1968-11-18

Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, hon. members have undoubtedly noted that this year the regular semi-annual meeting of the NATO Council was brought forward as a ministerial meeting in order to determine what would be, for the alliance, the consequences of the situation created by the Soviet invasion of Czechoslovakia.
The Secretary of State for External Affairs (Mr. Sharp) and the Minister of National Defence (Mr. Cadieux) represented Canada on that occasion. Since both are still away, I would like to table a copy of the communique issued at the close of the meeting held in Brussels from November 14 to 16.
I would like, with leave, to table that communique.


Mr. Speaker:: Has the Prime Minister leave to table this document?


Some hon. Members:: Agreed.


Mr. Baldwin:: If it is not too lengthy, Mr. Speaker, could it be printed in Hansard?


Mr. Trudeau:: I have no objection, Mr. Speaker.


Mr. Knowles (Winnipeg North Centre):: As
an appendix.


Mr. Speaker:: Is it agreed that the document in question be printed as an appendix to Hansard?


Some hon. Members:: Agreed.
[Editor's note: For text of document referred to above see appendix.]


Pierre Elliott Trudeau: Mr. Speaker, the ministers of the 15 countries participating in the meeting have unanimously condemned Soviet military
intervention in the domestic affairs of another country. Moreover, it has been agreed that the resulting situation had brought in a factor of uncertainty as to Soviet future intentions with regard to the security of the west. Consequently, they have reaffirmed their determination to protect the members of the alliance against any military aggression, according to the treaty. They have also stated that any Soviet intervention directly or indirectly affecting the situation in Europe or in the Mediterranean would entail an international crisis with serious consequences. They cannot remain indifferent to any new development likely to jeopardize the security of members of the alliance.
[DOT] (2:40 p.m.)

The members participating in NATO's integrated defence program agreed that in the circumstances there was a need to reassess their defences, and indicated various measures they were taking to ensure that the security of NATO was being maintained at an adequate level. At the same time they reaffirmed NATO's determination to pursue the long term goal of detente in east-west relations and to exploit all opportunities to make progress in disarmament.
In their statements the Canadian ministers cautioned against the alliance overreacting to Soviet actions in Czechoslovakia which, it had been agreed, were not directed particularly against members of NATO. The Secretary of State for External Affairs suggested that while it was natural in the present circumstances to stress the defensive character of the alliance, it was essential that NATO should seek, and should be seen to be seeking, all reasonable opportunities to resume the dialogue with the Soviet union and thus to promote in due course progress toward the peaceful settlement of the issues facing Europe.
The Minister of National Defence explained that Canada was proceeding with its review of defence policy. Meanwhile, he said, we are maintaining our professional forces in Europe and in Canada at their high level of training, equipment and operational readiness.
2832	COMMONS
Statement Following Ministerial Meeting
Arising out of the decision to close one of the three air bases that we occupy in Germany-Zweibriicken-we had planned to reduce the aircraft of our air division by approximately 20 per cent. However, we felt that until there has been a better opportunity for the Canadian government to assess the aftermath of the Czech crisis, both in the light of this meeting and in the light of our own review of defence policy, it would be prudent to defer a final decision on our part whether the air division should be maintained at its present levels or reduced. This, of course, will not affect the decision to close Zwei-briicken.
The Minister of National Defence underlined the progressive qualitative improvement of our forces in all three environments, regular and reserve, and asserted that Canada continues to believe in collective security.


Gerald William Baldwin: Mr. Speaker, we have heard with some interest the remarks made by the right hon. gentleman. This adds one more to the very long list of varying statements that have been made in and out of the house, on this continent and on other continents. I think we will have to examine with some care the document the right hon. gentleman has tabled in light of what has been said by the Prime Minister in this house and his other more interesting observations made outside the house. We would also like to examine it in light of what is alleged to have been said by the Secretary of State for External Affairs and the Minister of National Defence at the meetings in Europe.
I would simply add, Mr. Speaker, that as far as the people of Canada and the hon. members of this house are concerned the matter is in a state of very considerable confusion. I only hope and suggest that what will be done is that which has already been suggested, namely that on the return of the Secretary of State for External Affairs the house leaders will arrange for a day to be set aside so there can be a clear cut debate on this issue, in view of the varying statements that have been made and the facts that have come to light.


Mr. Andrew Brewin (Greenwood):: Mr. Speaker, we heard the Prime Minister's statement with a great deal of serious reservation. One of the most regrettable results of the utterly unjustified invasion of Czechoslovakia has been to give an incentive to cold war

DEBATES	November 18, 1968
warriors, who are not without influence in NATO, to demand an even greater reliance than before on obsolete and dangerous military confrontations in Europe. There are some who seize avidly on the opportunity to put pressure on allies to multiply weapons that are already useless and, if used, would produce an unimaginable scale of destruction in Europe.
From the statement it appears that the government to some extent has yielded to this pressure. We are to retain in Europe the 20 per cent of the air division that was supposed to return to Canada. This division is part of a vulnerable, useless and obsolete type of defence and there is no reason, so far as we know, why it should be retained. We are not saying we do not need mobile defences, but this sort of defence would not be of help to Czechoslovakia or any other country.
We also have serious reservations about the extension of vague threats as to what might happen outside NATO if certain events occur in the world. These threats are either meant seriously, in which case they ought to be seriously contained in terms of real commitments, or they are not meant seriously and do not add one iota to the credibility of the commitments which have already been made in NATO.
We believe the Czechoslovak crisis and invasion came about through fear. We most earnestly hope that in the review the government is making in this field it will undertake a radical revision of the commitments we have made in and through NATO. We do not advocate withdrawal from NATO although we do advocate that the entire framework of NATO, based on tactical nuclear weapons, ought to be reconsidered.


Mr. Real Caouette (Temiscamingue):: Mr. Speaker, we have also listened carefully to the statement made by the right hon. Prime Minister.
The whole world has regretted the invasion of Czechoslovakia by Russia. Canada has an obligation, to itself and to the free world, to participate in all programs aiming at defending freedom in the world and to fight against dictatorship and aggression. I think that Canada can play a very important role in such circumstances and that we must not shirk our obligations to preserve this freedom which everyone wants.
November 18, 1968



CAPE BRETON DEVELOPMENT CORPORATION


[Stage Direction]
Hon, Jean Marchand (Minister of Forestry and Rural Development): Mr. Speaker, I have the honour of tabling the French and English versions of the report of the Cape Breton Development Corporation proposing a general program as prescribed by section 17 of the act establishing the corporation. This program has been considered and approved by the government.
Mr. Speaker:: Has the minister leave to table this document?


Mr. Robert Muir (Cape Breion-The Sydneys):: On a point of order, Mr. Speaker-


Mr. Speaker:: Order, please. The minister does not propose to make a statement. Since no statement has been made there can be no discussion. My understanding is that there is simply a motion before the house to table a document.


Robert Muir: Mr. Speaker, I only rose on a point of order to ask the minister to give consideration to providing copies of the report to all members of the house. Because of its far reaching implications for the future economic well being of Cape Breton Island I thought that might be a good idea.


Mr. Marchand (Langelier):: Mr. Speaker, I do not know whether we have sufficient copies for that to be done. If we do not have enough we shall try to supply copies to all those hon. members who are interested.


Mr. Donald Maclnnis (Cape Breion-East Richmond):: On a point of order, Mr. Speaker, and on the question of the availability of the report to hon. members of the house, may I suggest that if hon. members look at today's Ottawa Journal they will see that the Canadian Press has carried the report and has beaten the minister to the punch.
[DOT] (2:50 p.m.)



GOVERNMENT ORGANIZATION


Hon. C. M. Drury (President of the Treasury Board):: Mr. Speaker, by leave of the house I should like to table an additional group of 21 recommendations made by the royal commission on government organization
2833
Cape Breton Development Corporation which have been approved by the cabinet, some in a modified form. The government has now approved 208 of the 294 Glassco recommendations. Twenty-six were rejected as having been overtaken by events or as impracticable. There remains a balance of 60 recommendations on which final decision has not been made, but all are being actively pursued.
At this time I would like to pay tribute to the late J. Grant Glassco who, as the house is aware, died late in September of this year. Mr. Glassco was one of Canada's great citizens. We are indebted to him for his many contributions to the development of this country. One of his greatest contributions was his chairmanship of the royal commission on government organization. He earned high approbation for his leadership of the large research team he assembled, and for his wisdom, experience and the enormous amounts of personal time and energy that he devoted to this tremendous undertaking. That such approbation was justly earned is evidenced by the fact that no other royal commission dealing with so many matters of such complexity has to my knowledge ever achieved an equivalent acceptance of its recommendations. Scholars of the future will surely declare the Glassco Commission one of the most significant milestones in the development of Canadian public administration. I am sure there is complete unanimity in this house when I say that his passing is deeply regretted.



STATUTORY INSTRUMENTS


Mr. Mark MacGuigan (Windsor-Walker-ville) moved: that the first report of the special committee on statutory instruments presented to the house on Thursday, November 14, be concurred in.


[Stage Direction]
Motion agreed to.

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

Mr. Forfin: Have any candidates who were defeated in the General Election of June 25, 1968, and subsequently appointed to positions with the Government of Canada not filed a report on their election expenses pursuant to the Canada Elections Act and, if so, who are these persons?

November 18, 1968
Questions


Mr. Yves Forest (Parliamentary Secretary to President of the Privy Council):: A total of 968 persons were candidates in the general election of June 25, 1968. The names of those candidates on whose behalf returns showing election expenses were not filed, according to the information supplied by the returning officers to the Chief Electoral Officer, are set forth in the return made on November 15, 1968, to the order of the house made on September 25, 1968. However,_ since a person who has been a candidate in an election and who subsequently takes employment as a public servant, etc. is not required to declare that he has been a candidate, there is no record from which an answer to this question can be drawn.


C.N.R. LESS THAN CARLOAD SHIPMENTS, ATLANTIC PROVINCES
Mr. Coaies: 1.	What was the total tonnage of less than carload lot shipment carried by the C.N.R. in the Atlantic Provinces, in either the fiscal year 1966-67 or the calendar year 1966, also 1967-68 or the calendar year 1967, and for the six month period from October 1, 1967 to March 31, 1968?
2.	What was the total revenue from less than carload lot shipments in the Atlantic Provinces for the periods set out in part one?


Hon. Paul Hellyer (Minister of Transport):: The management of Canadian National Railways advises as follows: 1 and 2. As the railway system is not administered by provinces and as non-carload statistics are not kept by tonnage but by numbers of shipments, it is not possible to answer the question in the form asked.


C.N.R. WORK FORCE, MONCTON, N.B.
Mr. Thomas (Moncton): 1.	What was the total work force of the Canadian
National Railways at Moncton, New Brunswick (a) on September 1, 1963	(b) on September 1, 1967
(c) on September 1, 1968?
2.	Are further reductions in the work force at Moncton contemplated by the Canadian National Railways and, if so, to what extent and on what date?


Paul Theodore Hellyer: The management of Canadian National Railways advises as follows: 1. The number of employees paid at Moncton were: September 1, 1963, 3,992; September 1, 1967, 4,439; September 1, 1968, 4,118.
2.	The size of the work force depends upon traffic requirements, seasonal and other

factors. It is not possible to answer the question in the form asked. If adjustments have to be made in the work force then these are dealt with in accordance with the union agreements.


OFFICE FACILITIES, ENERGY, MINES AND RESOURCES MINISTER
Mr. Aiken: 1.	Have the departmental offices of the Minister of Energy, Mines and Resources been refurnished since the present Minister took office?
2.	If so, what has been the total cost of furnishings and furniture installed and other changes made?
3.	How much floor space is presently occupied by the Minister and his Executive, Special and Parliamentary Assistants; and how much was occupied by the previous Minister?
4.	Who are the members of the Minister's departmental staff; what are their salaries; and which of these have transferred from another department since June, 1968?


Hon. J. J. Greene (Minister of Energy, Mines and Resources):: 1. Yes.
2.	$15,635.20, which includes refurnishing, furniture and other changes made in offices formerly occupied by the minister and additional office space required.
3.	Floor space accommodating minister, special assistants and parliamentary secretary, 1,466 square feet. Former minister occupied 1,206 square feet.
4.	Lois Kennedy, ST-7 classification; $5,-985-$6,576 salary range.
Arlene LeTouzel, ST-3 classification; $2,932-$4,384 salary range.
Adam Clark, CR-1 classification; $2,761-$3,367 salary range.
Christine Wiksten, ST-4 classification, casual; $4,343-minimum salary.
H.	V. Black, CR-2 classification, casual; $3,761-minimum salary.
Miss Kennedy, Miss LeTouzel and Miss Wiksten transferred from Department of Agriculture; Mr. Clark and Mr. Black from Department of Secretary of State.


FEDERAL PARTICIPATION, ADULT TRAINING PROGRAM
Mr. Clermont: I.	For the fiscal year 1968-69, what is the federal government's share, per pupil, of the administrative costs of the adult training program including teachers, premises, lighting, books in (a) the academic course (i) full-time (ii) part-time (b) the agriculture course-full time (c) apprenticeship centre-bricklaying, carpentry, electricity,
November 18, 1968

painting, plumbing, heating, sheet-metal work welding-full time?
2.	What is the average number of pupils, per class and the duration of these courses?
3.	What is the amount of the weekly allowance granted to the pupils?
4.	What percentage does the federal government contribute to the adult training program?


Hon. Allan J. MacEachen (Minister of Immigration and Manpower):: 1. Under the Adult Occupational Training Act, the federal government pays the full cost incurred by training authorities in providing training courses for adults. This includes salaries of teachers, rental and maintenance of premises (light, heat and water) and also books and other instructional material used in all fulltime and part-time courses.
These costs1 cannot be given on a per trainee basis as the provinces have not as yet submitted their final claims.
2.	For the period of April-September, 1968 the average number of trainees per class was 17 and the average duration of the courses was 94 days.
3.	The rate of allowance paid to adult trainees ranges from $37 a week for an adult without dependants to $96 a week for an adult with at least three dependants, living away from home.
4.	The federal government pays the full cost incurred under the Occupational Training for Adults Program.


TERMINATION OF C.P.R. PASSENGER SERVICE, VICTORIA-COURTENAY, B.C.
Mr. Anderson: Will the Department of Transport hold public hearings in Victoria and other Vancouver Island centers before coming to a decision on the Canadian Pacific Railway's request to terminate passenger services between Victoria and Courtenay
Questions
formal application unless approved by the railway transport committee following receipt of an application.
In the event of a formal application being made to the railway transport committee of the Canadian Transport Commission by the Canadian Pacific Railway Company to discontinue the passenger train between Victoria and Courtenay, a public hearing will be held by the committee. No decision has, as yet, been made as to the precise location of the public hearing. Such hearings are arranged to meet the convenience of as many of the interested parties as possible, all of whom will be duly notified in advance.


TENDERS FOR HOUSES AT AIRPORT, FORT NELSON, B.C.
Mr. Howard (Sksena): wnat is tne name, address and amount bid by each person who tendered on nine houses (whether for individual houses or the lot) located at the airport at Fort Nelson, B.C.?


Hon. Donald C. Jamieson (Minister of Defence Production):: Insofar as the Crown Assets Disposal Corporation is concerned: It is the policy of the corporation not to divulge such information as requested until the expiration of 90 days from the date of sale. This safeguards the interest of the customers of the corporation who could otherwise be prejudiced in the marketing of purchased merchandise.
This sale was completed as recently as September 27, 1968, and in accordance with the above policy the information will be available on or after December 27, 1968.


LEGISLATION ON JOB DISCRIMINATION BECAUSE OF AGE
Mr. McCleave: Has the government considered legislation to prevent job discrimination on account of age and if so, with what result or intention?	'


Paul Theodore Hellyer: The Canadian Transport Commission advises as follows: The present position with respect to the passenger train between Victoria and Courtenay, British Columbia, is that the Canadian Pacific Railway Company gave notice of its intent to discontinue the service, whereupon the railway transport committee declared the train to be a passenger train service for the purposes of sections 3141 and 314J of the Railway Act and directed that no discontinuance could take place without a 29180-1791


Mr. Jim McNulty (Parliamentary Secretary to Minister of Labour):: The subject is being studied and legislation is under active consideration.


COST OF NEW DESTROYERS
Mr. Forrestall: Since the reply to Question No. 1,07S made on February 21, 1968, has there been any change in the estimated cost for construction of the four new destroyers, including the equipment costs of these ships?

November 18, 1968
Questions


Donald Campbell Jamieson: No.


LOSS OF CIRCULARS, TORONTO POST OFFICE
Mr. Macquarrie: 1.	Were circulars mailed by the Womens Committee of the Toronto Art Gallery lost in passage through the Toronto Post Office and, if so (a) what was the number of lost circulars (b) what explanation for the loss was given to the organization sending the circulars?
2.	Is the Post Office Department having difficulty in obtaining part-time employees because of inadequate facilities at Toronto?


Hon. Eric W. Kierans (Postmaster General):: 1.	No; they were apparently mislaid or mis-routed from the date of mailing, September 27, to the week ending October 19, during which they were delivered, (a) 6,686. (b) When the first inquiry was made, a thorough check of the postal premises on Front Street was initiated. No trace of the circulars was found. The mailers were informed that the search had failed to produce anything and were invited to duplicate the mailing without any further postal charges. It is understood that a start had been made on a second mailing when word was received that some of the missing circulars had been delivered. It now appears that all were delivered by October 19.
2.	No.


UNEMPLOYMENT INSURANCE BENEFITS FOR CANADIANS IN U.S.
Mr. Rodrigue: 1.	What reasons are given by the representatives of the Bureau of Employment Security of Maine and of New Hampshire for preventing the conclusion of an agreement which would make Canadians working in American territory eligible for the benefits of Unemployment Insurance Act?
2.	For the years 1965, 1966 and 1967, how many Canadian workers were employed in American territory in the States of Maine, New Hampshire, New York and Vermont?
3.	What were the terms of agreements concluded with other American States over the issue of Unemployment Insurance benefits and when were these various agreements signed?
4.	What proposals for reaching an agreement have been submitted by the representatives of the Canadian Government to the American representatives?


Hon. Bryce S. Mackasey (Minister of Labour):: The Unemployment Insurance Commission advises: 1. Main authorities have been unwilling to conclude an agreement because of IMr. Forrestall.]
the cost to the Maine fund. Estimates compiled by the Maine authorities have indicated that the cost might run as high as 1.5 million dollars annually.
2.	The information requested is not available.
3.	Under the terms of the agreement, a person who has worked in a State with which we have an agreement can apply for U.S. benefit to the office of the Unemployment Insurance Commission serving the area in which he resides. Conversely, a person who has worked in Canada and who is residing in a State with which we have an agreement can claim against his Canadian entitlement through the office of the appropriate agency in that State. In either case, benefit is paid direct to the individual by the State or country in which he previously worked. The administration which accepts his claim merely acts as an agent for the liable State.
There are also provisions in the agreements to eliminate the duplication of coverage in a case of an individual who is employed in both the U.S. and Canada by the same employer. Under these provisions one State or country provides him with coverage on the basis of his total earnings for the year.
At present agreements are in force with all States except Maine, New Hampshire, Iowa and Alabama. The majority of the agreements were negotiated in the early 1940s, and virtually all present agreements were signed prior to 1950. There have been no new agreements concluded for several years.
4. Canadian officials are attempting to convince the Maine authorities that their estimate of the cost of their fund is too high. A survey designed to give an accurate estimate of the cost is currently underway.


ALBERTA MOTOR ASSOCIATION-OFFICE SPACE IN BANFF PARK
Mr. Lambert (Edmonton: West):
1.	What office premises are occupied by the Alberta Motor Association in Banff National Park?
2.	Have representations been made by the Alberta Motor Association for larger or alternative accommodation and, if so, when, and with what results?
3.	If a request was made for a building site was it refused and for what reason?
4.	Did the Park administration ever offer accommodation that it owned or controlled and, if so, where was it located and under what terms?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: 1. The
November 18, 1968

Alberta Motor Association presently occupy a two room office facility in the Banff Museum building.
2. Yes. On March 19, 1968, Mr. George A. MacDonald, executive vice-president of the Alberta Motor Association and Mr. McQueen of the Canadian Automobile Association, met with branch officials to discuss the A.M.A. accommodation situation in Banff.
On May 15, Mr. J. D. Paterson representing the Alberta Motor Association was informed that there were no crown lots available for lease by the association in Banff townsite at that time. Space in the new visitor services centre in Banff national park will- be available for organizations of this kind. (The proposed construction date for the centre is for 1970-71.)


C.N.R. BONDS
Mr. Skoberg: 1.	Who holds the existing CNR Bonds and where are they located?
2.	Has the CNR made any effort to get the Bonds back and, if so, what action has been taken in this regard?
3.	How many Bonds has the CNR bought back and how many are presently held by the Company?


Paul Theodore Hellyer: The management of Canadian National Railways advises as follows: 1. As C.N.R. bonds are widely held and negotiated by private and commercial investors, it is not possible to answer specifically the question in the form asked.
2 and 3. Yes. Particulars respecting the company's bond issues may be found on page 34 of the company's printed annual report for the year 1967.


FEDERAL PARTICIPATION, B.C. FERRY SERVICE
Mr. Durante: Does the federal government assist financially in the operation of ferries providing service between the mainland of British Columbia and Vancouver Island and, if so (a) what has been the cost to the federal government per year, for the past five years (b) what percentage of the total operating costs, per year, for the past five years, do these amounts represent?


Paul Theodore Hellyer: No, (a) and (b) not applicable.
Questions


ROAD WORK, MUSKOWEKWAN INDIAN RESERVE
Mr. Burton: 1.	What road work is being carried out on the Muskowekwan Indian Reserve during the 1968 construction season?
2.	What is the name and amount of all tenders submitted for each contract awarded?
3.	What contracts have been awarded and what is the total value of each contract?
4.	What is the unit price for each contract awarded?
5.	What specifications are included in each contract awarded?
6.	Are any further contracts to be awarded on this project?
7.	How much has been paid to date on each contract?


Joseph Jacques Jean Chrétien: 1. Construction of 4.5 miles of access road to the Muskowekwan reserve is being carried out right now.
2.	Tenders were invited by newspaper advertisement and received from: Marsh's Construction, Mistatim, Saskatchewan, $77,920; Corbett Construction, Neepawa, Manitoba, $49,461; Phil Cram Construction Ltd. (Incomplete tender), $61,448. The contract was awarded to Corbett Construction Limited, Neepawa, Manitoba for the following: 2.5 miles access road, Daystar reserve; 4.5 miles access road, Poorman reserve; 4.5 miles access road, Muskowekwan reserve.
3.	Contract awarded to Corbett Construction at a total value of $49,461 of which $17,260 pertains to Muskowekwan reserve.
4.	Unit price for contract awarded, which includes Muskowekwan reserve, was 21 cents per cubic yard for common excavation (including overhaul and rock excavation) with an estimated quantity of 80,000 cubic yards.
5.	Specifications are for access road subgrade construction based on required standards of construction of the main market grid used by municipal road assistance authority- (Saskatchewan).
6.	No further contracts are to be awarded on this project.
7.	No money has been paid for the Muskowekwan portion of this contract.


IMPLEMENTATION OF COHEN REPORT, MONTREAL HARBOUR
Mr. MacEwan: 1.	What main recommendations of the Cohen Report were implemented by the National Harbours Board at Montreal for its employees?

November 18, 1968
Questions
2.	What is the breakdown of the sum of $63,000 which was presented by the Minister of Labour to union officials at Montreal on October 10th, 1968?
3.	Have payments of $100 each been made to any employees affected by technological changes in their work at the Montreal waterfront and, if so, to how many?


Paul Theodore Hellyer: The National Harbours Board advises as follows: 1. Certain workers, determined by both the National Harbours Board and the union, are retained by the board and receive a grant of $100 for each year of service, as recommended in the Cohen report.
2.	This part of the question is apparently based on a newspaper item on information provided to the press, but no presentation was made.
3.	Yes. The total cost of the $100 grants will be $63,314. Distribution of the grants as at October 11 was $27,759 and the balance is being distributed to those who are entitled to them.


RECIPIENTS OF CENTENNIAL MEDAL
Mr. Diefenbaker: Would the Prime Minister table a full list of the names and addresses of recipients (other than members of the Armed Forces) of the Centennial Medal?


Mr. J. E. Walker (Parliamentary Secretary to Prime Minister):: Mr. Speaker, the answer to starred question No. 583 is yes. The list is now being compiled and will be tabled when complete.


RETROACTIVE PAY INCREASES FOR RETIRED PUBLIC SERVANTS
Mr. McCleave: 1.	When employees leave government service, do they receive retroactive pay increases put into effect following their departure?
2.	If not, for what reason?
3.	Has this problem been raised in collective bargaining and, if so, by whom and with what results?


Charles Mills (Bud) Drury: 1 and 2. The retroactive remuneration regulations authorized by order in council P.C. 1964-1417 of September 10, 1964 provide for retroactive remuneration to former employees who, for reasons beyond their control, leave the public service between the effective date of such increases and the date of their approval. The regulations, therefore, are applicable to former employes who have 
been laid off or have retired or to the estate of an employee who died but not to former employees who resigned or were dismissed.
3. Questions relating to matters governed by the retroactive remuneration regulations have, of course, been discussed during the course of some collective bargaining negotiations. Collective agreements which have been signed provide for application of the retroactive remuneration regulations.


GLIDE PATH INDICATOR, TORONTO AIRPORT
Mr. Gillespie: Is it the intention of the Department of Transport to install a glide path indicator on Runway 32 at Toronto International Airport and, if so, when?


Paul Theodore Hellyer: A glide path indicator, of a type known as a visual approach slope indicator system, (VASIS), is installed on runway 32 at the Toronto international airport. This facility has been in operation since August 19, 1966.


GREAT SLAVE LAKE RAILWAY
Mr. Skoberg: 1.	Has the railway construction been completed on the Great Slave Lake Railway?
2.	Has there been an operating order issued for the conveyance of revenue traffic?
3.	Is revenue traffic being carried on the Great Slave Lake Railway under a traffic order?
4.	What type of revenue traffic is being conveyed at the present time?
5.	What operating "Crew Consist" is presently employed on all construction or revenue trains operating on the Great Slave Lake Railway?
6.	Do the operational requirements of the Great Slave Lake Railway, presently come under the Railway Act?


Paul Theodore Hellyer: The management of Canadian National Railways advises as follows: 1. The original estimated date of completion of the line was December 31, 1966. By order in council No. P.C. 1966-1413, dated December 21, 1966, the date of completion was extended to March 31, 1970. Work is proceeding on strengthening certain embankments and improving drainage structures and drainage ditches.
2. On July 7, 1967, pursuant to section 279(7) of the Railway Act, the Board of Transport Commissioners for Canada, by order No. 124865 (amended by order No. 125316, dated August 22, 1967), authorized the carriage of traffic over the line of railway.
November 18, 1968

3 and 4. Under the authority of board orders referred to above, traffic is carried in accordance with tariffs filed with the Canadian Transport Commission.
5.	All trains have three crewmen.
6.	Until completion of the line and the issue of the appropriate order, not all provisions of the Railway Act apply. However, the Canadian Transport Commission has, and is exercising, jurisdiction in matters relating to safety.


OPERATING TESTS OF HOVERCRAFT
Mr. Blouin: With reference to the Press Release published on August 13, 1968 by the Department of Transport and dealing with the official inauguration and purchase of a SRN-5 Hovercraft to be used on the west coast as a research and rescue vehicle, is the government now in a position to provide information on the operating tests and performance of such vehicle?


Paul Theodore Hellyer: Operating and performance tests have not yet been conducted with the SRN-5 hovercraft purchased last summer as the unit is still engaged in training the number of operators necessary for continuous operation and this will not be concluded for some weeks. Following this, in addition to specific performance tests, it is intended to gain protracted operating experience under all possible conditions for several months before a decision is taken on whether procurement of more of these craft for the Canadian Coast Guard is warranted.


TRANSPORT DEPARTMENT EMPLOYEES, VICTORIA AIRPORT
Mr. Anderson: 1.	How many D.O.T. employees are there working at the Victoria International Airport?
2.	How many were working there a year ago?
3.	How many are employed on maintenance?
4.	How many were employed on maintenance a year ago?
5.	Are any outside contractors also employed on maintenance?
6.	If so, how much are they paid, and how much were they paid a year ago?


Paul Theodore Hellyer: 1. 15.
2.	15.
3.	11.
4.	11.
5.	Yes.
Questions
6.	There are two outside contractors in 1968/69 paid as follows:-Building cleaning, $19,200 annually; Landscaping, $7,200 annually. There were two outside contractors in 1967/68 paid as follows:-Building cleaning, $12,000 annually; Landscaping, $8,000 annually.


PARKING LOT RECEIPTS, VICTORIA AIRPORT
Mr. Anderson: What were the monthly receipts from the parking lot at Victoria International Airport during the past year?


Paul Theodore Hellyer: Monthly receipts from parking lot at Victoria
international airport 31, 1968:	April 1,	1967 to OctoberMonth	Year	RevenueApril	1967	$326.05May	>>	599.50June	ii	651.65July	it	653.25August	it	864.75September	it	644.40October	it	568.50November	*>	461.70December	it	438.50January	1968	387.65February	it	586.80March	ti	458.58April	ii	553.59May	it	531.15June	it	499.22July	it	845.24August	it	691.30September	ii	655.65October	ii	604.09


WRITE OFF OF POLLUTION EQUIPMENT COSTS
Mr. Durante: 1.	Does federal legislation permit industrial concerns to write off capital costs incurred for equipment installed to combat or prevent water pollution, in two years rather than on a percentage diminishing balance?
2.	Are the same concessions in effect for costs of equipment installed to control or prevent air pollution and, if not (a) for what reasons (b) will the government give early consideration to the extension of such concessions?


Hon. E. J. Benson (Minister of Finance):: 1. Yes, with respect to property described in class 24 of schedule B of the Income Tax Act regulations.
2. No. (a) and (b) This is a matter of government policy. If the government proposes an amendment to the Income Tax

November 18, 1968
Questions
Act regulations it will be announced at the appropriate time.


PAYMENTS UNDER MARITIME FREIGHT RATES ACT
Mr, Forresiall: How much was paid to railway companies under the Maritime Freight Rates Act in each of the years 1958-67?


Paul Theodore Hellyer: 1958,	$12,568,126;	1959,	$13,150,750;	1960,
$14,261,201; 1961, $14,064,800; 1962, $12,209,476; 1963, $12,936,500; 1964, $13,405,076; 1965, $14,724,861; 1966, $15,054,696; 1967, $14,335,157.


SOOKE HARBOUR SPIT
Mr. Anderson: 1.	Has the Department of Public Works received any correspondence within the past year on the condition of the Sooke Harbour Spit?
2.	Has the Department of Public Works carried out a survey of the condition of the Spit in recent months?
3.	Does the Department of Public Works have any plans to carry out repairs to or strengthening of the Spit?


Hon. Arthur Laing (Minister of Public Works):: 1. No.
2.	Yes, January 1968.
3.	Not at the present time.


APPLICATIONS UNDER AREA DEVELOPMENT PLAN
Mr. Muir (Cape Breton-The Sydneys): 1.	How many applications have been received by the federal government for the incentives available under the Area Development Agency since the inception of the program?
2.	Of the total number of applications received, how many have been approved and what was the total amount of assistance provided to the industries in question?


Mr. Russell C. Honey (Parliamentary Secretary to Minister of Forestry and Rural Development):: 1. 1,452.
2. Nine hundred and thirty-six of the applications have been approved or are being considered for approval. Benefits consist of capital grants under the Area Development Incentives Act which is currently in effect, or income tax abatements under section 71A of the Income Tax Act which had an expiry date, for qualifying eligible projects, of March 31, 1967. Payment of $27,924,000 has been fMr. Benson.]
made in development grants to approved projects. In projects involving income tax abatement, actual values of benefits will not be known until after the tax free periods have expired.


INCOME TAX DEDUCTIONS, MUNICIPAL AND SCHOOL TRUSTEES
Mr. Durante: 1.	Does the Department of National Revenue permit members of municipal councils to deduct the amount of their council indemnities from gross earnings in completing their personal income tax returns?
2.	Is the same consideration given to members of Boards of School Trustees who also receive indemnities and, if not (a) for what reasons (b) will the government give early consideration to permitting such concessions to these elected officials?


Edgar John Benson: 1. An amount may be excluded from the income of members of municipal councils under authority of section 10(3) of the Income Tax Act which reads as follows: "Where an elected officer of an incorporated municipality has been paid by the municipal corporation an amount as an allowance in a taxation year for expenses incident to the discharge of his duties as an elected officer of the corporation, the allowance shall not be included in computing his income for the year unless it exceeds one half of the amount that was paid to him in the year by the municipal corporation as salary or other remuneration as an elected officer of the corporation, in which event there shall be included in computing his income for the year only the amount by what the allowance exceeds one half of the amount so paid to him by way of salary or remuneration."
2. (a) No. There is no provision in the Income Tax Act excluding an amount paid as an allowance for expenses to a member of a board of school trustees, (b) This is a matter of government policy. If the government proposes an amendment to the Income Tax Act it will be announced at the appropriate time.


R.C.M.P. PERSONNEL IN QUEBEC
Mr. Matte: 1.	How many members of the RCMP were stationed in Quebec in 1960, 1961, 1962, 1963, 1964, 1965, 1966, 1967 and 1968?
2.	Is the constitution of the RCMP officially bilingual?
November 18, 1968


Hon. G. J. Mcllrailh (Solicitor General):: 1.
1560, 325; 1961, 339; 1962, 378; 1963, 429; 1964, 424; 1965, 496; 1966, 515; 1967, 611; 1968, 684.
2. The constitution of the R.C.M. Police is fundamentally the R.C.M. Police Act, a federal statute published in both the English and the French language.


YOUNG PENITENTIARY INMATES
Mr. Diefenbaker: How many inmates are there in Canadian penitentiaries (a) 14 or 15 years of age (b) 16 years of age (c) 17 years of age?


George James McIlraith: On November 7, 1968 there were: (a) 1; (b) 12; (c) 38.


QUESTION PASSED AS ORDER FOR RETURN
Mr. Lefebvre: 1.	What sum of money was provided by the federal government under the Winter Works Program for each year 1962-1968 in the federal constituency of Pontiac and what sum was paid by the provincial government for the same period?
2.	What was the total amount spent in each municipality during the seven years in question?
Return tabled.


NATIONAL DEFENCE
[Stage Direction]
On the orders of the day:
Gerald William Baldwin: Mr. Speaker, I would like to ask the Prime Minister a question. Can the right hon. gentleman tell us just when it was that the government came to a decision to defer its 20 per cent reduction in the size of the air division in Europe?


Right Hon.   P.-E. Trudeau@Prime Minister: In the course of the past weeks, Mr. Speaker.


Gerald William Baldwin: Mr. Speaker, my supplementary question arises from the statements made both inside and outside the house with regard to Canada's commitment to assign four antisubmarine destroyers to NATO. Will the Prime Minister advise the house whether the government intends to proceed with the production schedule and fulfil the delivery dates 29180-180
Inquiries of the Ministry for the four ships, commencing in June 1971 and ending in September 1972?


Pierre Elliott Trudeau: Mr. Speaker, I repeat what I was saying on Friday, that this was a decision which was made quite some time ago. As a matter of fact the construction of these ships was announced by the Minister of National Defence on December 22, 1964, and a further announcement was made by Mr. Drury and Mr. Cadieux when the contracts were let on April 6, 1968. Therefore these are decisions which had been made in the past, and contracts having been let the position we took- and this is the position Mr. Cadieux took in Europe-was that these ships would be at the disposition of the NATO command, as were our other anti-submarine ships in the Atlantic area.
Of course this does not prejudge what we will decide to do as a result of our review. If we should decide that we do not want the ships to be allocated to NATO we are free to decide that, but Mr. Cadieux was repeating-


Mr. McGrath:: Order.


Pierre Elliott Trudeau: Thank you very much-the Minister of National Defence was repeating a commitment which had been made by the Canadian government as early as 1964 regarding the construction of these ships.


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, would the Prime
Minister say whether, in view of the colossal build up in the navy of the U.S.S.R., Canada was approached to integrate the naval strength that she has with the naval forces of the European NATO members and, in particular, to join in strengthening NATO forces in the Mediterranean?


Pierre Elliott Trudeau: Concerning whether we were approached I would have to inquire and either give the answer or have the Minister of National Defence give the answer. But I have reason to doubt that we have been approached, because the present position is that all of Canada's anti-submarine forces which are based on the east coast are at present committed to the NATO command and are operative in the Atlantic area.


John George Diefenbaker: The question which I presume the Prime Minister wishes to have allocated to the Minister of National Defence is whether there is any question of these forces, the Canadian naval units, being placed in the Mediterranean.

November 18. 1968
Inquiries of the Ministry


Mr. David Lewis (York South):: Mr. Speaker, I should like to ask the right hon. gentleman whether a statement which is reported to have been made by the Postmaster General to the effect that Canada's foreign aid ought to be equal to or exceed our defence expenditures was, as I hope it may have been, a statement of government policy.


Pierre Elliott Trudeau: Mr. Speaker, I have not seen the Postmaster General since he made that statement. I will ask him whether he actually made it. I do know that he intended to make some statement to the effect that it was very important to have external aid, but in respect of what the percentage would be in relation to Canada's over-all defence commitments I am not aware.


David Lewis: May I ask the right hon. gentleman whether this problem of increasing foreign aid and decreasing our defence expenditures generally, including NATO, is one of the matters now under active review.


Pierre Elliott Trudeau: Yes, very definitely. In our review of external affairs and in our defence review we are looking very actively at the alternative ways of spending money usefully in our foreign relations, and this is one of them.


David Lewis: May I ask the right hon. gentleman, arising out of the communique of the NATO foreign ministers' meeting, did our Canadian representatives make clear that any suggestion that NATO would involve itself in any action that may take place on the eastern side of the iron curtain would not meet with Canadian support?


Pierre Elliott Trudeau: The question is rather too vague for me to answer it. Any action on the other side of the iron curtain-well, it would really depend on what it was. If I.C.B.M.'s come up from that side and are aimed at us, well-


Hon. J. A. MacLean (Malpeque):: Mr. Speaker, arising from the Prime Minister's statement in Kingston about the basis of the government's review of Canada's position in NATO, will the Prime Minister say whether the same plan will apply with regard to our continuation in NORAD? Is our continuation in NORAD subject to the general review of defence matters of which the Prime Minister speaks?


Pierre Elliott Trudeau: Yes, Mr. Speaker. The kind, quality and number of armaments which we

will want to commit under NORAD are very much the subject of the external affairs and defence review.


Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, is the government continuing a reappraisal or reassessment of all existing plans and commitments for the defence of North America?


Pierre Elliott Trudeau: It is a general review. I think I can say we are examining all existing plans.


Mr. David MacDonald (Egmont):: Mr. Speaker, the other day I asked the Prime Minister whether he would indicate who was carrying on the study of the terms of reference, and he was unwilling to do so. Would he inform the house what opportunity may exist for interested Canadians to participate in this government review of foreign and defence policy?


Pierre Elliott Trudeau: Well, at this stage I suppose they have available to them the normal channels of communication. There probably will be a later stage at which they will want to write to their members of parliament indicating to them what views they would like to see held in this house when we are discussing the review and policy which the government will put forward.


David Samuel Horne MacDonald: Does the Prime Minister indicate that there will be no formal way in which individuals or groups who have devoted a good deal of time to this matter and have gained a good deal of experience in respect of this important aspect of Canadian life will have an opportunity to make their representations?


Pierre Elliott Trudeau: Not in a formal way to the government at this stage.


David Samuel Horne MacDonald: At any stage?


Pierre Elliott Trudeau: As I said, at a later stage of course they could, when they know what our proposals are. They could express their views on them then, but at this stage the government is engaged in the business of establishing policies in very, very many areas, and we do not consult the organized groups before making any policy in any area.


Mr.  R. Gordon L. Fairwealher@Fundy-Roy-al: Mr. Speaker, would the Prime Minister agree to let us have a copy of his itinerary for the next few months so we could participate in such a review?


Mr. Speaker:: Order, please.
November 18, 1968


Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, may I ask the Prime Minister whether there has been any formal negotiation with the United States with regard to a cut-back in our NORAD commitment, and what is the United States attitude in this regard.


Pierre Elliott Trudeau: I beg your pardon?


Eldon Mattison Woolliams: What was the United States attitude with regard to any formal negotiation concerning any cut-back in our commitment to NORAD?


Pierre Elliott Trudeau: At this stage we are trying to establish what the government policy will be in the years and decades to come. We are not consulting the United States on that. We want to advance our own decision-making processes ourselves before either coming to parliament, going to the United States or going to these advice groups which were mentioned in an earlier question.


Eldon Mattison Woolliams: Do I take it, then, from the Prime Minister's answer that in this area of review of our commitment to NORAD no discussion is taking place with the United States at this time with reference to the defence of America, and that it is a purely unilateral decision of the Canadian government?


Pierre Elliott Trudeau: Mr. Speaker, under the
NORAD agreement, as under the NATO agreements, certain mechanisms do exist for consultation. This is going on all the time, but certainly there is no specific consultation with the United States on the direction of our review at this time.


OLD AGE SECURITY
[Stage Direction]
On the orders of the day:
David Réal Caouette: Mr. Speaker, I should like to put a question to the right honourable Prime Minister.
As Canadians now get their pension at 67 years of age, which does not necessarily authorize payment of a pension to the wife who may be, let us say, 55 years of age or some 15 years younger than her husband, has the right honourable Prime Minister or the government considered the possibility of authorizing payment of a pension to a younger wife whose husband is already getting his old age pension?
29180-180i
Inquiries of the Ministry


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, questions relating to pensions generally come under the purview of the Minister of Finance, and I wonder if the hon. member would not want to put this question to him when he is in the house?


David Réal Caouette: Mr. Speaker, a supplementary question.
I could have put my question to the Minister of Finance, but the right honourable Prime Minister knows that the Minister of Finance cannot decide on his own and that it is the cabinet that decides. The right honourable Prime Minister should therefore be able to answer.


Mr. Speaker:: Order. The hon. member has already put his question.


David Réal Caouette: Mr. Speaker, I did not get any reply.


David Réal Caouette: Mr. Speaker, I rise on a point of order. The Prime Minister has just told me that I should put my question to the Minister of Finance, and I would like to advise him that the matter does not come under the Minister of Finance but rather the Minister of National Health and Welfare.


WHEAT-INQUIRY AS TO INTRODUCTION OF TWO PRICE SYSTEM
[Stage Direction]
On the orders of the day:
Mr. R. R. Southam (Gu'Appelle-Moose Mountain):: Mr. Speaker, I had a question for the Minister of Industry, Trade and Commerce or the Minister of Agriculture, but in their absence from the house I should like to direct it to the right hon. Prime Minister. In the light of the clear-cut call by delegates presently attending the annual meeting of the Saskatchewan wheat pool for a two price system for wheat, will the government give favourable consideration to this request or some other acceptable alternative.


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, these ministers are to be in the house on Wednesday. I think the question might be asked of them then.

November 18. 1968
Inquiries of the Ministry EXTERNAL AID


NIGERIA-PROVISION OF CARIBOU AIRCRAFT FOR RELIEF FLIGHTS
[Stage Direction]
On the orders of the day:
Hon. D. S. Harkness (Calgary Centre):: Mr. Speaker, I should like to ask the Prime Minister whether the Caribou aircraft which were to be sent to Nigeria for the distribution of food supplies have now been dispatched to that country; or has there been a change of plans in this regard?


Right Hon.   P.-E. Trudeau@Prime Minister: As of Friday, Mr. Speaker, the Caribou aircraft had not been dispatched to that country, at the request on the Red Cross itself, which felt that they could not usefully be put into service at this time.


Douglas Scott Harkness: I have a supplementary question which is really part of my original one. Has a decision now been made by the Canadian government not to send these aircraft?


Pierre Elliott Trudeau: No, Mr. Speaker, we are still holding them ready for service. The house will remember that it was as the result of a discussion by my representative with General Gowon that we were told this would be the best alternative in view of the impossibility of using the Hercules. That is why we said we were prepared to commit them. As of now there is some question as to whether they are actually needed in that Nigerian area.


Francis Andrew Brewin: Mr. Speaker, I wonder whether I might ask the Prime Minister a question about the Canadian Hercules at Fernando Po. Is it still grounded, or has it been brought back from the Nigeri-an-Biafran area?


Pierre Elliott Trudeau: Mr. Speaker, we still hope, though with less enthusiasm as a result of no answer from Colonel Ojukwu to the daylight flight proposal and Red Cross negotiations, that we will be permitted to make daylight landings of the Hercules. We still do not know of any reason why flights of Hercules in the daytime, in order to help serve the people of Biafra, would not be authorized by their own leaders.


Francis Andrew Brewin: Would the Prime Minister say something about night flights? He replied in respect of daylight flights, but is the Hercules being used on night flights?


Pierre Elliott Trudeau: As of Friday, night flights to my knowledge have not been resumed, Mr. Speaker.


David Samuel Horne MacDonald: Mr. Speaker, in view of the fact that, to the best of my knowledge, every night last week and last night as well planes have been operating at night into Nigeria, why have not arrangements been made in the interim to have perhaps not one but an additional one or two Hercules aircraft operate in order to step up efforts to meet the relief requirements that are growing steadily, particularly when these people are nearing the end of their local harvest?


Pierre Elliott Trudeau: Hon. members know there have been some casualties as a result of night flights, and that we made a very reasonable proposal to make these flights in daytime when we would be able to bring in much more food with much less danger. We have the authority from the Nigerian government to do so. The Red Cross is interested in doing that, but we still do not have an answer from the Biafran leaders as to why they do not want us to fly in the daytime. We can only speculate that they have an interest in intermingling arms and relief flights in order that there may be confusion.


David Samuel Horne MacDonald: Mr. Speaker, I wonder whether the Prime Minister could indicate first whether at the moment there is any prohibition on the part of Nigeria to continue any flights that we commenced with our Hercules aircraft and, second, in what way we have attempted to contact the Biafran officials to ascertain whether there is a possibility of daytime operations.


Pierre Elliott Trudeau: In respect of the first part of the question, we do know the Nigerian government has said it would no longer give any assurance that the night flights would not be attacked, for the very simple reason that it is during the night that all the arms are getting in, and for the additional reason that they also authorized daylight flights. Having regard to the second part of the question, you had better ask it again, as I do not remember what it was.


David Samuel Horne MacDonald: In asking the question again, Mr. Speaker, may I indicate that the Prime Minister has suggested that arms are moving in both during the day and
November 18, 1968

at night. In respect of what time on the clock could we get approval allowing these flights?


Some hon. Members:: No, no.


Mr. Speaker:: Order, please.


David Samuel Horne MacDonald: In the second part of my question, Mr. Speaker, I asked specifically what contact has been made with Biafran representatives in order to make the necessary arrangements for daytime operations.


Pierre Elliott Trudeau: In answering the question I should indicate for the purposes of the record that I did not say arms flights were coming in during the day. Having regard to the second part of the question, I explained that we have made our proposals and the Nigerian government's proposal to the International Red Cross. It has undertaken to speak to Colonel Ojukwu in an effort to influence him to accept this position. I wish hon. members of this house and other people in this country who seem to have a lot of influence with Colonel Ojukwu would also speak to him and get an assurance from him.


CANADIAN CONSTITUTION
[Stage Direction]
On the orders of the day:
Hon. George Hees (Prince Edward-Hasi-ings):: Mr. Speaker, I should like to ask the right hon. Prime Minister whether it is the intention of the government to make the meetings of the federal-provincial conference dealing with the constitution and finance, to be held next month, open to observers appointed by the provincial and federal opposition parties.


Right Hon.   P.-E. Trudeau@Prime Minister: I cannot speak, of course, with respect to the provincial opposition parties, Mr. Speaker. The provinces are empowered to compose their delegations as they wish. As far as the federal government delegation is concerned, we had not planned to have any members of opposition parties as members of the delegation. Hon. members will recall that last year we reserved places at the conference for the various opposition parties in this house, and it was up to them to allocate these places to the members they desired. We plan to continue this procedure if we get the approval of the provincial governments.


Mr. John M. Reid (Kenora-Rainy River):: Mr. Speaker, has the Prime Minister given
Inquiries of the Ministry any consideration to the possibility of placing on the agenda of the forthcoming conference the formation of an eleventh province made up of northern Ontario and northern Quebec?


Pierre Elliott Trudeau: Mr. Speaker, the officials who are charged with establishing the agenda had not been seized of this problem when they last met. I doubt whether it will be able to get on the agenda at this late stage. Perhaps it will in some other year.


Mr. Erik Nielsen (Yukon):: Mr. Speaker, I have a very serious supplementary question for the Prime Minister. Will he indicate whether arrangements have been made to include elected representatives from the Yukon and Northwest territories at the conference?


Pierre Elliott Trudeau: I believe I indicated some days ago that there was an intention to have representatives from the Yukon and Northwest Territories, either or both, as members of the federal delegation, but this delegation has not yet been established.


INQUIRY AS TO AGENDA FOR CONFERENCE
[Stage Direction]
On the orders of the day:
Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I should like to ask the Prime Minister whether the agenda has now been settled for the conference with provincial premiers regarding the constitution in December? If so, would the Prime Minister be prepared to inform the house as to the agenda for the conference, since this is a matter of great public interest?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I agree that it is a matter of public interest, but the continuing committee of officials just finished discussing this subject some days ago. I have now a letter for my signature to go out to the provincial premiers suggesting an agenda to them. As soon as I have agreement on the agenda, and agreement that there is nothing confidential in it, I would be glad to let this house know what the agenda is.


HEALTH AND WELFARE
[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, I should like to ask the Minister of National Health and Welfare whether he is now in a position to answer the

November 18, 1968
Inquiries of the Ministry question I asked last Thursday, and the question asked by my friend the hon. member for Sincoe North, concerning the announced freeze on grants available under the Health Resources Fund Act. In view of the statement made in a report to the Medical Research Council last week as to the serious effect of this freeze, will the minister reconsider his position?


Hon. John C. Munro (Minister of National Health and Welfare):: Mr. Speaker, this was a firm decision taken by the federal government at the health ministers' conference, and no reconsideration is being given to it at this time. What is being given consideration, however, is the allocation of the moneys in the fund in order that there will not be too much harm so far as the projects of the provinces are concerned.


Mr. Gordon Riichie (Dauphin):: Mr. Speaker, I should like to ask the Minister of National Health and Welfare a question arising from the statement by the government of Manitoba that the cutback from a five year to a two year period in the health research and building fund will render joint planning with the university and major hospitals almost impossible. Is it the intention of the government to engage in any further discussion with the provinces on the future of this federal program?


John Carr Munro: Yes, Mr. Speaker. Those discussions are going on, and that intent was conveyed to the provincial health ministers at the conference.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
Hon. John N. Turner (Minister of Justice):: Mr. Speaker, on Friday the hon. member for Skeena asked whether the attention of the government had been drawn to a recent statement by Mr. Allan Bate to the effect that in court cases involving native Indian people the R.C.M.P. take sides against these native people and put them in the position of not being able effectively to obtain justice in the courts. This question was taken as notice by my parliamentary secretary, and I should like to reply to it on behalf of the Solicitor General.
Senior members of the force have been in touch with Mr. Allan Bate in order to obtain some clarification. Mr. Bate states that he did

not say the R.C.M.P. is against the native people. He also states unequivocally that he has the highest regard for the force and for members of the force whom he has encountered in his work over the years as counsel. He did say, however, that from his over-all experience no policeman should be put in the position of acting as investigator, accuser and often adviser to illiterate persons involved in offences, and this is more likely to occur in isolated areas policed by the force. In short, Mr. Bate is against the system and not the police, and has undertaken to explain his views fully in writing to the attorney general of British Columbia.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr.  R. Gordon L. Fairweaiher@Fundy-Royal: Mr. Speaker, I have a question for the Acting Secretary of State for External Affairs. Has our embassy in Mexico City investigated and, if warranted, taken steps to protest to the government of Mexico against what appears to be the highly unorthodox arrest and deportation of two Canadian journalists?


Charles Mills (Bud) Drury: That question will be answered tomorrow, Mr. Speaker.


John George Diefenbaker: I have a supplementary question, Mr. Speaker. Would the minister also find out whether these two itinerants were in Mexico under direction from the Canadian Broadcasting Corporation to bring back pictures of revolutionary movements and the like, as though we did not have enough revolutionaries coming to Canada?


John George Diefenbaker: Mr. Speaker, I rise on a point of order. I asked whether in the absence of the minister an inquiry would be made of the C.B.C., and I submit I am entitled to an answer to that question because today with the minister absent again it is hard to-


Mr. Speaker:: Order, please. I suggest that perhaps the right hon. gentleman is entitled to ask his question, but he is not entitled to the supplementary comments.


John George Diefenbaker: Mr. Speaker, my supplementary comments were just to help the government along. Would the minister make that
November 18, 19G8

inquiry so we may find out what these itinerants were doing down there?


Charles Mills (Bud) Drury: Mr. Speaker, I will see that inquiries are made of the C.B.C., but I am sure the right hon. gentleman would sooner see pictures of revolutionaries than the revolutionaries themselves.


Eldon Mattison Woolliams: have a supplementary question, Mr. Speaker. When the minister makes the investigation I wonder if he would investigate whether this revolution in Mexico which they were trying to film was a fictitious one or a real one.


Mr. Speaker:: Order, please.


[Stage Direction]
On the orders of the day:
Mr. J. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Prime Minister. Is the government aware that a student opponent of the Greek regime has very recently been condemned to death? If so is the Canadian government, as a fellow member of NATO, contemplating any action it might take in urging the Greek government to reconsider its decision in this matter?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I will have to inquire into the matter.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. Donald Maclnnis (Cape Breton-East Richmond):: Mr. Speaker, I have a question for the Minister of Forestry and Rural Development. Could the minister say, having studied and tabled the plan of the Cape Breton Development Corporation, whether he endorses this particular plan?


Jean Marchand: Mr. Speaker, I stated that it was approved by the government.


Donald MacInnis: Mr. Speaker, I have a supplementary question for the Prime Minister. In light of the fact that the Minister of Forestry and Rural Development referred to the report as a government report, I would ask the Prime Minister whether he agrees that this report has been drawn up and formulated in accordance with Bill C-135.
Inquiries of the Ministry


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I will have to discuss this with the minister.


Donald MacInnis: Mr. Speaker, since the minister is here and we never know ahead of time when he will be back, could he answer the question now?


Pierre Elliott Trudeau: Mr. Speaker, I will discuss it with him right now.


Mr. Speaker:: Order, please.



OFFICIAL LANGUAGES


[Stage Direction]
On the orders of the day:
Mr. Walter Deakon (High Park):: Mr. Speaker, the question I wish to ask today was posed to the right hon. Prime Minister last Friday and I understand was referred to the Minister of Justice. So, if I may, I should like to pose this question to the Minister of Justice. Will he advise the house whether he will refer the official languages bill to the Supreme Court of Canada for a ruling as to its validity before proceeding further with it in the house, in view of the submissions made to the right hon. Prime Minister by Mr. Thorson, the former president of the Exchequer Court of Canada?


John George Diefenbaker: And former Liberal minister of the government of Canada.


John Napier Turner: Mr. Speaker, I read very carefully, as have the law officers of the crown, the letter of Mr. Thorson, and the law officers of the crown advised me that Bill C-120, known as the official languages bill, in no way purports to amend the constitution of Canada or to affect or modify any legal right or obligation contained in the constitution relating to either the English or the French language, and that the enactment of this bill into law will in nc wise affect or modify the permission conferred or the obligations imposed by section 133 of the British North America Act. In short, the constitution of Canada as regards the use of the English or French language will remain the same.
I can therefore say, in answer to the hon. member's question, that there is no present intention on the part of the federal government to refer the bill to the Supreme Court of Canada.

November 18, 1968
Inquiries of the Ministry



COMPANY OF YOUNG CANADIANS


[Stage Direction]
On the orders of the day:
Mr. Louis-Roland Comeau (South Western Nova):: I have a question for the Prime Minister. Will the Prime Minister cause the Solicitor General to determine the means by which an advance confidential copy of a consultant's report to the Company of Young Canadians came into the possession of the hon. member for Burnaby-Seymour, and have the Solicitor General advise the house whether action will be taken of the kind threatened to be taken against the publishers of La Pressed



HUMAN RIGHTS


[Stage Direction]
On the orders of the day:
Mr. Barry Mather (Surrey):: Mr. Speaker, I have a question for the Minister of Labour, having in mind the statement made over the week end by a labour department official to the effect that Canadians should back up the anti-discrimination law of the country by rooting out racial discrimination in clubs, business circles and fraternities. My question is, will the minister indicate active support of such a good declaration?


Mr. Speaker:: Order, please. The hon. member is asking for a statement of opinion on the part of the minister, or a statement of policy. I do not think the question should be asked in this way.



FINANCE


[Stage Direction]
On the orders of the day:
Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, this could be a question of privilege but perhaps I could put it as a question to the Prime Minister because it relates to two departments, the Department of Agriculture and the Department of Finance. Both these departments issued releases over the week end setting interest rates under the Farm Credit Corporation Act and the Farm Improvement Loans Act for loans on land at 7f per cent and for loans for other purposes at 7J per cent. Is this not a typographical error? Surely no minister would set rates this high.


Mr. Speaker:: Order, please.



INQUIRY OF THE MINISTRY

[Stage Direction]
On the orders of the day:
['Perhaps I might reply to that, Mr. Speaker. As hon. members know, as the result of a special order the house will be dealing with the report from the external affairs committee on the question of Nigeria and that part of it called Biafra on November 26. I would be pleased to consult with my hon. friends with regard to the possibility of getting the estimates of the Department of National Defence and the Department of External Affairs fully dealt with in the standing committee on external affairs and national defence at an early date and using one of the other supply days to discuss this subject.']
Mr. John Lundrigan (Gander-Twillingale):: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. Could the minister say whether the increased unemployment in the Atlantic region is the result of the government's program curtailing government plans and government expenditures as was recently suggested by the Minister of Finance?


Mr. Speaker:: Order, please. The question as asked is argumentative.



[Stage Direction]
On the orders of the day:
Gerald William Baldwin: Mr. Speaker, I should like to ask the Prime Minister whether he could indicate to the house when the safari into the southern hemisphere will terminate; and would he discuss with his colleague the President of the Privy Council when arrangements could be made through the usual channels for a debate on external affairs through reference of an appropriate item in the estimates, to deal with the question of the NATO arrangements?


Hon. Donald S. Macdonald (President of the Privy Council):: Perhaps I might reply to that, Mr. Speaker. As hon. members know, as the result of a special order the house will be dealing with the report from the external affairs committee on the question of Nigeria and that part of it called Biafra on November 26. I would be pleased to consult with my hon. friends with regard to the possibility of getting the estimates of the Department of National Defence and the Department of External Affairs fully dealt with in the standing committee on external affairs and national defence at an early date and using one of the other supply days to discuss this subject.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mrs. Grace Maclnnis (Vancouver-Kings-way):: Mr. Speaker, a few days ago, in the absence of the Minister of National Health and Welfare, the parliamentary secretary told
November 18, 1968

me he would take the following question as notice:
In view of press reports that a Swedish-made abortion pill is now being sold in Vancouver, is the minister investigating this reported illegal traffic?


John Carr Munro: That matter is being looked into, Mr. Speaker.



CRIMINAL CODE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Justice. In view of the concern being expressed by members and other responsible people with regard to the lash and other forms of corporal punishment used in our prisons and penitentiaries, may I ask the minister whether the government is considering including in the omnibus bill an amendment to the Criminal Code to provide for changes in respect of corporal punishment.


John Napier Turner: No, sir, not in the presently reviewed omnibus bill. I have stated that the bill will contain, in substance, only the matters that were before the house in Bill No. C-195.


Stanley Howard Knowles: May
I ask the minister whether this matter is being considered by the government or by the Department of Justice under any other head?


John Napier Turner: There is no active consideration being given by the government to this subject. It is a matter which I am prepared to look into, taking into account expert advice from all quarters.


Winona Grace MacInnis: May I ask the minister, Mr. Speaker, when it is expected the omnibus bill will be introduced?


John Napier Turner: It has been redrafted, and I want to bring the changes in detail before my colleagues and have it submitted to the house as soon as I can.

Righl Hon. J. G. Diefenbaker (Prince Albert): Mr. Speaker, I have a question arising out of an answer given earlier by the Minister of Justice. In view of the fact that there is a widespread division of opinion regarding the legislation of abortion and
Inquiries of the Ministry homosexuality, will those two matters be separated from the omnibus bill when it is presented so that members may vote with particular reference to these matters? Will there be a free vote on these two questions which are above politics and have important social considerations?


John Napier Turner: I certainly appreciate the non-partisan nature of that question, Mr. Speaker. It is our present intention to submit this bill to the house as one bill. Of course, if the bill succeeds in obtaining second reading and goes into clause by clause study, there will be an opportunity at that time to debate every one of the individual items. It is my present view that the bill will be a government bill presented as one measure.


John George Diefenbaker: Is the government going to restrict the right of members to vote according to their conscience? Are the whips going to apply?



FORESTRY


[Stage Direction]
On the orders of the day:
John Howard Lundrigan: Mr. Speaker, I have a question for the Minister of Forestry and Rural Development. Since the minister's department has just announced an inquiry into the mechanization of the forest industry, can the minister say whether this inquiry has any terms of reference with respect to the loggers and other workers in this industry so affected?


Jean Marchand: I know of no such inquiry, Mr. Speaker. Was the announcement from the Department of Forestry and Rural Development?


John Howard Lundrigan: Perhaps I misdirected my question, Mr. Speaker. The minister's department is having the notice sent out. Perhaps I should direct my question to the parliamentary secretary of the Minister of Fisheries, who has been making pronouncements in that regard.


John Howard Lundrigan: Mr. Speaker, could I have an answer to the question I directed to the minister responsible for forestry?


Mr. E. F. Whelan (Parliamentary Secretary to Minister of Fisheries):: Mr. Speaker, the minister responsible for forestry will be here tomorrow, and I will refer the question to him.
November 18. 1968

Supply-Auditor General SUPPLY
The house in committee of supply, Mr. Faulkner in the chair.



AUDITOR GENERAL

[Stage Direction]
50. Salaries and expenses of office, $2,427,400.
Gerald William Baldwin: Mr. Chairman, I have a few general comments to make. I do not know whether it is the intention of the minister to make a statement but possibly he may have something to say later. I might indicate to you, Mr. Chairman, and to the members of the committee that it is not our intention to unnecessarily delay consideration of this particular vote nor the vote which will follow because the public acccounts committee is now sitting and the Auditor General is appearing before that committee. There will be, therefore, substantial opportunities in the committee to deal with the Auditor General's position and his functions. However, there are a few comments I should make which may invite a reply from the minister.
Some time ago it was suggested in this house, and also in the public accounts committee, that it may well be suitable for the office of the Auditor General to be the subject of a special act of parliament. At the present time, as members well know, all the legislation that relates to the Auditor General is in the Financial Administration Act or in special acts of parliament which call upon the Auditor General to perform the task of auditing the accounts of the corporations which are involved. It was proposed in the public accounts committee, and my recollection is a draft act was submitted to the committee and was the subject of some discussion, that having in mind the independent nature of this officer appointed by the government but reporting to parliament, a special act might well be considered. This bill could be brought before the house at a suitable opportunity, and I should like to have some comments on that suggestion.
[DOT] (3:40 p.m.)
Again, Mr. Chairman, may I say that I think the house should have some better way than it now has of dealing with the recommendations of the Auditor General. At present they are put before the public accounts committee, subsequently made the subject of discussion in that committee and then dealt with further in the form of recommendations made in the report of the committee which then comes into the house but upon which no further action is taken. I think it is in the interests not only of the government and the

house but of proper administrative efficiency that some means be devised whereby the recommendations of the committee be made the subject of debate in this house. I am not suggesting that there should be a long debate. I am not suggesting for a minute that the government must accept the recommendations of the committee.
It is well known, Mr. Chairman, that following the lead taken by the right hon. member for Prince Albert when he was prime minister the public accounts committee was given a new impetus, a new life. The chairman of that committee at the time was a member of the opposition party and had a very successful and distinguished career as chairman. Since that time this committee has had the opportunity to function in a non-partisan way more than any other committee of the house.
When this committee has considered in detail the recommendations and proposals made by the Auditor General, has considered his report and come to a determination, I think it is quite improper for no action to be taken on the committee's report. It has been my experience-and I am sure all other members who have served on the committee would agree with me-that to a very large extent the recommendations of this committee are almost always unanimous. In that way it is as non-partisan a committee as can be found. Its recommendations are objective and are directed toward securing a better and more efficient administration of government departments.
Therefore, Mr. Chairman, it is surely only fair and proper that some means be found, within reasonable limits, to debate in this house the recommendations of the committee when it reports to the house. One need only examine the last report of the Auditor General to discover that a very large number of the recommendations of the public accounts committee have not been dealt with, have not been considered, and the government has not come to a point of view about them or indicated whether it is for or against them. This certainly does not result in expeditious and effective government operation. I therefore suggest that some consideration be given to this point.
I realize, Mr. Chairman, that I can be told by the minister-and he will be quite right to tell me-that this is a matter for the committee. Nevertheless, I think it has been understood in the past that the report made by the committee withers on the vine and nothing
November 18, 1968

happens. In Australia, they have devised a far better and more efficient way to deal with this problem. The public accounts committee operates under an act of parliament. Its functions are set out by statute. Its appointment is arranged by statute. In the pursuit of its duties it publishes, at frequent intervals throughout the year, a document that sets out the recommendations of the committee side by side with what action, if any, has been taken by the government to implement them. This means that there is available to members of the public, to the government's officers and to members of the Australian House of Representatives at all times a clearcut and balanced interpretation of what the recommendations have been and what the government is doing about them.
I do not know whether this would be the answer to our problem, but I suggest that if there is to be any effective and meaningful role played by the Auditor General some better ways must be found to ensure that when a committee of the house, after serious and lengthy consideration, has made recommendations, those recommendations are the subject of debate in the house and, if necessary, of division in the house. After all, the government does not need to accept the recommendations. If it does not accept them the government should be prepared to come into the house and say why. If in the view of the opposition the matter is important enough to be the subject of a vote, then the house can decide by dividing on the issue.
The final point that I would make is this. On a number of occasions it has been suggested by the public accounts committee that the Auditor General should be joint auditor not only of government departments, crown corporations and other emanations in respect of which he is now authorized to conduct an audit but also joint auditor of all crown corporations. I draw to the attention of this committee a recent experience of this need in connection with one crown corporation, the Company of Young Canadians. I am not going into this question because it is now before a committee of the house, but I suggest through you, Mr. Chairman, to the members of this committee that if a joint audit had been done by the Auditor General and the private auditor, the recent experience might never have occurred.
Not only that, Mr. Chairman, but in circumstances where a change in the appointment of the private auditor is made, which does happen from time to time, I think the continuity that would be provided by the
Supply-Auditor General Auditor General appearing as joint auditor, with his experience and knowledge of the affairs of crown corporations, would be most invaluable. I should like to see the government give consideration to this recommendation. It is not a new one to me; it is a recommendation that has been made on a number of occasions in the public accounts committee.
These are the few suggestions that I make, Mr. Chairman. I do not know whether the minister would care to reply to them. I do know that other recommendations will be coming out of the public accounts committee. I assumed that the estimates of the Auditor General will be coming back to this house some time in the new year in a new form, and consequently as far as we are concerned we do not propose to pursue this matter. We say this without prejudice to our belief that there can be a better and more effective way found to deal with the functions of the Auditor General, but we are not prepared to hold up the estimates at this time. I do not want to inhibit the rights of other members, of course, but we feel that if this item and the other one can in due course carry we might well get into other legislative business later this day so as to try to help the government in its difficulties. However, these difficulties are of its own creation in that it has tried to get through the house the legislative diet that it has set for itself.


Mr. Burton:: Mr. Chairman, I just wanted to state that this year I was named to the public accounts committee and was really quite shocked to find that a number of the situations referred to by the hon. member for Peace River existed. First of all we had a report from the Auditor General indicating the status of the recommendations that have been made by the public accounts committee from time to time in the past. Some 55 recommendations had been made by the public accounts committee, on 20 of which no action had yet been taken.
[DOT] (3:50 p.m.)
There were 16 other recommendations where the executive had indicated disagreement. These matters had been considered and there was disagreement with respect to them. I would judge such decisions on their merits. In 13 instances it was indicated that slow progress was being made. In certain discussions there appears to have been sensitivity on the part of some government members on the committee to the use of the word "slow".
November 18, 1968

Supply-Auditor General The Auditor General used the word "slow" advisedly. Two of the recommendations have been implemented and another two are soon to be implemented. In one case the action taken has not been satisfactory and in another case a recommendation was withdrawn by the public accounts committee.
It can be seen that originally there were 55 recommendations and one was withdrawn by the committee, leaving 54. Of that number only four at this time can be said to have had adequate consideration and treatment. I submit that this is not a desirable state of affairs. It is not adequate and the minister and the government ought to attend to it immediately, particularly since the Treasury Board now fulfils certain functions with reference to items coming under the purview of the public accounts committee.
In the past there have been recommendations with respect to having an Auditor General's act. I understand that an act has been drafted and is ready for submission. I think it can be proceeded with. Could the minister say what action the government is going to take on this matter? Is it intended to bring forward the bill, and how soon? It seems to me that in this area the work of the Auditor General could do much to improve the operations of government as such. He could ensure that the government does a good job and could demonstrate through this act that the government can do as good a job for our society as any other segment of our economy. There is no reason why government cannot be operated as efficiently and effectively as any other part of our society.
The matters raised by the Auditor General need to be studied, and if we had an opportunity more than once a year to study many of the matters which are raised the public would have a good deal more faith in government as such. Bringing in the act would, I think, be in the the best interests of Canada and in the best interests of the state of affairs we wish to achieve in this country.


Mr. Allmand:: Mr. Chairman, I wish briefly to reply to some remarks made by the hon. member who has just resumed his seat. The house leader for Her Majesty's Loyal Opposition said that the public accounts committee had not operated generally in a partisan way, nor had its reports been used in a partisan way. The hon. member who has just resumed his seat has used the report of the present committee in a partisan way. I say this because I was a member of that committee

and was present when it brought down its report.
The hon. member tried to say that only four of the 55 recommendations have been subject to government action. I dispute that contention strongly. His interpretation of how the government has acted is partisan. The government has looked at many of the recommendations in the Auditor General's report and has decided it does not agree with those recommendations. That, I submit, is action.
With respect to those recommendations the Auditor General classified with the words "slow progress being made", may I point out that one of those items is with respect to the deficit on second class mail. Even though the government has introduced a bill in this house the Auditor General has still described the action taken as "slow progress being made". I submit that if committee members wish to refer to certain of these items they ought to point out merely that progress is being made. They ought to leave out the adjective "slow", especially when that adjective applies to second class postal rates. The bill has already been passed; yet the Auditor General says the government is making slow progress.
I submit that the point of view of the hon. member of the N.D.P. is completely wrong and his remarks are misleading. He is using the recommendations of the committee in a most partisan way, and I regret that.
May I ask the minister a question. The Auditor General at the first meeting of the public accounts committee said that certain members of his staff worked for the United Nations and its related agencies. He also said they received remuneration for this work. Can the minister say what this remuneration is? In the estimates certain revenue with respect to 1967-68 is indicated as applying to 1966-67. Does that revenue have reference to these international agencies or does it have some other significance? How much revenue is received by the Auditor General and his staff for work that is done for the United Nations and its related agencies?


Charles Mills (Bud) Drury: Mr. Chairman, if no one else wishes to speak may I offer some brief comments on the points raised by hon. members who have spoken. The hon. member for Peace River, backed by the hon. member for Regina East, suggested it would be useful to introduce a special statute to delineate the powers, duties and responsibilities of the Auditor General. It was his understanding that a draft bill had been prepared and, if I
November 18, 1968

understood his meaning correctly, submitted to the public accounts' committee. I do not recall that the public accounts committee-I stand to be corrected if I am wrong-has recommended such a statute or forwarded a draft of such a statute in any of its reports to the house.


Gerald William Baldwin: That is right. It has not.


Charles Mills (Bud) Drury: There is much to be said in favour of this approach, though I do not think there is any evidence that the Auditor General is suffering in the discharge of his responsibilities as a consequence of there not being a special statute. Since we have a most crowded calendar-the hon. member for Peace River has said, I believe, that we are suffering from indigestion in this regard-


Gerald William Baldwin: Dyspepsia.


Charles Mills (Bud) Drury: -I do not think this is the right time to bring forward further bills that we might have difficulty digesting, especially in view of the high priority and high degree of importance of some other business.
The hon. member for Peace River has alluded to the non-partisan nature of this particular committee. I do not think the committee is any more non-partisan, or any less partisan, than any other house committee. By this I do not suggest that it is partisan. I think other committees are as devoted to the general public welfare as the public accounts committee and as indisposed to engage in partisan politics. Merely because the chairman of the public accounts committee sits on the opposition side of the house is no reason to claim any particular virtue for that committee. I am not denying it has some virtue but I do not agree it is overriding.
The suggestion has been made that the Auditor General might be the joint, if not the sole, auditor of the accounts of all crown corporations. I think it has been said during previous discussion regarding the auditing requirements of crown corporations that the function of an auditor is not only to certify the accuracy of accounts and the adequacy of control measures but also to provide specialized managerial advice. I think the hon. gentleman will recognize this. Perhaps certain of the crown corporations, particularly those in specialized fields, constitute an area in which the Auditor General might have no special experience such as that available to some of our larger auditing firms which are engaged either in purely domestic work or in international work.
Supply-Auditor General [DOT] (4:00 p.m.)


Gerald William Baldwin: If I am right, the Auditor General is the auditor of the Polymer Corporation, which is very much an international commercial organization. If he is capable of auditing effectively the books of such a corporation, would he not be equally able to audit the books of almost any crown corporation?


Charles Mills (Bud) Drury: I am not suggesting that the Auditor General is incapable of auditing such accounts. I am sure he has this capacity; indeed, it has been demonstrated on a number of occasions in both the national and international fields. The point I was trying to make was that it is a common practice to look to a firm of auditors for what it is, in effect, a consulting service with respect to managerial problems. There are a number of specialized crown corporations which would wish to follow this practice, and I do not think the Auditor General would lay claim to specialized skills in this field.
After all, his experience has been almost entirely in the realm of government administration or international agency administration.
The hon. member for Notre-Dame-de-Grace asked whether the Auditor General received payment for the services rendered by him and his staff to international bodies such as the United Nations. I regret to say I do not have details but it is my understanding that the Auditor General recovers from the United Nations his out of pocket expenses in relation to this auditing function. If the hon. member wishes to know the specific dollar sum I should be glad to try to find out.


John Stratford Burton: I was pleased to hear the response of the President of the Treasury Board to some of the points made by the hon. member for Notre-Dame-de-Grace. It seems to me it should be borne in mind that the Auditor General is above all a servant of the House of Commons and subsequently of the public accounts committee. When he makes reports on certain subjects, it seems to me these are a matter of concern to all members of the House of Commons regardless of party. If there is pressure for the implementation of some of the recommendations in these reports from all quarters of the house, surely this would be helpful to ministers such as the President of the Treasury Board in bringing about the implementation of some of these proposals. I would also suggest that when the Auditor General uses certain terms and descriptions he does so advisedly and in a considered manner. If we are to have confidence

November 18, 1968
Supply-Treasury Board in his ability-and there is every reason to do so-we should take these words for the most part in the manner in which they have been placed before us.
The point has been made that the executive has rejected a certain number of recommendations. I have already dealt with this matter. These items will be considered in my mind in a different way from the other recommendations upon which no action has been taken or in connection with which only slow progress has been made.


[Stage Direction]
Item agreed to.
Item L30 agreed to.
The Chairman:: This concludes the estimates affecting the Auditor General. The committee will now take up the revised estimates of the Treasury Board for the year 1968-69, to be found at page 544 of the blue book, details on page 546.



TREASURY BOARD

[Stage Direction]
1. Departmental administration, including grants as detailed in the estimates, $5,131,400.
Charles Mills (Bud) Drury: Mr. Chairman, I am pleased to have this opportunity to make a brief statement on the role and functions of the Treasury Board as a prelude to having its estimates considered in this committee.
I feel that the board's purpose and responsibilities and its influence on policy and the allocation of government resources are not as fully understood as those of other government departments. And yet the Treasury Board has been a vital and essential part of our structure of government since confederation, and its role as a central control agency of financial matters and as a policy co-ordinator has steadily grown in important over the years.
The board is a committee of the Privy Council established by statute, having certain delegated executive powers and responsibilities as outlined in the amendments to the Financial Administration Act of 1966. The need for such a federal body to act as coordinator and overseer of the financial affairs of government departments was recognized immediately at the beginning of confederation. It was first created by order in council of July 2, 1867. Two years later, however, with the passing of the Department of Finance Act of 1869 it was made a statutory committee of the Privy Council.
An important stage in the evolution of Treasury Board functions came as a result of the findings of the Royal Commission on Government Organization or the Glassco commission, as it became known. At this point I

would like to repeat the tribute I paid earlier today to the late J. Grant Glassco, who made such a significant contribution to improved public administration. The commission felt that the needs of effective management fell into two general categories:	first, those
associated with the administration of departmental operations, and, second, those involved in the central direction and coordinations of government activities as a whole.
With respect to the central direction and coordination of government activity, the commission pointed out that the policies and programs of each department and agency must be balanced against and harmonized with those of other departments and agencies and that they must justify themselves in terms of their contribution to the general interests of the Canadian people. Thus the authority of each department must be subject to the overriding needs of the government for the general interests of Canadians.
[DOT] (4:10 p.m.)
The conclusions and recommendations of the Glassco commission were embodied in the Government Organization Act of 1966. The Treasury Board was established as a separate department of government under its own minister, the President of the Treasury Board.
The Financial Administration Act was also amended and it is from this revised act that the board now derives its current powers and responsibilities. These include financial management, expenditures control and general administrative and personnel policy in the public service.
The effect of the amended act was to establish the Treasury Board even more clearly than before as the agency of government chiefly responsible for formulating central management policy including the financial management functions of short and long range expenditure forecasting, program analysis, estimates preparation, supervision and control of expenditures, leases, contracts, and financial commitments.
Also for the first time responsibility for providing leadership and stimulus to improve management performance in the government service was explicitly vested in the board. However, possibly the most important widening in the duties and responsibilities of the board was in the field of personnel management. In part, as a result of being designated as the principal agent of the government in collective bargaining the board had assigned
November 18, 1968

to it, in addition to its previous duties relating to organization and establishment control, exclusive responsibility for classification, rates of pay and conditions of work, and for determining generally the policy governing personnel management in the public service.
At this point I would like to speak briefly on collective bargaining in the public service. This is a most important subject and I thought that hon. members would be interested in having a report on results to date.
In August, 1963, the government appointed the preparatory committee on collective bargaining in the public service. This committee was established to make preparations for the introduction of collective bargaining and arbitration in the public service, as well as to examine the need for reforms in the systems of classification and pay applying to public servants and prevailing rate employees. It was directed to consult with employee organizations and to make recommendations to the cabinet. The findings of this committee were presented to the government on July 2, 1965. The result of these efforts, the Public Service Staff Relations Act, received royal assent on February 23, 1967.
The legislation contains most of the conventional elements common to all labour relations statutes in Canada: the tripartite labour relations board, freedom of association, unfair labour practices, appropriate bargaining units, the principle of majority support, exclusive bargaining agents, and compulsory collective bargaining.
These are the more familiar elements. The act, however, contains a number of rather unique provisions which in a sense reflect the particular requirements of a national public service. One of the more unique features relates to dispute settlement. Unlike most labour relations statutes the Public Service Staff Relations Act provides two separate and distinct processes for the resolution of disputes arising out of the negotiation of collective agreements.
Disputed matters may be referred to binding arbitration by the Public Service Arbitration Tribunal established under the legislation, or they may be referred to an ad hoc conciliation board, constituted in the familiar fashion, for report and recommendations. The bargaining agent in effect has an option. The legislation, while conferring the right to strike in certain circumstances, contains provisions which are designed to protect the public against the disruption through strike
Supply-Treasury Board action of those services which infringe directly on its safety and security.
The extension of collective bargaining rights to professionals departs from existing practice under most labour relations statutes. Another significant departure is the fact that supervisory employees under this legislation have also been granted bargaining rights. The provisions of the legislation in this regard reflect the fact that supervisory and professional employees in the public service have been members of employee organizations for many years and have traditionally been represented by such organization in discussions with the government relating to their terms and conditions of employment. Managers, of course, are excluded.
The legislation places certain restrictions on the subject matter of collective agreements. No collective agreement, for example, may include any provision that would require legislative action by parliament except for the purpose of appropriating moneys required for its implementation.
The rationale for these restrictions is that employees in the public service have long enjoyed certain benefits by parliamentary enactment, for example, pension benefits under the Public Service Superannuation Act and the principle of merit in appointment by virtue of successive civil service acts. By adopting these provisions parliament decided in effect that the rights to which employees were entitled in these areas should continue to be guaranteed by statute rather than by provisions of a collective agreement.
These limitations also apply in the case of arbitral awards rendered by the Public Service Arbitration Tribunal and reports and recommendations of the conciliation board. No arbitral award and no conciliation board report may therefore contain provisions requiring the enactment or amendment of legislation.
I believe that hon. members will be interested in hearing the results to date of operating under this legislation. Bargaining units have been determined and bargaining agents certified for the great majority of employees eligible for collective bargaining under the legislation. As of this date some 61 units have been determined; 22 in the operational category, nine in the technical category, 19 in the professional and scientific category, six in the administrative and foreign service category, and five in the administrative support category. These units embrace

November 18, 1968
Supply-Treasury Board approximately 175,000 employees, or somewhat more than 80 per cent of the total number of employees eligible for bargaining under the system.
As of today the first 19 agreements entered into under the legislation have received formal ratification. These agreements cover supervisory and non-supervisory employees in the following occupational groups: correctional, fire fighters, general labour and trades, hospital services, lightkeepers and stationary plant operations. They also include agreements entered into with respect to printing trades employees, dockyard employees at Halifax and Esquimalt, letter carriers, mail clerks, postmasters and assistants in the Post Office Department, air traffic controllers, and veterinarians. The number of employees covered by collective agreements at the present time is approximately 75,000.
I would now like to spend a little time discussing our financial administration system and the role and functions of Treasury Board within it.
The basic fundamental principles of this system are that no tax shall be imposed and no money spent without the authority of parliament and that expenditures shall be made only for the purposes authorized by parliament. Along with parliament, cabinet is, however, also an integral part of the functional decision-making process in that it determines the general magnitude of expenditures when it establishes policy in the various fields of government activity. While in practice ministers exercise their collective responsibility for policy in cabinet, most of the detailed supervision and co-ordination of expenditures is delegated to the Treasury Board. It has the important function of rationalizing the requirements of all departments and fitting them into the budgetary picture as a whole.
The administrative procedure which makes this process operative takes the form of two major budgetary submissions by the various departments each year. In May departments prepare and submit to Treasury Board forecasts of activities and expenditures for the next five year period. The Treasury Board analyses these proposals with the objective of the exercise being to allocate available resources among competing requirements of all departments.
On the basis of its analysis the Treasury Board then proposes to the government specific financial targets for each department for

the next fiscal year. After departmental targets have been approved by the government and communicated to each department, work begins on the other annual submission, the main estimates for the next fiscal year. These detailed estimates will, in many cases, differ from the material submitted at the time of the program review to the extent that expenditure cuts have been made in the original proposals and departments have to re-allocate resources among their proposed programs. Treasury Board also reviews and analyses this submission. When the board is satisfied with the estimates, they are submitted to the cabinet for consideration. Once approved by cabinet they are recommended to the Governor General and then laid before the House of Commons.
[DOT] (4:20 p.m.)
Today government is big business in every sense-in terms of employees, expenditures and the variety and complexity of its activities. It therefore demands from its central financial control and management agency more than administrative clearance of appropriations and expenditures and a routine scrutiny of management functions in the public service. Modem government requires from such an agency meaningful assessments of new and existing programs in terms of objectives and results and complete and understandable data on such programs so that the government is in the best possible position to make policy decisions.
The Treasury Board is, therefore, constantly striving to improve its performance as a central control agency through the introduction of modern management techniques. For example, the Treasury Board has developed and is now implementing a programming, planning, budgeting approach to resource allocation in the federal government. Program budgeting is concerned with the presentation of expenditure proposals in a way that will enable effective decisions to be made on the allocation of resources. The program budgeting system differs greatly from traditional forms of government budgeting in its concentration on the results and benefits as opposed to just a consideration of the resources required. In this regard, program budgeting should also assist hon. members in their scrutiny of government expenditure proposals. I hope to be given an opportunity at a later date to make a fuller statement on this important subject to the public accounts committee.
November 18, 1988	COMMONS DEBATES	2857
I hope I have been able to convey in these remarks the important role that Treasury Board plays in the machinery of government. It can be said that the Treasury Board acts as the employer, manager and innovator in an administrative sense for the government. These are not easy roles, and we are constantly striving to develop new ways to improve our performance and thereby increase the over-all effectiveness of government operations generally.
Mr. Chairman, I commend the estimates of the Treasury Board to the committee for its approval.


Robert Lorne Stanfield: Mr. Chairman, I wish to thank the minister for his statement. I should like to ask a question or two and then perhaps he would not mind elaborating a bit on certain aspects of his statement. The minister indicated the initiation of a process of asking each department for a five year forecast and also for a preliminary indication of its estimates for the ensuing fiscal year. Could the minister elaborate a little in connection with the five year forecast which the Treasury Board receives? Would he give an indication of what use is made of this five year forecast at this stage of the proceedings by the Treasury Board? I have in mind the stage relating to the preparation of advice to the government as a whole with regard to a target for the ensuing fiscal year. First of all, without taking too much time, could the minister indicate whether the Treasury Board works on these five year forecasts on a continuing basis? Could he tell us to what extent the five year forecast is subjected to scrutiny or whether it is largely accepted at this stage exactly as given by the department? In other words, at this stage in the history of the government how sophisticated is this five year forecast? Is it a rough forecast made by the department or is it something that is subjected to a good deal of give and take by the officials of the Treasury Board and the department?


Charles Mills (Bud) Drury: Mr. Chairman, the term "forecast" may be misleading in that it implies a certainty about the program which might not be justified. It is rather a system for projection of departmental proposals or plans. The object in putting it on a five year basis is to see with rather more accuracy than would be possible with merely a one year projection where the program is likely to lead, the timing of the achievement of the objectives and the scale of resources required over a five
Supply-Treasury Board year period. I think the hon. gentleman, who has had some experience in the provincial government field, will be well aware that it is relatively cheap in terms of resources to get a new program launched but that it is only in subsequent years that it really gets into full scale operation and then the demand for accomplishment of a particular program in terms of total resources perhaps becomes unduly burdensome. It is for this reason a five year projection is required of departmental proposals and plans. The objective in seeking these, as I say, is to provide the government with a rather more accurate or a rather more realistic idea of the totality of what it is doing over a longer than one year period.


Robert Lorne Stanfield: Thank you. I think, however, if one were to ask a department for a five year projection of its plans and proposals the upper limit would be almost infinity because we all know departmental officials and ministers always have many good ideas in mind provided the government is willing or able to back them financially. I presume the five year forecast distinguishes between projections involving merely plans or desires of a particular department and a five year extension of its existing programs. Does the Treas-sury Board attempt to make, in conjunction with the department, realistic five year projections in respect of existing programs as distinct from new programs or extensions of existing programs which the department would like to have?


Charles Mills (Bud) Drury: Yes, Mr. Chairman. In so far as and to the extent to which it is possible we do try to secure the most accurate projections of costs over a five year period of programs to which the government is committed. One should say that any new ideas brought forward are also required to be projected on a five year basis so that we may determine how these fit in with the total of the existing projections and existing commitments.


Robert Lorne Stanfield: Perhaps this is something which should not be pursued at this time, but I am not quite clear concerning just how much responsibility the Treasury Board assumes with regard to checking out the five year forecasts made by the departments in respect of their accuracy so that the Treasury Board in turn can give the government some assurance that the five year forecasts are realistic even with regard to existing programs. Perhaps this is something which
2858	COMMONS
Supply-Treasury Board should be pursued in the standing committee rather than in the committee of the whole.
1 should like to ask the minister another question. At what stage in any fiscal year does the Treasury Board request these preliminary estimates with regard to the ensuing year and the related five year forecasts? At what stage during the current fiscal year, for example, does the Treasury Board attempt to obtain approval from the government of a target toward which the estimates would be directed during their subsequent refinement?
[DOT] (4:30 p.m.)


Charles Mills (Bud) Drury: In respect of the fiscal year beginning April 1, prospectively almost a year ahead, that is, in May, the departments are asked to produce a five year costed projection of their programs. These are checked by the Treasury Board and during the summer, following collation and examination of these programs, the government is invited to consider what will be the total figure of expenditures, having in mind some idea at that time of prospective revenue. They are asked to consider what might be the allocation of resources as between the various departments. Based on this decision taken in the summer, the departments are again invited to prepare detailed estimates covering these programs and these total amounts of money. The detailed submissions are then sent to the Treasury Board about this time of year, and prior to the end of the calendar year the government would recommend to the governor in council the detailed estimates which are published and deposited in this house in the printed form in January or February. Is that the timetable the hon. gentleman had in mind?


Robert Lorne Stanfield: Yes. So when the Minister of Finance, for example, gave a forecast in his budget speech a couple of weeks ago in respect of the expenditures for the next fiscal year, the government would have already decided on or recommended the target from the Treasury Board, presumably presented by the Minister of Finance in his budget presentation? This would be the considered target adopted by the government as a policy, and the practice would be for the total of the subsequent estimates to be tailored to this target already adopted by the government?


Charles Mills (Bud) Drury: That is true.


Robert Lorne Stanfield: I should like to thank the minister through you, Mr. Chairman, for giving this further clarification. Let me say that

DEBATES	November 18, 1968
I appreciate the general problems of coordinating government activities, financial controls and the workings of various departments in areas that sometimes overlap. The traditional structure of government departments makes this somewhat difficult. Having had a little experience in a much smaller operation I can well visualize the difficulties of achieving any adequate degree of co-ordination of departmental work in affairs of the bulk and size of the government of Canada, as they are today. It is my thought, therefore, that the work of the late Mr. Glassco must have been of great value to the government of Canada. I should like to associate myself with the minister in the tribute he paid to Mr. Glassco. Unfortunately I was unable to be in the house when he paid this tribute, but I should like to associate myself with his remarks and pay my own respects to the late Mr. Glassco for the work he did to assist the government in this very difficult field.
One of the problems, of course, is to obtain co-ordination without at the same time creating a bottleneck which has the effect of slowing down greatly the process of administration. I suspect that it must be a constant problem to prevent the Treasury Board from being just that bottleneck which would slow down the actual administration of government affairs.
I do not intend to say anything further this afternoon about the efficiency of the Treasury Board in the preparation of its estimates or its projections. The government perhaps would not be undeserving should the committee spend further time in this regard in view of the experience in the past year, and particularly in view of the overstatement made by the minister's predecessor regarding the sophistication of the Treasury Board in its projections. It was clear, at least at that time, there was still some room for improvement. We trust this is being accomplished.
Of course I am very unhappy, as are many Canadians, about the experience of the past year in respect of estimates. It would be difficult to speak too severely on this subject, but I have expressed my views and I will not take more time this afternoon except to express the hope that we will not suffer anything like the same sort of experience with the next set of estimates to come before the house.
The minister also said something about collective bargaining. This is a vast subject on which we could spend a great deal of time. There is a task force or a committee which it is hoped will report before the end of the
November 18. 1968	COMMONS
year on an important aspect of these programs. Therefore I do not propose to make any remarks at this time about the subject or the very difficult nature of essential public services and related subjects. I will content myself with waiting until we receive the report of the task force in this regard.
Finally, as I take my seat I simply wish to assure the minister that we will be watching with great anxiety and concern the unfolding of financial history in the next few months and during the next year.


Stanley Howard Knowles: Mr. Chairman, the President of the Treasury Board in his opening statement gave us a quick review of the various matters that come under the administration of the Treasury Board. It is not our intention to discuss all the aspects of this work during this review today, but two or three of us do have things we want to say about certain aspects of the work of this department. My leader, the hon. member for York South, will have something to say about the collective bargaining process, red circling and a few things like that. My seatmate on the other side, the hon. member for Vancouver East, has some matters he wants to raise as well.
[DOT] (4:40 p.m.)
I suspect that if I gave the minister just one guess as to what I am going to talk about he would hit it right on the nose. But before I give him the chance to hit it on the nose may I raise a question about the task force which the Leader of the Opposition asked about just before he sat down. 1 noted that the President of the Treasury Board nodded his assent that the task force was reviewing these matters. I did not know there was any task force reviewing collective bargaining in the civil service.


Charles Mills (Bud) Drury: May I say, to clear up the difficulty, that the task force to which the Leader of the Opposition referred is the one under Professor Woods, of McGill University which is looking into the whole area of labour-management relations.


Stanley Howard Knowles: am glad to have had that cleared up. I thought the reference was to the Woods task force which is dealing with collective bargaining generally, more in the private sector than in the public sector though of course in both areas.
One subject to which the minister did refer was, of course, the subject of the pensions of
DEBATES	2859
Supply-Treasury Board civil servants. The minister knew that that was what I would speak about this afternoon. He mentioned it in his survey, and if one looks down the items that come under the Treasury Board one sees, of course, that more than half the money that is spent by the Treasury Board is spent by way of government contributions to various funds that provide pensions for civil servants when they retire. If the President of the Treasury Board is rather surprised that I take him on as well as the others I have taken on with respect to this matter, I can only say to him that the way in which this issue has dragged on so long that one has to go from one government to another and from one minister to another in various governments annoys me as well.
During the course of the last parliament I started hammering away at this matter by making my representation to the then minister of finance. Certain adjustments were made, and it turned out that this matter came under the Treasury Board. So I made my representations to the then president of the Treasury Board who is now the Minister of Finance. In those days the then president of the Treasury Board and the then prime minister used to tell me how keen they were to do something about the pensions of retired civil servants, but they told me that the bottleneck was the minister of finance. Now the former president of the Treasury Board has become the Minister of Finance, and when I make representations to him I find quite a different attitude from the one he displayed when he was president of the Treasury Board.
So far in this session my questions have been directed either to the Prime Minister or to the Minister of Finance and they have accepted them as though the responsibility lay in that area, but here we are on the estimates of the Treasury Board and, lo and behold, the subject lies here as well. Nevertheless I look across at the President of the Treasury Board and I find him to be a very genial and co-operative kind of person. He has a broad and almost as winning a smile as that of the Prime Minister himself. I hope that at last we have a minister who will take a real and genuine personal interest in this subject and see it through.
Frequently when I have risen to say a few words on the question of pensions to retired civil servants I have started off by saying that I have gone over this subject so often that I need not go over it again in any detail. Well, I am going to change my tune today. There are over 100 new members in this House of Commons and many of them may

November 18, 1968
Supply-Treasury Board not be aware of the nature of the struggle that we have had over this issue. I still do not intend to go back over all the details of the last 20 years or more that I have been raising this as issue, but let me go back just a couple of years.
About two years ago when the whole question of the public service legislation having to do with collective bargaining, the integration of the various superannuation funds with the Canada Pension Plan and so on, was referred to a special joint committee consisting of members of the other place and of this house, I tried in that committee to get the question of the pensions of retired civil servants raised. I was soon told that that had not been referred to us and that we could deal with it in that committee only if we had a specific term of reference from the House of Commons itself. Therefore, back in the early part of 1966 I started pleading with the present Minister of Finance, who was then president of the Treasury Board, to ask the house to make that kind of reference to the special committee. His first response was to express his personal agreement but he said it would have to wait until we had disposed of the three other bills that we had before the committee. I settled for that.
Time went on. We got through those other bills and the present Minister of Finance kept his word. It took a little prodding to get him to do it, but he had the then government house leader bring in a motion to refer the question of the pensions of retired civil servants to that special joint committee on the public service of Canada. We became seized of this issue, therefore, in that special committee in the early part of 1967-I think in fact it was in the month of January-and we went at it thoroughly and exhaustively. We had before us many witnesses and many bodies representing retired civil servants. We also had representatives of the Department of Finance, the Treasury Board, the Department of Insurance, and various other sections and departments of the government. I think it is fair to say that we did a very thorough study of the whole question of whether parliament and the government should do something to increase the pensions of retired civil servants, and we agreed that increases had to be made.
May I back up for a moment and make the point that I do not think the government would have agreed to refer this matter to that special joint committee if it had not at that time intended to do something about it. Otherwise such action would have been a

cruel hoax, and some of the people affected think that this is what it has turned out to be. But I think the government in good faith agreed to have this matter referred, knowing that if the committee came in with a positive recommendation the onus would be on the government to do something about it. That is precisely what happened. Our various committee sessions took place in the early part of 1967 until the month of May, and on May 8, 1967, we presented a report to parliament. It was presented to the other place and to this house, and that report was agreed to unanimously by members representing both houses of parliament and all parties in parliament.
I should also like to make the point that the present Solicitor General, who was then government house leader, co-operated by facilitating arrangements so that the committee could meet on the morning of May 8, 1967. That was an important gesture on his part. Parliament was going to prorogue that day and if that committee did not meet that morning to get its report finalized and presented to the house the committee would die with the prorogation of parliament and all our work would have gone down the drain. But the hon. member for Ottawa East, who was then chairman of the committee, and some of the rest of us prevailed on the then government house leader, the present Solicitor General, to afford us his co-operation, and he gave it. So we met on the morning of May 8, 1967, there having been a short recess just before that, and we finalized the report, had a unanimous vote on it and presented it to parliament that day.
The report is to be found in Votes and Proceedings for May 8, 1967, at pages 1778, 1779, and 1780. I should like to put on the record the key portions of this report which naturally are the committee's recommendations on the subject of doing something about the pensions of retired civil servants. I read the following from pages 1779 and 1780 of the Votes and Proceedings of that day:
In the committee's view, the government should do what it reasonably can to protect and preserve, or failing that, to restore in some measure the original purchasing power of the contributory pensions which, under the Public Service Superannuation Act, and similar enactments, it has provided for its retired employees.
With this consideration in mind, your committee recommends immediate action by the government,-
This was on the morning of May 8, 1967.
-to update and extend the provisions of the Public Service Pension Adjustment Act (1959).
November 18, 1968

That, I may interpolate, was the one that was brought in during the days when the Conservatives were in power, the only occasion in history when there was some upward adjustment of the pensions of retired civil servants. Inadequate though it may have been, it set a precedent which I think should be followed. I continue reading:
This Act provided at the time of its passage limited and partial pension adjustments to meet a portion of the rise in post-war living costs. It covered only those beneficiaries who had retired prior to January 1, 1953: its benefits were available only to those below a pension ceiling of $3,000 ($1,500 for widows). Helpful though it was at the time of its passage, the Pension Adjustment Act of 1959 no longer meets the minimum justifiable requirement in the case of those former employees who retired prior to January 1, 1953; and it makes no provision whatever for employees who have retired since that date.
I interject again to point out that 1 am reading not from some speech that I made in the past of the hundreds that I have made on this issue but from the unanimous recommendation of a committee representing both houses of parliament and all parties that are here after very thorough discussion. I go on to read:
The Committee recommends that any plan to improve the position of these retired employees should conform to the following requirements:
(a)	It should be capable of quick and early implementation in the form of legislation in the next session of this parliament;
I interject again to say that we passed that on the morning of May 8, 1967, knowing that that session of parliament was to prorogue that morning and that the next session of that parliament was to begin that afternoon. We requested that there be legislation in the session that was to begin that afternoon. I read further:
[DOT] (4:50 p.m.)
(b)	Any adjustment in pensions should not be limited to a particular date of retirement and should be in addition to any other increase already granted under the Pension Adjustment Act of 1959;
(c)	it should maintain the principle contained in the present legislation that benefits should be related to length of service;
(d)	it should conform to the principle that any adjustment formula should take account also of the time which has elapsed since retirement;
(e)	it should take into account the increase in living costs during that period of time; and
(f)	it should increase the ceiling in the 1959 Pension Adjustment Act.
Supply-Treasury Board
There is just one more paragraph which I should like to read as well:
The task of the committee was facilitated through the assistance rendered by the departmental representatives. In particular, your committee wishes to acknowledge the help received from Mr. H. D. Clark, director of pensions and social insurance division, Department of Finance.
Now, Mr. Chairman, I am absolutely certain that I am betraying no secret when I say that the hon. member for Ottawa East, who was chairman of that committee, believed just as completely as I believed that we were dealing with a government which was acting in good faith, and that that report, having been agreed to unanimously by all parties, would receive favourable consideration by the government in that session which began in the afternoon of May 8, 1967.
One of the things that has puzzled me in the years I have been around parliament, and I know the things one can do and the things one cannot do, is what to do with some of the things that are told to us personally by some of these people. Let me put it this way. The present Minister of Finance, who was then president of the treasury board, and the former prime minister Right Hon. Lester B. Pearson, both know what they told me in the months of May and June, 1967, about this legislation. They both know the dates they gave me as to when it would be brought into the house and passed. They both will remember how firm were their assurances. Of course, their problem was to get around the then minister of finance. Nevertheless, their statements to me were as firm as they could be; something was going to be done along the lines of this unanimous report.
May went by, June went by, and still nothing was done. It was not that the government of that day was not reminded of this situation. It was reminded by me as well as by other members, sometimes three or four times a week. We were told to wait, it will be done later. Then July 7 came along and there was a desire to adjourn for a summer recess. I took a rather strong stand. I took the view we should not leave this place until we had dealt with this matter, until this promised legislation had been brought down. I was made to look like a person who was defying the wishes of the members of parliament because I wanted to keep the house in session. I had to settle for a vote on an amendment in connection with this matter, which I lost. However, I was assured by ministers out in the hall and by backbenchers on the government side, that when we came back in the

November 18, 1968
Supply-Treasury Board fall of 1967 we would deal with the matter. How many times do these people have to settle for this kind of promise that is never fulfilled?
We came back in the fall of 1967. The record will show that this subject was raised every week. It was not allowed to be forgotten. The replies we received were: It is under consideration, it is under active consideration, it is under serious consideration, or, there is nothing to add to what has been said before. These were the answers we received until December 7, 1967, when the present Minister of Finance, then president of the treasury board, gave a list of cuts the government was making. This measure was listed as one of the things that could not be done at that time. Despite that fact, I continued the fight.
A week later, on December 13, I tried to marshal all the facts again. The former member for Carleton, Hon. Richard Bell, who used to be a good deal of help on this issue, tried his best to get the government to say yes or no. I confess I never tried to do that because I did not want the no. I believe some day we will get the yes. Even when the government was taunted to say yes or no and be clear, the government still would not say no but rather that the matter was under consideration, we are thinking about it, we are studying it. This was the sort of answer we received. I do not know how many of the people who would be affected by this measure have died during the intervening time, but the number must be great.
The discussion of this subject goes on and on because the government has led us down the garden path. The government let us have a committee, let us make recommendations, gave us this promise, but still all we get is, no. The other day the hon. member for South Western Nova, who represents a constituency of particular interest to me because my ancestral home is in that constituency, tried in a very direct way to get the minister to suggest that there would be some good news before Christmas. The Minister of Finance gave the answer, no. I thought I head some shouts of "Shame" and "Scrooge" on that occasion, but they do not seem to appear on the pages of Hansard.
I submit that the way the government has played with the hopes of these citizens, these former employees, is a sorry story. How many are there? Not enough, of course, to influence an election; they are not concentrated enough to do that. If you add together the

number of retired civil servants and their widows, the retired personnel of the R.C.M.P. and their widows and the retired members of the armed forces who would come under this kind of pension, you may get up to around 60,000 or 75,000 people. They are scattered all over the country, in fact scattered all over the world. The fact is that they are former employees of the government. I submit we have a responsibility to them to be a good employer.
I know the various arguments that are used, even though they are not trotted out in public, against dealing with this matter. I know the main fear is that if the government moves in this field a precedent will be set that will annoy private business in some areas. May I tell the President of the Treasury Board that private business is beginning to deal with the matter. In the years I have been arguing for the government to act, a number of private companies have approved pension plans in which there are escalator clauses so that pensions go up after people retire. We have accepted the principle, at least very slightly, in the Canada Pension Plan and in the Old Age Security Act. There we have a 2 per cent limit, and it does take quite a long while for it to amount to anything and it never catches up with the rise in the cost of living.
[DOT] (5:00 p.m.)
In addition to all these factors of right and justice that I think are on the side of these people about whom I am speaking, I should like to say to this minister and to this government that I think this is one of the most serious issues facing us in the whole pension field. It used to be that not many people were on pension and not many people lived for very long after retirement. Thanks to medical science, longevity has increased. Thanks to all these transplanted hearts and everything else, a lot more people continue to live on pension, and as time passes more will do so, for 15, 20, 25 or 30 years.
Imagine anybody in any other sector of the economy being asked to live on the same level of income for a period of 30 years, Mr. Chairman, or for even for half that period! We have to face the fact that our pension program, if people are going to survive and our pensions not be placed in serious jeopardy, must have adequate escalation provisions. I suggest that the place to begin is right here with these our own employees, our retired federal civil servants.
November 18, 19G8

The retired federal civil servants find it awfully hard to understand why it is they cannot be given a pension increase out of the money that is in the fund. At least, they think it is in the fund because they see the figures, though we know it is part of the consolidated revenue fund of the government of Canada. It is not away in some bank account or trust account where it can be drawn out; it is just so many figures on the books. However, Mr. Chairman, they do see these figures. I ask questions that are put on the order paper about these figures, and they are sent down to me. I send them out and so these people do see them.
It has been ascertained, Mr. Chairman, that even the interest that the government adds to the figures every year represents a greater amount than is being paid out by way of pensions. Therefore the fund grows all the time. I know there are actuarial problems connected with this, but the ordinary retired pensioner looking at the fund, knowing that the base of it is the money he and his fellow pensioners have put into the fund, and seeing the fund grow every year, is wondering why something cannot be done for him.
Some bodies, notably the Professional Institute of the Public Service of Canada and others who have joined with them, have suggested that a look be taken at the rate of interest that the government pays on this money. The rate, Mr. Chairman, is 4 per cent. Where can the government get money today at 4 per cent? It pays 6.75 per cent on money that is invested in Canada Savings Bonds; yet these people are asked to settle for a rate of 4 per cent. The Professional Institute has suggested that maybe it would not be out of line to raise this figure to 5 per cent.
My hon. friend from Saskatoon-Biggar rose in his seat today to raise a point about what he thought was a typographical error when he discovered that interest on farm loans had been raised from a rate of 5 per cent to 7J. Yet the government still pays only 4 per cent on this fund. A small calculation will show that if the 4 per cent were raised to 5 per cent, the additional 1 per cent interest on the fund would provide enough money to pay an extra $50 or $60 a month to every recipient of a pension under the various acts-the Public Service Superannuation Act, the Canadian Forces Superannuation Act and the Royal Canadian Mounted Police Superannuation Act.
I am not, of course, suggesting that an increase be a flat across the board increase
Supply-Treasury Board like that. I think that those in the lower brackets need it more than those in the higher brackets, though I was delighted that in our committee report of May 8, 1967 no line was drawn. The committee recognized the fact that there are today many people whose pensions are of an amount that sounded substantial when they retired five or ten years ago, but who discover that even for them costs have gone up, that living standards in the milieu in which they live have risen to the point where they are out of the swim because of what has happened to the purchasing power and value of their pensions.
I am suggesting, Mr. Chairman, that that is what the government should do. If that is not the way to do it then there are other ways. Nevertheless I plead that the government has no right to refuse to act on this question simply because it does not agree with the way that I suggest or with the way that some public service body suggests. What is really behind all of this is the good word and good faith of the government itself.
I know that if one reads through Hansard the scores, even hundreds, of times when this matter has been discussed one will not find anywhere a minister rising to his feet to tell the house, so that it is printed in Hansard, that "this action will be taken next month or this year". However, I submit the statements made mean that, and that the reference of this matter to the committee in 1967 was an act that implied that something would be done. In this regard I remind the Minister of Finance, as I reminded the former prime minister outside the house-lie is not here at the moment-of his statements about this matter. I submit that the government is being unfair both to these people and to parliament in letting this issue stall any longer.
I have had occasion, Mr. Chairman, to refer to a suggestion made by the Professional Institute of the Public Service of Canada. I should also like to say how much I feel credit should be given to the Public Service Alliance of Canada for its interest in this matter. After all, that is an organization of employees who are now at work in the public service, and it could be pardoned if it concentrated all its efforts on improving the conditions of those who are presently at work. Nevertheless the Alliance is likewise concerned for those who have retired, and in this regard has made some excellent statements and presented some excellent briefs to the government. I pay my tribute to the work the Alliance has done on this matter.

November 18, 1968
Supply-Treasury Board
Of course, Mr. Chairman, the Alliance gets the same treatment from the government that we get on the floor of this thouse. The answer is: "There is no money. We cannot afford it now. We cannot do it this year; we will put it off until next year." The same answer is given to the federal superannuates national association, which comes down to Ottawa and presents a brief. The matter is put off and off.
Unless we act on this issue as a matter of principle, Mr. Chairman, then some day it is going to come home to haunt us in a pension structure that will be placed in jeopardy because its value will not sustain people through their years of retirement. I want to see the principle extended to all pensions, but surely the place to start is with our own pensioners.
I also deplore as strongly as I can the way in which this question has been put off across the months and across the years. The very latest that action should have been taken on this matter was within a month or six weeks following the tabling of the report of May 8, 1967. The matter should have been acted on in the month of June, 1967, and I was told that it would be. Here we are in 1968. Since June, 1967, we have had a session or two of parliament. There has been an election and a change in government, but still nothing gets done.
I do not know whether there is any hope that the present Prime Minister will be as interested in this question as was the last prime minister. I do not really know what the present Minister of Finance thinks about the matter now, though I know what he thought about it in the last session of the previous parliament. As I say, I believe the President of the Treasury Board has human instincts and that he has a heart. I believe that he is interested in this matter and I hope he will see that someting is done about this issue without further delay.
[DOT] (5:10 p.m.)


David Réal Caouette: Mr. Chairman, I fully agree with the member for Winnipeg North Centre (Mr. Knowles), that the retired public servants receive too small a pension, as recognized by the parliamentary committee which looked into the situation. To my mind, the government should have reached a decision last year, or even earlier, with regard to the public service.
The member for Winnipeg North Centre said that they do not live very long after

retiring. Small wonder, with the small pensions they receive, they cannot live very long. That is why we agree with the member when he asks for an increase in those pensions.
We know, for instance, that the pensioners outside Canada who receive an old age pension or allowance, in China, in India, or in Europe, have a cost of living bonus in addition to their pension or allowance, although the cost of living is not as high in those countries as it is here; yet they receive the same pension as retired Canadians.
Taking into account the high cost of living here and the low pension, it is clear-the minister must realize this-that those people cannot survive. The minister and the government may say that this is a financial question, that they do not have the money required. It is always the same story, the same reason: there is no money.
Along the same line of thought, when we ask, for instance, a 7 per cent bonus for bilingual employees of the Canadian parliament, we are told that the decision is incumbent on the Speaker, the Treasury Board, the Minister of Finance (Mr. Benson), and nothing is done.
Are the employees of the House of Commons considered as extraterritorial employees, external employees, employees of the administration of Canada? A bonus of 7 per cent is paid to bilingual public servants in various Canadian departments; but with regard to the House of Commons, they are no longer federal employees, it seems, because they do not get that 7 per cent bonus which is paid to bilingual civil servants under the law.
We have guides at the main entrance and on every floor of the main parliament buildings. We have secretaries, pages, a whole array of house employees to whom the 7 per cent bonus is denied. Why? Because, we are told, there is no money. As the Treasury Board is the one to decide whether or not additional amounts are to be paid to help various groups of society or employees-and with greater reason federal employees-I say that the Treasury Board is responsible for such a situation. For instance, useful works are refused or delayed, because there is no money while useless works are willingly carried out in many fields and they find the required money.
Parliament is asked to place restrictions on credit but have the Treasury Board and its president considered the fact that this year, the government will pay, in interests only, $1.5 billion on the national debt, namely an
November 18, 1968

increase of about $200 or $300 million over last year. Yet, the President of the Treasury Board (Mr. Drury) does not find anything abnormal about that. The Department of Public Works, post office employees, the Post Office Department and all government departments are asked to reduce their expenditures but they do nothing to affect the interest on the national debt. The debt is increasing at top speed year after year and the President of the Treasury Board does not object to the annual increase of interest on the national debt, which is imputable to a few financiers and not to the Canadian people.
Mr. Chairman, I said a while ago that useful works are rejected and insignificant ones approved in many cases.
We asked-and the Treasury Board is always the one that decides-that retaining walls be built along lake Temiscamingue in my region, in my riding. The projects are before the Treasury Board but it says that it has no money. The airport-not the air terminal but the airport-should be renovated but we are told that the funds are lacking. There is no money either for building post offices and again the Treasury Board makes the decisions.
I noticed also that in the field of public works more generosity is shown-according to the Treasury Board again-towards some other Canadian provinces than towards the province of Quebec. That is why complaints from our province are heard, not because public works are carried out in the other provinces, but because not enough are carried out in Quebec.
However, a department sometimes agrees to repairs being made or awards contracts; then delays occur and the Treasury Board refuses to pay according to the recommendation made by the department. I would like to give you an example at this stage.
Approximately two years ago, a contract for electricity and electronic facilities was awarded to a Mr. Paul Gingras, of Bour-lamaque, in connection with repairs to the radar station which used to be located in Senneterre. When his tender was accepted, Mr. Gingras agreed to complete the work within 180 days, and also to resort to the services of a certain D. R. Beattie, 1260 Lakeshore Road, Port Credit, Ontario.
Mr. Beattie was supposed to supply the shielding in order to have the contract completed within 180 days. As it took Mr. Beattie exactly 7 months to supply the necessary
Supply-Treasury Board material for completing the work at Senneterre, that was a source of embarrassment to Mr. Gingras who made representations to the Department of National Defence to have an adjustment made. He was granted $23,000 to compensate for the damage caused by Mr. Beattie.
[DOT] (5:20 p.m.)
Mr. Gingras wrote to Mr. Beattie who did not bother to reply. The Department of National Defence finally granted Mr. Gingras $23,000. However, this recommendation by the department was rejected by Treasury Board. For this reason, my colleague for Vil-leneuve (Mr. Tetrault) wrote recently to the Minister of National Defence as follows:
I wish to refer to the conflict that has existed for a year between Mr. Paul Gingras. a contractor of Bourlamaque, Quebec, and Mr. D. R. Beattie, of Port Credit, Ontario, also involving Defence Construction (1951) Ltd. concerning the above named project-
Reference to this project is as follows: "BUIC III-Senneterre, Que.-File No. S-87-1".
Who was responsible for drawing up plans for the shielding enclosure concerning this project as specified by D. R. Beattie Ltd?
On what basis did this official establish that this project could be terminated within 180 days after submission of tenders?
Also, I should like to obtain a copy of the correspondence exchanged between D. R. Beattie 1260 Lakeshore Road, Port Credit, Ontario and the D.N.D. concerning this project.
We would be happy to give you any additional information you might require.
Therefore, I am counting on your full co-operation in order to settle this matter as soon as possible.
This matter was dropped on for over a year. Mr. Gingras spends money, comes to Ottawa, meets officials of the Treasury Board and the Department of National Defence, and the officials agree, but Treasury Board refuses. The minister should perhaps get to the bottom of the matter and see to it that Mr. Gingras is not penalized because a friend of the government was mentioned by name in the contract for some work to be undertaken in Senneterre. If Mr. Beattie is unable to fulfil his obligations, the government should refrain from recommending him to contractors who must perform works such as those at Senneterre.
Mr. Chairman, that is an example. We have some more, but in such a case, why does Treasury Board not consider objectively the recommendations of a responsible department such as the Department of National Defence?

November 18, 1968
Supply-Treasury Board
Mr. Chairman, we would then be led to believe that there is some political partisanship, even if the minister maintains the contrary, within Treasury Board. We are somewhat sceptical, especially when we are told that Treasury Board acts in the best interests of the Canadian people. The function of the board is to control expenses, according to our fiscal system. When taxes have been collected, it decides if such or such a department may obtain or spend such or such an amount. It makes slight increases in a certain area and slight reductions elsewhere. We are fumbling with that system. Why? Because the government which is responsible for that situation wants to stick to it. In my opinion, the so-called sovereign government is a slavish government which refuses to take decisions without the authorization of the financial system. In addition, the execution of works is delayed. While 300,000 or 400,000 Canadians are unemployed and ready to work, the government chooses to pay them unemployment insurance benefits rather than give them work to create something in our country.
This is the procedure which has been chosen. Who is controlling that system? Some experts and economists. I do not know what kind of economists or experts advise the government but, in any case, we are subjected to a strange system which enables a few financiers to grow richer, while the majority of small taxpayers are getting poorer. That is exactly our situation at the present time.
Expenditures should be controlled instead of adjusting the financial system or our opportunities of developing the country. Attempts are being made to adjust the development of the country to the requirements of a financial system which is totally obsolete. In fact, this is the only thing they do not want to reform.
We hear every minister speaks about reform, in the field of education, farming, labour conditions, public service, reform in that field and in this field, however when it comes to the solution which would reform the financial system, it must be left alone. We must stop there because we do not even have the right to argue.
The Prime Minister of a sovereign country like Canada says: We have only the money that the people are willing to let us administer.
Mr. Chairman, it seems to me that the easiest thing to do in Canada is to regulate credit and to put it at the disposal of the Treasury Board.

Making cement, bricks, lumber to create or build something, that is difficult, that takes a lot of hard work. Building a road, a bridge or a school, enlarging a hospital, that is difficult. But the matter of credit, that is easy. With pen and ink to write the figures according to the possibilities to build things in Canada, that is financial stability.
The Treasury Board is caught in a system which sees nothing else but the possibility of the government to levy and administer taxes, to distribute what they yield to the public and the various departments after paying the administration costs. This is exactly the situation with which we are confronted and the honourable ministers know the problem. The ministers and the President of the Treasury Board are perfectly aware of the situation. They know that our natural resources are still at the development stage, in fact some have never been tapped. Universities prepare technicians because we need technicians, engineers and so on. Once they have left university, these boys who could create something, work in assembly plants in Montreal. Engineers who graduated in May or June last year, earn $5,500 to $5,700 a year on car assembly lines in St. Therese de Blainville. Then we get upset, we get excited, and we ask ourselves: How is it that students protest and rebel against the present state of affairs? Sunday afternoon, I watched Father Pierre on television in Montreal. It was incredible to hear him giving the reasons why youngsters today are revolting against the order of things.
People talk about peace, just society, justice and stability. True, but what kind of peace? The peace of those who are considered as the establishment and whom are not to be disturbed, because they feel comfortable. It is in such a peace that we are working today.
Youngsters cannot see how they will be able to identify themselves within such a society when they get out of university. This is the opposite of what we used to see 20 years ago when a student leaving university could find a job immediately. Today, it is not the same thing. Public works are no longer undertaken for financial reasons; rather, the young are left in a state of anxiety about the next day, they cannot even merge into society. Then, they will be accused of being rebels or revolutionaries.
Mr. Chairman, I think it is time that we reassess our social, economic and monetary philosophy in Canada. If one examines a little all the problems for which the President of
November 18, 1968

the Treasury Board is responsible, if one probes into them a little bit, one realizes that they are all financial problems. To the Department of National Health and Welfare, for instance, one asks today a pension of $125 a month for the elderly. The government cannot grant it because it has no money.
The President of the Treasury Board does not ask himself whether Canada can produce enough to pay the old people $125 monthly. One does not ask whether Canada can produce enough goods and services to help our young people in the just society that is talked about. Those things are not discussed, Mr. Chairman.
[DOT] (5:30 p.m.)
We are put in the strait jacket of a terrible financial system. We are not doing anything to get out of it; we knuckle down under the demands of this system. Then, we go to the people and say: We, the government-whether or not it is a majority government does not matter-decide, with the permission of another government that lies behind us, parliament.
Mr. Chairman, the Treasury Board is responsible for sums earmarked for one department rather than another, as I said earlier. Everything goes through the Treasury Board. It is the mechanism that enables the government to do something or to do nothing. Again,
I say discussions are taking place with the provinces. There will be more next week or in two weeks, at the ministers of finance level, with respect to federal-provincial relations. The provincial representatives came here recently and the minister took part in the discussions.
The Treasury Board is very important. More money is required. The following week, the Right Hon. Prime Minister (Mr. Trudeau) decides to make an official statement to the effect that from now on the provinces will have to take their own responsibilities and bear the odium of taxation to get and administer revenues in their territory.
But, the monetary aspect, the financial question itself-not the fiscal question-comes under the jurisdiction of Ottawa. The Right Hon. Prime Minister wants the provinces to take their responsibilities although the government of Canada is not even able, indeed not even prepared to shoulder its own. Therefore, the provincial premiers go back home saying: Ottawa is unco-operative, the hon. Minister of Finance, the President of the Treasury Board say to us: Nothing can be done for the provinces.
29180-18U
Supply-Treasury Board
However, nothing prevents them, for example, from increasing the 2 per cent income tax across the country. After taxing the people, the government says: We need this money in Ottawa; do not expect to get any of it. If you need money, levy your own taxes. That is not a solution. Mr. Chairman.


The Deputy Chairman:: Order. I am sorry to interrupt the hon. member, but the time allocated to him has now expired.


David Réal Caouette: Mr. Chairman, I rise on a point of order. Did I not begin my remarks at 5:10?


Albert Béchard: I am sorry, it is my mistake. The hon. member still has ten minutes.


David Réal Caouette: Thank you, Mr. Chairman.
I said earlier that it was easier to create credit in proportion to the goods and services which the Canadian people want to provide by using their intelligence, their hands and their physical possibilities, but the hon. ministers have not yet understood.
In the provinces, in Quebec as in the others, the situation is not understood much better. As I said earlier, everyone goes home and is ready to come back two months later to discuss all over again the same problem of taxation. There are no arguments concerning the problem of the distribution of wealth among the Canadian people. No. The arguments concern the right of taxing the Canadian people. Quebec says: it is my right. Ottawa says:	the matter does not come
within your jurisdiction but ours. There are endless arguments about this. Meanwhile, neither the provincial governments nor the federal government are suggesting any solution but that of continuing to tax the people. We never tell anyone that whoever controls money and credit is the master of all our lives,, the life of the government, the individuals, the families, society in general, and that without his permission, no one can even breathe.
This is the whole problem, Mr. Chairman. Even if we were to pass-as we are going to do anyway-the estimates of the Treasury Board, even if we were to listen to the right hon. Prime Minister or any other minister tell us how much the government is prepared to spend in order to help the Canadian people, not one of them wants to take the necessary means to do it. When we consider that our national output will reach this year $68 billion in goods and services and that.

November 18. 1968
Supply-Treasury Board the total income of the Canadian people, the salary of the minister included, will amount to $48 billion, we fail to see how there can be a gap of $20 billion in production which cannot be disposed of without the creation of a new purchasing power, because those amounts do not exist. If we talk about creating the difference, immediately we are called inflationists.
Mr. Chairman, we hear the right hon. Prime Minister, the Minister of Finance and the President of the Treasury Board tell us that the only way to improve the situation in Canada is to increase productivity. We are told to increase our productivity by 6 percent, but we are warned against salary increases in excess of 6 percent, which would put us in a position to buy the excess of production.
However, a simple mathematical operation shows us that if we produce $70 billion in products and services, and if our production increases by 6 percent during the course of the year, the increase will be $4,200 million. If our national income reaches $50 billion and if we cannot increase it above our productivity, i.e. 6 percent, the increase has to be $3 billion. Then, let us allow salary increases of $3 billion, so that the population will buy the production increase of $4,200 million; there will still remain a gap of $1,200 million. The government does not understand that. There still are ministers who do not know that 2 and 2 make 4; they want it to make 5. From a mathematical point of view, they are way off.
Others cry out: Fine, but where are the $20 billion? In towns and cities, store shelves overflow with products to the extent where no one knows what to do with the goods. There is a lack of purchasing power, and instead of increasing it, the government levies taxes, claiming that by so doing it checks inflation.
Smarter solutions than that could be proposed by the inmates of the Montreal mental hospital. Increase or decrease inflation, avoid the dangers of inflation by reducing the purchasing power of its people. How bright that is. Everyone is being crowded to the brink of bankruptcy. Merchants and consumers see their purchasing power reduced and they are told: Put up with it because it checks inflation. All the while, the purchasing power should be increased as well as the national revenue. They cannot be increased merely by raising the salaries which contribute to higher
IMr. Caouette.l
prices. That is not true. The only way to increase the national revenue, considering the current level of prices, is to use the Bank of Canada to distribute to the Canadian people
__to each and everyone of them-a national
dividend based on the surplus production in Canada. That is the solution; there is no other.


Some hon. Members:: Hear, hear.


David Réal Caouette: The national dividend is laughed at, but when an increase in the pensions is asked for, no one laughs; it is considered logical. Increase the pensions of the former public servants; with that we agree, no one fears inflation. But there would be danger of inflation if a dividend were distributed to the whole population.
Mr. Chairman, in closing my remarks, I would say this to the minister: if he has no solution to suggest, it is time for him to come with me on television, every week, to teach Social Credit to the people, so that we can be rid of an irresponsible government and appoint in its stead one capable of assuming its responsibilities.


Some hon. Members:: Hear, hear.


Mr. Winch:: Mr. Chairman, I know that before six o'clock I can raise and expatiate on the matters that I want to draw to the attention of the President of the Treasury Board. I also know it is a damn sight more important for the President of the Treasury Board to be speaking to his friend across the aisle, but I would like to hold the floor without speaking and without losing any time until the President of the Treasury Board is prepared to listen to what a member on this side of the house wants to draw to his attention. I have now got his attention. I think, Mr. Chairman, it is very important that when members on this side of the house raise matters they should have the attention of the minister in charge.
[DOT] (5:40 p.m.)
Through you, Mr. Chairman, I want to draw what I consider a most serious matter to the attention of the minister. I know I do not have authority to speak on behalf of the some 160,000 employees of the federal government, but I do think I have the right to draw to the attention of the President of the Treasury Board some aspects of a matter concerning some 160,000 employees of whom 102,000 are in the armed forces. In the last year or two changes have been made in negotiation
November 18, 1968

procedures and regulations and in respect of authority when dealing with management on matters affecting wages and conditions of employment of those within the civil service. However, in the legislation governing negotiations between the government and its employees there is a section which says that once a contract between the government and its employees is signed or an agreement is reached the government of Canada does not have to accede to it for 60 days but at the end of the 60 days must pay the increase and any retroactive payments.
It is a fact that in the last few weeks a number of contracts have been signed. I only know through reading the press how this affects the armed service personnel. However, if my analysis is correct, and I think it is, as a result of arrangements made in respect of armed service personnel and the other con-tractal agreements made by the government with its civil service employees there are now over 150,000 persons who are entitled to increases in wages. I would like to know from the President of the Treasury Board whether this provision in respect of the 60 days is to be put into effect before these increases are paid. If this is the case, then the 102,000 members of the armed forces and not less than 60,000 others in the civil service will not receive their retroactive pay until after January 1.
As I understand the legislation in respect of the social development tax, no exemption is to be made in respect of money received in 1969 that was earned in 1968. There was nothing in the speech of the Minister of Finance or in the legislation that would permit payments made in 1969 on moneys earned in 1968 to be exempt from that surcharge. I personally know of three agreements that have been signed by the government with its staff. I also know, although only by press reports, of an increase for the armed forces. I receive letters every day asking whether the government is going to hold to that 60 day provision before the money is paid and whether it will not be paid until after January 1 of next year. I know that many members of the House of Commons have received similar letters.
I raise this matter now in respect of the three contracts which I know have been signed and the increase which I know has been agreed to for the armed forces. I ask the minister whether this money will be paid before December 31 or whether it is to be held until after January 1 when the 2 per
Supply-Treasury Board cent surcharge will be collectible from the personnel of the armed forces and civil servants on money they earned in 1968. A question on this matter was asked of the Minister of Finance last Friday, I believe. The minister would not give an answer. Will the President of the Treasury Board now get up on his feet and say what the situation is and what he will authorize? I ask him not to be a stinker and charge civil servants next year on money they earned this year.


David Lewis: Mr. Chairman, I do not know whether the President of the Treasury Board will agree not to be a stinker. I am not asking him for any commitment which he may not be able to keep.
I should like to spend the few minutes until six o'clock raising two matters related to collective bargaining concerning which the Treasury Board has the responsibility of representing the employer in the public service. I wish to say first of all, as we said at the time when the relevant bills which later became law were before this chamber, that we are delighted that collective bargaining in the public service has finally been introduced. We are delighted with some of the progress which has been made in respect of the certification of bargaining units. I would say, however, that we were disappointed at the incredibly bad way in which the Treasury Board approached actual negotiations, of which the negotiations with the postal unions were perhaps the most striking example.
Having had some years of experience in negotiations I have not known anything more reprehensible on the part of an employer than the refusal for a period of months to make any monetary offer to the other side. When one sits down to negotiate in private industry, even if the demands of the union are considered outrageous by the employer, no objective employer refuses to make an offer on monetary matters for a period of months. If he did so, the employer would be called a stinker and a good many other applicable and relevant names.
This is exactly what happened in the case of the negotiations with the postal employees. My information is that this has happened during other negotiations although not over as protracted a period as in the case of the postal employees. The period has been long enough, however, that the public service organizations concerned are becoming terribly upset about the situation.

November 18, 1968
Supply*-Treasury Board
There is another item in this regard about which I should like to protest. Anyone who looks at this objectively ought to protest no matter on which side of the house he sits. During negotiations with one section of the public service-I forget exactly which one but I believe it had relation to seaway employees; this was during the election campaign-the President of the Treasury Board and the Prime Minister on separate occasions made public declarations that in their view the 6 per cent which was recommended by one of the conciliators or the conciliation board itself was a proper and fair settlement. What that means is that the head or the employer, being the Prime Minister, said to the board concerned in respect of negotiations that this was the limit beyond which it could not go. When the government is the employer and it does that in the course of negotiations it is really subverting the negotiation process. It is actually destroying any meaningful collective bargaining. What is the use of a public servants' organization asking for more if the Prime Minister and the President of the Treasury Board lay down a declaration that it cannot be any more?
[DOT] (5:50 p.m.)
This kind of behaviour in respect of the postal service employees and in respect of the employees of the seaway authority, to which I have just referred, makes a mockery of the collective bargaining process and underlines what some of us said during the hearings of the joint committee. It was said, particularly by my friend the hon. member for Winnipeg North Centre and myself, that the government was not really prepared to accept the implications of genuine collective bargaining because the government was still going to act as it did before the collective bargaining was introduced, as an authority making unilateral decisions. That is what is meant when the head of the government declares that a certain level of wage increase is fair and adequate. That lays down the law and the people who are concerned in negotiations cannot go any farther.
It is my hope that during the remaining negotiations and any future negotiations this attitude on the part of the government will not show itself and that the negotiators at the negotiating table will not be subject to these open declarations. They will, no doubt, have instructions from the President of the Treasury Board and from the cabinet, which is perfectly legitimate. They are the employers. If Doug Love negotiates on behalf of the

Treasury Board, the employer, he will naturally have instructions from those to whom he is responsible, as is the case in respect of any other negotiations, but a public declaration by the Prime Minister makes it impossible for any negotiations to take place. Let Mr. Love present the arguments as to why it is unjust, unfair, undesirable, improper, uneconomical, dangerous, or whatever else he wants to say, to go beyond a certain point. That is legitimate collective bargaining. He will have his instructions from the Treasury Board.
The President of the Treasury Board and the Prime Minister should not come out on the public platform and say the government will not go beyond such and such a point, because collective bargaining is not real unless the people on both sides of the table feel they have the opportunity to present their reasons and have a genuine exchange of ideas with some give and take. The collective bargaining process becomes impossible when you lay down the law away from the collective bargaining table. There is no need for this. I suggest it is merely an expression of authoritarianism that has no place in collective bargaining.
The other matter I want to raise, which is equally disturbing, if not more so, is that during the joint committee sessions on various bills relative to the status of public servants and the collective bargaining process it was pointed out-I remember doing so on several	occasions-that	when the law
excludes from the collective bargaining area such fields as classification, promotion, demotion, job descriptions, job evaluations and all the rest, it takes away from the public service an immensely important area for collective bargaining. The fact that we were right has since been proven in a number of cases.
Some time before the collective bargaining process became law the Treasury Board engaged in a reclassification of the public service. This has been going on throughout the piece until today. A good many employees of the government have been reclassified and literally thousands have been red-circled. This means they have been told they now have a new classification lower than the classification which they formerly held at a salary rate higher than the salary rate of the new classification. Therefore they are frozen at their present salary rates and are not entitled to the increases which their organizations have now negotiated or are now negotiating. They will remain frozen until such time as
November 18, 1968

the salary for the lower classification is increased to the salary they now receive in the higher classification.
I have had numerous letters, telegrams and personal conversations which indicated that literally thousands of civil servants have not received any of these increases and, in some cases, were even refused increases that went back to a date before they were reclassified. This is really reprehensible. I do not know whether hon. members and the President of the Treasury Board understand me. Perhaps I did not make myself clear. If reclassification or red-circling took place in October of 1968, let us say, this was made retroactive to October 1, 1967, so that the people concerned did not even get the increase applicable to their classification for the year.
The Depuly Chairman: Order, please. It being six o'clock shall I rise, report certain resolutions and request leave to sit again later this day?
Resolutions adopted in committee of supply this day reported and concurred in.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Bechard):: It is
my duty pursuant to provisional order 39A, to inform the house that the questions to be raised at the time of adjournment tonight are as follows: the honourable member for Belle-chasse (Mr. Lambert)-Public Works-Mont-magny, Que.-drainage basin requested; the honourable member for Winnipeg North Centre (Mr. Knowles)-Public Service-study of the report on the retired civil servants pensions; the honourable member for Gander-Twillingate (Mr. Lundrigan)-Rural Development-centralization of population in Atlantic region.
It being six o'clock, the house will now proceed to consideration of the private members' business as listed on today's order paper, namely notices of motions.

[DOT] (6:00 p.m.)



INCOME TAX


Mr. Stanley Haidasz (Parkdale) moved:: That, in the opinion of this house, the government should give consideration to the feasibility
Income Tax
of allowing residential taxes on owner-occupied homes and rental of accommodation of tenants to be deductible from federal personal income tax.
He said: Mr. Speaker, I welcome this opportunity to introduce a motion designed to come to the relief of the overburdened Canadian taxpayer. The motion which you have read I would like to read again. It reads as follows:
That, in the opinion of this house, the government should give consideration to the feasibility of allowing residential taxes on owner-occupied homes and rental of accommodation of tenants to be deductible from federal personal income tax.
I should like to say that I fully endorse the declaration of the Prime Minister (Mr. Trudeau) that the government of Canada should create a just society for all Canadians. This is the basic principle underlying my motion.
The purpose of my motion is to bring once again to the attention of the government, and especially to the attention of the Minister of Finance (Mr. Benson), the urgent need to ease the great burden of the Canadian taxpayer who is not only heavily taxed but in some cases is the victim of double taxation. It is my opinion, which I believe may be shared by all hon. members and by many fellow citizens, that both the home owners as well as tenants in rooming houses and apartments deserve fairer consideration by the Minister of Finance.
The present taxation system has been called in some quarters a flagrant ease of double taxation in that the federal personal income tax is a tax on municipal taxes as well as on personal income. The United States recognizes the inequity of such a practice and therefore has introduced a law which permits home owners to deduct municipal taxes from income for federal income tax purposes. It even goes much farther. It allows payments on mortgages on homes of citizens also to be considered an exemption for income tax purposes.
During the past few years many representations have been made to the federal government, to the Carter Royal Commission on Taxation and very recently to the federal task force on housing and urban development headed by the Minister of Transport (Mr. Hellyer), urging the government to adopt a similar practice. Repeatedly over the past several years, the Canadian Federation of Mayors and Municipalities has also appealed in its submissions to the federal and provincial governments recommending the deduction of municipal taxes from personal income

November 18, 1968
Income Tax
tax and even the deduction of home mortgage interest payments.
In the manoeuvring to give Canadians a new tax system it is obvious that there is growing concern and dissatisfaction among the people of Canada at the fact that the problem of municipal taxation is not being given the attention it properly deserves. I believe it is imperative that the Minister of Finance along with his provincial counterparts give this serious matter deeper study and favourable consideration.
House and home stand at the centre of people's lives. Proper shelter means security. It also means independence and privacy. These are the things which we need in our daily life. I believe it is also time to insist that the social aspects of housing be among the determinants of economic policy in our country instead of always being its unfortunate victim. In the present condition of our economy the ownership of a private home is a heavy financial burden for the ordinary Canadian wage earner. After paying an average of $26,000 to $28,000 for a home in a city like Toronto and after paying all kinds of provincial and federal taxes, our citizens are additionally burdened with an ever-increasing municipal tax year after year.
I would also like to appeal to the Minister of Finance to take into account the burdens of the municipal authorities. They are an essential part of our system of government, and I believe it is only fair that they should be given a fairer deal. Canadian municipal authorities find themselves forced to expand their public utility activities. Expenditures on education, transportation, health services, and social welfare have steadily increased. This investment in human resources is a great burden both on the property owner and the people who live in apartment houses and have to pay very high rents. Many Canadian citizens are asking themselves to what extent they should, through municipal taxation, continue to finance education, health services, social welfare services, police and fire protection, and other kinds of services. These benefits which are provided by our municipal authorities are not only shared by local residents but also by government institutions. Therefore it is quite appropriate, I believe, that these expenditures should be financed partly, if not as much as possible, by both the federal and the provincial governments.
[DOT] (6:10 p.m.)
We have heard many times, and especially recently we have read in the newspapers,

about the number of briefs that are being presented to the federal task force on housing and urban development to the effect that the housing shortage is not only acute in Canada but also a crisis. I believe that to meet this crisis the federal government, and especially the Minister of Finance, should give assistance to home owners and potential home owners. I realize that any effort to curb taxes, to protect the soundness of the dollar from inflation, is important. Inflation has eroded the security of many of our people who depend upon a fixed income. The heavy load placed upon most property taxpayers produces some very unhappy results. Older people with limited retirement incomes are left to exist on small pensions, and many of them are greatly harmed. They denied themselves in earlier years many things in order to pay off mortgaged homes. Now they find themselves faced with ever heavier municipal taxes year after year.
We have been told that older people would be better off in apartments, but many of them have no choice and no chance to move out of their own homes. They have to stay there. They have to cope with the problems of maintenance, and also, they face a rise in taxes	whenever they make substantial
improvements. Tenants in apartment houses also face increases in rents whenever municipal taxes rise. As municipal taxes go up, costs of maintenance soar and the tenants in apartment houses are forced to pay higher rents.
I realize that it is not an easy task to work out techniques that will give municipalities more revenues without raising property taxes. However, this is an objective which demands an effort by the responsible ministers of our federal government and especially by their senior advisers. I realize also that taxation should be on a basis that is equitable for all. I understand, too, the concern of the royal commission on taxation when it states that it is difficult to devise a system of credits for property taxes against personal income tax liabilities that would be equitable between those who own their homes and those who rent from others. In spite of the difficulty, we should do everything possible to solve this problem.
By adopting this motion hon. members will not only ease the tax burden but also stimulate the Canadian economy. I believe that all of us in this house desire to give the taxpayers of Canada a long overdue break. The load of the Canadian taxpayer has been made heavier by a succession of increased taxes at
November 18, 1968

the federal, provincial and municipal levels. Finance ministers have even devised new names for all kinds of new taxes, the latest one being the 2 per cent social development tax. The steadily rising cost of living also adds to the burden of the wage earner and especially the family bread winner to provide decent accommodation and the other necessities of life.
The matter of taxation in Canada is an urgent issue. I know it is complicated as well as being a vital instrument in our society and form of government. The royal commission on taxation, under the chairmanship of Mr. Carter and other experts, has revealed these difficult tax problems. "We have been promised a government statement on the report of the Carter royal commission on taxation but this has not been forthcoming as yet. I realize, as I have said, that it is not an easy problem. However, we must deal with the situation now because it is urgent.
When the federal government introduced income taxes it was felt that a basic deduction of $1,000 for a single person and $2,000 for a married wage earner represented the basic necessities of life. However, these exemptions are completely inadequate today. I am sure all hon. members will agree with me on that point. In presenting this motion to the house, I know that it is an attempt to amend the income tax but I feel this motion will recommend itself to all hon. members. By supporting this motion they will make it possible not only for the residents of owner occupied homes but also for people who live in apartment houses and boarding houses to claim an exemption for personal income tax. Therefore, in the same vein of thought I am sure hon. members will feel that justice is being done. I believe these people deserve this break.	'
The government will also recognize by this move a basic social need. Such an exemption would encourage home ownership which is the goal and dream of many Canadians. The dream is for a decent home in a sound environment. This is the best place for a man to raise his family. It is the duty of a democratic government, I believe, especially one which has declared its purpose to work for the establishment of a just society, to provide for its citizens decent housing at reasonable cost. As well as the moral, economic and policical implications of inadequate housing, congested living, slums and the burden of taxation, there are also many mental and physical health implications, as well as the harmful effects of air pollution in our industrialized
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urban centres. These problems must be dealt with too, and during the discussion of this motion I should like to add that I believe a special federal department of housing and environmental affairs should be created without further delay.
The exemption I propose in the motion would also stimulate our economy by encouraging the buying of more and better houses. This would also alleviate our rising unemployment problem. Above all, it would enable our citizens to lead better lives and would provide them with a greater chance for the fulfillment of their human potential. I appeal to all hon. members to support and pass this motion. Such action would ease the intolerable load of taxation that is burdening the taxpayers of Canada. The people in owner occupied homes as well as people living in apartment houses and boarding houses would benefit in many ways if all hon. members would accept this motion which I have proposed again in this session of parliament. Our opportunities in this house to reduce taxation are rare. We must not neglect the present opportunity.


Mr. Lincoln M. Alexander (Hamilton West):: I rise with some concern, Mr. Speaker, because I do believe that if it is possible for us to have a just society, then this just society must result from the directions of the government. However, with the greatest respect, I say that I do not believe in the phrase "a just society" because I believe it is an expression that has no meaning. I should like to place my emphasis, therefore, on what might be called the quality of life. I feel this is what we are concerned with, the quality of life of all Canadians; it is in this area that we should be genuinely concerned.
During his remarks the hon. member mentioned that owning one's own home is becoming an impossibility. Certainly this is something that we should investigate. I recall very vividly that in my maiden speech I said that owning one's own home was becoming an impossibility. In other words, the leadership that we had expected, and I think rightly expected, to come from this government has not been forthcoming. We find that we have a task force that is pussyfooting around the country. As a matter of fact, even in this just society the task force did not want to come to Hamilton. I had to indicate that Hamiltonians were interested in the task force and that it should come to Hamilton to look into the housing situation.

November 18, 1S68
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When I heard the hon. member's motion it sort of rang a bell. The motion reads in part: That, in the opinion of this house, the government should give immediate consideration to the feasibility of allowing residential taxes on owner-occupied homes-
I remember stumping the streets in 1965 at a time when this party had a program which indicated we were cognizant of the situation. We said at that time that if we formed the government we would allow an exemption of $500 from income taxes for this purpose. Therefore I have risen to support the hon. member who is concerned about rising taxes. In this just society we have just had the raising of taxes by a further 2 per cent, the so-called social development tax. I am sure I speak on behalf of almost everyone in this house when I say that hon. members would support this motion because it is important that we give some relief to the many people who are being strangled as a result of high taxes at all levels of government.
I realize that the hon. member has carried his motion much farther. Even though the Carter royal commission says there is a problem, the hon. member says we should not only give some consideration to the owner-occupier but should move into the area of rental accommodation. This should be considered too, and how just this is if we are going to move into a just society. At the same time we are talking about the quality of life and in many instances, because of peculiar circumstances, we see the effect of housing on this sort of thing but it is disregarded.
[DOT] (6:20 p.m.)
It seems to me, Mr. Speaker, that there is no question that housing is one of the most important priorities we have to face. Briefs are being presented from all parts of the country to emphasize its urgency and I am sure hon. members are receiving letters from all across Canada, not only from their constituents, on the subject.
When I think of a house, Mr. Speaker, I think not only of a roof over my head but of what the house itself contains. The hon. member has already expressed more articulately than I what I am trying to say, but when I think of a house I think of the fact that the provision of accommodation means a reduction in juvenile delinquency. I think it improves marital relations. I also think of a general reduction in crime.

Most important of all, Mr. Speaker, I think of the ghetto type of living about which people in other countries have become quite concerned. Where grievances lie dormant for months or years we find they reach the stage of being beyond solution, so that the solution itself becomes a problem. This in turn leads to riots, the type of social disorder that we in Canada certainly do not want and cannot afford.
I commend the hon. member for bringing forward this resolution. I am a new member and I understood him to say that he was bringing it forward again; it is good that he does so because I am pleased to stand and support it. At one t:me it appeared that we were interested only in the low income earner who was in a terrible situation as far as housing was concerned. We now find, at least as far as I am concerned, that no matter what part of the country one lives in one has to make at least $9,000 or $10,000 before one can become a home owner. Therefore we have moved our consideration from the low income earner to the average income earner.
Most people thought that the government had given weighty consideration to our housing crisis. As I understand it, the former minister of labour initiated a symposium on housing. This symposium travelled around the country seeking information. But surely, Mr. Speaker, they knew what was going on. We are now awaiting with great expectations the present task force's return.
I too, Mr. Speaker, like my hon. friend, think that housing is a matter of great consequence. As a matter of fact, one of the briefs that was presented stated;
However, with the growth of the country, the present dire need for housing our citizens and the many diversified problems involved in meeting that challenge, it is the contention of our association that such a task requires the undivided attention of a minister of housing to lead and direct the federal effort in solving the many questions arising in housing and urban development.
The brief goes on to state:
We believe, too, that the job of co-ordinating those activities which influence housing matters being carried out by other government departments such as-
Listen to the list, Mr. Speaker.
-the Treasury Board, Department of Finance, Labour, Manpower and Immigration, Transport, Consumer Affairs, Veterans Affairs, requires the full time services of a housing minister as does the federal housing relationship with the various provincial and municipal governments.
Therefore, Mr. Speaker, one can see that this is no easy task. The job does not call for
November 18, 1968

the services of one minister who has one or two portfolios, approaching the question with the attitude: Let us face the problem because the people are screaming for housing.
As I say, Mr. Speaker, I am honoured to stand and support my hon. friend's motion. We in this party sincerely believe that housing should not be beyond the reach of the Canadian people. This is why we believe we should move in the area of assisting municipalities to reduce the cost of land and services. We should be where the action is so that people who have average incomes or below can afford a home. This is a great necessity. We should take cognizance of those with below average incomes because this is where the trouble may start, as I have tried to indicate earlier. We have to think of individual home ownership. I should like to think that this is everybody's dream in the long run, to own one's own home. Thank goodness I was able to buy one ten years ago because I could not buy one today. Perhaps there are many here who do not yet own a home and cannot afford one either.
We also have to be concerned about low rental housing, housing research, housing construction methods, the cost of municipal services, row housing, co-operatives and condominiums.
I do not think I should take up any more time of the house, Mr. Speaker, except to say this. I think the hon. member has projected something of great consequence this afternoon. It is to be hoped that all hon. members will look upon it as favourably as he did in order that the phrase about which we hear so much these days, "the just society", will at long last mean that yes, we are in fact living in a just society.


Winona Grace MacInnis: Mr. Speaker, I wish that I and other members of this group could support this motion because I have no doubt at all that the intent of the motion moved by the hon. member for Parkdale (Mr. Haidasz) is to help the overburdened taxpayer. We all know that in many cases the overburdened taxpayer is in very serious jeopardy now. However, as spokesman for my party on this measure, Mr. Speaker, I cannot possibly support the motion because it does violence to the major principle that should underlie all taxation, that is, the principle of taxation according to ability to pay. Indeed, it stands poor Mr. Carter right on his head. Although the Carter report has been cited this afternoon, the one principle that underlies the Carter report is that
29180-182^
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people should be taxed according to their income and ability to pay.
This proposal, Mr. Speaker, does not do that at all. According to this proposal the people who have the best houses and pay the most taxes get the biggest rebate. The people less able to pay and whose taxes proportionately eat up a much larger share of their income receive much less relief than the wealthy. That does not fit in with my concept of a just society.
I know that is not the intention of the hon. member for Parkdale, Mr. Speaker, but unfortunately that is the effect of his motion. This is why our party cannot support it. Our whole effort and energy have been directed toward the premise that it is not terribly important how much you pay in taxes; what is important is what you have left to live on after your taxes are paid. Unfortunately, Mr. Speaker, this motion would lighten the load of the taxpayer in proportion to the amount his income increases. This takes a bigger share of the local taxes away from him than from the lower income taxpayer, through the federal agency. We do not regard that a fair way of doing things.
[DOT] (6:30 p.m.)
The hon. member for Parkdale (Mr. Haidasz) spoke of the importance of giving fair consideration to the taxpayer, and he emphasized that it should be fair. I do not consider this measure to be fair, and I think we ought to reject it and look for other ways of doing what is intended to be done. In other words, this measure of relief has no relation to the income of the person who is to be relieved of paying taxes.
Reference has been made to the Federation of Mayors and Municipalities. I have in my hand one of the resolutions that was moved by that body this year, and I read from it as follows:
-Resolved that, for the purposes of obtaining relief from the burden of the property tax, provincial assistance should be provided which would contain the following characteristics as basic principles :
-both tenants and owners to benefit;
-assistance directly related to the property tax;
-the assistance to be of highest benefit to low-income persons.
If one only reads to the second item, "assistance directly related to the property tax," the hon. member for Parkdale can say, "You see, that is exactly what I am doing." But if one reads the third item, "the assistance to be of highest benefit to the low-income persons,"

November 18, 1968
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he finds that the hon. member did not go far enough in dealing with this set of propositions.
In order to bring relief to those most needing it, the biggest benefits ought to be made available to low income people. Such would not be the case with the hon. member's notice of motion.
I now wish to talk about that part of the notice of motion which refers to the feasibility of allowing residential taxes on owner-occupied homes and rental of accommodation of tenants to be deductible from federal personal income tax. The meaning of that is not clear. I know what the hon. member for Parkdale intended, but lawyers have a habit of not reading minds. They look at cold print. The hon. member's motion does not indicate whether the benefit under the federal income tax is to go to the renter or the tenant. Who is to be forgiven? I know what the hon. member intended, but this measure I submit does not indicate what he intended. I think many lawyers might argue about the meaning of this measure and not arrive at a clear understanding, simply because of the way it is worded.
If we are to ask the federal government to help municipalities I think the best and most obvious way to do that is for us to get busy and act on the housing needs of the municipalities in a more co-operative way than has been the case to date. When I attended the federal housing conference in Toronto two or three weeks ago I heard over and over again that housing is no problem if one has money. Only if one has insufficient money will he have difficulty obtaining a home.
If the federal government is to assist in the housing needs of the municipalities it ought to follow the advice of members of more than one housing delegation, who said that we in this country require large scale and diversified building. I know that many people in the country would love to own their own home; while on the other hand there are many others who do not want to do so. We live in a mobile society and a quarter of our families move every year. People who move, and young people in particular, do not want to be burdened with owning a home. Rental accommodation is better suited to their needs. I have spent half my life in homes that I or my family owned and the other half in rented accommodation, and from my experience the

type of work one does will influence the decision as to whether one wishes to own a home or rent one.
In this country we need both more owner-occupied homes and more rental homes. The need for rental accommodation is fully as great in Canada as the need for private homes. Like the hon. member for Parkdale, I know of many cases, tragic cases, where old people cannot leave their large, old homes because they cannot afford to obtain alternative accommodation. I do not think the best way to help these people is by forgiving them their municipal taxes. That would not help them obtain a new home. We must provide more suitable homes for senior citizens, no matter whether they are separate homes, terraces, or, as in the case of Vancouver, separate homes that are incorporated in an apartment block. All these types are needed.
Ottawa can help the municipalities in a practical way by aiding people in the matter of income. I suggest that our basic income tax exemptions ought to be raised. That would be a much fairer way to help our taxpayers, no matter whether they live in owner-occupied homes or rental accommodation. Raising exemption levels to, say, $2,000 for single persons and $4,000 for married couples would be of immeasurably greater assistance to our overburdened taxpayers than the forgiving of their municipal taxes. I submit that our taxpayers could be helped far more if Ottawa were to raise basic income tax exemptions than if they were forgiven their municipal taxes. That would be a fairer way of doing it.
We cannot consider the question of how to help our taxpayers from one angle only. Housing is a vital need in our nation. If our municipalities are to have a larger tax base, they must have more houses from which to raise taxes. More houses mean greater municipal revenues. We must not forget that.
No doubt other hon. members wish to speak on this measure. I have made the points I wanted to make. I do not want the hon. member to think that we have not considered our position carefully. We approve of his trying to help the overburdened taxpayer, but we say with regret that this form of help will not lead to the just society. On the contrary, it will widen the gap between those who have much and those who have little. Consequently we cannot support this motion.


Walter Cyril Deakon: Mr. Speaker, in rising to speak on this notice of motion I wish to say briefly that I concur
November 18, 1988

with the principle of the motion, subject to certain reservations. I concur with the views of the hon. members for Hamilton West (Mr. Alexander) and Parkdale (Mr. Haidasz). It is my view that this motion ought to be considered along with a total review of our entire taxation system. Only that way can matters be made more equitable for all concerned.
It is a common saying that a man's home is his castle, and this applies equally to the home of an owner and to that of a tenant. It is regrettable that in our day and age to keep up this castle is more difficult than ever, mostly owing to the exorbitant tax rates presently being levied against real property. That directly effects the homeowner, and indirectly the tenants to whom tax increases are transmitted by means of higher rents.
[DOT] (6:40 p.m.)
These increases in realty taxes impose a great burden on all citizens, particularly on our senior citizens who are presently struggling on savings based on earnings of yesteryear. For these people, many of whom live in my riding of Toronto-High Park, the situation is difficult to cope with. To a large extent they must rely on small savings and assistance from their children to supplement the meagre old age security assistance they presently receive. Surely, after all they have done, they should be entitled to a better fate. Permission enabling them to deduct realty taxes from income would certainly be a step in the right direction. As to the comment of the previous speaker about elderly people who own large homes, I should like to point out that in many cases these homes have great sentimental value; their occupants are reluctant to leave them and I think they should be entitled to stay in these homes for which they worked and for which they helped to pay.
Permission to deduct realty taxes should also be given to those in the lower and middle income groups who are also overtaxed. If we consider this matter from a practical point of view, it becomes clear that this realty tax is actually a form of double taxation. Consider first, the residential home owner. The realty taxes he or she pays come from net income received, an income which is taxable federally. So, technically speaking, a home owner is paying tax upon tax.
A tenant finds himself in a somewhat similar position, since the rent he pays is in large measure dependant on the landlord's overhead, a major portion of which is constituted by realty taxes. Under our present income tax structure a landlord must declare the rents he
Income Tax
receives as income, and this income is, in turn, taxable. But remember: the tenant who pays the rent is paying it out of his net income, which has to be declared for income tax purposes. In essence therefore he is paying tax on tax, as is the home owner. Because of such inequities it is becoming increasingly difficult for a citizen to acquire and, in due course, to own shelter for himself and his family-a basic necessity of life.
Permission to deduct property taxes from income would, I firmly believe, lead to an increase in home construction, encourage home ownership and allow municipalities to raise much needed revenue to meet their ever-growing obligations, as was mentioned by the hon. member for Parkdale (Mr. Haidasz). In addition, an extra incentive would be given to home owners to improve and repair their premises and make them more beautiful for the benefit of the community. The step I propose would bring taxation more closely in line with ability to pay.
It is sometimes argued that to allow the deduction of residential taxes would normally be of greater benefit to the more affluent taxpayers than to others. In order to counteract this argument, which I consider to have merit, I would respectfully recommend a deduction ceiling of $750. This would eliminate any advantage which might otherwise be derived by more affluent taxpayers. It is my submission that over and above a certain basic amount necessary for a shelter in which to. house a family, the added cost is strictly for frills and luxuries.
I further submit that notwithstanding arguments to the contrary there would not, in fact, be a revenue loss but in the long run a revenue gain, since the money saved by the taxpayer would be spent elsewhere to assist the economy, and because in many instances persons who have so far not made complete disclosure of rental revenue would be encouraged or obliged to do so.
In addition to supporting this motion I would recommend the deduction from income of interest payable on mortgage payments as they pertain to residential property. A landowner who rents his property is already entitled to such a benefit, and in view of the fact that the benefit is transmitted to the tenant, the residential home owner should, in equity, be allowed the same privilege.
I should like to give hon. members a simple illustration. Let us assume that A sells a house to B for $30,000. The buyer does not have sufficient funds in cash to pay for such a

November 18, 1968
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home, so he gives A $10,000 cash and a $20,000 mortgage. Subsequently, A has to buy a house to shelter his own family. He buys one from C at a price similar to that which he has been promised. Since he received only $10,000 from B, he cannot pay the whole amount at once, but places a down payment of $10,000 and in turn gives C a $20,000 mortgage.
According to our present taxation system, A has to declare the interest received on mortgage payments from B, but he is not entitled to deduct interest he is paying on the mortgage equivalent to the one he is paying with respect to the property he bought from C. This shows how inequitable the present system is, and I submit that this interest should be deductible.
Based on these considerations, it is my humble opinion that this house should give immediate consideration to-
(a)	allowing residential taxes on owner-occupied homes to be deducted from federal income tax, up to a ceiling of $750
(b)	allowing tenants to deduct the cost of rental accommodation for federal income tax purposes
(c)	permitting deduction of mortgage interest from personal income tax.
I feel this would alleviate a portion of the heavy tax burden now imposed on taxpayers.


Mr. Rene Matfe (Champlain):: Mr. Speaker, I should like to take a few minutes to express some ideas.
I agree with this proposal although it is not complete, although in fact it barely touches upon a problem the depth of which is such that our whole fiscal system should simply be revised.
I wish to take this opportunity to denounce this realty tax which a retrograde tax, which should not exist in 1968 for the simple reason that today the realty tax is unfair. Allow me to give an illustration of the unfairness of this realty tax.
Take, for instance, Saint-Marc-des-Car-rieres: where an individual who earns $4,000 a year is being punished because he owns a house, because he put up a struggle, perhaps more than another who is renting and earns $8,000, twice the salary of the owner? With great difficulty he saved a bit of money and managed to build himself a house. After making sacrifices, at last he has his own home.
He will have to pay. He will be punished because he managed to build himself a house,
IMr. Deakon.l
to have a real home. But his neighbour, who is a tenant even though he earns twice his salary, will not have to pay a realty tax.
That tax is unfair. If need be, increase the income tax which is a fair tax, although of course we do not like to see it go up. If we compare realty tax with income tax, we realize of course that the latter is more justifiable than the realty tax which should disappear.
It seems that the motion of the member could help to solve the real problems of those who pay a realty tax. That is why it should be supported even though, as I said at the start, it is not complete.
I also agree with what was said by the member who spoke before me to the effect that certain provisions should be added as proposed last year in a similar motion by the member for Portneuf (Mr. Godin)-with regard to the Income Tax Act allowing private owners to deduct from their taxable income any amount spent in realty, municipal or school taxes as well as mortgage interest on the homes they live in.
Young people, in particular, should be encouraged to have their own homes, and this would be an excellent way of stimulating the economy throughout the country by encouraging home owners.
[DOT] (6:50 p.m.)


William Warren Allmand: In this resolution the hon. member for Parkdale (Mr. Haidasz) proposes that residential taxes, and in certain cases rentals, be deductible from federal personal income tax. Since the second part of the resolution dealing with deduction of rentals is not at all clear to me, I shall merely deal with the first portion regarding deduction of residential taxes.
I see this proposal as having two purposes. One would be to relieve the heavy burden of taxes carried by those who own homes, and the second would be to serve as an incentive to home ownership and to the building of homes for Canadians. Although I agree that residential taxes are a heavy burden I do not think that this is the proper remedy. I certainly agree with the previous speaker, that municipal taxes, residential taxes, school and other land taxes are completely inequitable, unjust, and completely out of step with modern taxation reforms.
November 18, 1968

There are instances, such as those already illustrated in this debate where a person who has improved his land, who has tried to make his home a nicer place in which to live, is penalized by more taxes, whereas a person who allows his house to become run down, to become a slum, pays less tax. Worse than that, take the case of a man who tears down a lot of older homes, sometimes nice homes, and turns the land into a parking lot. He will have his taxes reduced while he waits for the local municipality to introduce a road program or construction program from which he can make a great capital gain by speculating in the land.
If a man clears land and leaves it vacant his municipal tax is lowered. But his neighbour, who improves his home, possibly by building an addition to it to house a larger family, or by building a garage, is penalized because he must pay higher taxes. I agree that residential taxes are extremely unjust, but I do not think the remedy lies in allowing them to be written off as deductions against federal income tax. This would bring about the inequities which the hon. member for Vancouver-Kingsway (Mrs. Maclnnis) mentioned.
I believe the real remedy lies in changing the taxation system. Many suggestions have been made. Some people think municipal services should be paid for through user charges. Others suggest a site value tax, based on the purpose for which land is to be used rather than on tax charges for additions or for new buildings.
Neither do I think the second purpose of the resolution, which is to serve as an incentive for new housing programs, is the proper solution. As the minister in charge of housing said the other day, if we have to apply further subsidies or raise taxes in Canada to alleviate the housing problem we will not really be solving that problem.
I submit that the only way we can really help potential homeowners is by bringing down the cost of homes. Mass production techniques and new technology have been applied to almost all consumer products on the market, but not to house building. Washing machines, refrigerators and automobiles are manufactured through mass production techniques, but until recently homes have been built by old and very costly methods. In this connection I refer to this article which appeared in the Montreal Star of September
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24, concerning a new house building technique developed in California:
A computer-directed machine that can build prefabricated walls at the rate of 20 feet a minute, automatically sizing, cutting and nailing the lumber, has been developed in Fresno, California, by three lumber company executives.
The device at M. Kellner and Son Lumber Co. can construct the interior and exterior walls for an average-size two-bedroom house in about 20 minutes. Walls for 500 homes can be built in a week.
It goes on to point out that by using this method costs can be reduced to a great extent.
Other suggestions have been submitted to the task force on housing. I take issue with the hon. member for Hamilton West (Mr. Alexander) who said that the task force is not doing a proper job. We must reserve judgment until it brings in its report, and until the government acts on that report. One of the briefs submitted to the task force when it visited Montreal also pointed out that great savings can be made in house building through the introduction of new technology and mass production techniques. If we really want to help the house building industry, if we want to help people in the lower and middle income brackets to have homes they can afford, we must do it through new technology and mass production.


Mr. Speaker:: Order, please. The private members' hour has now expired.
In accordance with standing orders, I do now leave the chair till eight o'clock.
At seven o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
[Stage Direction]
The house in committee of supply-Mr. Faulkner in the chair.

[Stage Direction]
1. Departmental Administration, including grants as detailed in the Estimates, $5,131,400.
James Hugh Faulkner: House again in committee of supply, revised estimates of the Treasury Board.


David Lewis: Mr. Chairman, at six o'clock when the time was drawn to my attention, I was literally in the middle of a sentence.
November 18, 1968

Supply-Treasury Board I could not tell you the sentence but I do remember the subject matter. At the time I was dealing with the red circling of a good many employees in the public service, and I had reached the point where I was drawing the attention of the committee and of the President of the Treasury Board to the fact that not only is there the red circling but in many cases, and so far as I have been able to find out in literally thousands of cases, the red circling which was made, say in the fall of this year, was made retroactive to a year earlier.
I really cannot see any justification at all for that. Its effect has been to deprive employees of back pay to which they would otherwise have been entitled. We might take this example-a hypothetical example, but it describes the actual situation. The reclassification in a given situation was completed, let us saw, in October 1967, and was made retroactive to October 1, 1966. In the meantime a collective agreement was arrived at between the applicable organization and the government in which there was an increase of "x" percentage dated back to October 1, 1966. Because the red circling was also made retroactive to October 1, 1966 the employee who was red circled did not even get the increase applicable to the classification in which he worked and was employed for the preceding year.
I am astonished and outraged by that kind of behaviour. If I have misunderstood the situation or if I am misrepresenting it I assure the President of the Treasury board that that misrepresentation is not deliberate and he may correct me; but I do not think I am wrong. What possible explanation can there be for this; what right has an employer to say in October 1967 that, despite the fact that the employee worked in a certain class all through the 12 months from October 1966 to October 1967, he will not receive the increase that has been made applicable to that 12 month period and that he is frozen, not at the rate as of October 1, 1967 but at the rate as of October 1, 1966 and thereby loses the increase to which he is entitled.
For the life of me I really cannot understand what justification there can possibly be for that. If a poor fellow or woman is to be frozen, then let it be at the rate applicable at the date on which the red circling takes place, and not set back as in many cases a full year. From information I have been given, some post office employees and some customs employees have lost in some cases $200 or $300 and even more in back pay to which


otherwise they would have been entitled. This is really indescribably bad labour relations, and it is possible only for an employer as strong as is the government. There is no need for such a scrooge-like attitude toward employees.
When the legislation was before the standing committee, then before this committee and this chamber I appreciated there was some reason for the insistence on the part of the government that classification and promotion cannot be made fully a part of collective bargaining. As I recall the reasoning, it was that the merit system on which it was hoped appointment to the public service and promotion within the public service would be based, made it necessary that there be objective rules laid down by the public service commission, and objective criteria applied in appointments through examination and in promotion through examination, and that therefore the merit system could not be allowed to come under attack or be eroded by the provisions in respect of security and the like that must be considered in ordinary collective agreements.
I speak from memory, but as I believe I said at the time, and say now, I can see some validity in the wish to retain the merit system and not let it become subject to the ordinary collective bargaining limitation; but that does not mean that the organization representing the employees should have no say whatever in classification and promotion procedures. This does not mean that it is impossible for the employer, in this case the government, to consult with the organization representing the public employees in order to give them an opportunity to make representations about the classification and reclassification, and to give them an opportunity to do this before the reclassification becomes a fait accompli, because once it is done, and it is necessary to go through the grievance procedure and appeal procedure before the public service commission, there is nothing very much that will be done then.
I am certain it is an uncivilized procedure-and I use that word deliberately because I think it is uncivilized-for a big employer to say that it has the power to make the classifications and reclassifications, and is going to do it, and that the employee must take it even retroactively for a year if the employer so decides. That is not civilized labour relations. In a civilized situation there is no reason why the organization concerned should not be consulted and informed before
November 18, 1968

the reclassification and red circling becomes a fact, so that the organization would be in a position to put its case before the representatives of the Treasury Board. Had this been the case, perhaps the kind hard heart which faces me across the aisle might have agreed not to impose the retroactivity of the red circling. I have known him to be kind; I have also known him to be hard hearted. Perhaps if the organization had caught him in one of his kind moods he might have seen the injustice involved in the red circling of people retroactively for a whole year.
[DOT] (8:10 p.m.)
I say to the President of the Treasury Board that the reason the collective bargaining has worked so far is not because he and his associates have done what they should have done in respect of the public service collective bargaining process, because from my observation they have broken a good many basic rules of collective bargaining. I indicated they broke the rules in respect of making some offer to the people on the other side, as soon as negotiations began, so that movement could start early. In the case of the postal service employees, if my memory serves me right, it was some seven months before they made the first offer. This is almost an invitation to strike. When you keep people waiting for seven months before making them any offer at all, the bitterness that develops among the rank and file makes it impossible for anyone to keep them from striking. By that kind of collective bargaining you invite disputes of a serious kind.
The employer in this case, I suggest, also broke the basic rules of collective bargaining by laying down a ukase as to the amount the seaway employees would get. The Prime Minister stated that 6 per cent was fair, and the government would not give any more. He made the statement while negotiations were taking place. In my opinion the government also broke the basic rules of collective bargaining by imposing retroactive red circling without discussion or consultation with the organizations. Even with discussion and consultation it was wrong to do this.
The reason the collective bargaining process has worked as well as it has so far in the public service is not due to the proper behaviour on the part of the government, although a lot of it has been proper. In many cases the basic rules of collective bargaining were broken. It has worked as well as it has because public service organizations have not yet developed the militancy that unions usually develop, and because in the early stages
Supply-Treasury Board of collective bargaining, even in private industry let alone in the public service, unions tend to be a little more timid and careful.
I warn the government that, as the unions become more certain of themselves and as they gain confidence in their capacity to face their employer across the bargaining table, instead of having to accept orders and ukases, if the government does not change its attitude toward some of these rules of collective bargaining it will invite a great deal more disruption than we have had in the past.
Strikes in services like government services usually take place as the result of serious circumstances, and they occur only when the employer also has made mistakes. In the government service we have responsible employees and responsible leaders. I am using careful words. I am not saying strikes occur when the employer alone has made mistakes; I am saying they occur when the employer and the other side have made mistakes. In this case there is no excuse for the employer making mistakes. The government and its huge civil service ought to be able to research the situation so as to avoid mistakes.
Let me repeat my warning. If things are not changed, then serious difficulties will occur in the future. They need not occur. Let me conclude my remarks by even now pleading with the President of the Treasury Board to reverse the decision with regard to the retroactive red circling of employees. There is no justification on any social or moral ground for a person who has worked in a certain class before being red circled not getting an increase applicable to his class for that year. Every employee who was deprived of retroactive pay to which he was entitled suffered a grave injustice. It is not too late for the President of the Treasury Board to persuade his colleagues in cabinet that this injustice should be rectified.


Mr. Skoberg:: Mr. Chairman, I should like to draw attention very briefly to that portion of the estimates which come under the Treasury Board and deal with the National Research Council of Canada. I was very much interested in the report handed out regarding the National Research Council of Canada and at this time-


Charles Mills (Bud) Drury: I rise on a point of order, Mr. Chairman. I do not want to stop the hon. member but I should point out to him that the estimates of the National Research Council have been referred to a committee of the
2882	COMMONS
Supply-Treasury Board house. Consequently a discussion of them now during a consideration of the estimates of the Treasury Board would probably be out of order.


James Hugh Faulkner: I am sorry I was not listening carefully to the hon. member when he commenced his remarks, but the point made by the President of the Treasury Board is correct. Votes 15, 20, 25 and 30 of the estimates of the Treasury Board are before the standing committee.


John Leroy Skoberg: Mr. Chairman, I intended to deal in a general way with the report. I did not intend to take any specific item of administration as such. However, if that is your ruling, so be it.


Gerald William Baldwin: Mr. Chairman, I have a few observations I should like to make. During our consideration of this item in the estimates. When we are in the committee of supply I sometimes have the feeling that dealing with these estimates is like an ancient tribal ritual greeting spring. It has no real meaning as an examination of the estimates. I only hope that the new structure or procedure of sending the estimates to committees will be more effective. While I recognize the usefulness of using the discussion of estimates as a means of presenting the sort of argument we have heard from members of the N.D.P.- and we have been doing the same thing-I hope that proper use of the committee system will result in a far more meaningful effort.
Let me make several observations in this regard. I should like to consider this whole matter of using the estimates as a gauge of national expenditure. The Leader of the Opposition during our early consideration of the estimates questioned the President of the Treasury Board about the five year projections of spending proposals. After listening carefully to the minister's answers, I think our estimates would have far more meaning and value if the form of the estimates was changed. This form is subject to change, and I recall from my experience as a member of the public accounts committee that a great many useful changes could be made. Surely one change that might well be made is the inclusion with these various estimates of the five year projection in respect of particular votes dealing with specific and committed programs, so that we would see year by year the extent to which these five year projections had been in fact adhered to.

DEBATES	November 18, 1968
[DOT] (8:20 p.m.)
I can give a typical example. We had some questions in the house the other day about an item involving the expenditure of $61 million for the construction of a complex of buildings for the C.B.C. in the Montreal area. I think this information was given in response to a return which had been asked for on written questions. I would like to suggest that there is nobody in this committee who is listening to me now who would be prepared to wager any sizeable amount of money that by the time this particular project is completed its cost will be limited to $61 million. I would be very much surprised if, having in mind the usual changes, it were not much closer to $100 million by the time it is finished.
This is the kind of thing that I think, if we are going to have any meaningful and intelligent examination of specific projects, members of this committee, acting as the people charged by the 20 million people of Canada to examine the spending habits of the government, to see that we are in fact getting good value for our money, and to ascertain what would be the proper priorities to assign to different spending programs, should have an opportunity to examine. This may possibly be somewhat more limited than what the government, the Treasury Board and the cabinet would do, but some effort should be make on our behalf, and information should be given to us so that we could look at these respective programs. Then, in four or five years, we would be able to come to decisions, to evaluate the various proposals, and possibly, when we come to deal with the supply of money to the government, we would be able to exercise a judgment which at the present time I am afraid can only be a stab in the dark.
There may be good and valid reasons why this should not be done. My recollection is that it was Secretary McNamara in the United States who introduced into the department of defence there a budget programming, and a more intelligent and searching look. We heard from the Minister of Finance that he too is now doing this scientifically and that he has computers for the purpose. Talking about tribal rituals, and having in mind what the Minister of Finance has succeeded in doing, I often think that when he came to estimate his budgetary proposals and his deficit he probably slaughtered a chicken and examined its entrails, and this is where he came up with the facts which he gave to this house last fall, and again recently.
November 18, 1968

I would suggest that this is an aspect of the estimates which might well be considered, so that year by year we would have an opportunity of comparing what in fact were the actual expenditures with the projections which had been made. This might well have been applied to the national centre for the performing arts here in Ottawa. Such information might have been given members of this house and, without judging the merits of this or any project, I do think a similar procedure would really make for a more searching and intelligent scrutiny of the bad spending habits of the government-they have a few good ones but most of them are bad-by the members of this house, an opportunity which at the present time they are denied.
I would also like to deal with the aggregate of the amounts we find in these estimates. I listened very carefully to the explanations of the minister that the Treasury Board, at the appropriate time, having heard from the various departments, takes appropriate steps as a result of which the blue book emerges. But, after all, the blue book should be taken as a virtual contract between the government and the people of Canada whom we represent. The details of any good contract are offered for acceptance and consideration. The government offers to do certain things, to provide certain services and certain public works, and the people of Canada, through parliament, agree to pay so much for it. That is the consideration. But what we find is that this contract is broken year after year. Every time supplementary estimates are brought into this house, there is in fact a breach of contract.
I am not suggesting any government, and certainly not this government, is able to anticipate with accuracy and precision that some contingencies may not arise in the future, but when we see the total aggregate of the supplementary estimates which have been brought in, for example over the last five years, I say that surely, when the Treasury Board has with great pains and meticulous care gone through the departmental proposals and come up with the figures in the blue book, we should be entitled to look at them as being a firm contract.
We find that over the last five years over $4 billion was brought in by way of supplementary estimates. In the fiscal year 1963-64 there were five sets of supplementary estimates, from A to E inclusive, totalling $730 million. In 1964-65 there were four sets of supplementary estimates aggregating $900 million. In 1965-66 there were five sets of
Supply-Treasury Board supplementary estimates with a total of approximately $850 million. In 1966-67 there were seven sets of supplementary estimates aggregating $1,200 million. In 1967-68 there were three sets of supplementary estimates aggregating $460 million. As I said, the total is approximately $4,200 million.
This is a practice which has to be reviewed very carefully. What does really happen? Do the departments, being unable to bring in to Treasury Board the full amount of the expenditures they would really like to make, soften the blow by asking for a little less, or allow themselves to be taken down to a little less money, knowing all the time that before the fiscal year is over they are going to come back with requests, through the medium of supplementary estimates, to get the total figure for which they originally asked? If that is the case, then it is just a game which is being played.
There is no certainty about it, and I think that members of this house are entitled to better treatment than this. I point this out more in sorrow than in anger, in the belief that the practice is one which should, and I hope will, be reviewed. If the committee structure works properly, I think there will be adequate opportunity through this means to have a careful study made of these estimates as they are going through, and in fact through an examination of departmental officials committee members should be able to find out if the estimates as produced in the blue book are the total that they expect to receive for the fiscal year.
Then I want to add to that my dislike of another practice, which I think is equally invidious, of adding several hundred million dollars each year under the heading of loans, investments and advances. I am not going to go into the details of this matter, since I have done so before, but I am going to keep on coming back to it as long as I think the practice of the government is wrong.
[DOT] (8:30 p.m.)
Quite obviously many of these so-called loans, investments and advances are, in fact, expenditures. They are, in fact, expenditures of the crown and not loans or income producing investments. All one needs to do is to examine some of the items in question, and it becomes absolutely obvious there is not going to be any return to the consolidated revenue fund on moneys lent in this way, other than by subsequent expenditure items which are contained in future appropriations. This is the
2884	COMMONS
Supply-Treasury Board only way the loan is going to be repaid. I may be ignorant of the finer points of government financing, but surely there should be some distinction made between a valid loan made to a crown corporation where there is some hope of repayment, and the kind of expenditure we have seen. I dislike referring to the C.B.C. all the time, but we find a $25 million loan to the C.B.C. and another $35 million loan to the C.B.C. I can only hope that my prospects for eternal salvation are a lot better than the hopes of the C.B.C. for repaying these loans.
I make mention of these things, Mr. Chairman, because I think they are important, having in mind the problems faced by the ordinary taxpayer today in trying to make ends meet. We have a duty cast upon us to scrutinize as closely as we can the various expenditures. I am not satisfied that the government is putting before us the information we should have. I make this as my annual presentation. If the minister is where he is next year and I am where I am, then I will be coming back again to this subject. I am not an optimist like the hon. member for Winnipeg North Centre. I do not hope for a cure, except possibly if the people of Canada hear of this practice they may at some future date insist that the government conform with ordinary practices which are sound and sensible.


Stanley Howard Knowles: I do
not wish to take the floor again at this time, Mr. Chairman, if there are others who wish to do so. However, I should like to hear from the President of the Treasury Board with regard to the matter about which I spoke for about half an hour this afternoon. He did me the honour of listening to my remarks, at least I thought he was listening, concerning the plight of the retired civil servants. I am grateful for the attention he gave me because so often when I make this appeal I have to make it to a parliamentary secretary, or to persons who do not have the authority of the President of the Treasury Board. The minister knows that the unanimous report of the special joint committee was presented to parliament on May 8, 1967. I am sure he must be familiar with it. Can he tell me the status of that report, so far as the government is concerned? Has it been considered? Has the cabinet considered legislation based on that report? When can we expect action on this very serious and very important issue?


Charles Mills (Bud) Drury: If I may deal with the observa-tons roughly in the order in which they were

DEBATES	November 18, 1968
made, Mr. Chairman, the first was from the hon. member for Winnipeg North Centre, who made a very eloquent and repeated plea for the correction of the unfortunate circumstances in which the superannuated civil servants find themselves. The hon. gentleman did indicate that he thought, while at one point the government had had the best intentions in the world, it had only succeeded in leading these unfortunate people up the garden path. I think those were his words. He said that by agreeing to constructive, progressive steps people had been led to believe that a favourable outcome was inevitable; that it had not been, and that this was disillusioning. I will not yield to the temptation to give a constructive, helpful answer now for fear of being guilty of the same thing.
I think the hon. member knows that in the current year we have, with some difficulty, endeavoured to restrain total government expenditures and have provided revised estimates within which we hope to be able to live. At a time during the current fiscal year of retrenchment, no provision has been made to meet the situation which the hon. gentleman has described. He will understand if, rather than raise false expectations about what might happen in the next fiscal year, I decline to go further. However, as a result of his interesting expose, I will undertake to discuss this question with my colleagues.
The hon. member for Vancouver East raised the question of whether the government would avail itself of the 60 day delay provision in the legislation in respect of retroactive pay as a consequence of completed collective bargaining negotiations. The answer is no. As I assured another hon. member in the house the other day, we are making every effort, as fast as the administrative machinery can accomplish it, to put into the hands of recipients the cheques for retroactive pay. There will not be reliance on the so-called 60 day clause. We will do this as quickly as possible. I cannot promise more than that. The hon. gentleman would not want me to order the issuance of imaginary cheques or blank cheques. Calculations have to be made as to what is owing and to whom, and as rapidly as this can be done it is being done and the cheques are being issued.


Harold Edward Winch: Would that include the armed forces increases?


Charles Mills (Bud) Drury: The armed forces, Mr. Chairman, are not subject to collective bargaining arrangements. The arrangements for pay in relation to the armed forces depend rather
November 18, 1968	COMMONS DEBATES	2885
more on the Department of National Defence for calculation rather than on the Treasury-Board.
The hon. member for York South, who I am sorry is not here, spoke at some length on the question of the poor or invidious practices of the Treasury Board in conducting collective bargaining negotiations. He referred particularly to two questions; one was the unreasonableness of the Prime Minister and the President of the Treasury Board in announcing, during the currency of negotiations with the seaway workers, a 6 per cent ceiling on increases. Unfortunately for the hon. gentleman's memory the President of the Treasury Board took no part in these negotiations, nor did he make any announcement. The Minister of Transport, under whose department the seaway comes, did at one point make an announcement but the Treasury Board did not. For this reason one might have argued that the remarks of the hon. member for York South were out of order. But even if they had been in order, I am a little surprised, Mr. Chairman, at his logic in defining the actions of one of the parties in the collective bargaining process in making a public statement as to its bargaining position as being unreasonable and illogical, without at the same time requiring the other party to observe a similar line of conduct. At no time did he suggest that it was in any way wrong or inappropriate for members of the other party to the negotiations to seek the support of the public for their point of view or for their representations, however reasonable or unreasonable they might be.
[DOT] (8:40 p.m.)
It seems to me, Mr. Chairman, it is not in the spirit of what the hon. member for York South described as the give and take of the collective bargaining process to endeavour to impose complete freedom of action in relation to public-private negotiations, or in moving from one arena to the other, on the one side without at least a comparable freedom on the other. The hon. member complains it is wrong and unjust for the employer to state his position publicly while the bargaining is going on, yet it seems to be quite reasonable and logical for the employee side to go to the public with its case. I suggest that in this particular instance there should at least be some element of reciprocity observed in the conduct of negotiations.
The hon. member also dealt with the refusal of the government to put on the table a
Supply-Treasury Board wage offer in the case of the postal workers. I think the house will recollect that after some very considerable delay an offer of a pay increase was made. This was somewhat summarily rejected and the strike followed.
The fact of the matter is, Mr. Chairman, that the negotiations had been going on for a very long while. During these negotiations there had been little evidence of the give and take that I suggest is of the essence of collective bargaining. Indeed, Mr. Chairman, it was the failure to make any kind of progress at all on some of the rather minor points that led Treasury Board to be dubious about the value of putting on the table at too early a stage a wage offer that undoubtedly, as subsequent events proved, would have been rejected.
I do not think that one can argue that there is a set timetable, a prescribed ritual, for the conduct of collective bargaining:	it does
depend on the relative willingness of the parties to engage in meaningful negotiations. If for one reason or another this willingness is absent, then perhaps going through a procedure or a series of procedures probably will not advance matters very much. However, Mr. Chairman, I did listen with great interest to his admonitions. If I may use that term. The hon. member has had a great deal of experience in this field, though perhaps on the one side. Certainly my own experience is very limited indeed, but I do profess myself willing to learn, or to try to learn.
The hon. member also made a point about red circling, and explained his complete inability to understand how it could come about that if a man were, on examination, found to have been entitled to an increase in pay for a year or so anterior to the date of such determination, the increase in pay is justified, whereas a simultaneous determination that the work the man was doing for the same period did not justify the rate of pay which he had been drawing and that the classification determination should not be made coterminous. I hope that the hon. member for York South will regard employment in the public service as the giving of a dollar's worth of value for a dollar of pay, rather than some notion that once you get on the payroll you are set for life; that regardless of performance, of the discharge of your responsibility, you are still entitled to continue to receive pay, and not only that, Mr. Chairman, but entitled to benefit from any increases that have probably been earned by others.

November 18, 1968
Supply-Treasury Board
I find this a rather difficult philosophy to accept, Mr, Chairman. I think that most self-respecting public servants like to feel that they are working in a system where the reward or emolument is continuously commensurate with their performance. We have insisted on the merit system, which I think is an excellent one, rather than the system of seniority. We have engaged fairly continuously over the years in working toward the constant examination of classification and reclassification. During the past three years a rather more intense, massive and, if I may suggest this, rather more intelligent reclassification system has been in progress in which an endeavour has been made to introduce a coherent, continuous system throughout the public service so that everybody is treated fairly; so that we do not have instances where people, largely as a consequence of historical error, or habit, or perhaps persistence in initial mistakes, are being rewarded to an unfair degree compared with others discharging perhaps greater responsibilities and doing harder work who receive less pay.
Recognizing, Mr. Chairman, that this reclassification process would result in some people going up and some going down, the government, acting I think as a good employer, agreed that those who, by reason of reclassification, are found to be entitled to more pay receive this sum in the full amount immediately. On the other hand, those who upon re-examination of their duties and functions are found to be entitled to less pay are not required to suffer a decrease in pay but are merely put in a "hold" position and receive no increase in pay until such time as the emolument for the particular office they occupy reaches the level of salary that they are currently enjoying.
[DOT] (8:50 p.m.)
I should point out in respect to this red circling that there is a corollary known as green circling. Just as red is considered dangerous and unpleasant, so green is considered pleasant. Of the 82,000 odd positions which were evaluated or re-evaluated in the conversion, about 15,000 were red circled. That is quite a substantial number. As of September 15, 1968, the number of positions that were red circled had been reduced from 15,000 to 1,513. It may perhaps interest hon. members to know that although initially 15,000 persons were red circled, 18,000, coming under a similar general classification, were green circled. In total, more people were green circled, or reclassified upwards, than were red circled or
TMr. Drury.]
reclassified downwards. This system has not led entirely to unhappiness.
I suggested that if as of October 1, the date mentioned by the hon. member for York South, it was determined that a man one year ago was entitled, in respect of his position, to an increase in emolyment it would not be unjust, since he is now doing the same work he did one year ago, to apply the reclassification to him in respect of his upward reassessment for that same period.
The hon. member for Peace River raised two questions, one of which strikes me as interesting. He said that the estimates in some fashion should be portrayed on a five year projection basis so as to enable hon. members to see more clearly the significance of individual items in the estimates. By dealing with items for the previous and current years only, that significance is not so obvious. I think the hon. member's suggestion, if adopted, would make for a much more lucid and descriptive portrayal of government programs. I am not sure what that would do to the blue book of estimates, which already is a massive tome. However I think this project is worthy of examination. Perhaps the most useful way of carrying this out would be in the public accounts committee. Later this evening I hope a proposal will be made that we revert to motions in order to introduce to the public accounts committee a new scheme for setting up estimates which will be vastly more informative, and certainly more descriptive than present arrangements. When the public accounts committee is looking at the program method of portraying estimates, it might also wish to look at the question of doing this on a five year rather than on a one year retroactive and one year prospective basis.
The hon. member for Peace River also said he was unhappy with the system of introducing large supplementary estimates. In his view this was some kind of breach of contract or breach of faith with the public or the house. He may be aware that up until a couple of years ago there was no serious endeavour to include in the estimates all possible and foreseeable items of expenditure during the year. The main estimates might in some cases have been more accurately described as preliminary estimates. In the past two years we have consciously tried to reduce in number and in quantum the size of supplementary estimates. Last year the number of sets of supplementary estimates was limited to three; this year one set of supplementaries has been introduced already, for special reasons, and it is my hope that there will be only
November 18, 1968	COMMONS
one further set of supplementary estimates in the current fiscal year, and that that will be the so-called final sup. If that is done we shall be better able than was the case in previous years to look at entire programs in terms of the main estimates. I think this approach will go a long way to meeting the objections of the hon. member for Peace River.
He also raised the question of loans, investments and advances, indicating that in some instances sums of money represented as loans, investments or advances could more honestly have been portrayed as grants or authorizations to expend in the current year. To a large extent this involves a question of accounting techniques and offers the house the continuing possibility of keeping a finger or a trained eye on the particular amount that is put out by way of loan, investment or advance. Even though the amount is unlikely to be repaid in the foreseeable future, this does mean that the receiving organization, be it a department, agency of government or crown corporation, continues to be accountable until such time as the loan, investment or advance is repaid or discharged. It continues to be accountable for this particular item.
On the other hand, if the amount in question were characterized as a grant or authorization for expenditure, the accountability in respect of the amount presumably would cease during the currency of the fiscal year in question. This is something we might look at and see whether in some instances sums provided by way of loans, investments or advances might more usefully and accurately be classified as grants or authorizations to expend.
I think I have covered most points raised in respect of these estimates, though I might add one observation in respect of some remarks made by the hon. member for York South about red circling and reclassification. I am told that the effective date of reclassification in almost every instance has been discussed with the bargaining units during the negotiating process. To suggest that the action taken by the government has been unilateral-I think he used the term "ukase"-is inaccurate. The retroactivity of the reclassification has been discussed with the bargaining units in most instances during the process of negotiation.
[DOT] (9:00 p.m.)


Stanley Howard Knowles: may, Mr. Chairman, I should like to return for a few moments to the question of the pensions of retired civil servants. I should
DEBATES	2887
Supply-Treasury Board like to thank the President of the Treasury Board for the remarks he made. I have no objection to the odd barb which seemed to be tucked in, because he did end his remarks on the subject by agreeing to discuss the matter again with his colleagues. If I understand that language, it means he will take it back to the cabinet. Well, that is what I want. I hope it will be soon. I hope it will be a sympathetic cabinet. I think I have one supporter just back over the minister's left shoulder.


Bryce Stuart Mackasey: Thank you, Stanley.


Charles Mills (Bud) Drury: You have a lot of volunteers over here.


Stanley Howard Knowles: Yes. As a matter of fact there is the parliamentary secretary behind him who, if he were in the cabinet, would support my position and there is another down the way a few desks who is just knocking at the door, ready to say yes at any time and to act on this important issue. And there are some more around. They could be the hon. members from Hull, Grenville-Carleton, Ottawa-Carleton, Ottawa East, Ottawa West, Ottawa Centre and so on.
I am sorry if my suggestion that some of these retired civil servants felt they had been led down, or up, the garden path offended the minister. I can only say this is the way many of them feel. What these people would like, and what I should like, would be for the government to get back to the frame of mind that I honestly believe it was in from about January to June of 1967. I am glad to see the minister nodding his head. Whether that means he agrees with me that the government was in the proper mood then, or that it should get back into that mood, I am not sure. At any rate he has been very helpful. The fact is that, during those five or six months the government did agree to have this matter referred to the special committee. Representatives of all parties seemed to be free to discuss the matter, and officials from the departments were there, and when the report came back I think it was the disposition of the government to act on it forthwith, if it was a reasonable and responsible report. I believe it was both reasonable and responsible. I gave the terms of its recommendations earlier this afternoon, and I am sure they are familiar to the minister. I earnestly hope he will take this matter back to the cabinet, that he will remind the cabinet of the responsible terms of the 1967 recommendation, and that he will do his best to get favourable action on this issue without further delay.

November 18, 1968
Supply-Treasury Board
When he was speaking a few minutes ago, the minister seemed to confirm that there was a change of government attitude-that in the earlier part of 1967 there was a favourable disposition to act on this matter, but that in the latter part of the year the government concluded that it was necessary to make certain cuts, that it was obliged to practise a certain amount of financial retrenchment. The minister intimated, if I understood him correctly, that the government had reduced its estimates and was trying to live within the confines of its revised estimates. I would remind him that the revised estimates are of course much larger than they were before they were revised. When these estimates are broken in so many respects, and when the figures are inflated in so many cases, I find it difficult to understand why these people should be called upon to be deprived of the pension increases to which they feel they are entitled, because of the so-called practice of economy. Every time the government announces that cuts are to be made and the budget balanced, the net result is the spending of more money. Yet these people who have a justifiable claim are told they have to wait.
If the minister is going to imply that increasing these pensions is somehow or other taxing the people of Canada, he will have to try to explain this to those pensioners who know there is about $3 billion in the fund, and that it is growing rapidly every year, because the interest alone represents more than is paid out in pensions, not to speak of the new contributions that is paid in.
I do not really profess to understand the mechanics, the financing, the economics of this, but I can follow the reasoning of people on the government side when they explain that this money has no existence except as figures in a book, and so. on. But try to explain that to these people who worked for the government for 20, 30 or 35 years and who paid their money in-or, at least, they did not get it in their pay cheques. Try to explain to them that the money is not there, that it is just figures in a book and that they cannot get it, or a reasonable rate of interest on it, without there being a charge on the people of the country.
I know that all pensions are a charge on current production; I have proclaimed it many times. But the minister had better explain this to these people, and in ways that nobody else has yet been able to do satisfactorily. As they see it, the simple fact of the

matter is that when they were working they were asked to take home, not 100 per cent of their pay but 931 per cent or 95 per cent, whatever the rate was at the time. The balance went into some account, and interest was paid on it. In the meantime, other people got increases in the amounts they have to live on. Why could it not be done for these people? Indeed, if the government falls back on the argument that it is living within the confines of revised estimates, it does not wash as far as these people are concerned.
However, I am grateful to the minister for saying he will take the matter back to cabinet. I am grateful for his not having disclaimed responsibility for the problem. I went through this in the last parliament: One minister passed the problem on to another. But the President of the Treasury Board does not mince matters; he has taken this under his responsibility. I hope he will take it back to the cabinet and remind his colleagues that in the early part of 1967 the government of the day was almost persuaded that this was a just cause and that something should be done about it. Let us get back into that reasonable frame of mind and do the right thing by these people who are former employees of the government and of the people of Canada.
There are one or two other things I should like to say. I am sorry that my hon. friend from York South is not here now. He was here earlier this evening, but he had to appear in a television interview. If we had television in here, instead of upstairs or outside, maybe this kind of thing would not happen. However he can speak for himself, and on the appropriate occasion I am sure he will deal with the points the minister raised, so I shall not attempt to cover that ground.
I should like to ask about a related subject. What is the status at the present time of the regulations regarding retroactive pay increases in the cases of employees who leave the public service in the meantime? As the President of the Treasury Board and his officials know, this relates to a grievance which those affected find hard to take. Let us put it in the simplest possible terms. Here is an employee who has worked for a number of years with the federal government. The time comes when for one reason or another he has to leave. Sometimes he goes to a better job, but it is not usually that. Usually it is for health reasons. After he leaves, a pay increase comes through and it is retroactive for months or for a year.
November 18, 1968	COMMONS DEBATES	2889
[DOT] (9:10 p.m.)
The employee looks at this and he sees there was a period of six, eight or nine months when he was working for the government doing a job which it is now recognized deserved a higher rate of pay for that six, eight or nine months. Yet, because he was not on strength on the day the retroactive pay increase was allowed, he is denied that increase for the period of retroactivity. I see the minister shaking his head. Perhaps he can straighten me out with his answer, but if his answer is not satisfactory I can send a few cases in point either to him or to his officials.
But before he answers that question, Mr. Chairman, may I ask him two other short questions. When we were dealing with the collective bargaining legislation in the committee a great deal of time was spent on the case of employees who are outside bargaining units. An undertaking was given that a committee would be set up, or an arrangement would be made under which employees outside bargaining units could have a relationship that would be as nearly as possible the equivalent of collective bargaining. Could the minister tell me whether anything has been done about that?
With respect to my final question, if the minister tells me to bring it up when we are on items having to do with legislation I will wait until he wears his other hat and brings the legislative items back to the committee. Another point we discussed in the parliamentary committee was the provision of collective bargaining for the employees on parliament hill, equivalent to that which obtains now in the public service. As a matter of fact, if I remember correctly our committee recommended that something along those lines should be done. Can the President of the Treasury Board tell me whether any progress has been made in this field? If I can get answers to these two or three questions I will not have any new ones to raise, although 1 may have some supplementaries depending on the replies of the minister.


Charles Mills (Bud) Drury: In respect to the question of retroactive pay, the principle is that retroactive pay is paid to the man who has left the public service if the reasons for his leaving were involuntary. These might be health, retirement on account of age, and other reasons. I am not sure what all the reasons are, but if it is a voluntary separation at the choice of the individual, then he does not qualify for the retroactive payment.
Supply-Treasury Board


Stanley Howard Knowles: have a supplementary question right there. Supposing it is the health of an employee's wife that makes it necessary for him to leave a posting, let us say, in the far north. Would he qualify?


Charles Mills (Bud) Drury: Well, Mr. Chairman, I suppose the term involuntary depends on where you sit. In so far as the employee is concerned whose wife's health is such as to make it impossible for him to continue in his particular job, then this is hardly voluntary on his part. I frankly do not know what the answer to that particular question is. I do know the principle is that in the case of voluntary withdrawal there is no entitlement to retroactive pay. Involuntary withdrawal does qualify the ex-employee for retroactive pay. The question the hon. member poses is a very interesting one. I do not know what the answer is but I shall make inquiries and let him know.
In relation to the second question raised by the hon. member concerning working conditions or terms of work for persons excluded from the bargaining units, I may say that the government has been very much preoccupied with the situation of these people and has established an advisory group on the executive composition of the civil service. As part of its terms of reference this advisory group was asked to make recommendations to the government on the principles that might be followed in determining the rates of pay and conditions of employment of public servants employed in a managerial or confidential capacity. As yet we have not received a report from this advisory group but we hope to do so reasonably shortly.
It is only when we get their report and we are able to see perhaps a little more pattern emerging from the process of collective bargaining that we will be in a better position to formulate principles to govern the terms and conditions of employment of persons excluded from the bargaining units.


Stanley Howard Knowles: Could the minister tell me who comprises this advisory group? I do not ask for the names of the persons, but rather their categories, whom they represent and so on?


Charles Mills (Bud) Drury: I hope, Mr. Chairman, they represent talent rather than "whom." One is the head of a university. Another is the head of a large corporation. I shall just get my information on this and perhaps I can describe them, if the hon. gentleman does not want the names.

November 18, 1968
Supply

Treasury Board


Stanley Howard Knowles: I do
not mind getting the names. I just was not pressing for them if there was any reason why they should not be given.


Charles Mills (Bud) Drury: They are Hon. J. V. Clyne, Vancouver; Dr. Deutsch, Kingston; Dr. Gau-dry, Montreal; Allan Lambert, President of the Toronto-Dominion Bank, Toronto; Marcel Vincent, Montreal, Chairman of the Board of Bell Telephone Company.


Stanley Howard Knowles: While I am reflecting on that, perhaps the minister could answer the last question I asked him. It had to do with the possibility of collective bargaining for employees who work on parliament hill. When might we expect an answer on this matter?


Charles Mills (Bud) Drury: Mr. Chairman, the hon. gentleman suggested that perhaps this might be dealt with under another heading, and I think that would be more appropriate. It would surely be slightly impertinent for the Treasury Board to hazard views on how the house, and particularly the Speaker, should conduct their business.


John Howard Lundrigan: Mr. Chairman, in 1949 when Canada joined Newfoundland there was some confusion as to the natural transition of people who worked with the Newfoundland civil service into the public service of Canada. Apparently there were quite a number of employees who worked with the then Newfoundland government and later under the Department of Transport at Gander who did not come under the public service jurisdiction, and consequently did not get credit for their previous employment. I know that for three years these people have been seeking recognition to be qualified as members of the public service, so that they may be given full credit for the years they worked in that particular aspect of aviation.
I could not say exactly how many are involved, but perhaps there are not more than 20. Some are ready for retirement, and some have already retired, but those who have retired are receiving pensions as much as $2,000 less than they would receive if they had qualified to be fully fledged civil servants from the time they began employment with the Department of Transport. Has Treasury Board received representations from these people? Will consideration be given to them? There are perhaps 20 families involved, and I have had a number of representations from them. It is my understanding that some
[Mr. Lewis.)
negotiations have taken place with the government of Canada in order to give them some recognition.
[DOT] (9:20 p.m.)


Charles Mills (Bud) Drury: I would be very surprised if representations either by or on behalf of these people had not been made. I am not aware of them, but I shall try to inform myself. I would, however, perhaps take issue mildly with the hon. gentleman when he talks about the government of Canada granting to these people their rights. It can be argued that a government of Canada pension under the superannuation act is earned by an individual on the basis of the contributions made by him and by the employer, and the size of his pension is determined by the size of the contributions and the period over which they have been made. People who make large contributions for a given period receive a larger superannuation than those who make a smaller contribution. Those who make a contribution over a long period would receive a larger superannuation allowance than those who make the same contribution over a shorter period.
In relation to the approximately 20 families mentioned by the hon. member, I would certainly hope that the pension they have received has been certainly no less than that which would have been received by someone making the same contribution while employed by the public service of Canada. However, to be quite frank I must say that I do not know the answer to this. I shall try to work it out.


John Howard Lundrigan: what is morally their right under the present arrangements. Would the President of the Treasury Board agree to receive a representation by me on behalf of the people?


Charles Mills (Bud) Drury: Mr. Chairman, I would be glad to read anything the hon. member sends me.


David Lewis: Mr. Chairman, I am sorry I was unable to be here when the President of the Treasury Board commented I understand with some lucidity on my remarks earlier. The President of the Treasury Board said my remarks were lucid as well as acid. Lucid acid is still acid. I am sorry I was not here. My colleague, the hon. member for Winnipeg North Centre, indicated why unfortunately I had to leave, and he has given me what I am sure in his usual careful way is a correct summary of some of the things the President of the Treasury Board said. I should like to take two or three minutes, if I may, to comment on that. No doubt the President of the Treasury Board will correct me if I have misunderstood his comments.
First, I was glad to have the minister confirm the fact that there were some thousands-I understand he said 15,000 odd-public service employees who were red circled. I was not questioning the fact that there is value in reclassifying jobs. I was questioning the fact that it was done without consultation with the organization, and as I said earlier I was particularly outraged by the fact that some people did not receive their retroactive pay because the red circling was made retroactive in some cases for a full year. I could see no reason for that. It is neither my suggestion nor that of anyone else who has any knowledge of this thing that the jobs must remain in precisely the same relationship to each other, despite changes in the work load and work content; but I believe it is better labour relations not to make changes which affect thousands of people without consultation with their spokesmen.
If that suggestion appears to the President of the Treasury Board to be one sided, then I should tell him the comments which I understand he made were certainly not two sided; they were certainly the management view that it is entirely within management's power and authority to reclassify and readjust without consultation and without other people knowing what is being done.


Charles Mills (Bud) Drury: I should point out to the hon. gentleman that I did say that the effective dates of reclassification have been the subject
Supply-Treasury Board of discussion during the course of negotiations. This has not been done without consultation or unilaterally or by ukase.


David Lewis: I am glad to have that assurance. All I can say to the President of the Treasury Board is that those who spoke for the employees at the negotiating tables were not under that impression. They were under the impression they were being told what the date was. They were informed of the date on which the red circling would become effective retroactively. If that is what the President of the Treasury Board means by discussion and consultation, then he and I had better look up a dictionary. If they were told the red circling would take effect on a certain day, some of them may not have protested, but in many cases they did. The representatives of the employees should have been asked for their comments. That is what I mean by consultation. I do not mean that he should sit down and tell them what he has decided to do. That is not discussion either. So far as my information is concerned that is all that happened.
I should like to know by what philosophy or social or moral thesis an employer has a right to make red circling retroactive. If I have worked a year in a certain class and you take unto yourself the power to change my class today, I suggest that is enough; but by what right do you take it within your power to tell me that in the past twelve months, even though I worked with the knowledge that I was in a certain class-not merely the impression but the knowledge-putatively, as we lawyers would say, I must be considered to have been in a lower class one year ago? On what basis do you place that kind of an imposition on an employee affected by red circling, and what purpose does it serve except to create bitterness and resentment, which is entirely justified?
This was the major point I drew to the attention of the President of the Treasury Board. I am told that that point was not answered and I should like to know what the answer is. It is bad enough for one to be told that his work is not worth as much as he thought it was in relation to the job-and I do not deny your right to say that. But by what right can you push someone back a whole year in that new lower classification? That is the major point.
The second point in respect of which I understand he said I was being one sided, because all my experience was one sided-it was, and I make no apology-was that concerning the employer having the right to state

November 18, 1968
Supply-Treasury Board his limits and the union having the right to state its demands. Surely the point is that in good labour relations in the government service one must forget that the government is a pretty important and pretty powerful agency.
[DOT] (9:30 p.m.)
In my experience in collective bargaining, and there are others in this chamber who have had experience, I cannot recall any case, in which I was involved, and I have been involved in thousands of them, when the president of a company went on television or on radio and said through that medium to his negotiators at the negotiating table and the public of Canada that he was not going to give more than "X" amount. He might do that after the negotiations have broken down, but I have not known the head of an ordinary private company, who has any sense about labour negotiations, doing that during negotiations. He sends his instructions to his negotiators.
When the employer of the public service, who is the governor and ultimately the public, does that in the course of negotiation- that is, gets on the public platform, along with the President of the Treasury Board-


Charles Mills (Bud) Drury: I didn't.


David Lewis: I beg your pardon; you did not?


Charles Mills (Bud) Drury: It is terribly hard to compete with T.V. personalities today. I outlined all this.


David Lewis: In any event, when the Prime Minister does that I suggest he is doing something which is not good for labour relations in the public service. If those are the instructions they should go to the government's negotiators at the negotiating table. When the Prime Minister makes such a statement to the people of Canada, who ultimately are the taxpayers out of whose money these salaries are paid, what does this do to those people and what does it do to postal and seaway employees vis-a-vis the people of Canada? I do not know whether this occurred at the same time, but the Prime Minister added something about squeezing a lemon, and that there is only so much juice in a lemon. He said he was not going to be a lemon, or something to that effect. What does this do to the negotiators on behalf of the government and the employees, vis-a-vis the public of Canada? If I were one of the employees affected I would make a devil of a lot of noise
if the Prime Minister did that during negotiations which my representatives were attempting to carry out. There is no need for this. There is no need to create public opinion which impinges on postal and seaway employes, putting them under the gun in that way.
The government has negotiators at the negotiating table. It should send them its instructions, and they will pass them on to the negotiating committee of the workers concerned. Surely that is the way to carry on negotiations. No matter what the President of the Treasury Board may say, this is a ukase when it is stated by the Prime Minister with all the power and knowledge the government has in relation to everybody concerned in the bargaining process, particularly during an election campaign. The President of the Treasury Board or his colleagues cannot tell me that is legitimate bargaining, as the law puts it, in good faith. If that is so, then I should like to know what bad faith in bargaining is. I repeat the warning I gave earlier: If this is the road that is to be followed, there is going to be a great deal more trouble in the future than we have had in the past.


[Stage Direction]
Item agreed to.
5. Contingencies-Subject to the approval of the Treasury Board, to supplement other votes for paylist and other requirements and to provide for miscellaneous minor and unforeseen expenses not otherwise provided for including awards under the Public Servants Inventions Act, and authority to re-use any sums allotted for non-paylist requirements and repaid to this appropriation from other appropriations, $70,000,000.
Mr. Hales:: Mr. Chairman, I have one or two things to say about this contingency fund. It is only right that we should ask the President of the Treasury Board a few questions about this blank cheque for $70 million, representing an increase from $45 million, that he is asking us to give. We have a few fond memories about this contingency or slush fund which covers the waterfront and takes in almost everything. We recall one time when we were dealing with interim supply in this house, which was not granted as soon as the government thought it should have been. The government went to work on this fund and found enough money to pay the bills and take this club away from the opposition. We have not forgotten that. The minister should explain the purpose of this fund to the house.
As I suggest, this covers the waterfront. It says, for instance it can be used, subject to

November 18, 1968	COMMONS
the approval of the Treasury Board, to supplement other votes for pay lists. In other words, if there is some increase in pay in different departments this fund will presumably take care of them. It is my thought that if a department estimates its expenditures for salaries and does not estimate them correctly, it should come back to the house and ask for a supplementary amount so that parliament will know the use to which the money is supposed to be put.
The item also suggests that this fund can be used for other requirements and to provide for miscellaneous, minor and unforeseen expenses. That is about as broad as it could be. Why do we not just say that it is to cover everything, instead of trying to dress it up with a whole lot of fancy words? This is as wide and as open as the sky. It refers to unforeseen expenses not otherwise provided for, including awards under the Public Servants Inventions Act. I am not too familiar with that act and I think the minister should tell us what it is all about. The item refers also to an authority to re-use any sums allotted for non-paylists. In other words, this includes anything that has nothing to do with salaries but has been allotted in the estimates, not used and repaid into this contingency fund. As I understand it this refers to all the departments of government, not just the Treasury Board. It refers to any estimates that had been passed in the house other than for salaries, which have not been used. They can be put back into this contingency fund and the Treasury Board has a blank cheque to use this for anything they decide. This is a very important vote and parliament should know what it is passing in respect of this $70 million.


Charles Mills (Bud) Drury: Mr. Chairman, as the hon. gentleman has indicated, the principal amount to be granted in this vote is to cover expected, although undetermined salary increases as a consequence of bargaining negotiations now taking place. The hon. gentleman will realize that we are now in full swing of negotiations. All of these negotiations or agreements have resulted in over-all increases in wages and salaries. In order to avoid indicating in advance of the bargaining process what one might describe as the final offer, which in respect of the government service has not yet been done either publicly or privately, the amount is put into the contingency fund with the understanding that in the final supplementary estimates the amounts required to
DEBATES	2893
Supply-Treasury Board meet the salary increases arising out of collective bargaining agreements, which may have been concluded by then, will be made up in the final supplementary estimates. This accounts for the bulk of the amount.
[DOT] (9:40 p.m.)
As the hon. gentleman has indicated, there are a number of paylist items. I have examples of that kind of thing for the previous year. It is impossible to say what unforeseen contingencies will occur in a current fiscal year. Equally it is a little difficult to say what precisely, and of what value, will be the inventions made by people in the public service during the course of the fiscal year.


Alfred Dryden Hales: Would the minister mind running down that list and giving us, not the amounts of money but the headings under which those amounts were paid out?


Charles Mills (Bud) Drury: Does the hon. member mean the non-pay list?


Alfred Dryden Hales: Yes, Mr. Chairman.


Charles Mills (Bud) Drury: The 1967-68 list runs to quite a few items. June 27, 1967, payments to eligible milk producers, $209; construction of road through Kapuskasing experimental farm, $10,000; payment to owners of crops destroyed by the Golden Nematode, $60,600; funds to the Canadian Dairy Commission for the payment of audit fees, $30,000. Those are some items in the Department of Agriculture. Then under the heading of chief electoral officer we have $2,500 for commissionaire services and travelling expenses. Under the relatively new Department of Consumer and Corporate Affairs we have expenses of the task force on Canada Corporations Act, $152,400; expenses of task force on securities, $46,500; federal government's share of committee on mutual funds and investments contracts, $142,525; expenses of consumer affairs branch, $175,000. These are the kind of items that are on this list.
Under the heading of Energy, Mines and Resources there is the item for expenses of Canadian steering committee of international association on water pollution, $5,000; expenses of Crow's Nest industries team to world series of safety competitions, $2,000. Under the heading of External Affairs there is the item, protection of diplomatic property in Canada, $75,000. The hon. gentlemen will recollect that some damage was caused to the premises of the diplomatic mission here, an occurrence which understandably cannot be

November 18, 1968
Supply-Treasury Board foreseen before the year begins. Next we have purchase of Beaver aircraft for assistance to Middle East refugees, $139,000. Then, there is the study of external aid programs, $50,000; Italian earthquake relief, $100,000. Under the Department of Fisheries we have the item for fishing vessel construction subsidies, $300,000. It will be recollected that the rate at which fishermen availed themselves of this offer of a subsidy turned out to be higher than forecast.
Under the heading of the Canadian livestock feed board there is the item for general administration expenses, $30,000. Under the heading of Indian Affairs and Northern Development there is forest fire fighting in Yukon, $130,000, and grant to commissioner of Northwest Territories in establishing new government in Yellowknife, $175,000. Under the Department of Labour there is the item for allowances and expenses of conciliation boards and industrial inquiry commissions, $30,000. Under the heading of the Senate there is the item for the expenses of the Senate committee, $115,000, on two separate occasions. Under the House of Commons, December 14, 1967 there is the item for additional funds for publishing debates, $240,000. Under Manpower and Immigration there is the item of operating grants to the provinces under the former technical and vocational training agreements, $11 million.
I have a few more pages of these items but I think what I read gives an indication of the nature of these non-pay list items.


Alfred Dryden Hales: Mr. Chairman, it certainly gives us an idea of what goes on. I do not think one could call more than a third of these items emergency or contingency items. Many of them should be estimates under the department, such as for instance audit fees in the Department of Agriculture, chief electoral officer, purchase of Beaver aircraft, livestock feed board, new government at Yellowknife, and House of Commons debates. All these are more or less permanent items, could have been foreseen and should have been in the estimates for these various departments. I do not think we can call all of these contingencies. The minister did read out some that were contingencies, and I am sure hon. members would agree to that; but, goodness knows, this account is not being used for what it was set up for.
I hope the day will come when we will have a committee of this house, whether it is the public accounts committee or a part of

the Treasury Board, where members of parliament will agree to these expenditures before they are approved. The way it is now, parliament leaves these decisions in the hands of Treasury Board, and who does Treasury Board consist of but the five ministers on the front benches? The opposition has nothing to say about it, and the money is spent and gone. This house needs a committee where members from all parties would sit down and deal with these contingencies. Believe me, a lot of these contingencies would be wiped out and there would be proper estimating if we had such a committee.


Mr. Bigg:: Mr. Chairman, I was a member of the public accounts committee at the time of the pay scandal-that is the only word I can use for it-and it is then I believe that I invented the phrase "slush fund", because that is all this fund was at that time. It amounted to $45 million, and I was assured by the then president of the Treasury Board that this would never occur again, and that it was an accident. The government of that time found the money in the slush fund and thus frustrated parliament. Parliament thought that its members had the traditional right of denying Her Majesty supply, but what in fact happened was that the different departments got together and found $100,000 here and $100,000 there, and if my memory serves me correctly over $2 million was found by accident with which to pay the civil servants of Canada. In this way the opposition was not able to bring forcibly to the attention of the nation the scandalous way in which our finances were being managed. Now we are asked to vote some $70 million, which is very close to double the amount the government had a few years back when this trouble occurred.
Unless I miss my guess, with the $70 million the government will have a great deal more leeway than it had with the $45 million. By carelessly voting $45 million we frustrated ourselves in our right to criticize the government and all its departments. We discussed this very thoroughly in the public accounts committee and we decided to try to plug this hole. We even asked the officials of the departments for their advice on how this sort of thing could be stopped so that it could never occur again. Now I am astounded to see that our recommendation, which were very strong at that time, that no $45 million of unmarked money should be left lying around for such a contingency, has been completely disregarded
November 18, 1968	COMMONS
and that we are asked for some $70 million to be paid into exactly the same kind of fund.
For fear that what I say may sound like nothing but criticism I have a suggestion to make, namely that none of this money be allowed to spill over to allow the government of the day to get out of the hole. If we are in fact putting money in which has already been spent, and this is only a general fund to cover up legitimate expenses in individual departments, such as fire fighting costs and costs for refitting of ships and a setting up of a new government for the Northwest Territories, that is fine and dandy; but we want to be assured here and now that this fund will not again be abused as it was before. Apparently the promises of Treasury Board are not enough, because I suspect that if we approve this $70 million without receiving some assurance from Treasury Board that this fund will not be abused, we will have a repetition of the trouble we had once before, but with nearly twice as much money with which to play around.
I wonder if the minister would assure me that he will do all he can to see that this particular abuse of our trust in the financial administration of this country will not be used as a club over the heads of the opposition, and indeed over parliament itself.
[DOT] (9:50 p.m.)


Charles Mills (Bud) Drury: It is quite difficult to answer that, Mr. Chairman. I do not believe I can accept the statement that the government has abused the trust of parliament in the use of this particular fund. If I gave that assurance, it would be implied that the trust was used as a club with which to beat parliament on some previous occasion. If it is quite clear there has not been any such previous occasion, I am quite prepared to do all I can to see that this contingency fund is not employed as an abusive trust, nor will it be employed as a club with which to beat parliament.


Frederick Johnstone (Jack) Bigg: I think the answer is not too difficult to give. Suppose there are 20 departments that need some type of contingency fund, then I am quite willing to vote them a percentage of, say, 10 per cent of their yearly appropriation for this purpose. However, I am not prepared to see the fund spill over into other departments and used in a way to frustrate parliament when it comes to voting supply. This fund should not be used for paying civil servants or for other departmental purposes. If there is an over-appropriation, then that amount should go back into the con-
DEBATES	2895
Supply-Treasury Board solidated revenue fund or perhaps used as a general contingency fund.
However, the contingency fund should not be used to get the government out of a bind. The government sometimes finds money which we did not know about, which we did not vote for a particular purpose, and they pull it out of a hat, like a magician at a sideshow. Then the government says to parliament, "Ha ha, we have the money; there is no point in continuing the supply debate. We have paid the civil servants"-or the mounted police, as the case may be. In this way the historical right of the opposition to question the government about spending money is frustrated. We are not able to discuss the estimates of every department in parliament. The time allotted to the supply debate runs out and we are probably able to discuss only five departments a year. Perhaps on the last supply vote of the year we are able to refer to certain things which we believe are abuses, and bring them forcibly to the attention of the government by means of a long debate. If this opportunity is going to be taken away by frustrating the opposition's right to grant supply, then I feel parliament is being frustrated. I think it is the duty of Treasury Board and the government as well to put this voluntary check on their own abuses. It is not a question of whether or not there are abuses. Naturally we trust the government to do its best, but they have made mistakes from time to time.
If our system of party government has any value at all, then it lies in the fact that the opposition is able to bring forward what they believe is an abuse. It is not yet treason in Canada to criticize the goverment; it is our duty.


James Hugh Faulkner: Shall vote 5 carry?


Some hon. Members:: On division.


[Stage Direction]
Item agreed to.
10. Government's share of surgical-medical insurance premiums and Government's contributions to pension plans and death benefit plans for employees engaged locally outside Canada who are excluded from the Public Service Superannuation Act, to the Unemployment Insurance Fund in respect of Government employees paid through the Central Pay Office and to the Hospital Insurance (Outside Canada) Plan, $14,994,000.
Item agreed to.
James Hugh Faulkner: Shall we now proceed to the estimates of the Department of Labour?


Stanley Howard Knowles: Ten
o'clock, Mr. Chairman.
November 18, 1968
2896	COMMONS
Proceedings on Adjournment Motion


Bryce Stuart Mackasey: I think the house leader indicated earlier in the evening that he would like to revert to motions. Perhaps in view of the lateness of the hour I could deal with my estimates on Thursday.
Resolutions adopted in committee of supply this day reported and concurred in.



THE ESTIMATES


Donald Stovel Macdonald: I wonder if I could have leave of the house to revert to motions for the purpose of making a statement with regard to the new form of the estimates?


Mr. Deputy Speaker:: Is it agreed?


Some hon. Members:: Agreed.


Donald Stovel Macdonald: The house will recall that during the recent debate in committee of supply, the President of the Treasury Board mentioned that the government was developing a new form for the estimates designed to provide a proper basis for discussing the government's expenditure plans. I should like now to ask leave of the house to table copies in English and in French of a sample booklet to illustrate this suggested new form of the estimates. In order to show the proposed new form we have used the Department of Indian Affairs and Northern Development, the Department of Insurance and the Department of the Solicitor General.


Mr. Deputy Speaker:: Does the minister have leave to table the booklet?


Some hon. Members:: Agreed.


Donald Stovel Macdonald: Consultations have taken place which lead me to believe there might be unanimous agreement to a motion along the following lines, which I should like to move:
That a sample booklet illustrating the new form of the estimates be referred to the standing committee on public accounts for examination and report to the house.


[Stage Direction]
Motion agreed to.

Donald Stovel Macdonald: As my final selection this evening, Mr. Speaker, perhaps I might just give the business of the house for the balance of the week. Tomorrow, as indicated by my colleague the Minister of


Manpower and Immigration last Thursday, we will commence with the resumed debate on the Customs Tariff resolution. We hope, by leave of the house, to proceed to the advanced stages of the bill founded upon that resolution. On Wednesday, we will return to committee of supply and there consider the estimates of the Department of Justice. On Thursday, we would again be in committee of supply when we would have the opportunity of listening to the speech of my colleague, the Minister of Labour, followed by a consideration of the labour estimates. On Friday, we will again be in committee of supply when we will deal with the estimates of the Department of Transport.
[DOT] (10:00 p.m.)



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Adrien Lamberi (Bellechasse):: Mr. Speaker, I thank you for having taken into consideration the question I asked some time ago with regard to a problem concerning my riding, and more particularly the people of ile-aux-Grues and the town of Montmagny.
Is is about a wharf, the Montmagny Wharf built a number of years ago, thanks to the contribution of both the government and a private enterprise. At that time, the wharf was meeting the needs of the population and was capable of promoting the economic development of the area.
Opposite the city of Montmagny there is an island inhabited by good citizens, 90 per cent of them farmers, especially potato growers and milk producers. The only useful means of communication between Ile-aux-Grues and the city of Montmagny is by boat.
But for some years now, the situation has been worsening. The channel leading to the wharf at Montmagny, which is commonly called the dock channel, is so full of sand and mud that this fall, even at high tide, the ship that plies between Ile-aux-Grues, the big island and the city of Montmagny had a hard time docking, often damaging its engine. In fact, the owner, Mr. Lavoie, is wondering if he will be able much longer to
November 18, 1968

carry the produce, the mail and the people who have to keep in touch with the rest of the province and the country. In short, the people have the right to live on that island and they are also entitled to the services which are normal in 1968 with regard to communications, health, etc.
The government authorities in Ottawa have been aware of that problem for a number of years now because, during the week, a special meeting took place between the city council of Montmagny and the intermediate bodies. Of course, I was invited to take part in that study in order to submit the problem once again to Ottawa and to try to convince the authorities of the urgency of doing something.
Studies were made two, three or four years ago, and estimates were prepared by engineers. According to present day flies, it seems that it would cost approximately half a million dollars to dredge the channel and give the ships access to the wharf, thus facilitating navigation and communications.
I feel that, even though it should not be extremely profitable or advantageous for the government, something should be done to help that area of the province of Quebec, if not to develop further at least to maintain itself economically.
Mr. Speaker, it is common knowledge that the lower St. Lawrence, from Montmagny down, has numerous economic difficulties. All the governments, co-operate in trying to maintain an interesting and decent standard of living, as well as agricultural and industrial organizations with a view to encouraging the people to stay in that beautiful part of our country. I insist on this and I shall continue to insist, because it is my duty. It is not an election commitment because, before the elections, a questionnaire had been submitted to me in order to know my ideas on the subject and I deliberately omitted to reply, in order not to give the impression that I promised to solve problems which I did not understand.
I did not want to enter into any commitment, but today I am their spokesman in the house and since I understand their problems better, it is my duty to try to work with the government in order to find solutions which will be beneficial, valuable and lasting.
There is another aspect to the problem which must be remembered, and that is that a great many migratory birds come to l'ile-aux-Grues in the autumn. The hunting season attracts many tourists to the island and is an important source of revenue for the people. However, because navigation is difficult, there
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Proceedings on Adjournment Motion are fewer hunters each year, and therefore less profit to be made. In my opinion, taking into consideration all those problems concerning l'ile-aux-Grues and the town of Montmagny, it would be in the national interest to take the steps necessary to solve them as soon as possible, so that the people do not feel neglected. They should be given the same help as is given elsewhere. This is not always economically sound but it is necessary from the humanitarian point of vue.
It has been my good fortune recently to visit another country and I have seen to my amazement some places where-


Yves Forest: Mr. Speaker, the hon. member for Belleehase (Mr. Lambert) has raised a problem which is certainly very important for his riding. Therefore, I can assure him that in the absence of the minister and of his parliamentary secretary (Messrs. Laing and Langlois), I have taken note of his remarks wh'ch will be brought to the minister's attention as soon as possible, so that he may follow up the matter, if it is deemed advisable.



PUBLIC SERVICE-CONSIDERATION OF COMMITTEE REPORT RESPECTING PENSIONS OF SUPERANNUATED CIVIL SERVANTS

Stanley Howard Knowles: Mr. Speaker, on Thursday, November 7, as reported in Hansard at page 2520, I asked the Minister of Finance or the government house leader if arrangements could be made so that there would be time for the house to consider and concur in the report of the special joint committee which was tabled in the house on May 8, 1967. That was the report of the special joint committee on the Public Service of Canada and it was the report that recommended increases in the pensions of retired civil servants.
The Minister of Finance indicated that, in his view, there were technical difficulties in concurring in the report of a committee made to a previous parliament. As a result of that I endeavoured to help the government by proposing the next day, on Friday, November 8, a motion to take that report into review during the present session. I presented that motion on Friday, November 8, as reported in Hansard at page 2567. There was not the necessary unanimous consent, so the motion was not allowed. In stating his objection the President of the Privy Council said that there
28g8	COMMONS
Proceedings on Adjournment Motion would be opportunities during the current session to deal with that report.
When I posted this matter for one of these adjournment debates I did not realize it would come at the end of a day on which we have had a fair amount of discussion on the whole question of pensions of retired civil servants. Although we did not reach any conclusion that might be called satisfactory during our discussions today I was happy that the President of the Treasury Board agreed that the matter could and should be discussed again by the cabinet.
[DOT] (10:10 p.m.)
Perhaps I should leave it there instead of pressing my questions of November 7 and 8. Perhaps I should simply ask the Parliamentary Secretary to the Minister of Finance (Mr. Gray) if he will confirm the statement that the matter will be discussed in cabinet. I know he is not in the cabinet, but I also know he is close to the Minister of Finance (Mr. Benson) and if he will just let the Minister of Finance know that this commitment has been made by the President of the Treasury Board (Mr. Drury) and express the hope that consideration will be given at an early date, that will be a measure of progress.
I should like the parliamentary secretary likewise to urge on the government the validity of the suggestion I made on November 7 and 8, namely that the report of the special joint committee be brought before parliament this session so that members of the House of Commons might express their opinions on it. I do not think a lengthy debate would be necessary and I believe a vote for it would be unanimous. My hope is that if we can take this step we can get back to the mood that I think the government was in between January and June of 1967 and get action on this matter at an early date.
I am glad to see the parliamentary secretary to the Minister of Finance here to answer the question tonight. I hope he will give us the best answer he can, and that at least he will give us an assurance that he will endeavour to see that his minister takes part in the discussion of this matter in cabinet, and also that he will do his best to get an opportunity for the house to express its view, which I am sure will be unanimous, that the time has come to provide these increases in the pensions of our federal superannuates, without any further delay.


Mr. H. W. Gray (Parliamentary Secretary to Minister of Finance):: I will be pleased to

DEBATES	November 18, 1968
draw the attention of the Minister of Finance (Mr. Benson) not only to the remarks of the hon. member who has just spoken but more particularly to the remarks of the President of the Treasury Board (Mr. Drury) during the debate on the estimates of his department, which has just concluded. What the President of the Treasury Board said during this discussion will, of course, be on record in Hansard and will speak for itself.



RURAL DEVELOPMENT-PROPOSED CENTRALIZATION OF ATLANTIC REGION PEOPLE

John Howard Lundrigan: Some time ago, on November 7 to be precise,
I asked the Minister of Forestry and Rural Development (Mr. Marchand) to give us some indication whether the government was actively studying the sociological and economic circumstances surrounding the centralization of the people of the Atlantic region.
My question arose out of the statement of the minister in Halifax to the effect that we must look to regional interests but we must not confuse this with being parochial; regional development did not mean there would be more jobs in every county, a new plant at every crossroad or a new wharf in every harbour. The minister went on to indicate that the countryside is losing people and that many villages and small towns are declining in population. He went on further to infer that people would be expected to migrate. The whole inference of this was that the department had made plans for the centralization of the people of the Atlantic region.
A few days earlier, the Minister of Fisheries (Mr. Davis) referred to the fact that some 8,000 people would be centralized under a resettlement plan in Newfoundland. That is, 15 per cent of the people of Newfoundland would be brought from small rural communities to urban communities within the next ten years. As a matter of fact on Friday, November 15, one of our local newspapers in a commentary indicated that centralization is probably the biggest single issue the province has had to grapple with at any time in modern history. It said it can mean the future progress and stability of the province or its economic and social ruin. That editorial was entitled, "Don't Play With People."
An eminent Canadian author has characterized the decentralization carried on by the federal and provincial governments as the concentration of people into concentration camps before they move to Toronto.
The reason I pose my question to the minister, and would like a statement from
November 18, 1968

him concerning the government's philosophy on resettlement and centralization, is that in actual fact I think the government has no philosophy. Perhaps I should direct my question to the premier of Newfoundland.
This is an important matter of urbanization, centralization, relocation and resettlement, particularly of the people in Newfoundland and of people in the Atlantic region generally. I am not one bit against centralization. I am not against any changes designed by any government, municipal, federal or provincial, to improve the lot of people, provided those changes follow some kind of philosophy, some kind of plan, some kind of program, and provided the alternatives have been investigated. My contention is that 8,000 people have been moved, and 80,000 more people are to be moved in Newfoundland without this program being based on any philosophy, plan or policy. I could quote at length from a report investigating the urbanization or relocation of people in Newfoundland, a report commissioned by the federal government.
At page 15 of the report it is pointed out that it would seem the government adopts a policy of hands off, refusing to offer advice to those being moved lest it be held responsible for any unforeseen difficulties that might arise. It does not inquire into the reasons why people should move. The report goes into detail and indicates that people have been moved from slow growth centres to no growth centres. It indicates that housing has been a major problem for people with large families. It indicates that unemployment has resulted. It indicates that elderly people have been forced to relocate in areas where they are virtually faced with starvation.
The report contends that the government has been dealing with the benefits accruing to young people from the program, with no regard given to the problems faced by the adult segment of the population resulting from relocation. The government has a narrow concept of centralization. It intimates that the government has literally been playing checkers with people, expecting people to leave a sinking ship and jump into the raging Atlantic.
It is heartbreaking to study many of the problems faced by people who have been relocated in Newfoundland. As a result of relocation now we have the man without a home as compared to the man with a home, the man Edward Markham and Millais painted and wrote about.
I am asking the government for a statement of its philosophy. I am asking it to take a
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Proceedings on Adjournment Motion closer look at what it is doing with people, because centralization is not the sole solution for many of the problems of rural Atlantic Canada. I am asking the government to inform the people of the Atlantic region, in fact of all regions in Canada whether west or east, what its policies are in this matter.
We have had instances where people have been moved to a new location and found they could not afford to buy houses. People get $1,000 to move and $200 per child, and sometimes they are moved into areas where the cost of living for them has increased fivefold. When the government moves people I ask it to consider the humanist aspects involved and not just the economic aspects.
I think the minister in charge of rural development has a clear concept of what is involved. I am convinced of this from reading his statements in the maritimes. All I am asking is that the Minister of Fisheries (Mr. Davis), who now has responsibility for the program, and the minister in charge of regional development, get their heads together along, with provincial officials, and indicate to the people of Canada what their philosophy is. Right now there seems to be no philosophy, and what does appear is tragedy for a good number of people in many regions of Canada.
[DOT] (10:20 p.m.)


Yves Forest: Mr. Speaker, I believe the hon. member for Gander-Twillingate knows the reason the Minister of Forestry and Rural Development is not here to answer the hon. member's question concerning the proposed centralization of the people of Newfoundland and the whole Atlantic region. The hon. member may be assured, however, that I shall bring this to the attention of the minister tomorrow. The minister may see fit to give him a written answer.


Mr. Deputy Speaker:: Order. Pursuant to provisional standing order 39A the motion to adjourn the house is now deemed to be adopted. Accordingly this house stands adjourned until tomorrow at 2.30 p.m.
Motion agreed to and the house adjourned at 10.22 p.m.
[The following items were passed in Committee of Supply this day:]



DEPARTMENT OF FINANCE 50, L30. TREASURY BOARD 1, 5, 10. COMMONS DEBATES

[Stage Direction]
November 18, 1968


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1.	The North Atlantic Council met in ministerial session in Brussels on 15th and 16th November. The meeting was attended by foreign, defence and finance ministers. The [DOT]council had moved forward from mid-December its normal year-end meeting so that ministers might discuss at an earlier date the serious situation following the armed intervention in Czechoslovakia and the occupation of that country by forces of the Soviet union *and of four of its Warsaw pact allies.
2.	Ministers reaffirmed the inviolability of the principle, which has been invoked on numerous occasions by every country, including the USSR, that all nations are independent and that consequently any intervention by one state in the affairs of another is unlawful.
They noted that this principle has been deliberately violated by the Soviet leaders with the backing of four of their allies. World opinion has been profoundly shocked by this armed intervention carried out against the wishes of the government and people of Czechoslovakia. All the members of the alliance have denounced this use of force which jeopardises peace and international order and strikes at the principles of the United Nations charter. Like all other peoples, the people of Czechoslovakia must be free to shape their future without outside interference. Agreements concluded under the pressure of occupying forces can provide no justification for challenging this basic concept.
3.	The contention of the Soviet leadership that there exists a right of intervention in the affairs of other states deemed to be within a so-called "Socialist commonwealth" runs counter to the basic principles of the United Nations charter, is dangerous to European security and has inevitably aroused grave anxieties. It gives rise to fears of a further use of force in other cases.
The use of force and the stationing in Czechoslovakia of Soviet forces not hitherto deployed there have aroused grave uncertainty about the situation and about the calculations and intentions of the USSR. This uncertainty demands great vigilance on the part of the allies.
4.	Applied to Germany the policies which the USSR derives from its doctrine of a so-called "Socialist commonwealth" raise new
obstacles to the rapprochement and ultimate unification of the two parts of Germany. Moreover, they would be contrary to the letter and spirit of the four power agreements relating to Germany as a whole.
In this situation, and bearing in mind the special responsibilities of the United States, the United Kingdom and France, the ministers reaffirm the determination of the alliance to persevere in its efforts to contribute to a peaceful solution of the Germany question based on the free decision of the German people and on the interests of European security. Their governments do not recognize the "GDR", and they reject all claims which would tend to perpetuate the division of Germany against the will of the German people.
Referring to their communique issued in Reykjavik on 25th June, 1968, the ministers confirm the support of their governments for the declared determination of the three powers to safeguard Berlin's security and to maintain freedom of access to the city. They recall the declaration of the North Atlantic Council of December 16, 1958 on Berlin and the responsibilities which each member state assumed with regard to the security and welfare of Berlin. They note with satisfaction the important measures taken by the Federal Republic of Germany in conformity with the status of Berlin for the purpose of maintaining the viability of the city. They associate themselves with the position of the three powers as regard the legitimate concern of the federal government for the welfare and viability of Berlin and as regards the resulting ties which exist between the two on the basis of the arrangements in force.
The ministers associate themselves with the call made upon the Soviet union by the three powers to respect the quadripartite agreements concerning Berlin and the decisions taken pursuant to these agreements by the United States, France and the United Kingdom.
5.	The new uncertainties resulting from recent Soviet actions also extend to the Mediterranean basin. This situation requires that the allies continue by every available means their efforts to promote stability and a just and equitable peace, as well as mutual cooperation and understanding, in the area. The
November 18, 1968
[Stage Direction]
expansion of Soviet activity in the Mediterranean, including the increased presence of Soviet naval units, requires vigilance to safeguard allied security.
6.	The members of the alliance urge the Soviet union, in the interests of world peace, to refrain from using force and interfering in the affairs of other states.
Determined to safeguard the freedom and independence of their countries, they could not remain indifferent to any development which endangers their security.
Clearly any Soviet intervention directly or indirectly affecting the situation in Europe or in the Mediterranean would create an international crisis with grave consequences.
7.	So long as the Soviet leaders adhere to a policy of force, these new uncertainties will remain. The allies are convinced that their political solidarity remains indispensable to discourage aggression and other forms of oppression. Above all, they stand wholly determined to meet their common reponsibili-ties and, in accordance with the North Atlantic Treaty, to defend the members of the alliance against any armed attack.
8.	The allies participating in NATO's integrated defence programme have, therefore, been obliged to reassess the state of their defences. They consider that the situation arising from recent events calls for a collective response. The quality, effectiveness, and deployment of NATO's forces will be improved in terms of both manpower and equipment in order to provide a better capability for defence as far forward as possible. The quality to reserve forces will also be improved and their ability to mobilise rapidly will be increased. Renewed attention will be directed to the provision of reinforcements for the flanks and the strengthening of local forces there. The conventional capability of NATO's tactical air forces will be increased. Certain additional national units will be committed to the major NATO commanders. Specific measures have been approved within these categories of action for improving the conventional capability of NATO's forces. Ministers agreed that the co-ordinated implementation of these measures and the provision of additional budgetary resources to the extent necessary to support them would form part of the NATO force plan for 19691973 which will be submitted in January 1969. They also acknowledged that the solidarity of the alliance can be strengthened by co-operation between members to alleviate burdens arising from balance of payments deficits
resulting specifically from military expenditures for the collective defence.
9.	A year ago ministers affirmed in the report on the future tasks of the alliance that, while maintaining adequate military strength and political solidarity to deter any aggressor, the alliance should work to promote a policy of detente. The Soviet intervention in Czechoslovakia has seriously set back hopes of settling the outstanding problems which still divide the European continent and Germany and of establishing peace and security in Europe, and threatens certain of the results already achieved in the field of detente. Indeed, in view of the action of the five members of the Warsaw pact, the scope and level of allied contacts with them have had to be reduced.
10.	More specifically, prospects for mutual balanced force reductions have suffered a severe set back. Nevertheless, the allies in close consultation are continuing their studies and preparations for a time when the atmosphere for fruitful discussions is more favourable.
11.	In any event, consistent with western values the political goal remains that of secure, peaceful and mutually beneficial relations between east and west. The allies are determined to pursue this goal, bearing in mind that the pursuit of detente must not be allowed to split the alliance. The search for peace requires progress, consistent with western security, in the vital fields of disarmament and arms control and continuing efforts to resolve the fundamental issues which divide east and west.
12.	The North Atlantic Alliance will continue to stand as the indispensable guarantor of security and the essential foundation for the pursuit of European reconciliation. By its constitution the alliance is of indefinite duration. Recent events have further demonstrated that its continued existence is more than ever necessary. The foreign minister of France recalled that, for its part, unless events in the years to come were to bring about a radical change in east-west relations, the French government considers that the alliance must continue as long as it appears to be necessary.
13.	The next ministerial meeting of the council will be held in Washington on 10th and 11th April, 1969.
14.	The defence planning committee which met in ministerial session on 14th November will hold its next ministerial meeting in Brussels on 16th January, 1969.
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5? *5
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Tuesday, November 19, 1968