. Besides being unlawful, dumping in the long run is contrary to the public's interest. Without proper anti-dumping legislation and without prompt, vigorous and efficient application of that legislation, the capitalism of free enterprise will be replaced by the capitalism of international monopolies.
I should like to refer to a brief that was submitted to the authorities by our steel industries, which are vitally concerned about this matter. It is said that the Canadian steel market is particularly vulnerable to imports by reason of its widespread geography, the size of its domestic production compared with that of its near competitors, the world surplus of productive capacity and the marketing practices of certain foreign steel producers. In the brief I have referred to this is said:
Indeed, there is a real incentive in several countries to maintain full employment by exporting steel at whatever price may be obtained above the labour and material costs of its production: they, in effect, export their unemployment. Therefore, steel is particularly vulnerable to dumping tactics by foreign competitors.

It goes on to say that the Canadian steel industry has a vital concern to see that the legislation will be effective in its application to trade in steel, and in products consuming steel. The latter part is extremely important and I believe was dealt with previously by the hon. member for Wellington South. The brief also says that the rapidity with which both the determination of dumping and the judgment of material injury can be resolved will contribute significantly to the effectiveness of the legislation.
The brief continues to say:
[DOT] (8:30 p.m.)
In our opinion the determination of injury would prove to be an extremely complex problem. The establishment of a tribunal, charged with this serious task, appears and excellent proposal. The absence of a definition of injury indicates appreciation that it is a difficult concept: Each case will require the judgment of the tribunal, and should be judged on its own merits.
The composition of the tribunal should be such as to make possible conclusions based on practical understanding of business conditions and competitive circumstances. Furthermore, it is suggested that the tribunal be comprised of persons with knowledge and experience in those industries most susceptible to dumping.
The steel industry is prepared to make available persons with special or technical knowledge either on a full-time or part-time basis. In addition, the steel industry desires the opportunity to meet regularly with the deputy minister of national revenue for a discussion of world business conditions and the likelihood of dump.
I certainly hope the parliamentary secretary will attach importance to these observations. If people are to be appointed to this tribunal on a partisan basis then the intent of the entire legislation will be defeated. What I am trying to indicate is that concern over the application of this legislation must be continuous because of its importance in terms of our economy. We must give this measure our continuing attention to make sure that the tribunal and the government act with the necessary speed, and that severe penalties are used, when justified, in order to protect our industries at home. Each case must be judged on its own merits, and both the tribunal and the government should constantly refer to and consult with industry. The clause which we are presently considering is, I submit, one of the most important parts of this legislation. I say this with all due respect and I trust the parliamentary secretary will accept my words in the spirit in which they are uttered.


Mr. Thomson (Baiileford-Kindersley):: I
have a question to ask the parliamentary
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secretary. It refers to the criteria by which the department will decide whether or not a product has been dumped on the market from the United States. Let me give an example or two. Suppose potatoes are shipped into southern Alberta and sold at the same rate price as in the United States. The farmer who grows potatoes might well receive a bonus or subsidy for doing so, instead of growing wheat, for instance.
The point I am trying to get at is this: What criteria does the department use, or will it use, when reaching decisions on this kind of thing? Take the difficulty which arose in connection with corn imports into Ontario some time ago. How will the department arrive at conclusions in cases like this, when subsidies are paid directly to farmers? In the absence of such subsidies perhaps the price of corn in the United States would be higher. I tried to And the answer to this question in the agriculture committee, as did the hon. member for Saskatoon-Biggar, but we could not get a satisfactory reply.


Herbert Eser (Herb) Gray: I might suggest, with all due respect to the agriculture committee, that we would have welcomed the hon. member if he had wanted to sit in on meetings of the finance committee where he would have gotten more information than I can give him now. But I will do my best to answer his question.
I believe his problem relates not strictly to dumping, as the word is ordinarily used, but to low-cost imports which cause injury to Canadian production because I noted he referred to goods imported into Canada and sold at the same price as in the United States. In such cases action taken to protect the Canadian producer would have to be taken under the proposed clause 7 which is before us. This replaces the present section 40A of the Customs Tariff Act. If it is passed by this house it would provide for the taking of emergency action as contemplated by article 19 of the GATT, and which could lead to the application of a surtax on the imported potatoes.
If it were determined that such subsidies were being paid to the United States producer in the manner contemplated by certain sections of the GATT, the way could be left open for the Canadian government to apply countervailing duties to offset the effect of these subsidies. This is a difficult subject to discuss in a general way; it is easier when we are looking at specific cases. But I hope that
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at least in general I have dealt with the hon. member's question.


Roderick J. (Rod) Thomson: Not
entirely. I am interested to know the criteria to be used. If this would lead to too involved a discussion here I would be glad to hear the hon. gentleman's private comments at another time. On what basis will it be decided whether there is dumping or not? From my own point of view I would find it difficult to decide what would be fair and reasonable, in the light of the different subsidies given to United States farmers, subsidies which are not made available in Canada.


Herbert Eser (Herb) Gray: First, let me say that the situation outlined by the hon. member is not what is commonly known as dumping. It would not come directly under the provisions of that portion of the bill which is before us, setting up new Canadian legislation on dumping. It would come under the concluding portions of the act, the consequential sections, particularly those which create the new section 7 in the Customs Act to replace section 40A which previously permitted the fixing of a special value for duty.
This section deals with goods imported into Canada in such a way as to cause injury to Canadian production, even if they were sold at a price which is not below the price in the United States. I wanted to clarify the legislative provision which would be invoked to deal with the problem the hon. member has mentioned. I can understand his concern about it.
With respect to the criteria to be applied, the simplest thing I can say is that the government would have to consider all the circumstances of each case; it would have to consider such things as the method by which the subsidies were applied and their amount, as well as the market situation both in Canada and the United States. This is why neither the existing legislation nor the proposed legislation attempts to spell out a long list of criteria; it was considered advisable to enable the government to look into all these factors taking into account all kinds of circumstances which might not be foreseeable at the time the legislation was provided. I would be happy to arrange meetings between the hon. member and officials of the Department of Finance, or National Revenue, to look into this question. I know they would be happy to sit down with him and go into this important question in somewhat greater detail, perhaps looking at it from the standpoint of specific

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cases and giving more complete information than would be possible for me to give in a discussion of this type.


Roderick J. (Rod) Thomson: I
should like to accept the hon. gentleman's offer.


Philip Bernard Rynard: I come from an area in which there are many small industries. Compared with the great corporations to the south, their output is limited. In my opinion there is therefore no question as to the need for this legislation.
It is interesting to recall that in 1961 a Conservative government brought in a bill to deal with goods of a class or kind made in Canada that should be subjected to dumping duties. You will remember, Mr. Chairman, that it was defeated by the Liberal party of that time.
[DOT] (8:40 p.m.)
My only objection to this clause is that, in so far as dumping from the United States is concerned, it is not tough enough. My fear is that the legislation does not go far enough to accord	sufficient	protection to	Canadianindustry. Let us face the fact that, situated as we are, directly within the economic orbit of the United States the greatest manufacturing complex in the world, Canada is a natural target for dumping policies of the United States. In a number of major industrial lines Canada over the years, particularly under the policies	followed	by	this government, hassimply become a dumping ground for surplus American products.	The result	is that
although politically we are no longer a colony, we have been subjected to economic exploitation in a manner that few other countries have experienced.
Last	summer	we	witnessed	wholesale
dumping of agricultural products, corn, poultry and others, from the United States, with no action by the government. In textiles we have been subjected to subsidized dumping from the United States and Japan. In footwear we have been subjected to dumping from all over the world. The result is that Canadian industries have gone out of business and we have become a nation importing finished products while forcing more and more of our enterprise into primary industry. No nation can go on doing this for very long.
We have been in the position of living off our principal, and using our resources to buy the things we need, rather than manufacturing those things here in Canada at a cheaper

price. Resources do not last forever and in a few years Canada, instead of being a resource rich nation, will be a resource poor nation in many fields. The point I wish to make is that continued toleration of large scale dumping of surplus industrial and manufactured products, as well as agricultural products, will make future generations of Canadians hewers of wood and drawers of water.
Canada has been in the position of an open city, or open country. We have practised the open door policy in so far as foreign goods are concerned. A few years ago we made some effort, by arriving at mutual understandings with countries such as Japan and the United States, to limit the amount of foreign dumping in order that native Canadian industries would not be smothered under an avalanche of cheap goods coming in from other countries. Now with the Kennedy round agreements, the situation is likely to be worse than ever.
This anti-dumping measure is a reluctant recognition by the government that some action must be taken to protect Canadian industry. It is interesting that this measure should be brought in by a party which over the years has proclaimed itself all out for free trade. But nevertheless one cannot help wondering how much protection is afforded the Canadian producer by this bill. As I have said before, it does not go far enough. It is simply paying lip service to the need of preventing Canadian industry from being overrun by dumping from abroad.
The record of the government in international affairs is not reassuring. The Liberal party has a long record of placing international relations above the interests of the Canadian producer. We know how the Kennedy round discussions became an instrument for delaying the signing of a new grains agreement and how Canadian wheat producers suffered by being undercut in the interim. We have been told that Canadian industry will not suffer. Obviously this clause is an attempt to lock the garage door after the automobile has been stolen-and an American automobile at that, Mr. Chairman.
What we now have, obviously, is a tribunal, a sort of court of last resort to which the Canadian producer, when he is on the verge of bankruptcy as a result of having his market undercut, can appeal for some kind of action. Knowing how most of these tribunals work, it is highly unlikely that action will be forthcoming before the producer is compelled to close his doors.
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There is another point that must be made in connection with this whole question. It is not merely anti-dumping legislation that is required. There are many cases of Canadian products being designed, developed and manufactured in Canada, and even a market created for them in Canada and sometimes the United States, and then American corporations with their superior financing, large run economies and larger markets at home have moved deliberately into the market created by a Canadian firm and, over a period of time, have simply collared that market for themselves. This is not an exception, Mr. Chairman; it is almost the rule.
This is not done by dumping within the terms of this legislation. It is done simply by making use of the economies of production available to American producers in the American market. The dumping comes later when the Canadian product has been eliminated. At that point the American manufacturer can simply dump his surplus product in Canada, taking over the market created in Canada by a Canadian producer whom the American has either bought out or pushed out. I fail to see any way in which this clause protects Canadian producers against this kind of monopolistic competition. Yet in my opinion this is the most common kind of unfair competition facing Canadian manufacturers of finished articles, the competition from gigantic American competitors who move in, once a Canadian firm has created a market and, either through the parent U.S. corporation or through setting up a Canadian subsidiary, simply take over the market.
Anti-dumping provisions therefore do not prevent the cannibalization of Canadian industry by gigantic American or other foreign competitors, for the simple reason that under the unrealistic definition of dumping there is no dumping until or unless: "the normal value of the goods exceeds the export price." Under the definition of normal value it is only considered to be dumping when a product is sold in Canada at a price lower than the price at which it is sold in the United States. But, Mr. Chairman, it can be just as harmful to Canadian industry when the product is sold at the same price as the price at which it is sold in the United States, because very often the greater volume of American production permits huge economies in production. But that situation is not taken into account in this bill, so far as I can see.
The fact that the goods must be sold below the domestic price in the Canadian market
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means that a great number of goods which can be sold cheaply and made cheaply in United States or Japan can come into Canada. This applies to Czechoslovakia, East Germany and other European and Iron Curtain countries which can send their products here at exactly the same price at which they are sold in those countries and, because of currency differences and production economies, undercut Canadian manufacturers to a considerable degree.
This is why I said this bill does not answer to any great degree the problem of Canadian manufacturers being undercut by unfair competition from other countries. They would not fall under the dumping definition. This is where the clause falls short. Within a short time the government will be facing a serious situation in the form of complaints from producers all over Canada.
[DOT] (8:50 p.m.)
I shall give just one other example, Mr. Chairman, and I do not know whether it has been touched on or not. As we know, our seasons in the north range from winter into the spring, and then into summer, so that quite often goods on sale in the country to the south of us have reached their peak market before they come into the Canadian market. Therefore the producers of those goods can afford to sell them here below their actual cost. They can lower their prices because they have already sold 75 per cent, 80 per cent or 90 per cent of their production. Not only that, but the output of one U.S. firm on occasion equals the total production of all Canadian manufacturers of a particular article. One can cite instances where one big corporation in the United States can manufacture more goods and dump more into Canada than the total annual production of Canadian manufacturers. This is of great concern to me. Once those are in the suppliers' hands how can this law be enforced? Therefore, that is the reason I do not think this bill and this clause will accomplish what they are intended to accomplish.


Mr. Caouetie:: Mr. Chairman, I should like to say just a few words on the anti-dumping legislation. The objectives of the bill are certainly to encourage Canadian manufacturers and to protect them against the entry into Canada of goods similar to those manufactured in Canada but at much lower prices.
However, this bill, which is intended to protect Canadian manufacturers, says nothing

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about consumers and their needs in view of the present economic situation of Canadian or foreign manufacturers.
Anti-dumping is being practised not only between the Japanese and the Americans or other countries in the world, but even within our own country, between one town and another, for example. Obvious examples of this are to be found in the trade between Ottawa and Hull, two adjoining towns which are practically one. However, Ottawa people buy in Hull and Hull people buy in Ottawa because of tax differences between Quebec and Ontario; that constitutes dumping. In fact, Hull people come to buy in Ottawa because prices are lower. The consumer cannot be blamed for seeking lower prices. If, for example, a consumer can buy rubber shoes made in Japan at half the price of the corresponding Canadian-made product, one cannot blame him.
Instead of passing anti-dumping legislation designed to keep prices high, the government should introduce a bill to subsidize Canadian industry, in order to compete with the prices of goods dumped by other countries on the Canadian market and to protect the Canadian consumer. This is not what we are doing. Dumping is not practised only in Canada, because we do it ourselves in other countries.
For instance, Mr. Chairman, it is impossible to find out how much we are paid for the wheat we are selling to Red China. This is then a case of dumping when subsidies cover about one half the normal price of wheat. We are selling our wheat to China at a much lower price than production cost. This is dumping practised by Canada towards other countries.
At one time, we were blaming the United States for selling their wheat to Russia at better prices than ours. American economists and the American government were asked to keep in line with our prices.
The problem will remain the same, Mr. Chairman. This will not increase the purchasing power of our consumers by one red cent. Even with the adoption of this bill, our people will not be in a position to buy more. Perhaps some products will not be admitted to Canada or the government will be able to levy import duties so that these products will reach approximately the price levels of Canadian products, but the purchasing power will not in turn be stimulated; the reverse will be true. I think this is a direct infringement-


Alfred Pullen Gleave: Mr. Chairman, would the hon. member permit a question?


David Réal Caouette: Yes.


Alfred Pullen Gleave: What subsidies on Canadian wheat being sold to China are you referring to? Or did I misunderstand the question; was the translation imperfect?


David Réal Caouette: Here is the situation, Mr. Chairman. We are selling our wheat to China at less than prime cost, than cost price, and it is impossible to find out from the minister what prices we are being paid for the wheat we sell to China.


Alfred Pullen Gleave: Mr. Chairman, if I may be permitted to interrupt the hon. gentleman I should like to correct one impression. The wheat we sell to China is sold at competitive prices.


Albert Béchard: Order. The hon. member for Temiscamingue.


David Réal Caouette: It is sold at a competitive price when we ask the United States to protect us to get the price we want because they were already selling wheat for less than we were and they increased their price to enable Canadians to sell their wheat. That is what happened not so long ago-in fact barely three years ago-but I hold my ground and I maintain that we are selling our wheat to the Chinese or the Russians for less than it is costing us to grow it here. Each time we traded with those countries we had to sell our products at lower prices and that represents Canadian dumping in those foreign countries to which we sell wheat.
Mr. Chairman, I am not against our selling wheat and our being competitive but I object to our selling our products below cost because we have a surplus. However, Canada acts towards the other countries as they do towards us. That is what I mean when I say that this will not help the consumer. It may help the producer, true. It may please the manufacturers of textile products, of rubber, or any other goods.
We want to protect our industry and I suggest this way of doing it. Instead of dumping in other countries, let us give our Canadian manufacturers subsidies to enable them to
December 17, 19G8

reduce their prices and sell their goods to the Canadian consumers.
[DOT] (9:00 p.m.)
Then production would achieve its end which is to meet the needs of the consumer. That is the solution of the Ralliement credi-tiste. It is not a far-fetched solution because any intelligent person can understand it.
On the one hand, we dub as unfriendly those countries which sell their goods at extremely low prices; on the other hand, we try to export our goods to those same countries.
We want to help the Canadian people, not only the manufacturer. Canadian manufacturers export and receive subsidies to do so. If it can be done for exports, why can it not be done for consumption here in Canada? Would it be asking for the moon? These subsidies would allow prices to be lowered, and this, in turn, would increase the purchasing power of consumers. It is as simple as that.
However, instead of looking at the economic situation from the point of view of the consumers or of their interests, the government is only concerned about the production angle. Mr. Chairman, the problem is not one of production, but of prices. Actually, production is very healthy. It can be doubled or tripled so long as there is a corresponding demand. The real problem is one of distribution and of consumption of goods manufactured in Canada and outside the country.
We will always have to deal with other countries. We will have to exchange Canadian wood, for fruit from Florida, for example, or wheat against Chinese products. Transactions will always have to continue and even improve.
However, that must always be done in the interests of the consumers and not only for the pleasure of enriching a few persons, such as importers or exporters, and still less financiers who strangle the working people, the farmer as well as the worker. We are not at all interested in protecting and enriching those people. Those who will read Hansard to-morrow, will know that the Ralliement Creditiste is not interested in those who want to make profits out of anti-dumping laws, but in protecting the Canadian citizen.
Those, Mr. Chairman, are the few remarks that I wanted to make tonight. The government owes it to the Canadian people to consider the consumption aspect of our economy and our transactions with other countries. Let us grant to our Canadian people the same
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subsidies which we give other countries so that they may come and buy here. Instead of taxing and over-taxing the Canadian people in all sorts of ways, let us help them, and the problem will be solved.
We can effectively lower the cost of consumption or production through subsidies; then, we shall become better competitors in the international market and we shall be able to face dumping, as we call it. There would be no need to pass anti-dumping legislation if we were to guarantee every Canadian citizen a purchasing power which would make it possible for him to purchase Japanese, Chinese or Canadian products. In fact, this is the only way we can protect our Canadian industry by granting subsidies so that our people may face international competition.


Alfred Pullen Gleave: Mr. Chairman, I wanted to rise a short while ago to ask some questions of the responsible minister. Now I am on my feet I would also like to refer to some remarks made by the previous speaker, whom I hope I understood correctly. With regard to dumping wheat in China or any other market, this charge should not be brought, and if it is brought, it cannot be substantiated. The wheat that Canadians sell overseas through the Canadian Wheat Board is sold at international prices, without the benefit of subsidy, and I would like to quote some figures to substantiate my point. I am sorry I am speaking only from memory in this regard, but in the area of Vulcan, Alberta, the figure arrived at as the result of a cost study was $1.70, or $1.76 a bushel. This is the cost of production in that area of Alberta, which is one of our good wheat producing areas, comparable to some of the better areas in Saskatchewan or Manitoba in what might be called the dry country.
If you take the export figure at which wheat has been sold, ranging from $1.96 to $2.12, and the difference in the cost of transportation, and so on, you will find it compares with that figure. I would not like the committee to be under the impression that this is a subsidized price for exports. It is not. If you take the cost of transportation and the cost of marketing, you will find that at this figure you are coming very close to the Vulcan figure of cost production.
As the hon. member for Regina-Lake Centre has just said to me, the figures I am quoting are for grades 1, 2 and 3 wheat. If it happens to be low grade wheat, you will be very much in the hole.

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Having said that, Mr. Chairman, I come to the question I wanted to direct to the parliamentary secretary. It arises out of the answer given by him to the hon. member for Bat-tleford-Kindersley. I hope I understood his answer correctly. Do I understand him to say that the anti-dumping provisions can apply fairly effectively to manufactured goods and manufactured imports, but they may not apply very effectively to agricultural imports, and when you get into the agricultural field you may be using a surcharge or value for duty? Did I receive the correct impression, sir?


Herbert Eser (Herb) Gray: Mr. Chairman, I do not think that was the impression I intended to convey. The proposed anti-dumping law does not make any distinction with respect to the type of goods which can create the complaint of dumping. I was attempting to get across to the committee that the nature of the problem with respect to agricultural imports very often took a somewhat different form from that of imports of manufactured goods. In my remarks with respect to dumping I hope I was not creating any impression, because that was not my intention, which would indicate that the proposed anti-dumping law made some distinction between agricultural products and manufactured products. It does not.
As I said in response to questions asked by hon. members, if you examine the complaints about imports of agricultural products, in many cases-I do not know whether I should say most-the problem does not fall under the definition of dumping as that term is used in the law of international trade. Rather it would fall under the heading, shall I say, of low cost imports causing injury to Canadian production, because it cannot be demonstrated that these agricultural products are being sold in Canada at a price lower than they are available for sale in the country of export. Therefore a different legislative provision has to be made use of, and the legislative provision in the proposed bill, if it is adopted by this house as I hope it will be, calls for the application of a surtax. The proposed section is based on article 19 of the GATT which contemplates this type of problem facing the various trading nations.


Alfred Pullen Gleave: Mr. Chairman, am I to understand from that answer that agriculture is to get the worst of both worlds? Is agriculture not to benefit from the protection of antidumping duties? Does it mean that the part of agriculture that is vulnerable to imports

will not receive the protection of anti-dumping duties? Does it also mean that that part of agriculture which depends on export markets for trade will face the additional cost of production as a result of the protection of the manufacturing industry?
[DOT] (9:10 p.m.)


Herbert Eser (Herb) Gray: I certainly would not agree with the hon. member that under these provisions agriculture would get the worst of both worlds. On the contrary, if the importation of agricultural products falls within the provisions of the proposed anti-dumping law, then anti-dumping duties will apply. If the importation of the agricultural products in question falls within the definition contemplated by the proposed clause 7(a) of the Customs Act, then they will get the protection made available by the proposed clause. Any distinctions are not with respect to the type of goods but with respect to the nature of the transaction.


Alfred Pullen Gleave: Then, according to the hon. member's explanation, would this protection under the surtax be effective with regard to the importation of U.S. corn and vegetables and would it be effective with regard to the importation of Russian sunflower oil?


Herbert Eser (Herb) Gray: If the importations referred to are of the type that caused concern a few months ago with respect to corn imports into Ontario and which led to value for duty action being taken under the existing section 40(a) of the customs tariff, then the proposed clause 7, which the hon. member has mentioned with respect to the application of a surcharge, would apply in the same way. The proposed clause 7 is designed to replace the existing section 40(a) of the Customs Act, which permits the creation of arbitrary values for duty. The new clause is being proposed to the house because it is felt that the wording of the proposed clause will make clearer than the existing section 40(a) the nature of the action being taken, and the fact that it is not anti-dumping action but rather special emergency action. As a result this action would be linked more closely with article 19 of the GATT, which attempts to deal with this type of problem for the trading nations which are signatories to it.


Alfred Pullen Gleave: As was mentioned in the committee a few minutes ago, steel is a fairly standard product with a fairly standard grade which can be measured. How will this provision apply with regard to potatoes coming
December 17, 1968

into Alberta and undercutting the Alberta market, these potatoes being of stripper grade? This particular situation was reported a year ago by a responsible Alberta publication, The Wheat Pool Budget. How do the provisions under this legislation apply in the agricultural field? Do they apply in the same way as they do in the industrial field?


Herbert Eser (Herb) Gray: My answer is yes, Mr. Chairman.


Roderick J. (Rod) Thomson: I
have been looking through this bill and I do not see anything which would state what puts this legislation into force. So far as corn is concerned, I do not know what representations have been made to the previous government, but so far as I am aware and so far as the public is aware it was the tractor march to Ottawa that drew the attention of this government to the particular problem.


Some hon. Members:: Oh, oh.


Roderick J. (Rod) Thomson: I am
not saying that this is the case, but I would like to know where in this bill it is stated that the legislation would be put into effect. Does there have to be a tractor march, do there have to be lobbies, and must pressure be put on the minister in this case? What is the approach to be?


Herbert Eser (Herb) Gray: If the hon. member is referring to the procedure under the proposed antidumping act, I would refer him to clause 13. I am not sure if this is in order, but perhaps to expedite the business of the house we might do that. Clause 13 reads:
The deputy minister shall forthwith cause an investigation to be initiated respecting the dumping of any goods, on his own initiative or on receipt of a complaint in writing by or on behalf of producers in Canada of like goods.
So this creates a pretty wide ambit.
If the hon. member is speaking of the proposed section 7 of the Customs Act, which is dealt with in clause 37 of the bill before us, then I would think that, in view of the fact that a somewhat different procedure is contemplated under that clause, the governor in council should be willing to initiate an investigation on the receipt of a complaint from any one of a great number of sources, and the hon. member has outlined a number of possible sources of complaint.


Roderick J. (Rod) Thomson: Mr. Chairman, I should like to pursue this matter further. Can anyone write an application on behalf of himself, a group or a company? For
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example, can I as a member of parliament write an application and would such a complaint be investigated?


Herbert Eser (Herb) Gray: I certainly think that would be the case, particularly with respect to clause 37 which proposes that section 7 be added to the Customs Act.


Mr. Bigg:: Mr. Chairman, I think that the idea of this bill is a very good one, but I am a little afraid that we may go on a kind of witch hunting expedition here which may hurt many of our industries, if we pursue this along the wrong lines. I suggest that in order that this legislation be effective there must be a close liaison among the different departments of the government. What is good for the agricultural industry may backfire in other industries, or even in different regional parts of Canada. For instance, if we decide arbitrarily that the selling of U.S. corn in eastern Canada should be stopped, we have to be careful that reciprocal action is not taken by the United States, which will cut down on the importation of coarse grains and fodder from Canada into the northwestern United States.
We are living in times of change. At one time perhaps it was safe to generalize and to say that western Canada was a free trade area. This may well be so when we are trying to sell our wheat, but when we are confronted with the problem of selling our oil, particularly in Alberta and now in the Arctic, we are up against a different thing. Free trade in oil would ruin the oil industry of Alberta at the present time. Before we suggest that the United States is dumping Venezuelan oil in Canada, we have to remember that we have to protect our large oil market in the northwestern United States. At the present time we have a gentleman's agreement with the United States according to which they will sell Venezuelan oil in Montreal, and we will be able to ship our oil through our pipe lines into Seattle.
So we have to be careful that we are neither regional nor blind in this matter. As I said, a closer liaison will be necessary among the agriculture, industry, trade and commerce and the revenue departments to make sure that what we mean to do does not backfire. I think that the stress should be put on reciprocal agreements, and perhaps we should use this legislation very sparingly and only use it as a final stick. But if we plan properly and if we ensure a closer liaison between the different departments, I do not think that this dumping legislation will have to be put into effect very often. As has been pointed out by
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December 17, 1968
Anti-Dumping Duties
several hon. members tonight, when we are ready to invoke this act, often it is too late, and if we used a little more foresight in our reciprocal agreements, whether it be in agriculture, in industry or in trade and commerce, the need for this would be forestalled.
[DOT] (9:20 p.m.)
If we had a proper world grain agreement, and if we had solidified Canada's trading position in this field, then I do not believe we would have to worry so much about the dumping of corn in eastern Canada or about not having any sales for fodder and coarse grains from western Canada. We should have a viable economy which would draw together all of our industries, agriculture, our manufacturing industry and primary producing industries such as oil.
What I would envisage would be this: If we are going to be faced with the dumping of oil on our Canadian market, I think the people from our industry could build a pipe line system across Canada so that our Department of Industry, Trade and Commerce would be able to forestall the dumping of United States oil on our markets. They would be able to offer United States interests cheap Canadian facilities, and we would at least then have our fair share of oil moving through this pipe line. This is the kind of planning we need. As I say, I feel this is a necessary piece of legislation but it should only be a stop-gap; it should only be emergency legislation. We should forestall any need for invoking this measure by careful planning and by good reciprocal agreements, particularly with the United States which is our greatest competitor in the manufacturing field, in the oil field and in some cases even in agriculture.
Let us not forget that the United States is also our best customer in all these fields. We are only now becoming an aggressive young manufacturing nation. However, we still have a tremendous stake in agriculture. Western Canada has perhaps a half agricultural and half industrial economy, but the agricultural half still has to be protected. I do not want to see Canada going off half-cocked barring corn entering Ontario, because then the United States could say, "All right, no more beef can be shipped into Montana and no more hay into the Dakotas in the dry season."
I should like to see a great deal more liaison between our government departments, so that by careful planning and co-operation with our own primary producers or through making reciprocal agreements, particularly with the United States, we could forestall the

need for dumping legislation. We are in a good bargaining position. The United States wants our friendship and co-operation and in some cases they want our cheap oil, our better beef and our competitive grain. However, we have to be willing to make reasonable concessions in return.
If we planned our turkey imports on a quota basis, there would be no need to flood our markets at Thanksgiving or Christmas with cheap turkeys from the United States. This ruins our small producers. As one or two other members have said, it is too late to lock the door after the horse is out of the barn. After our turkey producers have been put out of business, then United States producers are in a position to recoup all their so-called losses by jacking up the prices, in co-operation with the chain stores. In this way they recover the money they were presumably risking by giving us cheap turkeys for one year. We find ourselves in a position where our own producers are out of business, and we have to pay the price.


[Stage Direction]
Clause agreed to.
Clauses 4 to 8 inclusive agreed to.
On clause 9-Determination of normal value of goods.
Douglas Scott Harkness: I have one question on clause 9, subclause (7), dealing with the determination of normal value when there is an export monopoly or, in other words, where state trading exists. The clause reads, in part:
(a)	the government of that country has a monopoly or substantial monopoly of its export trade, or
(b)	domestic prices are substantially determined by the government of that country,
shall be determined in such manner as the minister prescribes.
What are the criteria envisaged here for making this determination? Is the criteria the normal price that such goods are imported into Canada from other countries or are sold here? Perhaps I might put it this way. What is the general practice at the present time so far as goods from state trading countries are concerned?


Herbert Eser (Herb) Gray: I believe, Mr. Chairman, that the purpose of the section is to provide authority for the continued use of prices prevailing in trading countries with free economies as the basis of determining the normal value in respect of goods imported from state trading countries. This could involve a number of different options. I suppose this could involve
December 17, 1968

the price at which a state or company sells goods in an adjacent free market country; it could involve the price at which like goods are imported into Canada from free market countries which are adjacent to the state trading countries. I believe I have outlined the major methods. It provides flexibility for dealing with any problem which might be created by the nature of the organization of the economy of the state trading country.


Douglas Scott Harkness: I would merely suggest that to use the price at which goods from the state trading country are exported to some third country would be a very poor criteria to use in determining the price of those goods so far as dumping is concerned in Canada. Some of the other criteria mentioned would be more reasonable. I would hope that what would be used would be the price of like goods which are being imported into Canada from other countries, or what the general level of those goods was at the point of manufacture in Canada itself.


Herbert Eser (Herb) Gray: Well, Mr. Chairman, perhaps I should clarify my remarks. I mentioned two possible methods. Certainly, one can understand the problem created by the method to which the hon. member referred. I am informed that the method most commonly used is to look at the price at which like goods are sold in a free or open economy. This would ordinarily be some free economy in the general area of the state trading country in question.


[Stage Direction]
Clause agreed to.
On clause 10-Determination of export price of goods.
Alfred Pullen Gleave: I am sorry, but in so far as a free or open economy is concerned, how do you define this in relation to agricultural products which are subsidized in the country of origin? How do you arrive at the figure which is to be established in the country of origin? For instance, if a corn producer in the United States takes so many acres out of production, he gets a certain price per bushel. If he takes so many more acres out of production, he gets another price. How do you say this is a free or open economy, and how do you establish the price in the country of origin?
[DOT] (9:30 p.m.)


Herbert Eser (Herb) Gray: Mr. Chairman, I was attempting to answer the question posed by the hon. member for Calgary North with reference to 29180-258
Anti-Dumping Duties
the very difficult problem of establishing normal value for goods exported from countries with state trading economies. I am not sure if the hon. member who has just spoken was thinking of a similar situation; perhaps he might prefer to use the term "comparatively open" since it is recognized that there are various forms of government intervention in most countries with respect to various aspects of the economy.
I think I indicated earlier in our discussion that, with respect to determination of normal value, both the bill and the draft regulations, the key parts of which were tabled before the committee, make it possible to take into account, if I am not mistaken, such things as subsidies which help to make up the price in the country of origin.


[Stage Direction]
Clause agreed to.
On clause 11-Where information not available.
Alfred Dryden Hales: Mr. Chairman, this is the clause that gives to the deputy minister the right to demand in such manner as he may prescribe such information as he may wish to acquire with respect to the determination of normal value. I wish to ask if our constitution is such that the deputy minister of a federal department can demand from the chairman, say, of a hydroelectric power commission of any province, the price at which the commission accepted a tender. Can he demand that information?


Herbert Eser (Herb) Gray: Mr. Chairman, I am not sure if it is permissible for people carrying out the function I am presently carrying out to attempt to give legal opinions on complicated constitutional questions. I know the hon. member who normally sits adjacent to the seat I am temporarily occupying hesitates to give opinions on constitutional matters and his expertise in law is far beyond any that I can hope to attain. Perhaps I should also hesitate before becoming involved in such an area; but, I presume that the deputy minister could ask questions and seek information; if he is not satisfied with the answer there are other clauses which enable him to come to a decision, even though answers to his questions are not provided by the people he contacts. In other words, the scheme of the act contemplates that the making of decisions with respect to dumping will not be frustrated through a failure to provide information.


Alfred Dryden Hales: Thank you. I asked that question because in the provinces it is the public

December 17, 19G8
Anti-Dumping Duties
utilities that generally make purchases of heavy electrical appliances. When they place orders offshore it is very hard to establish whether there is dumping. That is what prompted my question. I hope that the deputy minister has the right to demand from the public utilities in the various provinces the figures at which they accepted tenders.


Herbert Eser (Herb) Gray: Mr. Chairman, it is my understanding that this clause is designed to provide authority for the deputy minister of national revenue. I believe we are talking of clause 11. It provides the prescribed manner to be used in determining the normal value or export price where sufficient information has not been furnished or is not available. I am also informed that this residual authority is similar to that provided under section 40 of the Customs Act. It is also my understanding of the scheme of the act, that the way the Department of National Revenue will encourage people to give it the information it wants is by virtue of the authority it has under this clause to come to a decision on whatever limited information is available to it. Therefore the people who are not providing the required information may feel that the result will be more adverse to them than if they were to comply with the request of the deputy minister.


Marcel Joseph Aimé Lambert: Mr. Chairman, this is the very point I referred to at the resolution stage. There was a good deal of discussion about it during the committee hearings and I do not know what the ultimate answer is. We took the question under advisement when making our report. It seems to me that if the deputy minister of national revenue is kept aware, either on a regional basis or some other way, that public utilities have been placing orders offshore, some inquiry from him to that public utility body would very likely elicit co-operation, because I think these public utility commissions will realize that perhaps 18 months or two years afterwards, when they receive the goods they have ordered, they may be hit with antidumping duty. Or, they may be hit when the deputy minister of national revenue has sufficient information on the matter. I think it is a question of establishing a useful rapport with such bodies, and I think experience will bear this out.
I share the concern of my colleague, and I think we all did on the committee. I do not know whether the anti-dumping machinery was made as effective as it might have been, but we shall have to see. Nevertheless, if the

Department of National Revenue is able to elicit answers by using, shall we say, voluntary machinery, it may be better to do it that way than to force information out of these bodies by wielding a big stick.


Herbert Eser (Herb) Gray: Perhaps I can add to the very useful comments of the hon. member for Edmonton Centre. Under our constitution provincial governments claim to have a certain jurisdiction over the development of industry in the economy.


Mr. Paproski:: On a point of order, Mr. Chairman. I think the parliamentary secretary is talking about the hon. member for Edmonton West. I represent Edmonton Centre.


Herbert Eser (Herb) Gray: I apologize to the hon. member for Edmonton Centre. Clearly, we have two most distinguished members from the Edmonton area.
I was going to say that provincial governments under our constitution claim jurisdiction to encourage the development of the economy and the expansion of industry. One hopes that the comments of the hon. member for Edmonton West and of other hon. members of the committee will be brought to the attention of the appropriate bodies through the coverage given these proceedings, and that when we review the results of the operation of this proposed legislation in a year or so we may find, hopefully, that the problem is not what it may seem to be at the present time.


[Stage Direction]
Clause agreed to.
Clause 12 agreed to. e (9:40 p.m.)
On clause 13-Initiation of investigation.
Leslie Gordon Benjamin: We read in clause 13 that the deputy minister may cause an investigation with respect to the dumping clause to be initiated, if he is of the opinion, and so on. Does this mean that the deputy minister may decide, on his own, that there is cause for investigation, without reference to the tribunal?


Herbert Eser (Herb) Gray: Yes, that is right, Mr. Chairman.


Alfred Dryden Hales: I rise to comment favourably on what I think to be one of the finest features of this whole bill. This clause contains the phrase "or is materially retarding the establishment or production in Canada of light industries". I take it this means that if there
December 17, 1968

is a company, or a group of men, willing to make like goods of a kind which are now being dumped in Canada, the department or the deputy minister can rule that there is dumping because it is retarding the establishment of industry. I believe this to be a substantial improvement. It should pave the way for young, new and growing companies to establish themselves in Canada.


Herbert Eser (Herb) Gray: I should like to thank the hon. member for drawing this to the attention of the committee. He has mentioned a significant addition to our laws against dumping.
I might add that under our existing law, before dumping duty could be applied it was necessary to show that Canadian goods which were considered to be adversely affected by the imported goods were of the same class or kind, and this had been stated to mean that they had to supply 10 per cent of Canadian consumption. Thus, companies in situations of the kind referred to by the hon. member were unable to receive the protection of antidumping duties.


Frederick Johnstone (Jack) Bigg: I wonder whether this measure envisages protection against the reverse of dumping. For example, I understand that fertilizer manufactured in Saskatchewan is sold in North Dakota and Montana for one third less than the price in Saskatchewan itself. This seems to me like dumping on the United States market, or unfair competition. Incidentally, it is to the detriment of western agriculture. I think this legislation could very well be abused. We are giving overmuch protection in some cases to distributers of fertilizer here. They should make sure that the Canadian farmer is protected. In any case, I believe he should be protected against tariff concessions in reverse. We are dumping our fertilizer in the United States and presumably they are in competition with us when it comes to selling agricultural products. Is anything contemplated to prevent this? If we are dumping on the United States market it will surely be difficult to prevent them dumping on our market.


Herbert Eser (Herb) Gray: 
Frederick Johnstone (Jack) Bigg: When I spoke of liaison earlier on I was suggesting we would be in a good position to prevent occurrences of this sort if we were to meet with representatives of the United States or of other trading nations and conclude a gentlemen's agreement under which we would refrain from dumping, on our part, and they would undertake to reciprocate. We might keep this in mind when dealing with other trading nations.


Leslie Gordon Benjamin: I am still a little confused- but perhaps that is normal for me-as to the procedure under clause 13. If the deputy minister were to decide there is a case for investigation and if the tribunal did not take this attitude, supposing a complaint had also been filed with the tribunal, what would be the situation?


Herbert Eser (Herb) Gray: I should make it clear that the tribunal does not deal with the whole area covered by the proposed law. There are two aspects. There is the determination whether the normal price is higher than the export price, and therefore whether there is a margin of dumping. Second, there is the question whether this dumping is causing injury to Canadian production.
It is the job of the tribunal to make a determination on the question of injury. It is essentially the job of the deputy minister and the departmental officials to carry out investigations and reach conclusions with respect to the question of dumping and the subsidiary factors which have to be considered in order to reach such decisions.


Leslie Gordon Benjamin: I take it then that the government feels there can be dumping without injury.


Herbert Eser (Herb) Gray: That is the concept contemplated by the General Agreement on Tariffs and Trade, and the anti-dumping code based on it and as part of the Kennedy round agreement. This concept is reflected in the legislation which we are considering this evening.


[Stage Direction]
Clause agreed to.
Clauses 14 to 18 inclusive agreed to.
On clause 19-Appeal to the Tariff Board.
Marcel Joseph Aimé Lambert: I am taking no one by surprise when I rise to speak on this clause. I made strong representations about it in the committee and I have made


Herbert Eser (Herb) Gray: Mr. Chairman, this is one of those situations in which we are essentially in agreement on ends but, at the same time, in which we are not in agreement on means.


Gerald William Baldwin: That is the story of
parliament.
December 17, 1968


Herbert Eser (Herb) Gray: There is no question in my mind with respect to the attitude of the government. It wants to give the fullest opportunity for those concerned to be able to file notice of appeal. It is a question of working out procedures which take into account, at least in my opinion, not simply administrative concerns but also the fact that almost any procedure considered might have some type of fault or another in it. For example, it is suggested to me that a problem might be created if the hon. member's proposal is accepted by the fact that everybody may not read or get the Canada Gazette on the same day. I am just raising this as a point that one has to consider in looking at his proposal.
I say this because he has raised various concerns, and certainly we can understand the reason for his concerns with respect to this proposition in the bill that we are studying this evening. The hon. member has brought to the attention of the committee views sent on to him by the Assistant Deputy Minister of Finance, Mr. R. Y. Grey. Perhaps it might be useful if I brought to the attention of the committee some of the other views of the deputy minister on this, not so much to prevent consideration of the hon. gentleman's proposal but to provide a balanced way of looking at this particular matter. I might say that I think the hon. member will agree that his view which he raised in the standing committee has been given very detailed and serious consideration by the department and the officials and that, if it has not been acceded to at least until now, it is not because it has been summarily rejected but that after some study of the matter there is some honest difference of opinion.
In an earlier portion of his memorandum to the hon. member the Assistant Deputy Minister of Finance said that the hon. member had-
-urged that all persons, regardless of their location in Canada, should have equal time, in practice, to file an appeal from a decision of the Deputy Minister to the Tariff Board. I am, of course, in sympathy with your position and I have reviewed this matter with our legal advisors.
It has proven to be a very difficult matter to find a solution that would ensure that equal opportunity would be provided to anyone who wished to appeal such a decision. You will note from the wording of section 19(1) of the draft bill, that the right of appeal is not limited to the appellant, but rather provides an opportunity of appeal to "a person who deems himself aggrieved". We have been unable to work out a procedure that would ensure that anyone who wished to appeal would have equal time to file such notice. It seems to us that there is no certain means of notifying
Anti-Dumping Duties
all such persons other than by notice in the Canada Gazette. In this connection we have considered lengthening the appeal period, but this would not seem to meet the substance of your position.
He went on to say:
We also considered introducing a provision similar to that appearing in S-61A the Income Tax Act.
I will not attempt to quote it. Then he continued:
We also took into account that if it were, in fact, possible to word the section in such a way that anyone who wished to appeal would have sixty days in which to do so, that the provisions under which an appeal may be made to the Tariff Board under this proposed anti-dumping act would be at variance with the appeal provisions now in the continued:
He concluded with the paragraph that the hon. member brought to the attention of this committee of the whole house. I would conclude as I started by saying I think we are obviously in agreement on ends, but not in complete agreement on means, and I propose consideration might be given to seeing how we operate under the proposed section in the bill. It may be necessary after a year or two of experience to make changes, because this is a work of human minds, of human beings. I hope it will not be, but this is something that could be given further consideration. Meantime I will see what further thought has been given to the proposal made by the hon. member.


Marcel Joseph Aimé Lambert: I appreciate all the arguments made by the parliamentary secretary, but may I say that this situation reminds me of the time I wanted to do something before the Exchequer Court. I wanted to tax a bill. There is a provision in the rules of the Exchequer Court that the assistant registrar may tax a bill. I made an appointment with him and then I was advised that the President of the Exchequer Court in a decision had ruled that the Exchequer Court had no business making such a rule, and therefore it was not applicable and the deputy registrar was not to take any appointments, to tax bills of this kind.
He made that ruling in a particular case. I am not going to cite it. A person very closely connected to this chamber was involved. But then the judge told the court officials, "This decision is not to be published," and he refused publication in any of the law reports. So therefore 18 months later, long after the period of the appeal of this nonsensical ruling was up, there was no way of finding out.
December 17, 19G8
4084	COMMONS
Proceedings on Adjournment Motion
This is precisely the sort of thing I want to avoid, that a decision shall have been made and then three weeks later it appears in the Canada Gazette. It will appear in the Canada Gazette all right, but three weeks or maybe a month later.
[DOT] (10:00 p.m.)
If somebody in Halifax or in Vancouver should feel aggrieved it would be necessary to consult counsel, who may be a tariff consultant, but the period would have elapsed before they could appear before the Tariff Board. This is what I want to avoid. If the date for filing an appeal shall start from the date of publication in the Canada Gazette, then I feel far more people would be available and more justice would be done. That is the purpose of my amendment. I hope the members of the government will sleep on it tonight and accept it.
Progress reported.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the house under provisional standing order 39A deemed to have been moved.

Mark Willson Rose: Mr. Speaker, I rise tonight because I wish to speak on a question that was ruled to be inappropriate about a week ago. Over a century ago the Indian affairs department started out to administer treaties and to protect rights of native peoples, but according to Indian leaders, because of its paternalistic attitude it has gradually over the years become the oppressor rather than the protector of the very people it was developed to assist. It is perhaps fair to say that no other department of government enjoys so little confidence among the people it is structured to help. There is little real dialogue between the department and the native people themselves, in spite of repeated proposals from the natives that they take part in the decisions which affect them.
The record in respect of the treatment of Indians during the past 100 years in appalling. I could document this if I had time. Despite the expansion of the department by 10 per cent from 1966 to 1968 this expansion has resulted in little observable improvement in the services that will enable the Indians


and Eskimos to improve their ability to function in society with independence and dignity. As little as 5 or 6 per cent of the total budget of the department for salaries is being spent on employees of Indian and Eskimo origin. I should like it to be noted that the term "persons of Indian and Eskimo origin" is a very vague one. This does not mean that the money is being spent, in spite of the pitiful 5 or 6 per cent, on wages and salaries for reserve Indians. Metis or off reserve Indians are not covered under the act, but they are of Indian and Eskimo origin.
I think the main problem in the department is that the bulk of the budget is being paid to too many white chiefs, and that not enough trickles down to the Indians. To support this I should like to read from page 385 of the Senate Debates for the year 1968:
The Department has 927 senior officer positions of which 801 are presently occupied. Of these, 17 persons are of Indian and Eskimo origin. Sixteen of the 17 persons are all occupied with Indian Affairs and represent 4.4 per cent of the senior positions occupied. A number of the 801 senior positions are concerned with education supervision.
Need I say more? If we take out the school principals and supervisors, this 4.4 per cent figure shrinks alarmingly. It is then accurate to say that the major decisions affecting native people are made by men, dedicated as they may be, who are in no position to understand Indian aspirations, because they are not Indians themselves. The door is barred to Indians in this department having a real voice for a long time to come. This brings me to the central point of the question I asked in the house:
Has the Indian Affairs Branch recently advertised a competition at the PM6 level with a salary of $18,000 to consult with the Indian and Eskimo people on policies and programs affecting them? This competition, as I understand it, is not open to qualified native applicants.
Upon investigation I learned that the position was not really a competition at all but an internal promotion-some would say a political promotion within the department itself- with the incidental right of appeal by a native applicant within the department, if he felt he could meet whatever criteria might be set for the position. I think it is important that people know how these appointments work. First, they are not open competitions designed to secure the best man available from throughout the land. They are, instead, advertised narrowly within the department, and I imagine those in the know realize very early upon whose shoulders the magic wand has been placed.
December 17, 1968	COMMONS
The executive committee, which really means the deputy minister, chooses a person to fill the position. The right of appeal exists, of course, for any other employee if he is brave enough to appeal the choice, in this particular case before the expiry date of December 18. That is tomorrow, Mr. Speaker. Can you imagine who in his right mind would risk making an appeal in such a patriarchal system, if he wanted to get ahead?
The particular position in question is for the chief of the Indian-Eskimo bureau in Ottawa, a very important position in light of the growing desire of native Indians and Eskimos for a greater voice in their affairs and decisions affecting them. I think this position requires a man of considerable experience in dealing with the problems of native people. If not a native himself, he should have the respect of the people with whom he is to deal. He should possess a real empathy for native people. He should like them and be liked by them, because the position requires that the successful applicant cooperate with native people and enjoy their confidence in order to facilitate communication and learn with them.
What is the history of the applicant designated to fill this very important and sensitive office? My information is that there is little in the applicant's background which would qualify him as chief of the Indian-Eskimo branch. I apologize to the minister and to the applicant in advance, if my information is either unfair or inaccurate. The designated man is a former serviceman, an ex-air force officer. He was formerly employed in public relations in the office of the Minister of Transport (Mr. Hellyer) when he was minister of national defence. He later worked in public relations for the centennial commission, or was at least under contract to and employed by the centennial commission. Over the past year, and for one year only, the applicant was employed as executive assistant to Mr. R. F. Battle, assistant deputy minister of Indian affairs. He came into Indian affairs without competition. As far as I know he has never been before any civil service board. Now he is slated, after one year's experience in Indian affairs, to be moved from a $13,000 to an $18,000 per year position, without competition.
Two weeks ago in Ottawa the founding meeting of the National Indian Brotherhood took place. Indian leaders from all across Canada are demanding a greater voice. This kind of staffing and promotion practice within
DEBATES	4085
Proceedings on Adjournment Motion the department appalls these leaders and is a great slap in the face to them. Mr. Speaker, how can the Indian leaders believe that the department of Indian affairs is sincere in its desire for better relationships when a public relations man of one years's experience in Indian affairs can be promoted to a position of such importance without competition? Public appreciation of Indian problems and public sympathy and support for a better break for native people is in my view at an all-time high. Practices such as I have described only lower the image and prestige of the department of Indian affairs and, indeed, government generally. In my view it is about time we began to set our house in order in this regard.


Joseph Jacques Jean Chrétien: Mr. Speaker, the house knows that during the last few months we have been systematically reorganizing the Department of Indian Affairs and Northern Development. In fact, we have merged the Indian Affairs Branch and the Northern Administration Branch so that our best officials can hold the positions that will enable them to serve the Eskimos and Indians better.
With regard to the position the hon. member has just mentioned, of course new positions were created during the department's reorganization and the titles of the officials were changed.
With regard to the position of head of the Eskimo and Indian Affairs Branch, a competition was held within the service in order to find the candidate best qualified for that position. That competition was supervised by the Public Service Commission, under the established procedure, and the candidate chosen to fill the position as a result of the competition is Mr. Boyd.
Evidently, it is always possible to say that a candidate may not have the necessary competence, or that it might have been preferable to get the services of a person of Indian or Eskimo origin. In fact, I would have been most happy, Mr. Speaker, if the examination board had chosen a person of Indian or Eskimo origin. That would have been in keeping with my views, as I think it would be desirable to have more Indians and Eskimos among our staff. I am taking every possible means to have this policy enforced in
December 17, 1968

Proceedings on Adjournment Motion the future. I have instructed officials to interview, in universities and high schools, Indians and Eskimos, and invite those best qualified to join the department.
I can inform the hon. member that we have had the privilege of getting the service of an Indian to replace Mr. Boyd as executive assistant to the assistant deputy minister in charge of social affairs.
I can assure the hon. members that I intend to do everything I can so that the department will hire the largest possible number of Indians and Eskimos, because I believe they are the ones who will best of all solve their problems. We must take the necessary steps to develop in them the spirit of leadership that will enable them to give a new orientation to the people of Indian origin.
I thank the hon. member for having pointed out that perspective to me, of which I am very much aware. Still, it will be understood that within an administration, especially when jobs are shifted around as in this case because of the reorganization, we cannot invite just anybody from the public to fill the vacancies left by men who have been with the department for many years.
If anyone in this house pleads every day in favour of the seniority rights and other rights acquired by the public servants, the members of the New Democratic party do-


Mr. Speaker:: Order.


Joseph Jacques Jean Chrétien: I wonder why it is that today they would like us to remove people who have spent years with the department and put newcomers in their place.


Mr. Speaker:: Order.



AIRPORTS-TORONTO-PROTESTS AGAINST EXPANSION OF FACILITIES

Mr. Hyl Chappell (Peel South):: Mr. Speaker, on December 13 I asked the Minister of Transport if he would abandon the proposal to enlarge the Toronto international airport at Malton. In the few minutes allowed me I shall try to persuade him to do so.
During the last three months I have done a great deal of research on the subject. My views have been fortified by studies conducted by the municipalities and by others. In addition, I have received objections, with reasons, from thousands of families who would be adversely affected.
I have concluded that the proposal is holding up the production of 19,000 housing units


or accommodation for 50,000 people in Mississauga and Etobicoke. Living conditions would become unbearable for another 50,000 people now living to the south of the proposed enlargement. It would impair or destroy housing accommodation for another 150,000 people living to the east. Dozens of schools and hospitals would have to be soundproofed at great cost, and even then their efficiency would be lessened. It would disrupt the planned course of development, and thus the economic stability of the municipalities concerned. It would withdraw about 2,000 acres from a limited supply of 40,000 to 50,000 acres of land ready for urbanization, and thus have an extreme adverse effect on housing and other urban developments in the Toronto metro area. It would conflict with the Ontario planning act and be an insult to the planning of the area, as planned by the municipalities and approved by the province and by the Department of Transport itself. It would commit the federal government to pollution, in the sense that where investment is large enough we must accept it and thus make it impossible ever to cleanse thoroughly the air in the Toronto area.
[DOT] (10:10 p.m.)
Think of the air in ten years, at a time when there is no wind and thus no movement of air, with 2,000 flights a day spewing gas and carbon over the area. I understand that each plane burns approximately four tons of fuel during a take-off. This could lead to a total of 10,000 tons a day in the 1980's. Future generations would rightly condemn us.
The proposal has been rejected by all of the municipalities concerned. Their refusal to rezone the land for flight paths means that such land would have to be purchased, and the cost of the land alone would, I believe, be at least half a billion, whereas the original estimate for the whole project was approximately $300 million. Appropriately, the Central Ontario Planning Institute of Canada concluded that the expansion is wrong and would lead to a growing and insoluble conflict between the metro demand for land and the airport's demand for control.
A more acceptable and less expensive site can and must be found. I suggest for consideration a site on undeveloped and inexpensive land north of Kingston for a double jet port to serve Toronto and Montreal. If this is thought to be too far into the future, then perhaps Camp Borden would provide a site, since the government already owns 20,000
December 17, 1968	COMMONS
acres there. In both cases, the land is submarginal farm land, and could be acquired at a minimum cost. The recent trend in North America is for jet ports to be 50 to 100 miles from city centres. Pending development of rapid transit, there could be flying bus service from smaller ports such as de Havilland and the island in Toronto, by means of the new short take-off planes.
A second alternative, that of a floating airport seems worthy of investigation since the flightways would be over open water and would disturb no one. Leading civil engineers hesitate to estimate the cost, but feel a study costing about $100,000 would be a worthwhile investment. In fact, the United States federal aviation administration has just recently launched an intensive study of this solution. Two immediate objections, those of water pollution and a greater use of United States air space for descending planes, are not really tenable.
The airport of the late 70's or early 80's will require a staff of perhaps 30,000 people with a supporting city having a total population of perhaps 200,000. Rather than cause these people to settle in Toronto and Montreal metropolitan areas, where land is scarce and at a premium, we should plan for a new city to be compatible with an airport which would help to relieve the pressure in the metro areas, and at the same time allow the development of a new city on a pre-planned and logical basis.
Since severe intensification of flights would be as undesirable as the major expansion, I support a second airport as early as possible, but better still now, sufficiently removed to avoid a repetition of the present problem, and where land is inexpensive and can be zoned to provide for future further expansion.


Mr. Stanley Haidasz (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: I appreciate this opportunity, Mr. Speaker, in the name of the Minister of Transport (Mr. Hellyer), to reply to the hon. member's interesting remarks. As indicated in the house a few days ago, the Minister of Transport is now in the process of reviewing the entire situation with regard to the proposed expansion of Toronto international airport. The minister has looked at the evidence which has been acquired by the Department of Transport and other agencies, and has examined the reports of meetings which have been held with officials of the municipality and the province of Ontario. He
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Proceedings on Adjournment Motion has also spoken to groups representing citizens of all the surrounding communities of the Toronto international airport. It is expected that within the next few days the Minister of Transport will make a statement concerning the Toronto international airport situation.
[DOT] (10:20 p.m.)



CONSUMER AFFAIRS-REQUEST FOR INVESTIGATION INTO PRICE OF TOYS

John Stratford Burton: Mr. Speaker, yesterday I asked the Prime Minister the following question on orders of the day:
In the absence of the Minister of Consumer and Corporate Affairs, I wish to direct my question to the Prime Minister. In view of the outrageous prices being charged for Christmas toys this season, would the Prime Minister consider requesting the Minister of Consumer and Corporate Affairs to conduct an immediate investigation into this serious problem?
In a supplementary question I noted that millions of dollars are spent on toys, that there are only a few shopping days until Christmas and that advertising creates additional pressures on our society. My interest in this question was aroused on Saturday when I accompanied my wife on a Christmas shopping expedition. We were appalled at the prices. Since our oldest child is now over eight years of age we have had some years of experience in Christmas shopping for our own children, within the limitations of a family budget. On this basis we noted that prices had skyrocketed since last year.
We were interested in buying several items in which our children had expressed interest, largely as a result of viewing television advertising. The items in which we were interested ranged from $15 to $30 or more, each. This was beyond the family budget. After our initial shock we started to look around. There was hardly any toy selling for less than $8 which would give any child pleasure. Curiously, there were a number of items which had been marked down to half price. I suggest that very likely these were not loss leaders, because they were still selling at a considerable price. Rather, they represented items where the desired profit had been made on the total consignment of the item, and the remaining stock was being sold at a lower level of return.
A friend who heard of my inquiry sent me the following note:
I bought Billy Blastoff for $8.88 at a well known toy store. I've since seen it for sale in other stores
December 17, 1968
4088	COMMONS
Proceedings on Adjournment Motion at several different prices, including as low as $4.88. This price range seems ridiculous. We parents need protection.
On Monday, prior to orders of the day, I purchased a plastic building set for $8.98, plus tax, and presented it to the Prime Minister following my question. I hope he enjoys playing with the set and that it will give him some relief from the tensions of office. I believe I obtained the beginner's set; with it I hope the Prime Minister may make more progress than he has so far in building his just society. Possibly he is fortunate that I did not give him the instant insanity set of blocks.
Since then I have discussed this matter with other people. I heard of one case where a four year old girl decided she wanted a particular make of doll. When her mother took her to see Santa Claus at a store the girl informed him she wanted the doll and Santa replied, "You tell your mother we have your doll already wrapped for you." On investigating the mother found the doll cost over $18, and had considerable difficulty, of course, in persuading her daughter that it would be better to buy another doll.
Another mother here in Ottawa investigated the toy situation just after Christmas a year or more ago. She was informed by the merchandising people that any toy could be sold through television advertising. They also told her that toys advertised on television could be sold for three times the ordinary retail price.
Christmas giving is a tradition in our society, stemming from the giving of gifts to the child Jesus in Bethlehem. Down through the centuries the giving of gifts, particularly to children, has become a tradition. Foisted on this beautiful tradition is the influence of mass advertising, and particularly television. The crass commercialization of Christmas for purposes of profit has prostituted this tradition. The conventions of our own society help to create a captive market in the Christmas season. The impact of television advertising constitutes a form of torture, used to squeeze out every possible dollar from the consumer under the guise of Christmas tradition.
I witnessed the impact of television advertising just this evening. My wife and I were looking at a Christmas catalogue and noted a "happy, happy doll" selling for around $15. Our four year old son was able to recite the words of the television ad at the mere mention of the name-"She laughs, and she'll make you laugh, too". Millions of dollars are


spent on toys each year, and toys bring merchants one of the highest levels of retail mark-up. I am reliably informed that the average retail mark-up on toys is well above 40 per cent. I am also reliably informed that the retail price of toys is generally double what they cost to manufacture.
Further questions of toy safety have arisen. In the Ottawa Citizen of Friday, December 13 we read:
So you're thinking of buying your daughter a miniature vacuum cleaner or sewing machine just like mommy's for Christmas?
Better think again. Consumers Union in the United States tested 42 electric toys of this nature for last months' issue of their magazine Consumer Reports, and found ten to be unacceptable from a safety standpoint.
The article goes on to give many examples. This is an excellent illustration of the type of thing that should be tackled by the Department of Consumer Affairs. Only a few shopping days remain until Christmas. If the Department of Consumer Affairs is to be effective it must develop a capacity to cope with such situations as this in a matter of a few days. Only in this way will the new department be of real value.
In the Ottawa Citizen of Saturday, December 14, appeared an article under the heading: Space toys "in", guns "out". In it we read:
Canadians are spending more than ever in the frantic crush of pre-Christmas buying and toy-makers forecast sales about 30 per cent higher than last season.
The '67 seasonal sale totalled about $180,000,000, or $32 per child.
I am sure this is a matter worthy of investigation by the department.


Stanley Haidasz: With only seven shopping days left before Christmas I welcome this opportunity to answer the hon. member on behalf of the Minister of Consumer and Corporate Affairs (Mr. Basford). I appreciate very much the remarks he has made about the tradition of Christmas giving. I would also like to state with deference to the Prime Minister (Mr. Trudeau), that I cannot make any remarks as to his reference to what the Prime Minister said on the subject of block building.
I listened intently to what the hon. member said as to the price of toys, particularly since during the Christmas season all citizens with families of young children have the purchase
December 17. 1968	COMMONS
of toys very much on their minds. In attempting to ascertain the degree to which the current price of toys is a matter of concern to consumers we have checked returns to box 99 which, as hon. members are aware, is the facility through which the consumers of Canada register their complaints with the department. I find there has been little reaction to the price of toys. Out of fewer than 3,000 complaints since the inception of box 99, only 23 have related to toys and of these only two were concerned with price. There is, of course, a wide selection of toys available on the market, presenting the consumer with the opportunity to make a choice as to the variety, quality and, above all, price, to suit his purse. Price shopping is so important that the minister has strongly urged the consumer to shop by price, not only for toys but for all consumer goods.
Especially in cases where consumers regard the price of an article as essential and when
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Proceedings on Adjournment Motion other choices are available, as is the case with toys, the exercise of consumer wisdom in buying less expensive articles will have an appropriate effect on the market. Of course if the hon. member has any information to suggest that illegal restraints exist with respect to toys, he should immediately convey that information to the minister, or to the Director of Investigation and Research under the Combines Investigation Act-


Stanley Howard Knowles: Or
to Santa Claus.


Stanley Haidasz: -and complaints so directed will, I am sure, receive the appropriate attention and action.


Stanley Howard Knowles: Ho,
ho, ho.
Motion agreed to and the house adjourned at 10.30 p.m.
4090

December 17, 1968



APPENDIX


[Stage Direction]
Letter from Mr. Fowler to Mr. Benson Dear Minister Benson:
In completing the 1969 United States balance of payments program and while arranging for an orderly transition, I thought it would be useful to review the unique financial relationship which exists between our two countries. This was last described in the exchange of letters I had on March 7, 1968, with your predecessor, Mitchell Sharp. In my letter I noted: "Unique financial relations between our two countries have been a mutual support to both and to the international monetary system. These relations have served the interests of both our countries without interfering with the domestic policies of either." Events since March add a new endorsement to this judgment.
This unique relationship which our two countries share is a natural reflection of a common and peaceful border of some 5,500 miles. It reflects as well the importance of trade and capital and neighbours who move across this invisible boundary. Recognizing this interdependence, we have long since believed that it is not in the interest of either country to occasion destabilizing influences on our currencies which might inhibit the other country in the pursuit of its own economic objectives. To this end, our policies in this field have been to support our overall objectives to our mutual advantage.
This is the reason, notwithstanding the crisis then raging in the gold markets of the world and only shortly after the President's New Year's day balance of payments measure, that in March we were able to exempt Canada from our balance of payments measures. This exemption and your reaction to it was indeed "mutual support." Canada was thus assured of access to our markets for a wide range of capital transactions, enabling Canada to continue its traditional method of financing its current account deficit with the United States and permitting financial institutions in both countries to operate flexibly.
This latest recognition of the interrelationship of our international payments is also the reason you have taken constructive actions to ensure that Canada is not used as a "passthrough" channel by which the purpose of the
United States balance of payments program might be frustrated. Moreover, the policy under which you invest your foreign exchange holdings is to our mutual advantage.
This is also the reason that in the exchange of letters last March we reiterated the basic principle that it would not be Canada's intention to increase its foreign exchange reserves through borrowings in the United States. Implementation of this principle does not require that Canada's reserve level be limited to any particular figure. We are well aware of Canada's need for flexibility with respect to reserve levels in order to accommodate the adaptation of monetary policy to the changing needs of its domestic economy, seasonal factors and other influences of a temporary nature. This statement of objectives recognizes that under circumstances in which an improvement in the payments position of the United States is essential to the strengthening of the world monetary system, it is in Canada's own interest to avoid hindering the achievement of this objective by unnecessary borrowing in the United States. In recent times capital markets in other countries have developed a capacity which has attracted borrowers from many countries. Canadian authorities have taken advantage of these expanding capital markets to raise funds in substantial quantities. These developments now offer Canada an alternative means of achieving an increase in its reserves whenever Canadian authorities believe this is desirable. In addition, Canada has given strong support to the arrangements for new special drawing rights which, when activated, will offer a source of regular and automatic additions to international reserves. Both our countries, along with other nations, actively support the ratification of this new facility in the International Monetary Fund and the activation of these reserve assets as soon as possible.
In undertaking this review of our relationship, I have been very much aided by the knowledge and experience our respective governments have gained through the close consultations which form such an important part of this relationship. These consultations will, of course, continue to permit us to keep each other fully informed of our views regarding current financial developments.
December 17, 1968
[Stage Direction]
The unique financial arrangements we have developed, expressed first with the joint statement of July 21, 1963 and brought up to date today, provide support to the payments positions of both countries and hence strengthen the international monetary system.
Sincerely yours, Henry H. Fowler.
Letter from Mr. Benson to Mr. Fowler
Dear Secretary Fowler:
I welcome the review of financial relationships between Canada and the United States which you have provided in your letter of today's date.
As you have noted, the Canadian government is keenly aware of the importance to Canada and to the world, as well as to the United States, of the strength of the United States dollar and, as a means to that end, of a continued improvement in the international payments position of the United States.
With this in mind, the Canadian government has adopted policies to ensure that the exemption of Canada from the United States balance of payments program would not endanger the success of that program. In particular, we have taken steps to prevent Canada from becoming a "pass-through" channel for the flow of capital from the United States. We have also found various appropriate means of supporting the payments position of the United States. Thus the Canadian government has invested its United States dollar reserves (in excess of working balances) in special non-marketable issues of the United States treasury. It also turned to the expanding capital markets of Europe to
find funds with which to rebuild Canada's foreign exchange reserves. In the course of this year substantial sums have been added to our reserves as a result of borrowings of the government of Canada and other Canadians outside the United States, and the investment of these sums has provided support to the payments position of the United States. We expect, as you note in your letter, that the implementation of the special drawing rights scheme in the International Monetary Fund will provide an additional well-regulated source of new reserve assets.
I too have found very useful the close consultations which have come to form such an important aspect of the relationship between our two countries. I look forward to a continuation of them as a means of keeping each other fully informed of our views regarding current financial developments.
In the light of all these considerations I can reiterate to you that it is not an objective of Canadian policy to achieve permanent increases in our exchange reserves through unnecessary borrowing in the United States. I fully share the view expressed in your letter that the implementation of this principle does not require that Canada's reserve level be limited to any particular figure, and that our reserves may be expected to fluctuate to accommodate the adaptation of monetary policy to the changing needs of the domestic economy, seasonal influence, and other influences of a temporary nature.
Yours sincerely,
E. J. Benson,
Minister of Finance.
[Stage Direction]
Wednesday, December 18, 1968