1968-11-08

Mr. Speaker:: I have the honour to inform the house that a message has been received from the Senate informing this house that the Senate have passed the following bills without any amendment: Bill C-lll, an act to amend the Farm Improvement Loans Act; Bill C-113, an act to amend the Prairie Grain Advance Payments Act.



REMEMBRANCE DAY


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, before this house meets again the world will have marked the fiftieth anniversary of the conclusion of world war I, the war intended to end all wars. It is therefore appropriate, I suggest, that we pause a moment this morning to reflect on the sacrifices made by Canadians in that holocaust, and reflect as well on the minute distance which man has advanced in the past half century toward the goal of a warless world.

Monday next will be dedicated to the memory of the sacrifices and the assistance offered generously by Canadians during the war of 1914-1918 and other conflicts in which we have participated since then. Let us not forget, however, that this contribution also provides a lesson: that war is a poor solution and that it proves mainly the refusal of peoples to solve their conflicts with their intelligence. And let us not forget that war, in this atomic age, constitutes in the words of Albert Schweitzer "the height of absurdity".

When on Monday we pause in silent tribute to those who fell and those who served in the first world war I suggest, Mr. Speaker, we should remember that among them were members of the parliament of Canada. Their sacrifice will not be in vain if we here accept their challenge and strive to avoid the need for further sacrifices in the name of war.


Hon. J. A. MacLean (Malpeque):: Mr. Speaker, I am sure all Canadians will join with the Prime Minister in the tribute he has paid today on the occasion of the fiftieth anniversary of the ending of the first world war. I think perhaps my deskmate the right hon. member for Prince Albert (Mr. Diefen-baker) is the only veteran of that conflict who is still serving in this house.


Some hon. Members:: Hear, hear.
[DOT] (11:10 a.m.)


John Angus MacLean: I am sure all veterans will appreciate the recognition the Prime Minister has given today to their contribution, and to the contribution of those of their comrades who are not here to acknowledge that recognition on their own behalf.
While Remembrance day originally was set aside to honour the memory of those who fought and especially those who fell during the first world war, it equally commemorates those Canadians who made the supreme sacrifice for their country in the second world war and in the Korean conflict.
The Prime Minister in his statement has referred to the futility of war as a means to resolving disputes. Certainly in recent months we have been reminded that to resort to force is not a thing of the past but is still with us. In this imperfect world the choice men face is not always, or even very often, between good and evil but rather is a choice between two evils. The wars of this century in which Canadians and men of other countries gave their lives for freedom may be regarded by some as futile, but we owe even the imperfect order and peace we have today to their sacrifice. Their sacrifice at the very least gave mankind a further chance to seek the rational solution to which the Prime Minister referred.
In these days, when many Canadians are rightly concerned about the unity of our country, it is well to remind ourselves of those who gave their lives for its survival. I speak for Her Majesty's loyal opposition in seconding the remarks of the Prime Minister, and I am sure I can also presume to speak for the veterans of two world wars and of the Korean war in acknowledging the recognition paid to them this morning by the Prime Minister.

November 8, 1968
Remembrance Day


Mr. David Lewis (York South):: Mr. Speaker, obviously no one can say enough about the bravery and sacrifices of Canadian men and women in the first world war which ended 50 years ago, and their sacrifices in the war which ended 23 years ago. Our tribute to them is deep and humble.
I want to suggest that it is not enough merely to recognize that war is the ultimate in folly. If I may make a personal reference, I was five years old when the first world war broke out. I was living in a little village in eastern Europe. During that war it was sufficient for my family and others to avoid the consequences of the fighting by hiding in a cellar. That was no longer sufficient in the second world holocaust, and if another war should come there will be no place which will be safe for any human being.
I suggest that when we as parliamentarians pay heartfelt deep tribute for the sacrifice of the men and women in the wars of this century which enables us to continue to live in democratic freedom, we as parliamentarians should remember that war is not something that happens; war is the result of imperfect political action, and of the failure of political leaders. The first world war was the result of political and economic rivalry. The second was a result of the failure of the world to understand the dangers of nazism and the fact that Hitler received support from high places in many parts of the world.
I urge, Mr. Speaker, that as we pay tribute to our dead in the world wars of this century we look carefully at the political international situation today, in which we have pursued policies which may well lead not merely to another war but to the total destruction of humanity.


Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I thank the right hon. Prime Minister for having sent me, this morning, a copy of the statement he has just made. However, I regret one thing: that I received an English copy while I should have preferred a copy of the French version.
In any event, I echo the words of the right hon. Prime Minister to the effect that wars have never solved anything and constitute "The height of absurdity". If only peoples and their leaders could convince themselves of this. Let us pay tribute to all those Canadians who sacrificed themselves for their country and let us hope that wars will forever be banished by all the peoples of the world. The

atomic age can destroy the universe or enable it to grow and prosper. Everyone wants peace, and it is our duty, as responsible parliamentarians, to achieve a just and lasting peace, within our country as well as abroad.


Mr. Gerard Laniel (Beauharnois):: Mr. Speaker, I rise on a question of privilege merely to point out that the hon. member for Malpeque (Mr. MacLean) forgot to mention that the hon. member for Fort William (Mr. Badanai) is also a veteran of the first world war and that he is now representing the parliament of Canada at the ceremonies taking place in Mons, Belgium, to commemorate the 50th anniversary of the first world war.


John Angus MacLean: Mr. Speaker, I am greatly indebted to the hon. member for bringing this to the attention of the house, and I very much regret the oversight.



BUSINESS OF THE HOUSE


Hon. Donald S. Macdonald (Rosedale):: Mr. Speaker, because of the continued interest of hon. members in the budget debate, and in view of the fact that but for another arrangement we would have a private members' hour this day from five o'clock to six o'clock, I wonder whether there might be a general disposition in the house to waive the private members' hour today. Perhaps the house might be agreeable to an order to that effect at this time.


Mr. Speaker:: Is that agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: It is so ordered.



EXTERNAL AID


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I stated in the house on Monday of this week that one of the subjects which Professor Head had discussed with General Gowon was the most effective form of assistance which Canada might offer Nigeria respecting the distribution of relief supplies in federal territory. I said these discussions were being pursued on an official level and that I hoped to make a further statement shortly.
November 8, 19G8

I wish to say today that we have now concluded an agreement to make two Canadian Caribou aircraft available through the Canadian Red Cross to the Nigerian Red Cross for the distribution of relief supplies in federal territory. Because of the short range of the Caribou and navigational problems encountered in ferrying them the great distance involved, this operation is a complicated one, and I am informed they cannot be on the ground in Lagos for some 14 days.
It is the intention of the government to recall the Hercules aircraft now at Lagos which has been unable to operate because of the poor condition of the forward airstrips, a condition which will not hinder the operation of the lighter Caribou aircraft.



PUBLIC SERVICE


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise under the provisions of standing order 42 to ask the house to agree to a motion to take care of a technical point. Perhaps I might read standing order 42, which is as follows:
A motion may, in case of urgent and pressing necessity previously explained by the mover, be made by unanimous consent of the house without notice having been given under standing order 41.
[DOT] (11:20 a.m.)
Because my motion relates to the technicality of making it possible to deal in this session of parliament with a report presented in a previous session, indeed in a previous parliament, may I draw the attention of Your Honour and the house to citation 320, subparagraph 3, of Beauchesne's fourth edition, which reads as follows:
As to the report of a committee presented during a previous session, motion must first be made that it be considered during the current session, and, if such a motion is carried, the house may appoint a day for consideration of the report.
I should also like to draw Your Honour's attention to a Speaker's decision on this point which is to be found on page 694 of Beauchesne's third edition, which was a decision given on March 3, 1938, that it was in order to move a motion for the house at its current session to deal with a report that had been presented in an earlier session.
Yesterday the Minister of Finance (Mr. Benson) suggested that there was a technical problem in dealing in this session with the report of the special joint committee on the public service of Canada which had to do
Public Service
with the pensions of retired civil servants and which was presented to the House of Commons on May 8, 1967. I therefore ask the consent of the house to move a purely procedural motion. It is not my intention to debate it. It seeks consideration at a later time in the session, and the question of when that will be done can be negotiated. But it would seem to me that all members of the house would be willing to take care of this technicality so that some time during this session we could deal with the ninth report of the special joint committee which was made on May 8, 1967.
I may say that my leader, the hon. member for York South (Mr. Lewis), is of course prepared to second this motion, but he would be quite happy to give way if the hon. member for Ottawa East (Mr. Richard) or the hon. member for Grenville-Carleton (Mr. Blair) would like to be associated with it. Therefore I ask leave to move:
That the ninth report of the special joint committee of the Senate and the House of Commons on the public service of Canada, presented to the House of Commons on May 8, 1967, be considered by this house during the present session of parliament.


Donald Stovel Macdonald: Mr. Speaker, I would take issue with the hon. member for Winnipeg North Centre that there have not been and will not be opportunities to deal with this report during the current session. There are, in fact, opportunities to deal with it at the present time under the budget debate. Therefore I would indicate there would not be unanimous consent this morning.


Mr. Diefenbaker:: How kind you are to the retired civil servants.


Stanley Howard Knowles: Mr. Speaker, on a question of privilege may I be permitted to ask the President of the Privy Council whether he understands the situation. Is he not aware that yesterday the Minister of Finance said there was a technical difficulty in concurring in this session in a report that was presented in a previous session? This motion does not seek that concurrence; we cannot do both things in one step. My motion merely asks that we cover the point raised yesterday by the Minister of Finance, and that we make sure that we have the right to consider in this session a report that was presented in a previous session. In other words I am seeking to overcome the technical difficulty raised by the Minister of Finance,
2568	COMMONS
Suggested Abuse of Rights of House and I urge the President of the Privy Council not to press his objection.


Donald Stovel Macdonald: Mr. Speaker, I do not think it is really a question of there being any technical difficulty in the way of the hon. member for Winnipeg North Centre dealing with this question, because obviously there are plenty of opportunities for doing so.
I do not concur in his suggestion that we follow this procedure.


Mr. Baldwin:: Mr. Speaker, on a point of order-


Mr. Speaker:: Order, please. I ask whether hon. members realize that under standing order 42, as has been pointed out by the hon. member for Winnipeg North Centre, we require unanimous consent. As there is not unanimity at the moment, we cannot proceed further and there should be no debate on the question.



PRIVILEGE


John George Diefenbaker: Mr. Speaker, I rise on a question of privilege. I dislike doing so, but the recent trend in the answering of questions by the government with a cavalier disregard of the rights of parliament demands that I refer to the return which was brought in the other day to question No. 174 (a) in connection with the Company of Young Canadians.
I asked therein for the names, addresses and amounts paid to each of the recipients of such payments. Several pages of information were given on the amounts and the names of the individuals, but strangely enough the addresses were not given, only the names of the cities, towns or villages where these particular recipients live. When it is realized that according to the return some $30,000 was paid to chartered accountants to examine the accounts of the Young Canadians, it is obvious that it is an imperative necessity that the addresses be given, otherwise this is simply a hodgepodge of names, and it would take an eternity to find out whether these people in fact received the amounts which they allegedly received, and I have no information in that connection.
We are entitled to addresses of recipients. The motion was passed by the house, and to provide a document like this with a list of names of recipients, giving cities and towns without giving the addresses is a flagrant abuse of the rights of the house.

DEBATES	November 8, 1968


Donald Stovel Macdonald: Mr. Speaker, I do not accept the rather colourful language of the hon. gentleman in referring to this matter. Every effort is made to provide the information requested. If the addresses are available they will certainly be provided. I would be prepared to inquire from my colleague the Secretary of State to see whether he can provide the information. But obviously if the information is not available or not available in any systematic form, then it cannot be provided.


John George Diefenbaker: Mr. Speaker, may I say in answer to the hon. gentleman that I am sure the addresses must have been available; otherwise the cheques in payment could not have been sent to the recipients.


Donald Stovel Macdonald: Perhaps the
hon. member should bear in mind the nature of the operations of some of these young volunteers, and the fact that in many of the communities they worked on a transient basis. All I can say is that perhaps the addresses are available. I am prepared to make inquiries, but I do not accept the hon. gentleman's epithets.


Mr. Maclnnis (Cape Breion-Easf Richmond):: Mr. Speaker, I have a question-


Mr. Speaker:: Order, please. May I point out that we are not in the question period at this time. I understand the hon. member wishes to ask a supplementary question concerning the matter raised by the right hon. member for Prince Albert. However, I understand from the President of the Privy Council that he is making inquiries to give effect to the request made by the right hon. member for Prince Albert. Perhaps the matter should be allowed to rest there.


Mr. Donald Maclnnis (Cape Brelon-Easl Richmond):: Mr. Speaker, I rise on a question of privilege following the question of privilege put by the right hon. member for Prince Albert. I should like to ask the President of the Privy Council if he would consult the Minister of National Revenue.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
Mr.  R. Gordon L. Fairweather@Fundy-Roy-al: I have a question for the Prime Minister. Was Canada one of the 15 member states of the United Nations which sought acceptance
November 8, 1968	COMMONS
of the credentials of the People's Republic of China rather than the nationalist government of China as a member of the security council yesterday?


Right Hon.   P.-E. Trudeau@Prime Minister: I would have to take that question as notice. I am not quite sure I understood. Was Canada one of the nations which-?


Mr. Fairweather:: I am not trilingual, but I will try again. Was Canada one of the 15 states of the United Nations which sought acceptance of the credentials of the People's Republic of China rather than the nationalist Chinese government as a member of the security council?


Mr. Trudeau:: I cannot answer that, Mr. Speaker, but I can inquire. I can also tell the hon. member that our position on the admission of the People's Republic of China to the United Nations has not changed. We are pursuing our studies toward seeking a way in which we might establish relations with the government of Peking, and until I have reported to the house on that we do not contemplate changing our position in the United Nations.


Mr. W. B. Nesbitt (Oxford):: A supplementary question, Mr. Speaker. Is it the intention of the government to abstain from voting on the acceptance of the credentials of the People's Republic of China in the United Nations or to vote against acceptance of those credentials?


Pierre Elliott Trudeau: Well, Mr. Speaker, on the general resolution which comes before the United Nations we will take the usual position of abstaining. This, I believe, is what is called the Albanian resolution which links the admission of the People's Republic of China with the exclusion of Taiwan in ways which we do not approve at this stage. There are other resolutions on which we will take a position which will indicate we are not hostile toward seeking a solution whereby eventually the People's Republic of China can be admitted to the United Nations. Our concern is that the government of Taiwan not be disregarded in the process.


Mr. Ed Schreyer (Selkirk):: I have a question, Mr. Speaker, which is actually a related question. I should like to ask the Minister of Agriculture if it is true that wheat board delegates are present today in Canton, China.


Mr. Speaker:: Order, please. The hon. member for Egmont.
DEBATES	2569
Inquiries of the Ministry


Mr. David MacDonald (Egmonl):: Since the Prime Minister is enunciating government policy with regard to mainland China, will he say whether definite contacts have been made with that government with regard to their recognition in the United Nations and our own diplomatic relationship with them?


Pierre Elliott Trudeau: This question of whether we should or could establish diplomatic relations with Peking is a complex and difficult one. I would rather not report on the various stages of progress or lack of progress until a more definite stage has been reached by the government.


John George Diefenbaker: The Prime Minister has given a rather clear statement today regarding the attitude of the government in this connection. I should like to ask him whether it is the intention of the government, providing it gives recognition to communist China, to assure that the nationalist government of Taiwan shall continue to be a member of the United Nations and shall be protected against any aggressive action on the part of the communist regime of Peking.


Pierre Elliott Trudeau: As I said in my previous answer, Mr. Speaker, we do want to take into account the fact that there is a separate government in Taiwan, one with which we have enjoyed good relations in the past. The procedure which will be followed in the United Nations is, of course, one which can only be determined by a majority of the members there. It is our intention, as I indicated earlier, to further our study to establish relations with Peking. I can only report the outcome of that at a later stage. Of course our conduct in the United Nations will be dependent on the progress of our bilateral endeavours.


John George Diefenbaker: Will the Prime Minister answer one question that he did not answer? Will any action be predicated upon preserving the nationalist government of Taiwan, which has stood for freedom throughout the years, to assure that it shall not be placed in jeopardy as a result of action taken by the government of Canada?


Pierre Elliott Trudeau: I should say that the intentions of the Canadian government toward the government of Taiwan are in no sense hostile; they are friendly.


Wallace Bickford (Wally) Nesbitt: Mr. Speaker, I have a question for the Prime Minister. In view of his observations a few moments ago in regard to the
2570	COMMONS DEBATES	November 8, 1968
Inquiries of the Ministry
good relations enjoyed between Canada and employees covered by collective agreements the government of Taiwan, is it now the and since red circled? intention of the government to set up some
form of diplomatic representation in Taiwan? Mr. Drury: I am not quite sure of the sig-
,	nificance of the hon. gentleman's question.


Pierre Elliott Trudeau: We do have diplomatic repre- ^ecj circiing and the transfer from one bar-sentation with the government in Taiwan, gaining ^ tQ another as a conseqUence of
r. pea er.	reclassification I do not think are necessarily


Some hon. Members:: 
Mr. Forresiall:: 
Mr. Speaker:: Order, please.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
David Lewis: If I may
change the subject, Mr. Speaker, I should like to direct a question to the President of the Treasury Board. Has he received protests from the various public service organizations over the continuation of the widespread reclassification of public servants, resulting in the red circling of thousands of positions which deprives the holders of those positions of increases which have been negotiated? If he has received such protests, what are the intentions of the government with regard to the continuation of this practice?


Hon. C. M. Drury (President of ihe Treasury Board):: I think the house is aware, Mr. Speaker, that this process of reclassification has been going on for almost three years now. It has resulted in a great many changes in a very complex system and is now largely completed. It would be a mistake at this juncture, I think, to try to reverse the process. I can assure the hon. gentleman that sympathetic consideration is being given to the difficulties, the anachronisms and in some cases the injustices which arise in this process.


David Lewis: A supplementary question, Mr. Speaker. In view of the fact that this continuing reclassification has eaten into the bargaining units which have been established by the public service staff relations board, and in view of the fact that the result is in conflict with decisions made in negotiations for a collective agreement, will Treasury Board reconsider the application of red circling to



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. Bernard Dumont (Frontenac):: Mr. Speaker, it was my intention yesterday to direct a question to the Minister of National Defence, but as the schedule of attendance showed that he would be absent, I put it aside until taday. Now, I note that the minister is probably attending to very important matters, so I will have to direct my question to the right hon. Prime Minister. I also wonder whether it would not be appropriate to rectify the attendance roster of ministers, as it seems we cannot rely on it.
My question relates to a photograph of a soviet bomb in orbit, taken by the Cold Lake observation centre. Can the minister assure the house that the North American radar defence system is still efficient?


Right Hon.   P.-E. Trudeau@Prime Minisler: Mr. Speaker, following the remarks made by the hon. member, I must point out to him that the Minister of National Defence was not scheduled to be in the house yesterday or today, but that he will be here next week.


Bernard Dumont: Mr. Speaker, according to our information, the minister was supposed to be here this morning.


Mr. Speaker:: Order. Does the hon. member wish to ask a question?


Bernard Dumont: Yes, Mr. Speaker.
Is the government not afraid that bombs coming from the south might not be detected by our long radar network in the north?


Pierre Elliott Trudeau: The list is not up to date.
November 8, 1968



FINANCE


[Stage Direction]
On the orders of the day:
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, my question is to the Minister of Finance. Would the minister please inquire into and then make a statement to the house on the financial operations of the Commonwealth group of companies in British Columbia, and the possible loss by certificate holders and other investors in this particular group?


Hon. E. J. Benson (Minister of Finance):: Mr. Speaker, I have already made inquiries in this connection. The Commonwealth Trust Company in Vancouver is not, I believe, subject to the receiving order. The Commonwealth Trust Company is covered by the C.D.I.C., so its depositors are quite safe. The other companies involved are provincially incorporated companies that are not covered by the C.D.I.C. I have asked for further information as to what is happening in this regard, though I might mention that it is not the responsibility of the federal government.


Marcel Joseph Aimé Lambert: A supplementary question, Mr. Speaker. While admitting that particular aspect of the matter, I wonder whether, in the light of reports that investigations may have originated in February and May 1968, the minister would advise the house if the Superintendent of Insurance acted under his authority under the deposit insurance act and carried out investigations in the interval.


Edgar John Benson: Mr. Speaker, my understanding is that the insurance department has been looking at this particular matter. As a matter of fact the superintendent reported to me, at the time the receiving order was issued in connection with the other companies, that the company in which we had an interest since it is insured by the C.D.I.C. was not involved.
Incidentally, Mr. Speaker, perhaps I should take this opportunity to point out that the Commonwealth Trust Company in Vancouver is not related to companies in other parts of Canada operating under the same name. I say that just so there will not be any misunderstanding.


Marcel Joseph Aimé Lambert: A further supplementary question. The minister has
Inquiries of the Ministry referred to the receiving order. Was this the receiving order that was passed at the same time the order in council was passed, either in February or May, or was it passed during the last few days?


Edgar John Benson: This was a recent action, Mr. Speaker, taken in British Columbia. A receiving order was issued against a group of companies related to the Commonwealth Trust Company. No receiving order was issued against Commonwealth Trust, the company in which we had a prime interest, because its depositors are insured under C.D.I.C.


Mr. Erik Nielsen (Yukon):: A supplementary question, Mr. Speaker. In the absence of the Solicitor General perhaps the Minister of Finance could inform the house whether the regional office of the bankruptcy division in Vancouver is inquiring into this matter.


Edgar John Benson: Mr. Speaker, I really am not informed as to this matter, but I will take it up with my colleague and answer later.



COMMONWEALTH RELATIONS


[Stage Direction]
On the orders of the day:
Mr. R. N. Thompson (Red Deer):: Mr. Speaker, I should like to direct a question to the Prime Minister. It arises from a statement made at the current Commonwealth Parliamentary Association conference to the effect that Canada's immigration policy is wicked and disgraceful and that Canadians accept only skilled and talented immigrants and practise colour discrimination.
Could the Prime Minister say whether the government has forwarded any instructions to the leader of the Canadian delegation at the conference to assure the conference that Canada will not allow such a policy as described by the attorney general of Jamaica? If the government has not sent any instructions to the head of our delegation, Mr. Speaker, is it intending to do so?


Right Hon.   P.-E. Trudeau@Prime Minister: I will make inquiries, Mr. Speaker.


Hon. W. G. Dinsdale (Brandon-Souris):: supplementary question, Mr. Speaker. In light of the statement made at the Commonwealth conference would the government reconsider its plans to remove the reciprocal privileges extended to Commonwealth immigrants, a step that would increase discrimination against immigrants from the West Indies?

November 8, 1968

Inquiries of the Ministry


Pierre Elliott Trudeau: I will make inquiries about that too, Mr. Speaker.



WHEAT-INQUIRY AS TO MISSION TO RED CHINA

[Stage Direction]
On the orders of the day:
Mr. John Burton (Regina East):: Mr. Speaker, I wish to direct a question to the Minister of Industry, Trade and Commerce, who normally undertakes to be present in the house this day. In his absence I would direct it to the Minister without Portfolio, the hon. member for Saskatoon-Humboldt, who is acting minister of trade and commerce and who also normally undertakes to be present in the house this day. However, in his absence I will direct it to the President of the Treasury Board who is second acting minister of trade and commerce, as shown in Hansard for October 21.
Will the minister investigate statements made by the trade commissioner in Hong Kong and wheat board officials that a mission is negotiating a wheat sale to China, in view of statements made by the Minister of Industry, Trade and Commerce and the Minister without Portfolio in this house to the effect that it would not be in the public interest to make comments respecting what negotiations are in progress? When will the house be given access to information about what is happening?


Charles Mills (Bud) Drury: Mr. Speaker, may I thank the hon. gentleman for his somewhat lengthy recital of the procedures of the house. However, I would draw to his attention that the practice does not provide for ministers to be present but for departments to account for themselves.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order, please.


Charles Mills (Bud) Drury: In reply to the hon. gentleman's question, Mr. Speaker, the Minister of Industry, Trade and Commerce and the Minister without Portfolio have both said that it would not be in the public interest to disclose negotiations in progress. I think this is still true. Indeed, the published reports do not relate to the conduct or content of the negotiations but merely to the fact that they are in progress and who is participating. I repeat that two commissioners of the wheat board are currently in mainland China conducting such negotiations.
[Mr. Dinsdale.l


John Stratford Burton: A supplementary question, Mr. Speaker. Is the President of the Treasury Board aware that some of the inquiries made previously in this house were exactly on the subject referred to by the officials, as stated in my question?


Mr. Speaker:: Order, please.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Paul Yewchuk (Athabasca):: My question is for the Prime Minister, Mr. Speaker. Is the government considering the establishment of a national program for summer employment of university students, as recommended at the meeting of the Association of Universities and Colleges of Canada this week?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, I believe this matter would come under the jurisdiction of the Minister of Manpower and Immigration. Perhaps the hon. member would want to ask him.


Paul Yewchuk: A supplementary question. In view of the prediction by the president of the university and college planning association that Canadian university students face another very bleak employment situation next summer, has the government launched any special studies of the student employment problem?


Pierre Elliott Trudeau: The same answer, Mr. Speaker, but even more so.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Andre Fortin (Lotbiniere):: Mr. Speaker, I should like to put a question to the Prime Minister.
Can he tell us whether he will invite the C.B.C. to set up a fair policy concerning the use and allotment of broadcasting time to political, non-political or other movements?


Right Hon.   P.-E. Trudeau@Prime Minister: Mr. Speaker, this is a question for the Secretary of State.
November 8, 1968


André-Gilles Fortin: Mr. Speaker, I rise on a question of privilege. In reply to a question I put to him a while ago concerning the C.B.C., the right hon. Prime Minister said that it came under the Secretary of State. On the other hand, yesterday, as reported on page 2532 of Hansard, the Secretary of State said that this matter did not come within his jurisdiction.
I wonder, therefore, who is answerable for this matter and whether we stand a chance of getting a reply?


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
J. Michael Forrestall: My question is directed to the Prime Minister, Mr. Speaker. I should like to ask, further to questions asked on October 28 and November 5 by the hon. member for Fraser Valley East, if he could indicate to the house whether he has had any correspondence, in particular from associations, regarding orphans in Biafra.


Right Hon.   P.-E. Trudeau@Prime Minister: Yes, Mr. Speaker, there has been some correspondence, and I am replying in a general way to the effect that adoption is, of course, a matter under provincial jurisdiction and that we are in no position to infringe upon that jurisdiction but would be prepared, if adoption is arranged through the proper channels, to make space vacant in our aircraft available to anyone who might be adopted in these circumstances.


David Lewis: The arrival of children from Biafra does not necessarily depend on their being adopted legally under provincial jurisdiction. May I ask the Prime Minister what if anything the government is doing to encourage the bringing of such children to Canada, whether or not they are being legally adopted under provincial laws.


Pierre Elliott Trudeau: The government is not doing anything to bring children to Canada. The federal government is not equipped to look after children after they come to Canada. If they came to Canada they would have to be adopted or cared for by institutions or by
Inquiries of the Ministry families under provincial laws. What the government intends doing in this event is to cooperate with provincial authorities or private individuals who may wish to seek our assistance in providing transportation.


David Lewis: I am trying to avoid an argument, but I might say to the Prime Minister briefly that I am drawing his attention to the fact that it is possible-


Mr. Speaker:: Order. Would the hon. member ask his question, if he has one?


David Lewis: -for people or organizations to bring children here without adoption. I am asking whether such persons who desire to bring children to Canada and take care of them-and this does not come under any particular jurisdiction-are being given any encouragement by the government.


Pierre Elliott Trudeau: I answered the question in the context of adoption because that is how it was asked. If institutions or families want to take care of children from Biafra, and if we can assist in any way through our immigration department we shall do so. But I want to make it clear that the initiative does not lie with the federal government but with the organizations, groups or families which would want to take into their homes, houses or institutions, children from Biafra.


Mr. Lincoln M. Alexander (Hamilion West):: Are we to understand that the government is now prepared to relax the immigration laws in order that admittance may be expedited as far as refugees from Biafra are concerned?


Pierre Elliott Trudeau: I will take this up with the minister. I am sure that in circumstances where this would be necessary we would consider doing it.


David Samuel Horne MacDonald: Can the
Prime Minister tell the house whether any contacts have been made with Biafran authorities with regard to the bringing of children or others from that country to this?


Pierre Elliott Trudeau: No, Mr. Speaker. We have not had, nor do we intend to have, any contact with the Biafran authorities.


[Stage Direction]
On the orders of the day:
Mr. Thomas M. Bell (Saint John-Lancaster):: My question is for the Prime Minister. Will officials of the Department of Public Works and of the National Capital Commission be

November 8. 1968

Inquiries of the Ministry acting as technical advisers to a parliamentary caucus being established by Liberal members from eastern Ontario, as announced by the Minister of Justice?
May I ask the question in another way. Would the Prime Minister assure the house that no public servants will be suborned to the use of any private group such as a parliamentary caucus of the kind announced?


Donald MacInnis: A supplementary question. It may be easier on the Prime Minister if he would check the statement emanating from the Minister of Justice and then inform the house just who is in charge of patronage in Ottawa.


Some hon. Members:: Oh, oh.


Mr. Barry Mather (Surrey):: Mr. Speaker, I would like to direct a question to the President of the Privy Council. Having in mind the fact that last week the minister found it impossible to give the house the number of defeated Liberal candidates who had been appointed to the judiciary or to other offices, would he not find it easier to give us the number of defeated Liberal candidates who have not been so appointed?


[Stage Direction]
On the orders of the day:
Mr. J. Edward Broadbent (Oshawa-Whiiby):: My question is to the Prime Minister. In view of the potentially serious effect on our system of parliamentary government of the right hon. gentleman's decision to establish a series of regional offices and a body of 150 extraparliamentary advisers, would the Prime Minister at an early date make a statement on motions as to the duties and responsibilities of these new groups? More specifically, how would their existence affect the traditional functions of the Prime Minister and members of parliament?


Right Hon.   P.-E. Trudeau@Prime Minister: I will inquire into this, Mr. Speaker.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Eldon M. Woolliams (Calgary North):: wish to direct a question to the Minister of


Finance with reference to the province of Alberta. Has Dr. Rose, Minister of Health, objected to the federal government opting out of the medicare arrangements, and has the provincial government asked that when the federal government does opt out, the amount of money contributed by the federal government should be compensated for by way of equalization payments?


Edgar John Benson: do not think there has been any such direct representation to me at this point.


Eldon Mattison Woolliams: Is there any agreement with Alberta that when the federal government does opt out, the amount which was being paid by the federal government would then be assigned to the province of Alberta to help pay for the service?


Edgar John Benson: The province of Alberta is not in medicare at the present time; I do not know why the hon. member is talking about getting out. In any case, the general conditions under which we would turn the service over have been made quite clear in the house, I believe. If the hon. member requires further clarification I would be pleased to send him a copy of the statement I made to the federal-provincial meeting in this regard and a copy of the statement to the house of the minister of finance in 1966.


Eldon Mattison Woolliams: I appreciate that Alberta is not in the scheme. The question I should like to put is this. Is it not a condition that provided the federal government would take over financial responsibility as agreed, the provinces, including Alberta, would come into the plan? Is Alberta being promised that if the province comes in, when the federal government opts out the amount of the federal contribution would then be assigned to the province?


Mr. Speaker:: Order. The hon. member is repeating the question he asked in the first instance. If he is not, I would have to rule that the first supplementary question, asking for an interpretation of a statute, is out of order, and that the second is hypothetical.


Eldon Mattison Woolliams: It is not a repetition of what I asked earlier.


Mr. Speaker:: I accept the hon. member's statement. Order. Would the hon. member resume his seat? I accept the hon. member's statement that it is not a repetition but I have to rule that the question as asked is not in order.	*
November 8, 1968	COMMONS


Eldon Mattison Woolliams: May I rephrase the question, then. Is there a suggested agreement with Alberta that if the province of Alberta comes into medicare, when the federal government opts out the amount of money which would be paid by the federal government in reference to the plan would then be assigned to the province of Alberta?


Edgar John Benson: There is no agreement with individual provinces, but if the hon. member looks at the medicare legislation and the speech made by the minister of finance when the measure was before the house he will find the general conditions under which, ultimately, we would turn medicare over to the provinces.
It has been made quite clear that we would continue to fulfil the obligation we have to the provinces, first through the transferring of taxation powers, by making up the differential in their cost during a transitional period, and then by means of an ultimate settlement when the provinces take over. So it is quite wrong to say we shall have pulled the rug out from under the provinces, as some have said. There is no intention of doing that. If the hon. member will look at the offer of 17 tax points made in the statement, a copy of which I will send to him, he will see that we are not pulling any rugs out. We want to pay full compensation to the provinces, but we think ultimately it is better for people to administer programs directly rather than having to deal, as it were, with 50 cent dollars. The people who have control over a program should have the taxing power to cover it.


Gerald William Baldwin: As a
supplementary question arising out of that answer, Mr. Speaker, I would like the minister to say whether the federal government can get away with paying anything less than 50 per cent of the cost of medicare to any one province without having to change the act.


Edgar John Benson: Mr. Speaker, we have no intention of paying less than 50 per cent of the cost of medicare to the provinces. I think we have made that quite clear. The ultimate settlement would make clear that we are simply transferring taxing power to the provincial jurisdictions under whose control the programs are so that they can have better control of the programs and yet not lose any. thing they formally received from the federal government.
DEBATES	2575
Inquiries of the Ministry


John George Diefenbaker: Mr. Speaker, I am sure the answer to this question will be very simple. As there are still Canadians who believe there should not be taxation without representation I would ask the government to say whether in respect of the 2 per cent surtax being imposed on the people of a province that does not enter medicare there will be a refund to the taxpayers of that province.


Edgar John Benson: Mr. Speaker, I have quite clearly said that this tax has been imposed, along with a great many other taxes in the budget-


An hon. Member:: You can say that again.


Edgar John Benson: -including the tax on insurance companies and banks and various other charges, in order to meet the financial requirements of the federal government. The social development tax was needed in order to cover the increasing cost of several programs. For example, we are now putting $650 million a year-


Mr. Speaker:: Order, please.


Edgar John Benson: -into hospitalization.


Mr. Speaker:: Order, please. It seems to me that we are now getting into the budget debate, which I understand the house will resume in just a few moments.


Erik Nielsen: Mr. Speaker, I have a question supplementary to those dealing with medicare to direct to the Minister of Finance. Has the government any plans to bring Canadians living in the Yukon and Northwest Territories into the scheme and, if so, can he assure the house that they will be in the scheme before the federal government gets out of it?


Edgar John Benson: Mr. Speaker, it is our hope that all the people of Canada will be taken care of under this scheme, and this of course would include the people of the Northwest and Yukon Territories, whom we consider very valuable citizens of Canada.


Erik Nielsen: I thank the minister for his kind reference, but can he say when it is the government's intention to bring the citizens of these territories into the scheme?


Edgar John Benson: I would have to take up this question with the Minister of National Health and Welfare who looks after the coming into the program of the various parts of Canada. 1 will raise my hon. friend's question with him and obtain an answer to it.
November 8, 1968

Inquiries of the Ministry DRUGS-REPORT BY QUEBEC HEALTH MINISTER
On the orders of the day:


Mr. Frank Howard (Skeena):: Mr. Speaker, in the absence of the various acting ministers of national health and welfare and in order to give the parliamentary secretary something to do may I direct a question to the parliamentary secretary to the Minister of National Health and Welfare. Was the expected report from the minister of health of the province of Quebec relating to drug abuses, which was to have been provided to the recent federal-provincial conference of health ministers, received and, if so, will it be made public or tabled in this house?


Mr. Rosaire Gendron (Parliamentary Secretary to Minister of National Health and Welfare):: I will take this question as notice, Mr. Speaker.



VANCOUVER-REPORTED SALES OF SWEDISH ABORTION PILL

[Stage Direction]
On the orders of the day:
Mrs. Grace MacXnnis (Vancouver-Kings-way):: Mr. Speaker, I would like to direct a question to the parliamentary secretary to the Minister of National Health and Welfare. 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?


Rosaire Gendron: I will also take that question as notice, Mr. Speaker.



EFFECT OF INCREASED AGRICULTURAL IMPORTS FROM U.S.

[Stage Direction]
On the orders of the day:
Mr. Gilbert Rondeau (Shefford):: I should like to put a question to the hon. Minister of Agriculture (Mr. Olson).
In view of the fact that the changes in the tariffs on certain goods exported to the United States have led them in turn to announce larger exports of meat products of all kinds to Canada, can the minister tell us what steps his department is contemplating to cope with the probable economic effects of the American exports?


Hon. H. A. Olson (Minister of Agriculture):: Mr. Speaker, if the hon. member would give me specific details of which products he has in mind I would be prepared to give him an answer in regard to those products.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, I wish to direct a question to the Minister without Portfolio. Was the decision to defer urban renewal projects reached after consultation with the provinces and municipalities, or without consultation?


Hon. James Richardson (Minister without Portfolio):: Mr. Speaker, I shall be glad to look into that and report later. I do not have the answer at the moment.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
David Samuel Horne MacDonald: Mr. Speaker, I wish to direct a question to the Prime Minister. Could he tell the house whether the hon. member for Don Valley, when speaking at the United Nations, was stating government policy when he said that Canada favoured setting up a standing UN committee on the problem of regulation of the ocean floors?


Mr. Speaker:: Order, please. I do not think the rules allow the form of question asked by the hon. member.


David Samuel Horne MacDonald: Perhaps I could rephrase my question, Mr. Speaker. I would like to ask not only whether it is the intention of the government to support a measure setting up a UN committee on the regulation of ocean floors, but whether the government has taken a position with regard to the sovereignty that is involved and whether certain benefits might accrue to the United Nations itself.
Righf Hon. P.-E. Trudeau (Prime Minister):
The question is under consideration, Mr. Speaker.
November 8, 1968	COMMONS DEBATES



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the President of the Privy Council in his capacity as government house leader. In view of the minister's statement earlier today that there will be opportunities at this session to consider the report of the joint committee that had to do with the pensions of retired civil servants, will he discuss with those of us who are house leaders the arranging of one of those opportunities at an early date?


Donald Stovel Macdonald: I would be glad to discuss this, Mr, Speaker, along with the general forward movement of government business.


Gerald William Baldwin: As a
supplementary question, would the government house leader take note of the fact that if his hard heart would soften this party would be agreeable to give unanimous consent to the request of the hon. member for Winnipeg North Centre?


Donald Stovel Macdonald: Mr. Speaker, I look forward to the same spirit of co-operation from the hon. member's party on all matters.



AIRPORTS


[Stage Direction]
On the orders of the day:
Edward Richard Schreyer: Mr. Speaker, my question has to do with civil aviation and is directed to the Minister without Portfolio. Is a study under way at the present time or will a study be made soon into the problem of shortage of hangar space at most airports in Canada, particularly at Winnipeg?


Mr. Speaker:: Order. I would think this question should be placed on the order paper.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Paul Yewchuk: Mr. Speaker, a couple of days ago I asked a question of the Acting Secretary of State for External
2577
Inquiries of the Ministry Affairs concerning the giving of encouragement to South Viet Nam to participate in the Paris peace talks. Is he prepared to make a statement at this time?


Charles Mills (Bud) Drury: Not at this time, Mr. Speaker, but next week.


[Stage Direction]
On the orders of the day:
Mr. A. P. Gleave (Saskaloon-Biggar):: Mr. Speaker, I direct my question to the Minister of Agriculture in the absence of the Minister of Trade and Commerce. In view of recent reports that grain in large amounts, reportedly as much as 2 million bushels, has been moving illegally and contrary to wheat board regulations across interprovincial boundaries, has the minister taken any action to investigate these allegations or is any action proposed in the near future?


Charles Mills (Bud) Drury: Mr. Speaker, the wheat board has been looking into this matter and as soon as we get a report from them I will be glad to make a report to the house.
[DOT] (12:10 p.m.)



THE BUDGET


[Stage Direction]
The house resumed, from Thursday, November 7, consideration of the motion of Hon. E. J. Benson (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means.
Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, there is an old saying, "Would that mine enemy would write a book." I do not consider that the Prime Minister (Mr. Trudeau) is mine enemy because I have rather a strong liking for him-


Some hon. Members:: Hear, hear.


Harold Edward Winch: -except for his politics, and I mean his present politics.
The Prime Minister has either written or collaborated in the writing of a number of books. I desire to refer to one in which he collaborated. I do so because of what we have read and heard about the recent dominion-provincial conferences involving the premiers, the Prime Minister, and other ministers

November 8, 1968
The Budget-Mr. Winch of the crown. It seems completely obvious, as a result of the presentation made at those conferences by ministers of the federal government, that there has not been a feeling of consultation, co-operation or compromise, with the result that the provincial premiers and ministers have returned to their homes and their legislative halls with strong feelings of disappointment, disillusionment and heartbreak. I think that is fairly obvious. The result is that the first conferences held by this new government and its ministers under the leadership of the new Prime Minister have perhaps done more in the past few days and weeks to destroy any growth and understanding of federalism and national unity than what has occurred over a period of years.
I am interested in this particular phase of the development and appearance of the federal government at these conferences because of the different approach, views and ideology of the present Prime Minister from those he held when he was not a member of this house and did not hold the high office of Prime Minister. I refer to the years 1958-61 when the present Prime Minister, myself, David Lewis, Professor Frank Scott, Professor Michael Oliver of McGill University, Professor Grube of Toronto, Professor Jamieson of the University of British Columbia and Dr. Eugene Forsey, research director of the Canadian Labour Congress, were members of an editorial board charged with the drafting of a book "The Socialist Analysis of the Future of Canada". The book was published in 1961 and was called "Social Purpose For Canada". In this book-and this is marvellously coincidental with the approach of this government at the recent conferences in Ottawa-there is a chapter headed "Practice and Theory of Federalism". The author is Pierre-Elliott Trudeau.
I think the house would be most interested in the views and the ideology of the federalism that is Canada in the written word and in the government's attitude and actions in doing everything possible to break real federalism by means of the presentation of a fait accompli to the provincial premiers and their other ministers just a few days ago. I believe Hansard should have on record what the present Prime Minister wrote when he was jointly responsible with these other socialists for preparing a work on what is required for national unity and federalism in Canada. Just in case some hon. members might think I would take quotations out of context I will give the page numbers so that

they will be able to find them. They are indeed interesting, Mr. Speaker. As found on page 381, Pierre-Elliott Trudeau said:
From the foregoing analysis of the B.N.A. Act it is obvious that intergovernmental co-operation is not only possible but that it is in many ways constitutionally indispensable.
At page 385 we find these words:
And since the future of Canadian federalism lies clearly in the direction of co-operation, the wise socialist will turn his thoughts in that direction, keeping in mind the importance of establishing buffer zones of joint sovereignty and co-operative zones of joint administration between the two levels of government.
Again, at page 389:
Consequently the economic aspects of socialist theory might be a guide towards a more efficient distribution of powers under the constitution.
At page 389 we find the following: Consequently, in such matters-
Oh, this is a honey when we recall the meetings of these past few days and the government's presentation of hard of heart fait accompli-"This is it; take it or lump it."
-there is no reason to presume that the federal government will be more enlightened than the sum of the provincial governments, or even than one provincial government acting alone.
This most important view of Pierre-Elliott Trudeau was completely negated when ministers of the government of which he is Prime Minister met with the provinces a few days ago. I should like to refer to one more quotation which appears at page 392:
The basis of a socialist critique is to state clearly what the provincial governments can do and fail to do, and what the federal government can do and does not do, each within its respective jurisdiction.
[DOT] (12:20 p.m.)
We are being forced, in view of the policies and attitudes of this present government and in view of the budget now before us, to place on the record not what the Prime Minister of Canada has said but what Pierre-Elliott Trudeau has put down in writing about the basic fundamentals required for co-operative federalism and Canadian unity. There can be no doubt that a fait accompli was presented to the provinces.
We have had provincial conferences in the past and undoubtedly we will have more in the future. Let me say that as useful and as necessary as these conferences are, no matter how many are held they will not resolve the basic problems, difficulties and differences which exist in respect of the provincial and
November 8, 1968

federal authorities. My opinion is that if we are to have a reasonable and sensible approach to these problems and differences there can and should be an understanding reached in the interests of the future of Canada, and we should convene a meeting of the representatives of federal, municipal and provincial governments as soon as possible. These representatives should meet as often as required in order to resolve these problems in the only conceivable way.
This can only be accomplished by a revision of the constitution whereby there is a clear line of demarcation between federai, provincial and municipal authority. As brilliant as the Fathers of Confederation were 101 years ago they could not foresee the problems of government and the demands of the people 101 years later. Nor could they possibly foresee that Canada would not have two levels of government but three-federal, provincial and municipal.
Temporary solutions may be found as a result of conferences. I should like to say it is my strong feeling that if we are realistic and sensible in our desire to resolve these problems we will exercise all the pressure we can on the government to adhere to the principle of bringing all levels of government together for as long as necessary to reach an understanding and a degree of co-operation in relation to the division of responsibility of the three levels of government, as well as fiscal jurisdiction. It is only when that has been accomplished that we will be in the position of knowing who is responsible in legislation and for taxation. Once this has been accomplished people will know which government is responsible for supplying necessary things. They will know the taxing powers of each level of government and which government must impose an extra tax to provide for certain demands. I feel this is a most important matter which has not been given proper consideration.
It is also my belief that if the Minister of Finance (Mr. Benson) is correct and there will be an over-all policy and change in federal fiscal arrangements and a balanced budget, which many of us doubt, then consideration should be given to at least making a step in that direction. I know the government is in grave fiscal difficulty now, and I think it will be next year, but it has long been my thought that this present generation as well as generations in the past have and are acting completely unethically. On a great many occasions we have passed on the responsibility for repayment to future generations not yet born.
29180-163J
The Budget-Mr. Winch If I had the ability and the time I should like to make a study to see whether we have as yet paid for the Boer war.
What has been our fiscal policy? In the main it has been to borrow for 20, 25 or 40 years and then pass on the refunding responsibilities to an unborn generation. On an ethical basis, as far as it is possible, when we borrow under our authority we should not only make provisions for paying the interest but should accept a responsibility for setting aside annually an amount of money so that at the end of the borrowing period we can pay off that debt.
I realize there is a serious problem involved in this regard and we might have to be very tough and hard, but I honestly believe that if we are to be reasonable, ethical and moral parliamentarians it is time we made a start in this direction. We should accept our responsibility to repay the principal as well as the interest rather than carrying these debts for 25, 40 or 100 years hence. We should avoid building up this debt of interest and principal. This is a difficult problem but some thought should be given to taking at least a token step in this direction.
It was interesting to hear the Minister of Finance describe his difficulties during his speech the other night. He referred to the $600 million deficit this year and promised to have a balanced budget next year. He indicated that in this regard members of the House of Commons will not have very much success in respect of constituency or provincial matters which require money. He made it very clear that we can talk all we want but we will not get action. I can understand that coming from the minister but it seems to me it was not and is not necessary for him to say so.
This is perhaps the case because of the lack of planning on the part of the previous government and because of inefficiency in the past and present. The present and past governments have thrown millions of dollars down the drain instead of using this money for useful purposes. Several years ago the government decided to spend $32 million for the construction of a new airport terminal at Vancouver. The top echelon or top brass must have been aware of the transportation problem which would occur. If they did not know they were told by the members of parliament. We asked the government to do something about this but it did nothing. This wonderful $32 million airport terminal was opened. Nothing was done in respect of transportation

November 8, 1968
The Budget-Mr. Winch facilities. What is to be done now? Within one year a two lane approach will have to be built over an arm of the Fraser River. By the end of 1972 we will require a four lane main artery highway from Vancouver to the airport. The government knew of this situation years ago but it did nothing about it. So now the citizens of Vancouver and others who travel will have to put up with the inconvenience and problem involved. In addition, it will cost the government 100 per cent more to do in the next three years what it should have planned three or four years ago.
[DOT] (12:30 p.m.)
This is a waste of public money. It is plain stupidity. This type of thing has been done many times. But, Mr. Speaker, that is not all. Let us consider another matter. This government cannot help members of the house to obtain those things which are of immediate necessity to their constituents, because they cost money. The money should be available with which to meet reasonable requests. It would be available if the government cleaned out its administrative house. What do I mean by that? I would love to see the public accounts committee really look into these questions.
There is supposed to be co-operation between departments. When equipment is not needed by one department but is needed by another, arrangements should be made so that the department needing it will have the -use of it. Does the government do that? No, it *does not. If a department no longer has need of a heavy piece of expensive equipment it is declared surplus, but until it is declared surplus another department that needs this piece of equipment should have the use of it. I could, if I had the time, give the house illustrations of what I mean. What does the government do in this situation? Because it has been declared surplus by one department the government takes the equipment away from the department that needs it and is using it, and sells it at a give-away price through -Crown Assets Disposal Corporation. I can give an example of this occurring in the Northwest Territories in the last month. Thousands of dollars went down the drain because of lack of co-operation between departments.
Then there is the question of alterations to buildings. Ye gods, the money the government has thrown down the drain in this way! If it happens in Vancouver, I guess it happens everywhere else. A building in Vancouver will be torn down in four of five years'

time. The government makes alterations to a building, builds partitions and instals new lighting. Then one day, before anybody was moved in, it is decided that this is not what was wanted, so contractors, or government's staffs move in, tear down the partitions and lighting and do it all over again.
How many millions of dollars is the government pouring down the drain in this way?
I wish the government would check the architects it uses. I know the construction industry and have a great many friends in that industry. I have many friends not just among the workers but also among the contractors. On most occasions the specifications call for a certain thing. Usually it is American; usually it costs twice as much as it could be purchased for in Canada, and the Canadian equipment would be just as efficient. But no, the architect specifies by name a certain piece of equipment, and Canadian taxpayers pay through the nose unnecessarily. This happens time after time.
I wish to bring another interesting matter to the attention of the house. It is right that cabinet ministers should travel across the country and examine departments and buildings under their control. This is very important if you are a new minister in a new government. But why is it, when a minister gives three weeks', four weeks' or two months' notice that he will be paying a visit to the departmental facilities across Canada that come under his jurisdiction, that overnight money is spent in painting and cleaning up buildings whether they need it or not. This is done to make everything just wonderful when the minister arrives.
About five weeks ago the Minister of Defence Production (Mr. Jamieson) gave notice that he was going to pay a visit to the one and a half floors occupied by his department in the Queen's printer's building over in Hull. For the last three weeks-and this is not rumour; I have checked it-the painters have been working at night and on Saturdays, on overtime pay, to have it freshly painted for the minister when he arrives there next week, the week after or whenever it is.


An hon. Member:: Look at the money the workers have to spend.


Harold Edward Winch: Look at the money the government is spending on a paint job that was not necessary. In addition, this is a comparatively new building. The air conditioning system was not working properly, so the government
November 8. 1968

spent $1 million to fix it. Every year the government is building new departments, new floors or having new alignments made to floors. Every time a new office or department is required they put in not only new partitions but lower the ceilings. Why in the name of heaven does the ceiling have to be lowered every time a change is made? When you consider these matters you realize the money that is being wasted by the government and the millions of dollars that could be used to carry out necessary works now if the money had not been wasted.
A proper job should be carried out in respect of the interior harbour of Vancouver. The harbour commissioners know exactly what is the ultimate development of the inner harbour of Vancouver. It extends from Lion's Gate bridge all the way down to the city of Port Moody and takes in not only my riding but five others. The harbour commissioners know what is the largest ship that can use the channel; they know the dredging that has to be done, the private companies involved and what their problems are. They know what it will cost to develop the inner harbour at Vancouver. What is this government going to do? They will spend $1.5 million next year through public works to start the dredging, which will take two, three, four or five years, and the cost involved will be far greater than it would if the work were done today. What we need is planned action, not talk. The government should clean its administrative house.


An hon. Member:: We haven't the money.


Harold Edward Winch: You can get it. Do not sell expensive equipment at give-away prices when another department needs it. Do not let a tenderer get this equipment from Crown Assets Disposal Corporation at give-away prices. Do not carry out unnecessary alterations, that is, do not make alterations until you know what is required. Do not spend thousands of dollars of the people's money-I put this figure at the minimum-because a minister is going to visit a building and it has to be painted before he arrives. This is the taxpayers' money that is being wasted. It should be used wisely and efficiently. If money were not wasted in this way, it would be available for all those things members require immediately in their constituencies.
The attitude of the Prime Minister and the cabinet as reflected in the budget should be changed. This budget is not based upon ability to pay but upon making the rich richer

The Budget-Mr. Winch and the poor poorer. If reasonableness and common sense were applied to the problem, these things could be done. The Prime Minister should, with reasonableness and common sense, apply the principles he agreed upon as a socialist. If he were, as Prime Minister, to do this we could build greater national unity instead of the present disruption and destruction that are being caused by the policies of the government. Disruption and destruction are indicated in the planning and talk of this government. I wish, Mr. Speaker, I had longer to speak because I could take up another 30 minutes on this subject, but I see I have only 30 seconds left.


An hon. Member:: Carry on.


Harold Edward Winch: If the house would allow me a further 30 minutes I would love to finish my speech. However, I know there will be further opportunities when I can give evidence of the injustices perpetrated in a so-called just society. I will conclude, Mr. Speaker, because my time is up, by saying to the Prime Minister and members of his party that we welcome his call for a just society. We believe in a just society. But we say, not with humility but with conviction, that you will never achieve a just society by talk. You will never achieve a just society by following unjust policies and practices. When this government demonstrates to the house that it means what it says it will receive 100 per cent support of all members of the New Democratic party.
[DOT] (12:40 p.m.)


Bernard Dumont: Mr. Speaker, in view of the budget speech of October 24 last, like Maurice Chevalier, the hon. Minister of Finance (Mr. Benson) could have sung the song so well interpreted by this artist: "Pay your debts". But today, this public debt singer tells us: "Pay your taxes". Therefore, a song entitled "Pay your taxes" will have to be written.
I remember this song by Madame Bolduc which could be heard so often in Quebec during the depression, and I shall quote a few sentences which I remember.
Ma chere, la vie est chore,
Pour s'regaler, qu'est-ce qu'on va faire?
La viande, c'est tout ce qu'on demande;
Le beurre et le riz sont hors de prix. Taxes sur les allumettes,
Taxes sur les cigarettes.
Taxes sur les susons et memo Sur les vieux garqons.
2582	COMMONS
The Budget-Mr. Dumont
I think that, even in 1968, it would be timely to sing this song from the depression.


Some hon. Members:: Hear, hear.


Bernard Dumont: Everyone is looking at this financial magician who is going to perform a spectacular sleight-of-hand by making an egg come out of a hat. We are not told what kind of egg it will be, it may be good, it may be bad, it may be poor, it may be round or square, but you can rest assured that it will be an egg. That is it the trick is played right under our very eyes and the magician takes back his hat.
Mr. Speaker, our Minister of Finance makes beautiful speeches in an attempt to win the friendship of the Canadian people, but very seldom does he put himself in their place in order to better understand their problems. He is a foxy one who ignores the seriousness of the taxpayers' situation and who makes remarks in a loud voice.
Before I carry on with my remarks-since we are told that a speech cannot last more than thirty minutes-I should like to challenge a few remarks made by the hon. member for Trois-Rivieres (Mr. Mongrain).
Yesterday, in his speech, he launched an attack against the leader of the Ralliement Creditiste (Mr. Caouette). First, I want to point out to him that he does not come up to the garter of the hon. member for Temisca-mingue and he has not done a quarter of the work which the leader of the Ralliement Creditiste has done in Canada.


Mr. Andre Ouellel (Papineau):: I do not
think that the hon. member for Frontenac should talk about the most private underclothing of the hon. member for Temisca-mingue by referring to his garters.


Mr. Deputy Speaker:: Order, please. I was trying to check that myself. The hon. member has to address the house from his own seat.


Bernard Dumont: Mr. Speaker, I am under the impression that the hon. member for Papineau misunderstood me; I was speaking of the garter of the hon. member for Trois-Rivieres.
The hon. member also said: "I studied Social Credit and did not understand a thing".


David Réal Caouette: Yes; he is not bright enough for that.
DEBATES	November 8, 1968


Bernard Dumont: I am not surprised.
I shall never forget the words the late Maurice Duplessis-Mr. Duplessis came from Trois-Rivieres, and doubtless the hon. member for that riding knew him-took pleasure in quoting: "Education is like liquor; some people cannot digest it." I feel those words apply very well to the member for Trois-Rivieres. Besides, in the next elections, he will sing: "I only passed through that riding".
At this stage, I should like to stress another point which leaves 40-year old people quite puzzled. Those are the thoughts that came to my mind when looking at pages 1327 and 1328 of the 1950 House of Commons Debates. We are puzzled when we hear the high-sounding statements of the Minister of Finance because of the short-sightedness which really existed at that time, and still today I wonder whether the Minister of Finance does not behave in the same way.
As can be seen on pages 1327 and 1328 of the 1950 House of Commons Debates, the Canadian government was granting loans of $98.5 million to provincial and municipal governments, while granting interest-free loans of $2,028 million to the United Kingdom and other governments.
We can read the followng on page 1328:
Loan to the United Kingdom.
In 1950.
$292.0 million.
Loan to the United Kingdom under The United Kingdom Financial Agreement Act, 1946, $1,165.0 million.
-That is an increase of 120 per cent.
Advances under The Export Credits Insurance Act, Part II, $523.5 million.
In short, loans amounting to $2,028 million were granted in 1949-50, and everyone knows that afterwards, the government under the right hon. Louis St. Laurent even exempted the United Kingdom from the obligation of repaying its debts.
Because of this want of foresight on the part of our administrators in the 1950s, those whose responsibility it is to govern the country today have to live with those past mistakes. However, the lesson those years taught us leads us to think that the same mistakes are being made today and that is why, at our age, we are asking ourselves whether Canada is taking the direction it should.
I should also like to point out that we, in this corner of the house, have repeated time and again, and the leader of the Ralliement

November 8, 1968	COMMONS
Creditiste (Mr. Caouette) said it again last night, that we want to see the end of the debt system whereby the banks create all the credit by fixing the interest rate for the country.
I ask the Minister of Finance to consider carefully the example I shall now give him. A few years ago, the Minister of Finance of the comparatively small country of New Zealand, through the national bank of that country, created 50 million pounds sterling free of debt or interest for use by the government. As Minister of Finance, he found a way of lending the farmers of his country money at an annual interest rate of 1 per cent.
If the Minister of Finance would follow that example today, these same loans could help all Canadian citizens who want to have their own home, their own house and their own heritage. Instead, everything is continually being taken away from them through excessive interest rates.
That article said that one of the worst things that can happen to a farmer or to a home owner is to have to buy a quantity of goods on time or to build a house and have to pay an excessive interest rate.
If we really want to help our people, those are sectors where we could be useful. What was good for New Zealand can surely be good for Canada, for this prosperous Canada of ours, at the present time, is certainly not short of production.
I have here an article published recently in a newspaper; it is entitled: "Crisis: too much wheat"
What are the Creditistes asking? That money be based on production. The wheat is there and the slip of paper should be made out to correspond to the production: $68 billion worth of production, $68 billion in money. Then the Minister of Finance would be able to find the money needed to manage the country properly.
[DOT] (12:50 p.m.)
Speaking of "Crisis: too much wheat" here are the figures, and I quote textually:
We are stuck, so to speak,-
For the year 1968
-with 664 million bushels.
And so, in spite of such abundance, Canada is heading for disaster because there is too much wheat. And the article continues:
But there is worse. India and Pakistan have managed, this year, through some miracle or other, to have bumper crops. The enthusiasm is such that the leaders have gone as far as to say that in the near future their country will no longer import wheat. Australia and France are offering wheat at a lower price than we are, and for a
DEBATES	2583
The Budget-Mr. Dumont long time now Argentina has had a foothold in just about all the markets of the world. Our customers, China and Russia, have not made a move yet but, as we know, our competitors are going out of their way to tear those two markets away from us.
I find it inconceivable that in 1968, when far-away places can be reached in record time, that it has not yet been possible to establish a financial system which would make that wealth available to the needy by converting it into the sums of money required. And this is exactly what is tremendously wrong with a system which the Minister of Finance continues to uphold. The system is outdated in this era of progress of 1968 and some means must be found at all costs to distribute that wealth to everyone.
Another example which I would like to give in this criticism of the budget speech deals with the taxes levied, especially on life insurance companies. The newspaper Le Droit pointed out that the raise amounted to 3,000 per cent.
I would not object to the taxation of some companies with head offices in England, in the United States or in some other countries and which opened branches here in Canada. I am talking in particular of British insurance companies who, because we are members of the Commonwealth, did not have to pay taxes in Canada. I would not object to the taxation of those companies in order to put an end to their illegal competition with our own companies. The main point I wish to make is that by attacking our insurance cooperatives and our French-Canadian mutual insurance companies in Quebec the minister is going against our aim in Quebec, which is to become more and more the masters of our own economy.
For eighteen years, I personally have helped to establish a French-Canadian mutual insurance company, by making sacrifices, fighting against the magnates of finance, namely the Prudential Company of London and the Standard Life Company. By making sacrifices, we managed to establish cooperative organizations which allow for the distribution of profits.
Thus, profits go back to the individual. Besides, I have in my hand an article which establishes who buys life insurance. I will quote it word for word in order to show that in fact it is not the companies which are taxed but rather the individual. Here it is:
Who buys life insurance? Studies undertaken in these last few years have established that Ontario and Quebec hold first place among the Canadian provinces for the amount of insurance in force per capita. The Canadian average, late in 1966, was
2584	COMMONS
The Budget-Mr. Dumont about $2,400 of life insurance per person, while the same average reached $2,750 for Ontario and $2,500 for Quebec. On a family basis the same situation prevailed.
The average amount of life insurance held by each family was about $16,100 for the whole country; however, it varied considerably from one area to the next.
It would be necessary for individuals and large families to buy life insurance and take advantage of the new taxation formula; this affects mainly co-operatives which had found a way to distribute their profits. The Minister of Finance is going to put some of them out in business in Quebec; I dare predict that over 25 companies which appeared in the last twenty years, will fold up.
If it is not, once again, a decision to destroy organizations which have become a little more powerful in Quebec, on behalf of those who disagree, I will accuse the Minister of Finance of being a great separatist, because it is through finance that he will choke us up systematically. A Quebec where people cannot get their economic freedom cannot survive.
Besides, since the Minister of Finance does not seem to know what is a co-operative, I shall make now a brief comparison. What is a co-operative? It is a group of people who organize themselves in order to provide themselves with goods and services. What is a private company? It is a group of businessmen who organize themselves in order to make profits out of capital. There is a world of difference between the two terms of this comparison.
Where do the goods of co-operatives go? They go to their members to the extent of their purchases from their co-operative. Therefore, the goods are obtained at cost; since people get them at cost, that 15 per cent surcharge should not be considered.
What do private companies want and what do they get? Their profits are distributed among shareholders according to the number of shares they have. They are trying to get a profit on every item sold.
I have no objection against private firms going on making profits, because in a well-organized society, where private enterprise is successful we only have to set up cooperatives if we want to prevent the abuses of capitalism.
So, long live private enterprise. I think we all agree on that. However, as the head of the Ralliement Creditiste said yesterday when a company is making too much profit as in the

DEBATES	November 8, 1968
case of Imperial Oil, which has made a profit of $70 million in nine months, one cannot help but wonder why the Minister of Finance did not tax them earlier as they are a tangible evidence of the abuses of a kind of capitalism which is out of place in 1968.
Furthermore, I wonder why the Minister of Finance did not tax mutual funds companies, like Investors Syndicate, a foreign company with profits running to millions. Trust companies and banks make enormous profits. Why then did he not draw from them the taxes he claims to need, in a system we do not accept because we feel it is outmoded.
May I call it one o'clock, Mr. Speaker?

At one o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 2.30 p.m.
Bernard Dumont: Mr. Speaker, before the
adjournment I was saying that Canada now has a surplus of 664 million bushels of wheat. I hope that the Minister of Finance who has enjoyed his good bread at lunch, will think of those who go without it and will allow that dollar which the Ralliement Creditiste is requesting to reflect that production, so that it will reach those who are in need.
The Ralliement Creditiste is in favour of private enterprise but wherever there is abuse-I am speaking of the abuse of capitalism which adds to the wealth of a few mil-lionnaires-we come with an alternative, namely the co-operation made possible today by co-operatives.
As evidenced on page 204 of the official report of the House of Commons Debates, the Minister of Finance said and I quote:
That with effect January 1, 1969, a life insurance corporation (including a mutual corporation or a fraternal benefit society) shall be required to pay an investment income tax at the rate of 15% upon its taxable investment income-
If that measure, and particularly that tax of 15 per cent on investment income are passed, many mutual corporations and many fraternal benefit societies, mostly French-Canadian, will disappear. Those companies will be forced to merge in order to compete with the almighty companies. Last spring, when Canada lived through a certain experience that was almost disastrous-I am referring to rush on gold-the Metropolitan Life
November 8, 1968
Insurance Company transferred $10 billion of assets to the United States, and in the magazine he monde des affaires, it was said that if ten companies had done likewise, the Canadian economy would have been lost.
In view of the disastrous economy we have, in view of an economy which is no longer correctly oriented, in 1968, the hon. Minister of Finances should nevertheless give particular consideration to what we say, because the fraternal benefit societies and the co-operatives are almost all we have left in Quebec.
I shall refer particularly, among other societies, to l'Industrielle, of which Mr. Jean-Louis Levesque was once the president. Recently, he sold the company to Americans who now control 53 per cent of the capital.
We have a Canadian invention which is due to the snow. In our "thirty acres of snow", we have invented something called a "Ski-Doo", a snowmobile. The "Snow-Jet" company, in Thetford Mines, the "Boa-Ski" company and the "Moto-Ski" company in Sainte-Anne-de-la-Pocatiere were set up. All of them as well as the "Sno-Prinee" company in Princeville have been sold to Americans. From the economic point of view, however we could count on our co-operative associations. Then, by what I call a low trick, a 15 per cent tax on profits which do not really exist was established. I made a comparison earlier. Unlike certain other organisations, a co-operative association should not have a tendency to become a capitalist concern. The aim of a co-operative association is simply to provide services.
That is why the ministers who work with the Minister of Finance and hon. members from Quebec should act immediately, as they did, for example, in order to restore the distribution of mail on Saturdays in rural areas, for the very survival of the institutions which
The Budget-Mr. Dumont we built with so many sacrifices is involved. Quebec and Quebecers will never, at a time when they are gaining strength, accept the disappearance of those organizations which are about the only property they have left.
Aside from the Desjardins movement, the Societe des Artisans-a life insurance company-and some other organisations such as the Laurentienne or the Catholic Farmers Union, what else really belongs to us, from the economic point of view? Why should we fight to defend this idea of the Minister of Finance whose aim is simply to destroy co-operative institutions?
The enemies of co-operatives often complain that the rate of taxation the government of Canada is imposing on company profits sometimes reaches up to 52 per cent. This is one way of deceiving the public at large. They keep repeating that companies are burdened by taxes and, that, in this respect, co-operatives are a greatly favoured economic sector.
I have on hand a document supported by figures which established that it is just the contrary which is the case. As it would take too much time to quote at length this 10-page document, I shall request the house to let me table this document to be included in Hansard so as to allow the Canadian people to know the amount of taxes private companies have paid comparatively to the amount paid by co-operatives. With the permission of the house, this document could be added in the appendix.


Mr. Speaker:: Does the house agree to have the said document printed in this day's Hansard as an appendix?


Some hon. Members:: Agreed.
[Editor's Note: The document referred to above reads as follows: 1


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EXHIBIT &quot;A&quot;

[Stage Direction]
RETAIL BUSINESS-STATISTICS OF COMPANIES-TAXATION YEAR 1960 (In millions of dollars)
Economic businesses	Uneconomic businesses
Losses for
Industrial group	Number of companies	Profis for current year	previous year (to be deducted	Net payable income	Total of declared tax	Number of companies	Losses for current year
877	43.7	.2	43.4	17.0	504 23 134 451 1,039 242 81 711 330 606 181 161 102 855	2.6Department and dry goods stores	
Other goods (gen.)	
Accessories. automobile tires, service stations	
Retail sales of automobiles	
Automobile repairs	
201 	
380 	
852 	
1,821 	
472 	
304	81.4 3.3 11.1 34.5 2.8 5.4	.1 .1 .1 1.3 .1 .1	81.3 3.3 11.0 33.1 2.7 5.3	36.1 .8 3.0 10.0 .5 1.6	1.2 .9 14.7 1.2 .3 2.4 1.3 4.5 .8 .5 2.0 5.2Clothes and haberdashery	
Hardware	
Furniture and appliances	
Drugstores	
Fuel oil retailers	
Jeweller's businesses	
Other retail businesses	
1,422 	
620 	
1,054 	
780 	
324 	
300 	
1,412	15.2 3.8 15.2 8.1 5.3 4.5 15.5	.8 .2 .9 .1 .2 .1 1.1	14.3 3.5 14.3 8.0 5.1 4.4 14.5	3.7 .8 4.1 2.0 1.5 1.5 4.2	Total	
10,819	249.8	5.4	244.4	86.8	5,420	37.7
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[Stage Direction]
Source: Fiscal statistics 1962, pages 113-114.
(Published by the Retail Merchants Association)
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The Budget-Mr. Dumont
November 8, 1988
[Stage Direction]
Corporate dividends, when added to personal incomes (salaries, wages, etc.), are not taxable at the rate of 23 per cent of their value. From the amount of 22 per cent of dividends, one can deduct 20 per cent of the net value of dividends received (see Exhibit "B").
For example, our shareholder should pay, apparently, $3,827 of the $17,394 received as dividends. But he may claim 20 per cent of that amount, that is $3,479; therefore, he has to pay only $348.
Therefore, the Crown levies $5,196 in income tax from an average company and $348 from the average shareholder, that is $5,544 altogether. If this amount is applied to the average net profits ($23,089) of the 10,819 companies, it can be seen that the Crown receives 24 per cent of those profits.
Companies and Co-operatives
Please note one thing before going further. If the company keep its profits, instead of paying dividends to its shareholders, taxes paid to the Crown decrease by $348 (amount of personal income tax) to approximately 22.5 per cent of the average net profits.
On the other hand, the same profits can be paid out by a co-operative to farmers, as a rebate. Therefore, the farmer with a taxable income of $4,000 (exclusive of rebates) pays income tax at the rate of 22 per cent of the rebate based on his purchases at the co-operative; it does not matter whether the rebate is cashed or left with the co-operative.
Capital gains
When an economic business does not pay dividends to shareholders, a time comes when its shares increase in value. When a shareholder sells his shares at a higher price than he paid for them, the difference between both prices is called a capital gain, which is tax-free.
To have an idea of the advantages to investors (and to economic companies, but not to co-operatives or to their members), let us take the example of an elevator factory.
In 1957, the shares of that company were selling for $23; now, quite recently, they had reached $96. One who bought some eleven years ago is now making a profit by selling them at $73 per share which is entirely tax-free.

[Stage Direction]
The second table in the report of the Retailers' Association indicates that Ontario then had some 77,773 taxpayers and owners of
The Budget-Mr. Dumont retailing businesses not legally constituted. Together, they received an income (profits) of $420 million and paid $45.4 million in taxes (see exhibit "C").
In other words, the income of the average owner of such businesses was taxed at the real rate of 11 per cent, that is less than the rate applied to the rebates for purchases of farming implements granted to the farmer whose taxable income varies between $4,000 and $5,999.
Any accurate comparison is difficult
The statistical data quoted do not include the 5,420 retailing companies nor the 30,563 individual owners who did not pay any income tax in 1960, because the business was showing a deficit or its income was lower than the taxable level.
The statistical data and the examples quoted in this article are quite general, let us admit it, not because our information is inaccurate, but because we must stick to averages. In addition, a great number of variable factors come into account as to the incidence of the various regulations on corporate and personal income tax.

[Stage Direction]
We have not taken in consideration up to now, it is true, the fact that an increasing proportion of the volume of consumers cooperatives take the form of personal and household assets and their rebates are not taxable.
This is the time to repeat it: it is not the purpose of the co-operative to increase the income of its members, but to reduce their expenses. It succeeds in doing so by refunding the difference between the cost price and the real cost of services provided.

[Stage Direction]
The statistical data are based on 10,819 retail companies having paid taxes in 1960. On the whole, the profits of those companies reached $249.8 million, and their net taxable income (after deduction of the previous year's losses), $244.4 million. They paid altogether $86.8 million income tax (see Exhibit "A").
By dividing the total net profits ($249.8 million) by the number of companies (10,819), we see that each one has realized an average profit of $23,089 and that its net taxable income was $22,590.
The corporate income tax applies at the rate of 23 per cent on the first $35,000 of
November 8, 1968
[Stage Direction]
The Budget-Mr. Dumont taxable income and at the rate of 52 per cent on the exceeding amount. Which would mean that an average company would pay 23 per cent (minimum rate) on its taxable income, namely $5,196.
It would therefore be left with an amount of $17,394	($22,590-$5,196) to be split
between its shareholders as dividends.
Shareholders' contribution
Of course, shareholders must enter all income in their personal income tax forms including dividends from companies, salaries, earnings, and so on.
Let us say that the balance of our company's profits, amounting to $17,394, are divided among a large number of shareholders whose personal salary or pay is $4,000 before they receive any dividends (which is quite a reasonable assumption, as can be seen from Exhibit "E").
According to the rates shown on the personal income tax form, our shareholder will have to pay $610 on the first $4,000 of his taxable income (which represents a rate of 15J per cent), and 22 per cent on the balance up to $5,999.
Exhibit "B"
Federal income tax rate for 1964
Taxable income	Tax	
$ 1,000 or less	11%	
1,000	$ 110+14% of the following	$ 1,0002,000	250 + 17 % of the following	1,0003,000	420 + 19% of the following	1,0004,000	610 + 22% of the following	2,0006,000	1,050 + 26% of the following	2,0008,000	1,570 + 30% of the following	2,00010,000	2,170 + 35% of the following	2,00012,000	2,870 + 40% of the following	3,00015,000	4,070 + 45% of the following	10,00025,000	8,570 + 50% of the following	15,00040,000	16,070 + 55% of the following	20,00060,000	27,070 + 60% of the following	30,00090,000	45,070 + 65% of the following	35,000125,000	67,820 + 70% of the following	100,000225,000	137,820 + 75 % of the following	175,000400,000	269,070 + 80% on the balance	
Abatement for dividends: If your income such companies. (NET means gross dividends includes dividends from "taxable Canadian received or granted less any deduction, such companies", you are entitled to an abatement as depletion and service costs). However, the for dividends. The amount of the abatement amount of the abatement should not exceed corresponds to 20% of NET dividends from the "total income tax .

November 8, 1968	COMMONS DEBATES	2589
Exhibit "C"
Retail Trade-Owners Taxation Year 1960 (In millions of dollars)
Owners
Taxable	Number	Income	Tax$	$	$	$	Under	2,000	4,870	7,517	2952,000-	- 2,999	12,274	31,424	1,0693,000-	- 3,999	16,244	56,424	2,5484,000-	- 4,999	13,432	59,883	3,7655,000- 5,999	8,789	47,900	4,0006,000-	- 6,999	6,065	39,216	3,7967,000-	- 7,999	4,324	32,324	3,7448,000-	- 8,999	3,157	26,640	3,3099,000-	- 9,999	2,018	19,138	2,51910,000-	-14,999	4,444	53,079	8,64115,000-	-19,999	1,326	22,601	4,82720,000-	-24,999	453	9,995	2,49625,000 and over	377	13,702	4,412Total	77,773	419,842	45,423Non Taxable	Under	1,000	10,993	1,831-	1,000-	- 1,999	11,904	17,964	2,000-	- 2,999	13,571	32,994	3,000 and over	4,095	14,622	Total	40,563	63,749	
Source: Fiscal Statistics 1962, p. 94.
(Published by the Retail Merchants Association Inc.).
Whether they are cashed immediately or later, rebates increase the purchasing power of the members. It would be worthwhile to establish the usefulness of every measure that allows the consumers to purchase more of the goods which are becoming increasingly abundant thanks to automation. For the time being, however, it is sufficient to note that co-operatives, through their rebate policy increase the purchasing power of their members.
As consumers well know, it is almost impossible to purchase anything without paying taxes directly or indirectly. Exhibit "D" shows clearly that the consumers, not the corporations, are the most important taxpayers in Canada.
It is true that this table lacks accurateness to the extent where it classifies taxes and
The Budget-Mr. Dumont other government revenues according to whether they are paid by individuals or corporations. Nevertheless, its figures come from a reliable source.
It is noted that general sales tax provides the government with revenues of almost $1 billion. Those taxes are levied at the manufacturer level, so that they are included in the prices to the consumers. Excise duties bring in $619 million, customs and import duty, $526 million, for a total of $2.15 billion, that is, a revenue by far superior to the total corporations tax, which amounts to $1.2 billion for the same period.
If we add to this the $1.75 billion paid in income tax by Canadians, we see that, in fact, the consumer contributes the most to the tax revenue.
Of course, co-operative members, as consumers, pay the same taxes. The rebate they receive from the co-operatives, by increasing their purchasing power, also makes them pay more taxes.
But-to the taxes paid by co-operative members, as they progressively are able to spend more, must be added the taxes paid by the co-operatives themselves. The rate of 23 per cent on the first $35,000 in taxable income, and that of 52 per cent on the balance, apply as well to co-operatives as to other types of undertakings.
Exhibit "D"

[Stage Direction]
Statistics for taxation year ending March 31, 1960
Amount (In millions
of Per cent dollars) of total
*(a) Tax revenue, largely derived from individuals
Personal income tax	1,752	30.6General sales tax (applied to cost of products at the manufacturer level)	1,003	17.3Excise duties Liquor 193 Tobacco 331 Automobiles 64 Other 33	619	10.7Customs and import duties	526	9.2Total	3,900	68.0
November 8, 1968
[Stage Direction]
The Budget-Mr. Dumont *(b) Tax revenue largely derived from corporations
Corporation income tax	1,234	21.5Tax on interest, dividends etc., going abroad	73	1.3Other revenues: post office returns, estate duties and estate tax, returns on government enterprises, licences etc.	528	9.25,735	100.0
*The classes mentioned here are of a very general character and probably somewhat inaccurate. For instance, corporations pay excise duties on the cost of automobiles they buy. On the other hand, estate duties and estate tax concern chiefly individuals.
**Sales taxes are established at the manufacturer level and are included in the cost price of products, which is paid in the final analysis by the consumer. It is to be noted that sales tax rates have increased since 1960 from 10 to 11 per cent of the cost price, so that the burden on the consumer has increased accordingly.
Table based on statistics from the Canada Year Book-1962.
Exhibit "E"
Canadian Taxpayers Statistics-1959
Income
Up to $1,999 From $ 2,000 to $ 2,999 From $ 3,000 to $ 3,999 From $ 4,000 to $ 4,999 From $ 5,000 to $ 5,999 Total
From $ 6,000 to $ 7,999 From $ 8,000 to $ 9,999 From $10,000 to $14,999 From $15,000 to $19,999 From $20,000 to $24,999 $25,000 and over
Grand Total
Source: Canada Year Book-1962
Taxpayers	Tax paid
No.	Per cent	(In millions of dollars)	Per cent of total662,240	15.6	36.0	2.3886,585	20.9	123.8	7.91,012,718	23.8	212.8	13.5756,219	17.8	236.2	14.9397,403	9.4	180.2	11.43,715,165	88.	789.0	49.9301,965	7.	203.6	12.997,903	2.3	103.2	6.576,753	1.8	133.9	8.524,389	.57	80.4	5.110,027	.24	51.4	3.216,288	.38	218.4	13.84,242,490	99.79	1,580.	100.
IMr. Dumont.]


[Stage Direction]
Occupation	Taxpayers Total	Total income	Total tax payable	Average income	Average personal tax	Per cent of income
	No.	(In millions of dollars)				
Doctors and surgeons	
12,878	202.7	44.0	15,737	3,419	21.7Engineers and architects	
2,183	32.7	7.5	14,982	3,453	23.0Lawyers and notaries	
6,934	97.9	22.4	14,123	3,236	22.9Dentists	
4,220	49.0	8.8	11,605	2,075	17.9Accountants	
3,620	39.9	7.5	11,033	2,081	18.8Other professionals	
7,306	47.3	6.3	6,476	859	13.3Artists and comedians	
2,001	12.5	1.6	6,237	805	12.9Investors	
107,089	657.5	97.1	6,139	907	14.8Salesmen	
52,029	289.8	30.8	5,570	593	10.6Business proprietors	
192,724	1,042.2	119.9	5,408	622	11.5Real estate agents	
2,603	12.9	1.1	4,965	422	8.5Fishermen	
3,895	17.1	1.5	4,394	377	8.5Farmers	
66,011	273.6	20.9	4,145	316	7.6Employees	
3,743,111	14,551.3	1,201.6	3,887	321	8.3All others	
35,886	121.9	9.0	3,397	250	7.2Totals	
4,242,490	17,448.3	1,580.0	4,113	372	9.0
Source: Canada Year Book-1962
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The Budget-Mr. Dumont
2592	COMMONS
The Budget-Mr. Dumont [DOT] (2:40 p.m.)
Bernard Dumont: As I said, if the budget carries as it is, it is obvious that the most heavily taxed will be the insurance companies as compared with trust companies, mutual fund companies and banks. Why should the minister not tax these institutions? He could get from them all the money he needs to satisfy his ever growing need for new funds.
At the same time, the Minister of Finance (Mr. Benson) wants to levy income tax on these companies. This represents an amount almost equivalent to the tax levied on investment income. Still not satisfied, the Minister of Finance, when the policy holder redeems his policy or receives a gift or transfers his policy to another person, taxes the gain on the insurance policy. Here is how this works out: Redeemable value of the policy minus the net premiums paid or, in other words, the premiums paid after deduction of the accrued dividends. If this tax is not one on capital gains, I wonder what is. In a mutual fund company, for instance, there is admittedly an annual dividend and it is normally calculated on a rather low interest of 3 or 4 per cent. The true profit is obtained from the sale of the mutual fund policies. For example, if I were the owner of a mutual fund policy of $500 and, after a number of years, I sold it for $1,000, I would not be required to pay any tax on the capital gain accrued on this fund. In fact, this profit results solely or almost from interest which I should have been receiving during those years.
In my estimation, the whole thing is ridiculous, Mr. Speaker. A life insurance company is not a capitalistic institution whose aim is profits. On the contrary, these companies, especially the one belonging to Quebec or Canada are the property of the policy holders. I am speaking about most of the existing mutual and fraternal societies. Therefore, those companies belong in part at least to their policy holders. It is well known that most of the insurance policies are of the participating type. Also, the law provides that for companies of this type, the insured have a right to elect as beneficiaries a certain number of administrators in order to protect their interests. Therefore, even if the Minister of Finance includes the life insurance companies for taxation purposes, he is not in fact levying taxes from those companies but rather from the public generally, since undoubtedly the effect of this taxation reduces refunds or

DEBATES	November 8, 1968
dividends on existing insurance policies which in turn will result in higher premiums for new policies. Who is paying? It is surely the public generally. It is not a matter of taxing the corporations, but it involves the public generally and, certainly, the little people are the losers.
I wish to emphasize that I do not want the insurance companies to be state-owned. I want them to remain on a co-operative basis as they are at the present time, for we have in the province of Quebec the best example of what socialism will do. The nationalization of the hydro companies has simply resulted in increasing the electricity rates. This is a case where co-operative hydros would have been of great help, whereas nationalization has not produced any results. In other words, it is only through co-operation that results would have been obtained.
This morning I had begun to give an example of the difference between co-operatives and private enterprise in order to demonstrate the abuses by capitalism wherever there is a concentration of profits.
Encyclicals have been written in this respect. Only a co-operative is able to check those organizations which, too often, are bent on making profits but, as we always say, have no heart unlike co-operatives which can make people benefit from the profits they make. I said earlier today that for 18 years I have helped to set up co-operative organizations of this kind, because I found that money had a soul in those organizations. In a capitalist company where exploitation of people is carried to its maximum, we do not meet people who are thinking in terms of human beings, they are only thinking in terms of the profits they are making. This is the reason why, when there is concentration of wealth on a large scale, in addition to small enterprises which are successful-and we recognize their usefulness-we must set up co-operatives such as the ones we have established in Quebec over the last 25 years.
Let us go on with the comparison: in the co-operative organisations, savings remain within the consumer's community and his money keeps going around so that in the long run, everybody benefits by it. It happens only too often in some private companies who exploit people that their profits end up in the hands of businessmen abroad, as for instance in the case of Snow-Jet Company, at Thetford Mines, a company which is making a motor-ski specially designed, prepared, oriented and
November 8, 19G8	COMMONS
organized to be sold in the province of Quebec. This company, however, is now owned by Americans. Thus, wealth is concentrated in the hands of some capitalists who, later on, come and drain the economic blood of our people leaving us with little choice but to be water carriers or lumberjacks.
1 want to carry further my comparison: The co-operative is owned by the members under a democratic process, since every member has an equal say on the elaboration of policies. The co-operative belongs to the people. "One man, one vote." Everybody remember that truth. In private companies, the control belongs to the shareholder or shareholders who have the largest number of shares. The ownership of 51 per cent of shares represents a controlling interest, but money is the deciding factor in private companies. This is why co-operatives require that money be used in a more human way.


Mr. Speaker:: Order. I regret to interrupt the hon. member but his time has expired.


An hon. Member:: Continue.


Mr. Speaker:: Has the member the
unanimous consent of the house to continue.


Stanley Howard Knowles: Let us give him 2 more minutes.


Some hon. Members:: No.


Mr. Speaker:: I regret, there is not unanimous consent.


Hon. Ron Basford (Minister of Consumer and Corporate Affairs):: Mr. Speaker, during the course of the budget debate my colleague the Minister of Finance (Mr. Benson) said I would be intervening, and I do so now. I rise to speak today because of my particular interest in the performance of the Canadian economy from the point of view of the consumer whom it is my statutory obligation to represent.
The consumer interest lies in an economic system which makes available an increasing abundance and variety of goods that are dependable in quality and reasonable in price. Similarly, consumers who rely on the use of credit-and their numbers are ever-increasing-are concerned about interest rates and borrowing terms.
During the past three years we have seen an almost uninterrupted increase in Canadian prices. And in the past two years, as the
DEBATES	2593
The Budget-Mr. Basford Economic Council of Canada said in its fifth annual review:
Prices have been marching forward against consumers across a broader front than at any time in the past 15 years.
This has occurred despite the fact that over-all demands on our economy have eased somewhat since the middle of 1966 and despite the fact that unemployment has been running at higher levels than in 1965 and 1966.
In the last couple of years the consumer price index has been going up at approximately 4 per cent per annum. These price pressures have been accompanied by corresponding upward pressures in costs, including wage costs, salaries, interest rates and rents. I know there is a good deal of argument as to which is the cause and which is the effect. The businessman is inclined to put most of the blame on wage increases. The trade unionist tends to blame business for raising prices and thus reducing the real value of existing wages. I believe these are sterile arguments. The process is essentially a circular one; rising prices give rise to increasing cost pressures and higher costs in turn give rise to still higher prices. Moreover, there are many other sources of income and cost pressures in our economy-rents, professional services, interest, stock options, to cite a few examples.
[DOT] (2:50 p.m.)
In any event, the effects are no mystery to the victims of inflationary forces. These victims are the Canadians who are old, who are poor, who have no means of adapting their circumstances to the rapid change. They are not organized to insist that their incomes reflect rising price levels. They have no power to insist on a fair share. Citizens who enjoy no bargaining power cannot bargain for a better deal. A fixed income should not mean a fixed injustice. There is always a danger that those whose market power is strong will be somewhat complacent about inflation. They are in a position to protect themselves, and those with little or no bargaining power are left to take the strain. The major instruments that governments must rely upon to keep the economic system in reasonable balance and to maintain reasonable price stability are fiscal and monetary policy. In the budget speech last week the Minister of Finance explained how this budget is intended to contribute to these purposes, and I shall not attempt to add to what he has said on this aspect of the matter.
November 8. 1968

The Budget-Mr. Basford
Without getting involved in conflicting schools of economic thought or theory, Mr. Speaker, it is generally accepted among economists that the basic influence on price performance and employment levels is aggregate demand in the economy. This is reflected in expenditure by consumers, by businesses, by governments, and by foreigners who buy our exports. The key to our performance lies in demand management as expressed in fiscal and monetary policies.
These have to be based on the best available judgment as to what businesses are likely to spend on their investment programs, what governments are likely to spend, and what our exports are likely to be. If the economic system were free from friction, rigidities, and time lags, and if we could foretell the future with more safety, the determination of the correct economic policies would be greatly simplified. The rudder, if we could set the rudder, would be set in the right position and, subject to occasional corrections for changes in the wind, the ship would remain steady on her course.
But we do not live, Mr. Speaker, in such a perfect world. Because of lags in the movement of impulses through the economy, responses to changes in the general economic environment take some time to develop. And what is more, changing expectations about future economic developments can have a perverse affect on the decisions of today. To put the matter more concretely, I think we are faced today with a situation in which a long period of expansion, the longest in our history, has created unusual expectations about future price increases and about continuing economic growth. These expectations are leading our businessmen and our trade unions to regard as normal rates of increase in prices, wages and other costs that are not consistent with reasonable price stability and are probably not sustainable. There is no doubt that these trends could be substantially slowed down, if not eliminated, by a very restrictive fiscal policy, but no one can say what level of unemployment and loss of potential output would be the result. We must consider other approaches.
Many industrial countries have been attempting in recent years to find ways of supplementing the major traditional instruments, fiscal and monetary policy. They have sought other measures to influence the movement of prices and incomes. Most hon. members will be aware of the efforts the British government has been making over a


number of years in this regard with the aid of a prices and incomes board, and the adoption of a set of fairly rigid guidelines.
The United States government has also tried programs in this field, first by setting voluntary guideposts, as they called them, for price and income behavior and more recently by creating a cabinet committee on price stability. This committee is charged with the task of looking into special situations such as supply bottlenecks in the economy and the like. A number of European countries have also experimented with various and different approaches to the same problem.
I wish I could tell the house, Mr. Speaker, that all these approaches have been successful, but the fact is that the results seem to have varied from country to country and from time to time. I do not think anyone would claim that these programs can do more than supplement and assist, in a modest way, fiscal and monetary policies. These policies remain the major influence on price and cost performance but there is a strong body of opinion that if the supplementary programs are judged by modest and realistic standards they have had some success.
As hon. members are well aware, the government has, over a number of months, been considering the introduction of a supplementary price stability program in Canada. This subject was studied by the Economic Council of Canada in 1965-66 at the request of the government. The council noted that a formal incomes policy was usually understood to comprise a set of general guidelines for incomes and prices in the whole economy, a means of making these guidelines relevant for individual price and wage decisions, and a means of inducing conformity with the guidelines. The Economic Council of Canada, concluded that a formal incomes policy would not be an effective way of bringing about an improved reconciliation of high employment and reasonable price stability in Canada under normal peacetime conditions.
I agree with the council's view that a formal incomes policy, so defined, would not be suitable in Canadian conditions. The question we have been studying is whether a less formal price stability program could make a contribution, a program which would involve the creation of machinery to provide better information about current trends in prices, costs and productivity, and to encourage greater restraint on the part of those responsible for price and income decisions. Such a
November 8, 1968	COMMONS
program could clarify for all of us the forces underlying our unsatisfactory price and cost performance, and could analyse special problem areas in our economy to see where improvements could be achieved. We have concluded that a program of this kind should be initiated.
A central element in this approach will be the creation of an independent public agency to study, investigate and report on problems of rising costs and prices. Its functions would include research and the issuing of periodic public reports on current developments in this field. There will need to be arrangements for parliamentary review of the reports of this agency. This role could be assumed by a parliamentary committee, perhaps the standing committee on finance, trade and economic affairs. We believe, Mr. Speaker, that this machinery, working together, could make a valuable contribution to greater understanding of the forces affecting our prices and costs, and bring home to all of us the need for social responsibility in price, cost and income decisions.
We have had some initial informal consultations about some of these ideas with provincial governments and with some business and trade union leaders. The government is now working on a white paper or policy statement which will contain some proposals and which will suggest possible means of implementation of this machinery. The white paper, which is being worked on now, will be available later this year. We shall be undertaking further, more formal consultations with interested parties. A program of this kind, however, will be only fully successful with broad support from business and labour or trade union groups. This support is crucial. This is why full consultation is essential before final decisions are taken as to the exact scope and nature of the program. The government will also wish to see the report of the task force on labour relations, or the Woods task force, before making final decisions, since this is one of the subjects the task force has had under consideration.
I know that some people, both in labour and in management, are less than enthusiastic about a program of this kind in Canada. Some, I believe, are inclined to judge it in advance on the assumption that it is the British program or the American program, or some other imported program. We have, however, to design a program that suits Canada's business and labour structure, that
DEBATES	2595
The Budget-Mr. Basford suits Canada's economy, open as it is to international forces, and that suits Canada's federal and parliamentary system of government. I hope people will refrain from pinning labels on this program, labels from other countries. There is no doubt at all in my mind that the public generally are strongly in favour of action by the government in this field of stabilization. I would urge members of interested groups to remain open-minded while we prepare our white paper and prepare for our consultations with them.
[DOT] (3:00 p.m.)
The success of this program will depend heavily on the quality of those who serve on this new agency. We will be appealing, in the course of working out the policy, to able and experienced people from the universities and elsewhere, to come and give of their time by way of public service in support of a worthwhile cause.
I want to make it perfectly clear that this program will not involve any attempt to introduce price controls or controls on incomes. One merit of our mixed market economy is the way allocation of resources among all kinds of competing requirements is determined by a flexible price and income system. When consumers choose to buy more and more of a particular product their intervention in the market sets in motion price effects which draw more resources into the production and distribution of that product. Similarly a successful, efficient business is able to outbid less efficient businesses for skilled labour and other resources. Price and wage flexibility within the market economy must be maintained if we want, as we do, a dynamic and efficient economic system capable of producing steadily rising standards of living for Canadians, and capable of maintaining and expanding our position in world markets.
This is not to deny that there are special cases where some form of price regulation is desirable. Certain services and utilities, such as railroads and telephone companies, by their nature are more efficient as monopolies, at least for part of their operations. In these cases there is no alternative to the application of statutory rate controls, and where these services are within its jurisdiction parliament has acted to provide for the regulation of rates.
The remarks I have made about the role of the price system are based on the assumption that the system is reasonably competitive. To
November 8. 1968

The Budget-Mr. Basford the extent that there is monopolistic market behaviour, including collusion and other restrictive trade practices, the role of the market in allocating resources to their best uses is impaired. Moreover, prices that purchasers have to pay may be unreasonably high. The government must be concerned not only with maintaining a reasonable degree of price stability, but also with maintaining competitive market conditions, so that prices to consumers and other buyers will not be higher than they need be. This is the role of the Combines Investigation Act and of the small but dedicated group of officials who administer the act.
I have heard a number of allegations in this house to the effect that the combines act is not being enforced vigorously enough or broadly enough. The fact is that, within the limits of their resources and within the limits of the present statute, the director and his staff are doing a remarkably good job. Those who are not aware of the extent of activity in this field would do well to read the latest annual report of the director of investigation and research which I tabled in this house on October 15 last.
Perhaps I should remind the house that the director of investigation and research is in a very real sense the watchdog of parliament and the public in the matter of competition policy. He has a statutory duty to undertake an inquiry whenever he has reason to believe that the Combines Investigation Act has been, or is about to be, violated. In this role he has a high degree of independence.
If there are hon. members who feel that the resources of the branch are inadequate, I would have to agree. I would have to say the same about some of the other branches in my department, and no doubt most other ministers would feel the same about the resources available for some of their programs. As a member of the government I support fully the severe measures that have had to be adopted to limit the growth of government expenditure, but we have to recognize that these economies cannot be achieved without some cost in terms of the services we can offer to the Canadian people.
We do not find in the Canadian market, or in any other market, one category of companies that are absolute monopolies, with all the rest operating under conditions of perfect competition. The vast majority of businesses in Canada are found between these two extremes. They operate in varying degrees of

monopolistic competition from one end of the spectrum to the other. While perfect competition may be the ideal, it is rarely attained in practice outside of certain commodity markets where the numbers of buyers and sellers are very large. Our objective has to be to maintain workably competitive situations, to prevent price-fixing and other forms of collusion, and to prevent unfair trading practices likely to reduce the degree of competition by driving firms out of the market.
The fact that many of our manufacturing industries consist of a small number of dominant firms often means that there is a pattern of price leaders and price followers. The price leader establishes a new price and the others follow. Sometimes this takes place within a matter of days or even hours. This does not necessarily mean that there is collusion. The combines staff watch all such situations carefully and consider them against the background of the particular industry as they know it.
A common criticism of the Combines Investigation Act is that it stands in the way of mergers or other arrangements that could lead to increased efficiency through economies of large scale production. This matter is not so simple as some critics imply. An important question is whether in each case the benefits of increased efficiency will be passed on to the public.
Another question is whether the firm concerned is in fact operating at less than the optimum scale. There is a good deal of loose talk about scale in the absence of evidence as to the ideal scale for a particular industry. Fortunately we are beginning to see an increasing flow of economic studies of scale and specialization in Canadian industry, stimulated by the work of the Economic Council of Canada on this subject. Under the present act, when the director examines a merger he is obliged to consider whether competition is, or is likely to be, lessened "to the detriment or against the interests of the public." In his annual reports the director has outlined a number of economic factors and questions he takes into account. These demonstrate that he does not limit himself to a narrow legalistic approach. Moreover, he is always prepared to listen to any proposals and give his opinion as to whether a particular course of action would be likely to necessitate an inquiry under the act.
I hope no one will take these remarks to reflect complacency about the present state of
November 8, 1968

the law. Competition needs to be enforced more effectively in Canada, and the present act is imperfect. Its coverage is not broad enough; many important services are outside its ambit. Based as it is on criminal law, it involves elaborate and lengthy court procedures with a heavy burden of proof resting on the crown. When a case is tried the court must either find that there is a criminal offence or else acquit the accused. The court is not entitled, nor qualified, to temper justice with a judgment about the economic impact of a restrictive practice on the community. The problem of dealing realistically with mergers is related in part to this element of rigidity. Needless to say, my officials and 1 have our own views about a number of ways in which the act should be improved. We are awaiting with interest the report of the Economic Council of Canada on this subject. We hope and expect it will deal constructively with the areas of weakness in the present act. I am in any case determined to propose a series of major reforms in this legislation after we receive the council's report.
Another major influence on competition and efficiency in Canadian industry is the tariff. Tariff reduction is one of the economic remedies provided in the Combines Investigation Act. Historically our relatively high protective tariff contributed to many of the weaknesses that still exist in our manufacturing industries. It encouraged the development of a branch-plant pattern in manufacturing, with the Canadian plant typically emulating its parent by attempting to produce a full range of that company's products. The inevitable outcome has been too many small scale operations and unduly high costs. There is a good deal of evidence that the height of the tariff has also contributed to the emergence of monopolistic conditions in Canadian industry. It is clear that the use of the Combines Investigation Act to enforce competition has to be related to and supported by complementary tariff policies.
[DOT] (3:10 p.m.)
The subjects I have touched upon today, Mr. Speaker, are all interrelated. They are by no means the only factors that affect our competitive position and our price performance. Many other policies must also come into the picture-our programs for manpower training and mobility, our grants to encourage research and development, for example. The house is familiar with these and I do not propose to review them. I have concentrated
The Budget-Mr. Woolliams on two main elements, price stability and competition policy. The main point I want to make is that we must not only do what we can to encourage restraint in regard to increases in prices and costs we must also ensure consistent and vigorous use of all programs that can contribute to a more dynamic, competitive and efficient economy.


Eldon Mattison Woolliams: Mr. Speaker, in rising to take part in the budget debate I intend to deal positively in an approach to one of our major industries in western Canada. Before doing so I should like to comment on a question I asked this morning. I feel that it would be expedient for me to do so at this time. I have in mind the answer of the Minister of Finance (Mr. Benson) in reference to medicare.
We in this house remember when the Liberal party brought in their medicare program. We well remember that at that time Miss LaMarsh said it would be something like the castor oil treatment: open your mouth, you are going to get the treatment whether you like it or not. We were under the impression at that time, rightly or wrongly, that the federal government would pay 50 per cent of the cost and 50 per cent of the cost would be paid by the provinces. Even on that basis I raised an objection because I have always taken the position that the government of Canada cannot legislate programs and thrust them on the provinces, particularly when the province must pay 50 per cent of the cost. The situation is even worse when the federal government turns around and not only requires the provinces to pay their 50 per cent of the cost but also the other 50 per cent.
The new formula announced at the conference between the federal and provincial governments was a real shocker. The federal government probably had it in mind all the time. We are now informed that the federal government intends to opt out of this program. At one time the provinces used to opt out, but on this occasion the federal government is opting out. It has handed the provinces a package and the provinces are not only going to have to pay their 50 per cent but the federal government's 50 per cent. The minister said this earlier in a sophisticated manner. This supports my feeling that we should always accept his words as having two meanings.
Having regard to the 2 per cent tax, or whatever it may be, in relation to medicare, the minister has said that he will look at it to
November 8, 1968

The Budget-Mr. Woolliams see that whatever the government's share of the cost is it will be passed on in the form of revenue to the provinces. What he is really saying is that he will probably take 17 per cent or 20 per cent of the tax collected for this particular purpose and suggest that is the allowance for the provinces and if they cannot live within that amount they will have to put up the balance.
The minister shakes his head. I want the record to show that he has shaken his head because I know the provinces are shaking in their boots and provincial treasurers throughout the country are very worried about this plan. It is too bad but I think the time may come-I do not encourage this-when the provinces will join together and say to the federal government, we are not going to accept this type of plan. The federal government is now thrusting a plan upon them much like the plan that was thrust on them in relation to property and civil rights which are under their jurisdiction. The government said it would pick up the tab for 50 per cent but it now says that the provinces must handle the whole thing and pay 100 per cent. That is not good enough, and it is not acceptable just because the Minister of Finance was not able to calculate within reason how he would manage a balanced budget.
I should like to hear from him on this point at some time. Perhaps he will give us an explanation, assuring the provinces. He may shake his head, but I hope he will say categorically without any of these sophistical reservations that the federal government will pay 50 per cent of the cost and will not come crying here about it being the cause of deficits. Surely he cannot blame the provinces for this fact when it is the government's own grandiose scheme that is responsible.
Before I comment about the petroleum industry I should like to say I listened with great interest to one of the most able lectures that has been delivered outside a law school, that delivered by the Minister of Consumer and Corporate Affairs (Mr. Basford). It was just a lecture and it was read quietly. He broke the frozen silence of his department and gave us a summary of what has been put under one roof. The minister knows that this department has had no effect in controlling the cost of living in this nation. Nor did he indicate any solution his department or any other department has in relation to controlling costs, whether they are the result of high interest rates or high costs of living.

In any event these high costs are having a serious effect on the old age pensioners and others who are tied to that type of income today. The government has forgotten these people; they are the forgotten people. I cannot remember what the increase is in relation to the increased cost of living that these pensioners are allowed, but the minister certainly knows that the old age pensioner today is chained to an economic system within which he cannot live.
We have heard a great deal about poverty in Biafra. The Minister of Transport (Mr. Hellyer) is at this time conducting a task force tour across the nation. He must be receiving many shocks as a result of the poverty which exists in Canada. The people who are existing in poverty, living in low class housing and suffering this terrible and horrible standard of living, are the old age pensioners, our senior citizens, who are chained to the inflationary economic programs of the government.
The minister can talk as much as he wants about his sources of revenue, but he is perhaps forgetting a most important principle. If you increase trade you increase demand, and when you increase demand you obtain greater supply because production can accelerate. In this way you obtain greater revenue and do not have to bring in a high taxation system. That was the philosophy of this government during the election campaign. Many of the candidates said the government was going to pay as it goes. What they really meant was that the people of Canada would pay and the government would go. That is really the government's philosophy.


J. Michael Forrestall: They have not got the courage to raise taxes to pay their own bills.


Eldon Mattison Woolliams: That may be true. I have made reference earlier to the grain industry. We warned this government for months about what was happening to grain trade. The government just sat in silence. The minister is now leaving. Of course he must leave, because he cannot stand the heat. Whenever it gets hot he has to get out of the chamber.
Canada is an anomally in the world today. We are currently producing over 200 per cent of its consumption of crude petroleum; yet we have a net deficit in this country of over $200 million per year. There is need for a new oil policy, and that need is essential. Let me pause here for a moment to indicate that in 1960
November 8, 1968	COMMONS
and 1961 the government of that day established a national oil policy. There has not been any change since that time. The circumstances have changed and economies have changed not only in Canada-I have in mind development, consumption and other factors -but throughout the world. This government leans on the fact that we have a national oil policy, but it never really admits it was the government of this party that implemented that policy. That policy now requires upgrading and change.
On October 1, I directed a question to the Minister of Energy, Mines and Resources (Mr. Green) regarding oil policy. I asked him whether there had been a cut-back and he said, as reported at page 625 of Hansard:
-the national oil policy is a matter of continuing negotiation-
There is no question in my mind that there has been a unilateral decision by the United States in reference to cut-backs on the importation of crude petroleum from Canada. This government will not admit that there were no negotiations or no attempt on their part to negotiate.
In this regard I should like to read the following from the Calgary Herald of September 28, 1968:
[DOT] (3:20 p.m.)
United States action which could cost Alberta export sales totalling close to ten million barrels of crude oil in the next three months, has created new tensions in Ottawa, Washington and the oil centres of North America.
U.S. companies which import Canadian crude have been "requested" by the U.S. oil import administration to cut back their purchases during the fourth quarter of 1968-
The United States made the request; Canada danced to their tune. There has been no suggestion anywhere, either in the answers to questions by the Minister of Industry, Trade and Commerce (Mr. Pepin) or the Minister of Energy, Mines and Resources (Mr. Greene), that there have been any negotiations with the United States, and there has been no suggestion of any protest to that country in respect of the cut-back in our exports of crude petroleum. The article continues:
Bonner H. Templeton, New York, manager of Mobil Oil Corporation's crude oil department, told the board his company has been subject to restraints on importation of Canadian crude since 1963, and had already been asked by the authorities to reduce its purchases "substantially" during the last quarter of 1968.
DEBATES	2599
The Budget-Mr. Woolliams
This was stated before the conservation board in the city of Calgary; yet when I asked the Minister of Energy, Mines and Resources and the Minister of Industry, Trade and Commerce about it I was given the wishy-washy answer that it has always been subject to negotiation under the national oil policy. The fact is that the government never negotiated in this respect and has never protested what has occurred. It has just stood back and lost the petroleum market, in the same way as it stood back and lost the grain market for western Canada. And these are both billion dollar industries.
I have never been one to stand in my place and criticize without offering a solution. We need a new, dynamic oil policy now. We need a policy that takes into consideration recent developments in the industry and changes that can be expected in the future. What is the situation today? We have a problem in the Near East which affects the oil supply of the world. We see scientific development taking place with respect to the Alberta tar sands. We see a tremendous development taking place in Alaska. Yet no consideration is given by the government to the situation that exists, and it has nothing to say about how the problem can be solved. All we have had is a stupid lecture given by the minister-I have used an adjective I should not have used-such as is given in law school.
The minister talks about controlling prices but he offers no solutions to the problem. We are given quiet little lectures which are written by quiet little people in the department. This is the kind of speech to which we have been subjected. We must increase our exports in this area before we can arrive at any solution to the problem. The average daily production for 1967 was 1,098,000 barrels. The average daily consumption during 1967 was
1.294.000	barrels. At the end of 1967 the estimated potential productive capacity was
2.650.000	barrels per day. During 1967 Canada imported an average of 200,000 barrels per day more crude oil and products than it exported. At an approximate laid down price of $2.90 per barrel, this contributed a net annual deficit of approximately $200 million to Canada's trade imbalance. For every thousand barrels per day of Canadian crude produced and sold, there is an approximate saving of $1 million per year in the trade deficit.
If the $200 million were spent in Canada for Canadian crude oil it would have a total effect on the Canadian economy, through
November 8, 1968

The Budget-Mr. Woolliams secondary and tertiary industries, of approximately $700 million annually. Therefore we would increase the gross national product and obtain more tax revenue. Instead of increasing rates, we could have a bigger share of the market and keep the rates at the same level. As I have said, if the $200 million for imports were spent in Canada for Canadian crude oil, it would have a total effect on the Canadian economy, through secondary and tertiary industries, of approximately $700 million annually.
Two major Canadian banking institutions have calculated that the multiplier effect of money generated in the natural resources sector of our economy is approximately 3.3. Canada loses on every barrel of imported crude oil, not only through the foreign production profits that remain offshore but mainly because each barrel of Canadian crude oil pays over $1 per barrel in the form of taxes and payments to the Canadian government. Therefore, to the extent of Canada's crude oil imports payments are received in foreign countries, and if these imports were replaced by Canadian oil it would result in such benefits being received directly by the citizens of Canada. This industry would go a long way to make up our deficits. Canada loses, on the importation of oil, the production costs and $1 in the form of taxes and payments to the Canadian government on every barrel of crude petroleum.
This is the situation. When the national oil policy was developed there were negotiations by the then Conservative government which stepped into the field because at that time, as a result of the Suez crisis, our exports of crude petroleum and other oil products had fallen off. The then minister of trade and commerce, the hon. member for Prince Edward-Hastings (Mr. Hees), and others worked out a plan with the United States so that we would export this commodity to the northwest United States and permit crude petroleum to come into this country from Venezuela, which market is financed by American interests. It was agreed that they would have the eastern market and would export to the northeast United States.
As I pointed out to the minister in the late show on October 1, our exports of crude petroleum, have been reduced by at least
10,000	barrels per day because of the unilateral decision of the United States. While their imports into Canada from that country are increasing, our exports to the United States are growing smaller. The Minister of

Finance should walk up and down and think about this situation.
In this connection the government should take a positive step and do something to solve the problem. The government should face the fact that the United States made a unilateral decision in this respect and has cut back our exports. Then it should say: We will send a negotiating team to Washington to arrive at a solution to the problem. The government should send a negotiating team to Washington, rather than sending ministers to South America which means they are never here to answer questions in the house.
The minister should discuss this problem with other members of the cabinet and make certain that our petroleum industry is protected. It is a pretty sad state of affairs if we in Canada cannot protect this most important industry. Even with our exports to the United States, without the cut-back and with the greatest domestic consumption in Canada, our industry is operating today at a production level of only 40 per cent. In other words, we could produce another 60 per cent in this industry and stay within the rules of conservation in the provinces. Now we are bringing into Canada millions of dollars worth of crude petroleum, $200 million a year, which aggravates our balance of trade situation.
What would the grain growers of this country think if we, as a wheat exporting nation, were to import $200 million worth of wheat? I know that the argument put forward is whether we can economically bring the crude or refined petroleum from western Canada into the Montreal area, but the experts point out that we could transport oil to the eastern market and compete with oil coming into this country from Venezuela. If this is true, the government should surely do something to correct the situation, and it should do it now. This should be done, rather than giving wishy-washy answers and trying to sweep the problem under the carpet.
There is nothing wrong, politically, in getting up and saying that the United States has unilaterally cut back our exports and that the government is pleased the opposition has brought the matter to its attention. Then the government should say: We will send a negotiating team to Washington and work out an arrangement. This is the kind of government I thought the Canadian people might be electing under a young man in the last election. However, I have seen no sign of this happening. Mr. Speaker, I hear the hon. member
November 8, 1968

across the way saying something. I do not know what he is muttering about; he is all greased up.
The western Canadian petroleum industry, exclusive of refining and marketing, currently spends approximately $1 billion a year, over 85 per cent of which is spent in Canada, for goods, services and payments to government. Of the major expenditures made for oil and gas pipe lines, gas plants, fittings, pressure vessels, pumps, etc., over 80 per cent was spent in eastern Canada, a large part of which was in the province of Quebec. The majority of these capital expenditures were made in Canada as a result of tariff protection. With that we have no quarrel, because some of our secondary industry needs protection.
[DOT] (3:30 p.m.)
At least 75 per cent of the capital expenditures on the $235 million tar sand plant was spent in Canada, a major portion of which was spent in Quebec. Eighty five per cent of the capital expenditure of a typical western Canadian gas	plant-Homeglen Rimbey,
which costs $18 million-was spent in Canada, of which the substantial portion represented purchases in eastern Canada. So this industry not only means a lot to western Canada, it means a lot to eastern Canada and to the Canadian economy generally.
The royalties paid to Alberta, British Columbia and Saskatchewan benefit Canadian taxpayers in savings to the federal government in federal-provincial equalization payments, in the words of the minister.
Today Saskatchewan is a have province, but only a short time ago it was a have not province. Alberta is a have province. These are have provinces because they have now developed a philosophy with regard to the development of our industries and the increase of our gross national product. It is only then that the nation will have the kind of revenue that it needs so that its citizens can live in dignity, and then perhaps the word "justice" might have some meaning.
What about the taxes received from federal and corporate profits? That in itself is substantial. The direct result of oil, gas and associated mineral development in western Canada has removed both Saskatchewan and Alberta from the provinces currently receiving equalization payments.
The national oil policy resulted in an agreement whereby we would export to the northwestern United States, while we would permit imports of crude from Venezuela. How
The Budget-Mr. Woolliams did this come about? It has come about because, as my good friend knows, in the course of negotiations the United States said: "If we cut off imports of crude petroleum from Venezuela we would be fostering communism in that area and the financial interests of the western world would suffer. If you allow us to import crude petroleum into the eastern market, we will give you markets in western and central United States". So let us follow through the negotiations with the United States. I am not complaining about the United States; they are good, sound businessmen and they will listen to us because Canada is their best customer. This is the plea I make to the government, and it is not made in the form of criticism. It is the kind of positive approach which I thought I would hear in this debate from the government, either with regard to wheat, to industry or to petroleum. However, that is all forgotten.
I suggest the government is permeated with socialistic thinking, so that all they can see are grandiose programs paid by grandiose taxation. What I say may sound like conservatism, but let me say that I listened to a very fine conservative speech from another member from Calgary, the hon. member for Calgary South (Mr. Mahoney) who spoke last evening, and I want to congratulate him on his maiden speech. I advise everyone to read that speech. I hope that what he said in the house he also said in caucus, but I hope he said it there more forcibly to those ministers who are socializing with socialists.


An hon. Member:: Oh, do stop it.


Eldon Mattison Woolliams: My friends say stop it. They can never stand this, but they are better off in the opposition than they were on the government side because you know what happened when we tried this experiment in the province of Saskatchewan when it was a have not province under the government of Thatcher, who, I am glad to say, is a Liberal premier. Now that province is a have province because capital came in there to develop the province's industry as a result of the confidence of investors, as was the case in the province of Alberta.
I always say to my socialist friends that I can never understand them because surely after the experience in Great Britain the people can consider they have suffered enough.


Mr. Gilbert:: What about Sweden?


Eldon Mattison Woolliams: I have been to Sweden. If we were to compare Sweden's gross national
2602	COMMONS
The Budget-Mr. Woolliams product and their standard of living with ours, I would put Canada ahead of Sweden any day. That is my answer so far as this is concerned.
Mr. Speaker, in the short time that I have left I should like to make several recommendations. The government must get off its butt right now and review the national oil policy, in the light of the changing circumstances which I have mentioned. It should renegotiate a deal with the United States or else tell the United States: Look, you may be worried about Venezuela or about a similar uprising to the one that took place in Peru, and we are also worried about it, but we are concerned about our own economy and we are prepared to allow a certain amount of imports into this country provided you will fulfil the terms of the national oil policy and let us put more into the Toledo, Detroit and Chicago area. I congratulated the government last year when they reversed their previous decision on the pipe line. Now I say they have to renegotiate the national oil policy.
The second recommendation I would make to the government is this. The National Energy Board officials must never be questioned, according to some people. As soon as an administrative board is established in this country, whether it is provincial or federal, it is considered to be a sacred cow. I suggest that the officials of the National Energy Board and the officials of the Department of Industry, Trade and Commerce should be carefully examined by a standing committee of the House of Commons with regard to what took place between the United States and Canada, and what is taking place now so far as the petroleum industry is concerned, because the ministers will not divulge the facts. I do not know why they do not want to do it.
My third suggestion is that I would like to see the Senate go to work. It should initiate a special economic study of the petroleum industry. It should get experts of all types from the independent petroleum association, from independent companies, from U.S. companies and from the Canadian subsidiaries that may be left. Facts should be set down, after which the committee should come up with a sound basic policy to increase our trade. Why do we need this investigation? We have to find out what effect the new Alaska production has on the national oil policy. The hon. member for Calgary South mentioned it in his speech, and I agree with him 100 per cent. It will have a dynamic effect. These are

DEBATES	November 8, 1968
the factors we must consider, and I am glad the hon. member is in accord with me in that regard. What effect does the Alaska production have on the Puget Sound area, particularly now when the largest cut-backs by the United States are taking place? This is dealt with in the September, 1968 edition of the Calgary Herald.
Will we be able to make up our loss of exports because of the Alaska production, by increasing exports to the Detroit, Toledo and Chicago area? These are the things that should be looked into immediately. A review of the national oil policy is of utmost importance to the economic welfare of Canada, and more important than considering the burdening of the industry with the Carter tax proposals, which sound good in theory and are quoted glibly for vote getting but could and might at this time hamper Canadian production, development and trade expansion. I can never understand those people who talk about taxing Canadian capital, here there and everywhere, these socialist thinkers who are not only on one side of this chamber. We are always talking about U.S. capital. If the government is going to tax Canadians to death, and that is what it is doing, and if it is now going to start taxing capital, because that is what it recommends, it will sap all the capital from Canadians, and how are we ever going to invest in our own country? That is the problem.
I do not know what kind of campaign the Liberals ran across the rest of the country but I have listened to their candidates in Alberta and found them to be the most Goldwater type of people I have ever met. I am not being critical of the hon. member for Calgary South, and I complimented him on his speech, but I thought that if some of these candidates were elected they might have had some power to direct this government into sound business thinking and to cut out the socialist trends which are ruining the welfare schemes, such as medicare which the provinces already had, and imposing a new plan on the provinces which will cost the taxpayers many more thousands of dollars and will sap more capital from Canadians so they will be unable to invest in their own industry. We have had the Watkins report and we have heard Walter Gordon talking about it, but the same people came in with a budget which is taxing capital, so that Canadians do not have the necessary capital to invest in their own industry. I think we need a new policy with regard to the petroleum industry.
November 8, 1968

My time is nearly up but I should like to end on this note. Although trade is most important, it seems to be forgotten today because we are so busy designing plans on taxation. I should like the members of the government to come clean before parliament, so far as the wheat markets of this nation are concerned, because they mean a billion dollars to be spent in the industrial centres of Quebec and Ontario. I hope the government will come clean with the opposition, because it is good government when it does, and that is their function. If the government sat on this side of the house, they would be doing the same thing-trying to get the information out. We want to see where we are going with regard to the petroleum industry.
[DOT] (3:40 p.m.)
Instead, they misrepresent the facts, as one of the ministers did back on October 1, when he said there was a cut-back but they were going to negotiate. They were going to meet with the industry itself and work out a plan that would give the industry another 10 per cent. Then we could at least say we had 50 per cent production. These are the two major industries. I do not know where your government is going with the Kennedy round, and other deals that were made. I do not know what impact this is having on industry in eastern Canada, but we hear many repercussions so far as that is concerned. We have never been able to debate that situation; it is always kept quiet.
The situation in those three major areas, wheat, petroleum and the industries of eastern Canada, under that kind of dictation, under that kind of control, with that kind of taxation and that kind of socialization, is that things are stymied and no development is taking place. You know, when you look at your budget, and considering the estate tax situation alone, this is what you find. It is all right to pass on your estate to your widow but, under the government's philosophy, you cannot pass on the estate to your children.
I do not know what the rates of taxation are going to be, and will not know until we get the resolution. However, this is what is going to happen. The small farmer who generally passes the farm on to his son, who in turn passes it on to his son, the little man who means a lot to Canada, is going to find that upon his death the family will have to borrow so much money at Liberal high rates of interest they will have to sell the farm to
The Budget-Mr. Whiting United States interests. Then the government will have another Watkins study, another Watkins report. I say to the minister, let us get on with the job of developing the resources of Canada, let us have some real vision.


Edgar John Benson: I should like to rise to a question of privilege, Mr. Speaker. The hon. member said I was leaving the house, but actually I did not leave. I listened with great interest to everything he said. The only thing I did was to get some curtains between myself and the hon. member to protect my eardrums.


Eldon Mattison Woolliams: Speaking to the point of privilege quite seriously, I want to apologize if I left the impression the minister did not listen. He did listen very carefully to what I said and I appreciate that very much. When the minister did leave I thought he just could not stand it, so I withdraw any suggestion that he did not listen to my speech. He went back of the curtain to get a message, but he did stay and I appreciate that very much.


Mr. R. L. Whiling (Hallon):: In speaking today in this budget debate, Mr. Speaker, I rise with a feeling of concern regarding housing and its relation to the welfare of the people of Canada. There is another matter which concerns me also, and it relates directly to the economic welfare of the country. I am referring to the ever increasing number of railway stations which are being closed in many communities, and in many cases those communities depend upon railway service.
Before I proceed, because this is my maiden speech, I should like to take advantage of this first opportunity I have had to pay tribute to some of my predecessors who represented Halton county in this house. I refer to Dr. Harry Harley, who represented Halton so well during the years 1962 to 1968. It gives me great pleasure to mention the name of Mr. Hughes Cleaver, who sat in this house as the member for Halton from 1935 to 1953. The late Miss Sybil Bennett, the niece of the former prime minister, the late Viscount R. B. Bennett, represented Halton as did Dr. Alexander Best, the son of Dr. Charles Best, the co-discoverer of insulin. I am indeed honoured to be the successor to these former members who contributed so much. I look forward to representing the people of Halton in the great tradition of my parliamentary predecessors.
However, I should point out that Halton county, as such, is no longer a constituency.
2604	COMMONS DEBATES	November 8, 1968
The Budget-Mr. Whiting
The Hal ton riding came into being as a result today is that these officials often avoid taking of redistribution prior to the last federal elec- responsibility for allowing new methods or tion. Halton riding now includes the town of new materials to be used.
Erin in the north, but no longer includes the a comprehensive national building code town of Burlington. I should like to take this would allow many companies to increase opportunity of welcoming the people of Erin their research and construction of prefab to the constituency of Halton. Erin is in Wei- houses which could be sold in all provinces. It
lington county. I might add that this area is one of the oldest settled sections of the province of Ontario. It is also one of the most scenic as well as being a fine agricultural district. Halton riding now extends from the shores of lake Ontario some 37 miles north.
I should like to turn to housing and its relation to the budget. According to the annual report of Central Mortgage and Housing Corporation, last year over a million dollars in federal funds were earmarked for housing and directly related programs, such as urban renewal and sewage treatment plants. In view of the over-all size of our total budget, it is obvious there is a limit upon how much in the way of federal funds can be allocated to housing. We need more houses. We need more money in order to build those houses if we are to meet the goal set by the Economic Council of Canada.
We must therefore find new sources of money. In addition, we must bring down the per unit cost of housing by a considerable amount. This can be accomplished in part by standardizing building codes and construction standards across Canada. We must also encourage the use of new building materials. Housing therefore is a matter of social welfare, and the federal government has never failed to show leadership but has, in fact, taken the initiative in practically every housing program. The time has come for a reappraisal of federal, provincial and municipal responsibilities for housing. We must decide, along with other levels of government, how the ever increasing demands for housing upon the federal purse are to be met.
I submit that a first step would be the establishment of a national building code. It would be basic in a revised program of housing development, and any expenditure of N.H.A. funds would be contingent upon adherence to this code. The result of such a procedure would be very simple, very strong and very direct. For-example, the National Research Council could approve new building materials and they would be immediately acceptable everywhere in Canada. This procedure would relieve municipal officials from the onus of personal decisions. The situation

would enable them also to deal with only one agency, the National Research Council, to get their new ideas and innovations approved. This would immediately decrease the cost of new houses in Canada. This is one positive step which would receive considerable public approval and would further emphasize the government's sincere desire to solve the housing problem. This problem is a complex one. There are many contributing factors which include land costs, construction costs, the cost of mortgages and so on.
[DOT] (3:50 p.m.)
Let us put the problem in a somewhat different perspective, Mr. Speaker. Consider a detached house costing approximately $28,500 in Oakville, which is located 25 miles from downtown Toronto. In order to buy one of these houses the purchaser must have a down payment of $10,000 and earn an income of over $8,000 per year to qualify for an N.H.A. mortgage. However, the average family income in Oakville is $6,235, the highest in Canada. Only 15 per cent of Canadians make over $8,000 per year.
This shows us, Mr. Speaker, that very few people have $10,000 cash. Financial institutions apply the rule that the applicant cannot afford more than 27 per cent of his income for mortgage interest, principal and taxes. A man earning $5,000 a year can therefore afford $110 per month toward his house payments if he were fortunate enough to live in an area where taxes were $300 a year, at $25 per month. He could afford $85 a month to pay interest and principal at 8J per cent with a 25 year mortgage of $10,000. If he saved 10 per cent of his gross income for five years, he should have $2,500 for a down payment, and the total price that he could then afford for a home would be $12,500.
This, Mr. Speaker, poses the question: How many families earning $5,000 can afford to save 10 per cent per year, and where can you buy a house in an urban or semi-urban area for $12,500? A man earning $5,000 must pay considerably more than 27 per cent of his income for shelter if he is to live by Canadian standards. He must pay a proportionately
November 8, 1968	COMMONS
high rent for an apartment or town house, or for a dwelling where they will accept children, or he is driven to buying a more expensive house on a resale basis by taking a second mortgage, with the likelihood of spending 45 to 50 per cent of his income on shelter.
Such mortgage payments and rents, Mr. Speaker, are a major cause of family breakdown because they take the milk from the baby's mouth and shoes from his feet. They deprive him of proper care, and frequently of the loving care of his mother, who often has to work in order to pay the rent or the mortgage.
The problem as far as housing is concerned is how to provide for or accommodate people in the lower income brackets. This problem must be solved by government action, which must be critical of obsolete methods of land assembly, construction and financing. A broad and enlightened attack on the problem is required. The government must not wait until all the contingencies are considered; the time to act is now.
Personally, Mr. Speaker, I regret that action did not begin with this budget, in the form of a land speculation tax on the resale of undeveloped prime land. Such a tax would be a deterrent to persons who buy and sell land without contributing to the development of the country.
I look forward, Mr. Speaker, to the result of the task force under the leadership of the Minister of Transport (Mr. Hellyer), which is now studying the problem across Canada. As soon as the housing task force was announced, a group of Halton citizens prepared a brief, which was presented to the task force in September. Some of my remarks today, Mr. Speaker, are taken from that brief.
I should like to discuss a situation, Mr. Speaker, that is not peculiar to my riding alone, but common to many constituencies across Canada. This relates to the railroads. I specifically refer to the policy of the Canadian National Railways of removing the agent operators from certain stations and incorporating these stations into what they refer to as the master agency plan. This is being done under the guise of economy, and is supposed to provide a more efficient service for the user.
I should like to point out, Mr. Speaker, that what the C.N.R. is proposing in these communities is not always in the best interest of
DEBATES	2605
The Budget

Mr. Whiting the people the railway has served. Neither do I believe that it will appreciably improve the financial position of the railroad. Nor does the proposal provide a very efficient service to the public.
I should like to give you a case in point, Mr. Speaker. The C.N.R. is presently making application to the Canadian Transport Commission to remove the agent operator at Acton, Ontario. If this application is successful it will mean the virtual loss of railway service to this community. Acton is a progressive community of 6,000 people located 40 miles from metropolitan Toronto. It is a community that should receive increased railway service, not less. If, for example, the C.N.R. would give this community commuter service, undoubtedly people would move to the community from the congested areas of metropolitan Toronto but would continue to work in the city.
The removal of railway service would have an adverse effect on the future industrial growth of this town, because in many cases industry requires the facilities that are provided by the railway. I might add, Mr. Speaker, that Acton is one of the very few communities which has a favourable assessment ratio of 60 per cent industrial to 40 per cent residential.
I can find no justifiable grounds to abolish railway service in this community, Mr. Speaker. I take strong objection to the cavalier methods used by the C.N.R. prior to making formal application to the board of transport commissioners. It was just over a year ago-on October 13, 1967 to be exact-that Mr. R. T. Vaughan, a vice president of Canadian National Railways, wrote to Dr. Harry Harley, who at that time was federal member of parliament for Halton county, advising him that the first stages of implementation of what the railway call the master agency plan would be put into effect on November 6 of that year. The first stage, Mr. Vaughan pointed out, involved taking away certain work from the station and placing it in the hands of the master agency in Guelph. This included express, freight and telegraph service. The agent would remain on the premises but would not carry out any work. It would be very difficult for the agent to carry out too much work, because in this process they also disconnected his telephone.
This was to be in the nature, Mr. Speaker, of an experimental period which would probably last until mid-January or early February

November 8. 1968
The Budget-Mr. Ricard of this year. Further, the railway stated that following this trial period the whole matter would be reviewed and looked at in the light of whether an application should be made to the Canadian Transport Commission for approval to institute the master agency plan in this area.
Apparently, Mr. Speaker, the matter was reviewed by the railway and a decision made in the light of its effect on railway operations alone. No users of the railway were asked to make any application or express their views on the effect of this re-arrangement of service. Quite understandably, Mr. Speaker, the people of Acton wanted their side of the story to be heard before the application reached the Canadian Transport Commission and the commission agreed to hold a meeting. This meeting was held on October 17, 1968 in the Acton town hall and was presided over by Mr. W. J. Rupert, district inspector of the railway transport committee, and six representatives of the C.N.R.
I will not go into the details of what took place at that meeting, Mr. Speaker. Suffice it for me to say that the railway officials were grilled, admonished and lectured by the people in attendance. Mr. Rupert heard such descriptive adjectives as "shocking", "rotten" and "costly" to describe the service that the railway was giving the citizens of this community. He stated that his report of this meeting would not be made public but would go directly to the rail transport committee.
[DOT] (4:00 p.m.)
I submit that this procedure is not democratic and I challenge the right of the committee to keep this matter secret since it affects the future of a town and its people. I suggest that this meeting should have been held long before the phasing out process began. Talking to many of the people who attended the meeting I found it was the unanimous opinion that the decision had been made by the C.N.R. to go ahead with its application regardless, and in spite of, what transpired at the meeting. Its decision had in effect been reached before going to Acton. In other words, the public be damned. I sincerely hope this does not reflect the attitude of the C.N.R. in its activities throughout Canada.


Hon. Theogene Ricard (Sainl-Hyacinihe):: Mr. Speaker, it is a privilege for me to have

the opportunity of participating in the consideration of the budget. During those few minutes, I shall try to be as objective as possible, even though some of my remarks or criticisms may not be too agreeable to our friends opposite.
I shall dispense with a full review of the promises and sharp criticisms directed against the ministers in the Diefenbaker government when we were in office, but it is difficult to remain silent about the election campaigns and the destructive criticisms the Liberals directed against the Minister of Finance of that day for showing a deficit in his budget. They promised to the people that as soon as they were in office, the Canadian people would not have any deficit in their budget, that it would be brought back to a more normal size and that, instead of showing deficits, we would have surpluses.
The facts are quite different from the promises made to us during the 1962 and 1963 elections in particular. In fact, since our friends opposite came to power in 1963, they certainly have had plenty of time to implement their promises and to show their ability to manage our country's business. However, today the cost of living is the highest in the whole history of Canada. In fact, according to the most recent statistics, the cost of living reaches 156.6 per cent. This means that a number of small investors and low income citizens have a hard time meeting their expenses at the end of the year.
Furthermore, we are faced with the largest deficit ever known in all our history. At the present time, 4.7 per cent of our labour force is unemployed and, out of this number, 99,000 are in the province of Quebec. Taxes of all kinds are the highest since confederation. The debt per capita is the highest ever known. For the second time in less than a year, personal income tax has been raised. It is the second time that this happens since the Liberals came to power. Postal rates have been increased too and, in some cases, the increase was in the order of 375 per cent.
It is also known that without any previous notice, this government has cancelled the winter works program that enabled municipalities to undertake, during the winter months, very useful works to lessen the evils of unemployment. Is it also to promote the building industry that this government maintains the 12 per cent tax on building materials? On several occasions, we on this side of the house tried to persuade the government of the benefit that would be derived from the removal of this 12 per cent tax, as it
November 8, 1968



would enable small investors to build themselves a home, but every time we ran into objections on the part of government members.
Everybody knows that this government has always encroached upon fields of provincial jurisdiction. This government will not grant the provinces their fair share of the tax revenue. As a result of such a position, Mr. Speaker, there remains a certain mistrust between the parties concerned; the government and the present Minister of Finance (Mr. Benson) should take a new stand.
Mr. Speaker, as I have but little time at my disposal this afternoon, I should like to talk about something that concerns the riding I have the honour to represent in this house, namely the textile industry.
[DOT] (4:10 p.m.)
This is one of the oldest industries in the province of Quebec. In that province, the textile industry provides employment for 52,000 Quebecers. There are plants in all or almost all the cities of the province and it is to be noted that those plants are mostly located in small or medium-sized towns.
This is to say that the textile industry has played along the years a very important part in the economy of our cities. We find a great number of textile workers in towns with a population of 5,000, 10,000 or 25,000 people, and they are the strength of our municipalities. They are home owners, people who have succeeded in saving enough money to build themselves a decent home for their family.
During the years 1960, 1961 and 1962, through the imaginative measures of the then minister of trade and commerce, (Mr. Hees), the hon. member for Prince Edward-Hastings, the textile industry has taken a new lease on life, whereas it was declining before 1960. Thanks to the measures taken by the minister of trade and commerce at that time, this industry found new foreign markets. We were surely entitled to expect that those would be continued. However, conditions today have forced us to realize that the present situation is exactly the opposite of what it was in 1960-62.
The textile industry is now going through a period of uncertainty which is worrying not only the owners of our textile factories, but even more the workers. Mr. Speaker, those are the results of the unconcern shown by the present government towards the textile industry.
A few weeks ago I had the opportunity of meeting the owner of a textile factory in my
The Budget-Mr. Ricard region who had asked me to his office to discuss the matter.
Since it is always a delicate subject to mention names in the house without being authorized to do so, I asked that plant manager whether he objected to my giving names and figures about his own business. He said: I do not object at all because it is a matter of life or death for my own industry and for that of others also.
That industry is the Yamaska Shirts located in St. Hyacinthe. It has been operating in that city since 1929. Until recently, it had 350 employees on a yearly basis. However, since August last, due to a lack of orders, the management has been compelled to reduce its number of employees by about one half. Should the situation continue there will have to be further cuts in the number of employees according to Mr. Yvon Bolduc, the manager of this firm.
Mr. Speaker, the employees and their families are affected adversely by those conditions which are detrimental also to the well-being of many other Canadians who are entitled to expect from the government more protection than they have been given until now.
If you look for the basic reasons for this lack of work not only in that particular plant but and in many others, you will find that it is due mainly to excessive imports from foreign countries, particularly from communist and Asiatic countries.
I have before me, Mr. Speaker, the findings of a survey by the Canadian Textile Institute which gives not only very interesting information but shows to what extent imports are hurting the Canadian industry.
I would like to quote a few figures from the pamphlet I have in hand.
Canadian imports of large fabrics: cotton, synthetic fibres and wool have increased, since 1963, from 409,663,000 square yards to
478,376,000	square yards in 1967.
We know, Mr. Speaker, that as far as cotton or wool fabrics, are concerned, Canada is in an unfavourable position to compete with foreign products as, in both cases, we do not produce the raw material.
However, as far as synthetic fibres are concerned, Canada is certainly well equipped to maintain a flourishing industry which is undoubtedly to the advantage of the Canadian people.
As for imports of synthetic fabrics, are concerned, I will quote again from that publication. In 1963, we received 97,725,000 square

November 8, 1968
The Budget-Mr. Ricard yards of material from all countries compared with a total of 123,017,000 square yards in 1967. From Hong Kong especially, we imported in 1963, 1,215,000 square yards of material, while those imports reached 11,290,000 square yards in 1967. From Japan, in 1963, we received 24,188,000 square yards of material compared with 42,612,000 square yards in 1967.
How, Mr. Speaker, can one logically claim that by accepting such huge quantities of products on our market, we can hope to maintain especially in the field of synthetic fibres, a textile industry which can meet foreign competition? What are the immediate consequences of those imports? Several plants have shut down already. To mention only one plant which I know quite well, since I worked there several years, the Goodyear Tire and Rubber Company is compelled to lay off 170 of its employees; I have been told that the Victoria Shirt in Arthabaska-and I got the information to me by the manager of the Yamaska Shirt plant in Saint-Hyacinthe- which has some 75 employees-will quite probably be forced to shut down before November 20. The same applies to several other plants throughout the province and to convince hon. members I would like to read part of a letter which I received from the director of the Textile Labour Unions of America. This letter dated November 5, 1968 was written in English and I quote it textually.
[DOT] (4:20 p.m.)

Recently we learned with great shock that at least four textile plants located in St. Hyacinthe, St. Jean and Coaticook were liquidating, forcing hundreds of employees into astoundingly growing joblessness.

Mr. Speaker, that is the situation in the textile industry.
There is one measure that the government could take; it could protect our workers because according to my information, Canadian tradesmen can get boys' shirts from Thailand at $14.50 a dozen, federal tax included. In Canada it would cost a Canadian manufacturer $26.55 to make a dozen shirts of similar quality. As far as men's shirt are concerned, an importer or a tradesman can get foreign shirts for $18.50, federal tax included, whilst the same product or a similar product manufactured in Canada, will cost him $34.50 a dozen.

It seems to me that the government of Canada has an obligation to give the Canadian workers and taxpayers the protection to which they are entitled and to guarantee that they will be able to continue working in the factories where they gained their experience and where their skills are still needed. If the present trend continues, the textile industry will completely disappear a few years from now, and we will all be sorry to see the end of an industry which, until now, has greatly contributed to the success and development of our municipalities.
It seems to me that the government should adopt anti-dumping legislation which would give our workers the protection they need. In my opinion, this legislation should prevent the entry into Canada of foreign products which compete with Canadian products.
If our Canadian factories can manufacture
24.000	or 30,000 dozen of shirts a year, we should not allow the entry into the country of
24.000	or 30,000 dozens of shirts, or whatever the figure, unless they are appraised at the same price as the shirts manufactured in Canada. That would put Canadian and foreign manufacturers on an equal footing. Unless such steps are taken, I am afraid our industry will sooner or later go bankrupt.
Mr. Speaker, I should now like to make a few comments on the first budget introduced by the Minister of Finance. I do not direct my remarks exclusively to him, because to my mind he is merely the tool of the government. I do not want the minister to think that I am criticizing him personally, but rather the policy he is implementing.
I should like to point out to the hon. minister what same journalists think of his first budget. For instance, I have here an article written by Roland Gagne, which appeared in La Voix de I'Est, on October 25, 1968 in which he gives his impressions on the budget of the hon. minister.
In our opinion, it is an injustice, because it is not the average wage earner, who always gets the beating, but the higher wage earner who has the means to pay higher income tax when the financial situation ol the state requires it. The least that can be said Is that Mr. Benson could have strained his grey matter to a greater extent to find less onerous sources of revenue for the people in the low and moderate Income groups.
Further on, Roland Gagne adds:
Mr. Benson should have taken Into consideration the high cost of living, the ever increasing prices, as well as the difficulties Canadians face daily in trying to make ends meet. Their income is by no means inexhaustible. The income that remains, once taxes have been paid, is barely sufficient to provide them with a decent standard of living.
November 8, 1968

And Mr. Gagne concludes by saying:
Why can the Minister of Finance not be reasonable, why can his tax measures not be fair and equitable for all Canadians?
In an editorial published in the newspaper Le Droit of October 23 last, having concurred with the stand taken by the minister towards insurance companies, Marcel Gingras adds this:
That satisfying measure unfortunately is matched by a mean action which will affect again the small wage earners who are urged to save while invited to subscribe generously to the latest issue of Canada savings bonds. As of now, nothing will be left to the small investors who could hardly save enough money to receive meagre bank interests and others. Every interest amounting to ten dollars or more in the future will be taxed while up to now at least, $100 in interests was protected from the greedy taxation people.
The just society, at that price, becomes extremely expensive and we shall regret having ever wished for it.
Now, here is the opinion of a labour leader whose every day work brings him in continuous contact with the workers who let him know about their needs. This is what Mr. Laberge, president of the Q.F.L. said with regard to the first budget presented by the Minister of Finance and I quote:
-the two per cent increase In personal income tax, with its $120 ceiling, is a real hold-up against low income people by a government which managed fraudulently to be elected on the basis of a just society.
That is the opinion of newspapermen and a labour leader about the first budget of our good friend, the Minister of Finance.
A lot more could be said about this budget, but since the time allotted to me is nearly over, I would simply appeal to the fair-mindedness of the minister and tell him that many today are the citizens who got fooled by the promise of a just society as proposed by this government.
They even have regrets and are just waiting for the next opportunity to show in a tangible manner their dissatisfaction towards this government.
The Prime Minister, the Minister of Finance and the present Liberal government would be well advised to remember that and to act accordingly. The government should remember that its first duty is to build a society which protects the weak and not the rich and the powerful, because the budget which we will be called upon to pass or reject bears all signs of a measure which, once again, falls on the low income people to the
The Budget-Mr. Roberts advantage of those who could withstand a tax increase much better than they can.
I ask the honourable minister if he is perfectly convinced that it is in the best interest of the population to tax $108 the married citizen who gets an annual income of $7,000 or $8,000 and to impose an increase of a few more dollars only to those who get an income of $10,000 $15,000 $25,000 or more.
I think that in his inner self, the honourable minister realizes that this is an injustice and I hope that he will use the next opportunity to correct it in order to bring about the just society which was promised during the last election campaign.
[DOT] (4:30 p.m.)


Mr. John Roberts (York Simcoe):: Mr. Speaker, I know it is traditional for a member speaking for the first time in the house to say a few words about his constituency. I would not wish to break with such a tradition.
York Simcoe is a new constituency, I am a new member, and I am relatively new to the area I represent. It is now my home and I have come to know it well. Those members who have visited York Simcoe know that it is a rural area lying between Barrie and Toronto. They will also know that it contains some of the loveliest land in Canada, from rolling hills to the Holland Marsh. They should know something of its roots in our history; the Scottish and British settlers and the French speaking pioneers, and the Quakers who first inhabited the area. Hon. members will know that more recently it has attracted people from many lands, who have also made their contribution. Its people are warm and hospitable, and it is an honour for me to have been accepted by them, as well as a privilege to represent these Canadians in the House of Commons.
In some ways my previous experience might have led me to attempt to enter political life. As a university teacher of political science I knew the frustration of lecturing about political problems without having to do anything about them. When I entered public service, first as a diplomat, and later as a ministerial assistant, I had some opportunity to deal with the problems facing this country. But I doubt that I would have attempted political office had it not been for the personality and the policies of the present Prime Minister (Mr. Trudeau).
2610	COMMONS
The Budget-Mr. Roberts
The concept of government, which the Prime Minister espouses, which seeks the active participation of the public in decisions which affect them

a government of involvement-is a vision of Canada which attracts me. This led me to enter public life to give what support I could to the person who I believe understands best the country that, ideally, Canada can be.
Today I should like to speak on the problems and prospects which face regional development in this country. It has become clear that Canada is moving out of an era of welfare politics into a period in which a primary concern will be the programs and politics of economic development. The whole emphasis on the implementation of welfare programs since the second world war-the establishment of a national system of social security- useful and important as these programs have been, has not moved us very far in eradicating the disparities of regional development which exist in this country. After a century of growth almost one quarter of our families in Canada are living at or under the poverty level.
Our past programs have treated the symptoms of poverty rather than the disease. The key to combatting the poverty problem is the channelling of more funds to realize the untapped potential of underdeveloped regions of our country. Their function must not be to provide a permanent crutch, or support, for lagging sectors, but to give temporary infusions of capital which will bring these regions to a level at which they can sustain their own growth and contribute to our national prosperity.
The proposed department of regional development will fail in this task unless it is conceived, not simply as a department of regional development but as a department which is concerned with general economic planning for the whole of Canada. Such a role opens up a whole nest of problems both within the structure of federalism and within the framework of interdepartmental relations within the government. The department of regional development, if it is to succeed, must take on this larger role simply because of the extent of interdependence within our society and our economy.
The whole history of the rural development program, for instance the agricultural and rural development administration, and the fund for rural economic development, is instructive from this point of view. ARDA was originally conceived as a program to deal

DEBATES	November 8, 1968
with specific, ad hoc, one shot agricultural programs. An analysis soon indicated that over half the people living in rural areas were not engaged in agriculture. As a result, a program directed simply toward agricultural problems could not deal with the underdevelopment of rural areas. The emphasis of programs shifted from agricultural projects to general projects in rural areas. We then found that even concentration on individual and specific projects was not enough. We cannot rely upon piecemeal plans. You have to look for programs in rural areas as a whole. Therefore we moved to a comprehensive development approach, and this led us to the creation of the $300 million FRED.
[DOT] (4:40 p.m.)
At the same time we found that one basic problem in lagging areas was the lack of potential employment opportunities. Consequently, the programs which were designed to improve labour mobility and enhance occupational skills have necessarily resulted in the migration of people from rural to urban areas. We were in danger of solving the problems of rural areas simply by compounding the problems of urban areas. So in the rural development program we have been led step by step to the necessity of regional economic development because we have found that development problems cannot be efficiently dealt with outside this framework.
I suggest that regional economic planning does not make much sense unless it is related to some over-all conception of economic objectives for the country as a whole. Only through such a conception can one keep regional developments operating harmoniously with each other rather than at cross purposes. But of course there are enormous problems in developing a useful system of economic planning in Canada, problems posed by the nature of federalism, by our economic traditions and by our strong interdependence as a trading nation within the North American economy.
Obviously whatever economic planning we have, it must involve close co-operation with the provincial and municipal governments. But one danger of this co-operation may be to remove the planning process from the effective scrutiny of the political process. Planning agreements hammered out in consultation with the provinces would become rigid documents. The House of Commons on the one hand, and the provincial legislatures on the other, will be told that nothing can be
November 8. 1968

changed since changes would restart the whole process of consultation and negotiation. In other words, there is a real danger that planning for regional development will become, in an exact literal sense, an irresponsible process. Positions will be taken with the provinces by planners and technocrats. For parliaments and legislatures to bring effective scrutiny and control to such a process will be extremely difficult.
We have seen how difficult it is for the public to ascertain governmental responsibility for the implementation of shared cost programs with the provinces. Indeed, the fudging of the lines of responsibility is one reason they are brought into discredit. Many members of this house have indicated their concern at the erosion of parliamentary control which has resulted from delegated legislation. There is a real danger that planning decisions, too, will, in effect, be delegated to organs of federal and provincial co-operation which it will be difficult for the House to control.
The process of planning is not simply a technocratic function. Any planning process, since it allocates scarce resources, involves a choice of means and ends which embody political preferences. Through planning certain groups are helped and encouraged, others are limited in their activity. We cannot avoid political judgments in this process.
It is for this reason that I am hopeful the minister responsible for regional development will engage the parliamentary committee fully in the regional planning process. Political choices-I am not speaking of partisan politics must inform technocratic judgment.
A second important factor will be the engagement of the people to be affected by planning, in the planning process. The French have had considerable success in this "animation sociale" and it might be that we could well adapt their use of regional and sector commissions to involve labour, industry, consumers, experts and others in the planning process. This public involvement is vital if planning is to succeed. People must be consulted and their judgments must carry weight.
The French government achieves this through 23 sector commissions. These commissions work on preliminary growth estimates prepared in a five-year basis by the "Commissariat au Plan". Since the commission include representatives of administration, business leaders, experts, people from universities and wage earners, they are able
29180-165j
The Budget-Mr. Roberts to thrash out different opinions and obtain wide agreement on development prospects. The process both overcomes the isolation of government departments, which tend to work in water-tight compartments, and engages public support for planning objectives. We in Canada have to go further, I believe, in involving the parliamentary committee in this kind of work.
Administrators like a quiet life. Civil servants involved in regional planning are not exempt from this general principle. Yet the objective of social participation in planning is to make their life unquiet. It is to ensure that the results of the planning process really do embody a consensus of the views of the groups affected by change. I hope that the minister responsible for this department will ensure that his civil servants will lead unquiet lives in this regard.
The second major problem area for a department of economic development is that of interdepartmental relations.
In most countries-Great Britain and France are good examples-the government departments responsible for economic development sooner or later run headlong into the policies of ministries of finance. The concern of ministers of finance is, after all, fiscal policy and their immediate concern is the short term view of the next 12 months. The view of economic planners is on the five, 10 or 20 year scale. In government, as we know, the urgent often takes precedence over the important. The problem is how to ensure that the planning voice is heard strongly in government councils which are markedly oriented to immediate budgetary and fiscal concerns. To attach economic planning responsibility to the head of government precludes the kind of attention the planning process requires. To attach it to the Department of Finance is to entrust a tender child to a notorious cannibal.
The best solution would appear to be to attach it to a strong minister with easy and influential access to the head of government. This I hope, and I am sure, happily, is the situation now in Canada. What is also required is to make budget making open to the increasing need of public involvement with the budgeting process. A whole mythology surrounds the present budgetary process. A delicious sense of mystery tantalizes those who wonder what the Minister of Finance will do. Obviously some economic decisions being considered by a government cannot be
2612	COMMONS
The Budget-Mr. Roberts discussed publicly, since public discussion would in itself have the effect of limiting the government's free decision. Devaluation is a perfect example.
But I believe it would be useful to have in a general way more information than we now receive in respect of the various economic measures the government is considering. The United States, for instance, is able to discuss budgetary proposals in congressional committees without an enormously disruptive effect. It seems to me that we possibly might be able to do the same thing.
At the moment, advice which is too narrowly channelled through one small group of people-and this is what happens at the present time-no matter how able those people are, is likely to prove inadequate. This is one reason I welcome the announcement of the recent appointment of an economic adviser to the Prime Minister, and I hope that one of his jobs will be to provide an assessment of Canada's economic policy apart from the views of the Department of Finance.
It would also be helpful if the forecasting services of the Department of Finance were improved, and eventually that the government reveal the long term forecasts on which it is working. These forecasts should be treated not as fixed goals which it is the determination of a government to achieve; they should be looked at as "best estimates," and it should be recognized that policies will change as circumstances change and as estimates prove to be more accurate. Such forecasts and policies tentatively framed in relation to them, will give us a much better assessment of a government's performance. At the moment it is too easy to justify economic success and failure as a result of the imponderable factors in unrealized forecasts.
Regardless of the difficulties of the forecasting process, government must obviously come to some view of what the performance of the economy is likely to be over a five-year period as a context for the yearly budgetary program. Indeed, in terms of the allocation of governmental program priorities the government must look at the life of a parliament as a planning period. Government program priorities are linked to budgetary allocation. A budget can only properly be assessed when viewed in the context of the longer period of government legislation and spending plans. I very much hope that the Minister of Finance will take steps-perhaps others than those I have suggested-to open up the budgetary

DEBATES	November 8, 19G8
and planning process to greater public involvement.

Mr. Speaker, as I speak in this house for the first time, I should like to address a few words to my French Canadian colleagues.
I must say that my concept of Canada is that of a country founded on the equalitarian principles of North America, a country with two languages, two cultures, rich from a material point of view, richer still from the spiritual point of view.
I am convinced that such a concept of our country requires the full participation of French Canada. I wish French Canada the role of an equal partner in the management of this country, and French Canadians actual and not merely symbolical power in the management of governmental, administrative and economic affairs of our country.
To all the members, on both sides of the house, I want to say that I am extremely proud to be their colleague, to sit with them, to have the honour of participating, even in a minor capacity, in the management of the affairs of our country.
[DOT] (4:50 p.m.)


Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, I respectfully request your tolerance and understanding in bearing with me during my first speech in the house. Indeed, while to me it must be a very important phase of my political life, I realize only too well that to you it is but one of many speeches you have heard in your illustrious term of office.
I hope too, Mr. Speaker, that all members of the house will bear with me in what I have to say, as I know that every one of the 264 members who occupy seats here in this chamber have been or will be charged with the duty and honour of giving his first speech in the House of Commons.
It is with a great sense of pride and humility that I stand here and with a weight of responsibility in the knowledge that I represent over 70,000 men, women and children in the riding of Humber-St. George's-St. Barbe in the province of Newfoundland. But I realize too, Mr. Speaker, that whilst my immediate duty is to my constituents, I am also responsible to the half million people of my province and indeed to the many millions of Canadians across our great dominion.
November 8, 1968

I hope that I may be forgiven if I do not deal specifically with the issue at hand, that is the budget, but what I intend to do is to deal generally with the spending of moneys, as it applies to the nation, by the federal government, and its application in its contributions to the province which I represent, together with my six other colleagues.
If I am critical, it is with respect to those I criticize, not for the sake of criticism alone. I wish to point out what I believe have been very grave errors of judgment, and I hope that some of the criticisms will leave a small mark of recognition on those who are responsible for spending, so that these errors will not be repeated in the future, to bring about the suffering of those who can least afford to suffer.
Due to my somewhat modest military background, in assessing the capabilities of the present government I cannot for the life of me understand their approach to the administration of our country, and I was immediately struck with the fancy military cliches reflected in the government's plan of operation. I refer to cliches like the war on poverty, task forces, training and mobility, strategy, and many other military terms. I would not be surprised if any day now we were to see a platoon of 29 ministers march into the house in the new green uniforms. If indeed the government intends to use military strategy in their attack on the country's problems, may I remind them of the fundamental military term, "appreciation of the situation". May I also remind them of such fundamental terms, which they seem to have forgotten, as basic training, common sense, sincerity, fundamental planning, and the important term, leadership.
With the change in the high command, they have started a change in departments. Let me remind them that if they are going to start playing soldier they are not going to fight the war on poverty by creating new departments. They are not going to overcome neglect, regional disparity, unemployment or the lack of housing by attacking these problems with task forces or by overstaffing their offices with research experts, psychologists or sociologists, by computers, or by looking at maps or reading statistics. They can only find the solutions by using their basic training knowledge or by looking over the ground.
You cannot solve the problem of housing in Newfoundland by sending task forces to the
The Budget-Mr. Marshall capital of the province and asking questions of the very people who caused the problem, that is the provincial government. You can only solve the problem by visiting the village, the settlement, the town or the community where the problem exists, and has existed for 20 years, due to ineptitude and political waste. You cannot talk training and mobility to Newfoundlanders who have been deprived of an education, due to apathy and complacency of government. You cannot talk centralization and reorganization to people who have been discriminated against, and who have never been afforded the common everyday basic services which should be their basic right. You cannot solve problems by thinkers' conferences and seminars and by preparing fancy reports; you can only solve them by getting to the grass roots of the problem and using a bit of common sense. You can only solve them by getting your hands a little dirty and your feet a little wet.
No, Mr. Speaker, our government has created a Frankenstein and has become so absorbed in creating royal commissions to tackle problems, royal commissions which after years of time and millions of dollars only tell them in the end what they knew when they started, that there is a problem. And nine times out of ten the government disregards the report, anyway.
I like the report on poverty of the Economic Council of Canada. After hundreds of pages, five annual reviews, 32 staff studies, five conferences, after presenting seven papers and nine other reports, they came up with the statement that poverty is real. What a stroke of genius! Is there anybody in this house, in the press gallery or in the visitors gallery who did not know that poverty is real? Do not the five million poverty stricken Canadians know that poverty is real?
I liked reading a couple of months ago of the grand celebration the government had here in Ottawa when, with great fanfare and publicity, the Prime Minister by the mere pressing of a button launched a new machine that tells us how many children are born each day. How much did this wonderful invention cost? But let me suggest to the government that they invent some new attachments for that machine which will tell them what happens to the babies born in depressed areas who will be deprived of an education. Let them find an attachment that will tell them what happens to those children who grow up without an education and cannot find jobs. Let them attach something to this machine to
2614	COMMONS
The Budget-Mr. Marshall prepare these babies for the neglect they will find in the fishing settlements of Newfoundland, where people do not have such bare necessities as water and sewerage, lights and telephones, doctors and nurses. Let the machine tell these babies how they can learn to understand the look of disillusionment and despair in the faces of their parents, when they are old enough to understand.
What is the purpose of all these royal commissions? Let us consider first the commission on the status of women. Why are thousands of dollars wasted to investigate the status of women? Why the waste of time and money when everyone in the country knows that any woman can become anything a man can aspire to become? Are there not women doctors, lawyers, professors, scientists and mayors? Are there not women members of parliament and senators who help govern the country? I would even go farther and admit that women can achieve what no man can: They can produce the children that we hope will grow up to become better clothed and fed and educated, and to become better leaders of our country. But let them also be reminded that they are mothers and that they should bring up our children by example and, before it is too late, prevent the diseases that are infesting our youth with glue sniffing, hippie-ism and rioting which I feel is getting out of hand and, if we are not careful, will result in the decay of our youth of the future.
Here we are in a state of financial chaos. The other day I read in Time magazine about the general and his lieutenants going off on junkets to Latin American countries. They are going on a month long mission to Latin America, on a belated voyage of exploration, to look into the all important aspects of our relations with Venezuela, Colombia, Peru, Chile, Argentina and Brazil, and other Latin American countries. They are going to have a shuttle service between Ottawa and Latin America.
Did anyone ever hear of anything so absurd? They are making a mess of running their own country and here they go looking for trouble in other countries. They cannot solve their own basic problems and they go looking for new ones. I say to them in all sincerity, let us clean out our own backyard before we go trying to solve someone else's problems. If the Prime Minister wants to go on a voyage of exploration, let me take him on a voyage to my district in Newfoundland to look into the all important relations with

DEBATES	November 8, 1968
the most neglected part of Canada. I will take his cabinet on a voyage which win make them hang their heads in shame.
[DOT] (5:00 p.m.)
First, let me take the Minister of Finance (Mr. Benson) on a junket. I will show him waste in spending which results from his and his predecessors' neglect by pouring millions of dollars into the hands of an incompetent administration. This waste resulted from neglecting to exercise control of spending. Let me show him a 500 page report by the royal commission on the economic state and prospects of Newfoundland. If I may quote from this financial report, we find that the consultants said:
In this study on the Newfoundland government the consultant had the greatest difficulty arriving at a complete picture of the current financial picture of the government.
The report continues, Mr. Speaker:
In examining past budgets of the government of Newfoundland, one cannot fail to note the incomplete and extreme confused nature of their contents.
Then, later, we find this:
Government expenditures have been allocated without any formal reference to a measured economic situation or to anything but the most vaguely and inadequately defined prospects ... No attempt has been made to performance budget nor to relate expenditure over the years with their effects on development.
This should be worth while reading for the finance minister. In addition, I can show him a debt of $509 million, and a projected debt of $1 billion within the next four years. We don't know the meaning of the word thousands any more in Newfoundland; we speak only of millions and millions. Within a short time, it is going to be billions and billions. The finance minister says he will balance his budget next year. Does he want to make a bet? What portion of this debt will this government have to pay when financial oblivion is evident?
Then, Mr. Speaker, I should like to take the minister responsible for housing on a junket across my district. I would show him the need for homes. I would show him nine, 10 and 11 children sleeping in one or two bedrooms. I would show him a home described by a Newfoundland newspaper which the minister of supply and services (Mr. Jamieson) should know well, the Newfoundland Herald.
This situation was described in the newspaper with the following headline, "Family Discovered in Shocking State". Nine people in
November 8, 1968	COMMONS
that city were existing in Biafra-like conditions. While we are flying over the wild blue fog in our Air Canada plane or travelling on the Newfoundland railway bullet, or in one of the new buses, the minister can read about this family in a tiny, fusty smelling kitchen with a dirt floor, and a stove condemned by the fire inspectors. If he does not believe what he reads in the newspapers, then I will show him an official letter from the department of health to a landlord. This letter resulted from my request that the department inspect a home I visited, where I saw an infant with rat bite marks. I will quote one paragraph of the letter for all to hear:
It was reported to us that the apartment, and indeed the whole building was crawling with cockroaches. We had an inspector visit the premises right away and he found a cockroach infestation far worse than anything any of us had ever seen before. There is also evidence of rats infesting the premises.
Then, Mr. Speaker, after I shuttle these two ministers back to Ottawa for their turn on the question period, I will take the minister responsible for regional development on a trip because I want to show him a part of the Atlantic region he overlooked when he made his speech in Halifax last week. I want Newfoundland to get in on this great 15 year development plan to overcome regional disparity and create new industry. I want to show him a district that has been neglected for 20 years. Newfoundland is part of the Atlantic region, too. I want Newfoundland to share in what he says economic development is all about. The minister likes to refer to regional economic expansion. I should like to find out what he means when he says that the points at which development takes place are widely spread across all regions of Canada. We want to be a part of that dynamic economy; we want to be part of this movement and change. Our concern, too, is that movement and change should occur within the Atlantic region, and not as a result of the attrition of the region.
I want the minister to meet some of the good, hardy industrious Newfoundlanders who want to become a part of his planning to attract new industries; to stimulate and aid the modernization and expansion of existing industries; to find customers outside the region; to structure transportation to aid marketing; to improve productivity and earnings; and to share in the utilities and services that are essential to healthy industrial growth. However, Newfoundlanders might
DEBATES	2615
The Budget-Mr. Marshall not believe in this wonderful plan because this is what they have been promised for 20 years. They have become suspicious and disillusioned. They have been fooled for 20 years, and the Liberal government reaped the results of that when the island failed to return the guaranteed seven seats. I hope the minister's failure to refer to Newfoundland in his speech was only an oversight. Newfoundland still wants to be part of Canada and we can make a contribution with good planning and leadership.
Then, I should like to take a special trip with my friend, the Minister of Fisheries (Mr. Davis). We will have to spend a little longer, though, because we will have to look into every little fishing village in order to study the complex problems of the inshore fishery. We will have to drive about 600 miles over dirt roads. This is a good time to do so, because the minister will see a depressed group of people who wonder why the greatest brains in the country cannot solve the problems of the fishing industry. I will show him why these hardy people do not want to know about upgrading and retraining methods. All they know is what was handed down to them by their forefathers, that is to take from the sea a God-given natural resource, fish, and try to provide a living for their families. They want someone to help them keep foreign draggers away from their shores and from interfering with their rights. They wonder why we do not have the guts to create fishing limits, why we let these draggers ruin their means of livelihood. They don't want handouts or disguised welfare; they want assistance and leadership in becoming good Canadians.
In order that we will not have to bother some of the other ministers who might not want to go on this junket, I will take the Minister of Fisheries to visit one fishing plant along a 300 mile coast of fishing villages. I will let him see the employees in this plant working for wages far below the minimum wage scale so that he can report to the Minister of Labour (Mr. Mackasey). Then we can visit the post offices and investigate the salaries paid to postmasters and postmistresses, which are ridiculously below anything that is fair and decent. A report can then be made to the responsible minister. Perhaps the minister will believe him, because he would not believe me when I asked a question of him in the house.
Finally, we will investigate the need for wharves and break-waters which have been
November 8, 1968

The Budget-Mr. Marshall promised to Newfoundland fishermen for years, and then ignored. Perhaps a report could be made to the Minister of Public Works (Mr. Laing). The minister of supply and services accused the Newfoundland members of being isolationist in their thinking toward this country. Let me say that if I am being accused of isolationism, then the same reasoning can be applied to national unity, which has been such a touchy subject for many years. You are not going to solve cultural problems by means of round table conferences, thinkers conferences, royal commissions or by sensationalizing through the news media.
Leave the people of Canada alone, I say. We have lived together in unity for 100 years by applying the common sense laws created by the Fathers of Confederation. National unity will result from the feeling we have in our hearts, the way we help our neighbours, regardless of race, creed or colour. We had examples of this during world war II, Mr. Speaker. No one told the French, the Italians, the Ukrainians, the Jews or the many other nationalities that they had to fight for Canada against German tyranny. They did so because they were Canadians.
What better examples of unity do you have than those which we have in this House of Commons? No one told the hon. member for Hamilton West (Mr. Alexander) that he could not represent all the people of his district because of his colour. He will represent them with determination, dedication and pride. No one told the hon. member for Kamloops-Cariboo (Mr. Marchand) that he could only represent the Indian people in his district. Nothing prevented the Prime Minister (Mr. Trudeau) from reaching the highest goal in the Dominion of Canada, that of leading all the people of Canada, because he is French.
The needs of our country are very basic, and the best way I can describe them is to apply the words of the late John F. Kennedy to what I want for Canada. I want a country where every family can live in a decent home, in a decent neighbourhood; where children can play in the parks and playgrounds and not in the streets and slums; where no home is unsafe or unsanitary; where a good doctor and a good hospital are neither too far away nor too expensive; where the water is clean and the air is pure and the streets are safe at night; where every child is educated, not according to his means but according to his capacity. Let us achieve these goals by

co-operation and understanding, by determination and leadership. We, as a government, must decide what course we will follow. Let us pray that this course will lead to a great Dominion of Canada.
[DOT] (5:10 p.m.)


Mr. Rod Thomson (Bailleford-Kindersley):: Mr. Speaker, I should like to deal for a few moments with regional disparities in Canada. This gay cavalier that we have for a finance minister shrugged his shoulders and made casual references to disparities among the provinces when he introduced his budget. It did not seem to matter whether these disparities were social, geographic or occupational. He did not offer the germ of an idea for solving the problems of some of the people in this country. He treated Canada as if its population were members of a large affluent club. This club, Mr. Speaker, had suffered some additional expenses, so the minister had decided to raise the dues. It did not matter that these dues fell a little hard on some people. I would suggest to the minister that these dues were particularly unfair to some people who cannot ever hope to become members of this club. The budget should have had some solutions to put forward for those who are faced with problems.
I should like to deal briefly, Mr. Speaker, with the problem facing our fisheries. For 20 years all our fishermen have heard are excuses; their problems still remain to be solved. It does not matter whether these problems relate to freshwater or saltwater fishing. Government solutions have in fact been inept and the budget contains no fresh ideas for tackling these problems. Certainly there have been no ideas on the part of the Department of Fisheries. I suggest that if an official in the Department of Fisheries were given an order book and told to go out and get orders for fish, he would not know what to do with the book. It is high time the government and the Department of Fisheries took the initiative and acted imaginatively to solve the problems facing our fishermen in Canada, whether those problems be geographic or occupational.
For example, Mr. Speaker, the fishing industry needs a Colonel Sanders to do for fish what he has done for chicken. I think it is high time we took a different look at our problems from the one taken hitherto.
Let me give another example, Mr. Speaker, which is really an association of words. If a housewife sees a newspaper headline that
November 8, 1968
reads: "New government budget has a fishy look", and she goes to market, naturally she will not buy any fish; she will probably buy beef or chicken or some other foodstuff. The businessman, already worried about increased taxation, is not going to eat fish when he goes to a restaurant; he will eat something else.
The hon. member for Surrey (Mr. Mather) had a good idea, Mr. Speaker, and I should just like to quote from a newspaper report I have which set forward this idea:
Instead of "fish", Barry Mather has tipped Jack Davis, sell it with some "flair and imagination- give it a little supermarket sex appeal."
Call it anything, says Barry Mather, but don't call it "fish".
Call it what it is: Boundary Bay Crab, B.C. Red Spring Salmon, West Coast Cohoe, Gaspe Salmon, New Brunswick Sardines, Nova Scotia Lobster, Athabaska Salmon Trout-
I suggest, Mr. Speaker, that what is required here is a different approach. In effect, we should use modern methods of merchandizing in the fisheries. Fish should be advertised as something that people want to eat. Salesmen in the Department of Fisheries should actually think, eat, sleep and dream fish. They should advertise this commodity so that people want to eat it. Therefore what is required is imagination and initiative, and it is time that something was done.
May I now turn for a moment, Mr. Speaker, to the grains industry in western Canada. This is a highly efficient industry, or could be made into such, but our grain producer is on the horns of a dilemna. If he spends more money on fertilizers, on new machinery or on improving the production of grain, he only adds to the surplus problem now facing our farmers. If he enlarges his input of money and output of production, and then finds he cannot sell that production, then all he is left with are "put-puts" and no money.
Last year, Mr. Speaker, since the international grains agreement had expired the government lost sales to Japan and other countries. The United States and France took them away from us. The government woke up too late, realized that the market had gone, and our farmers now have a surplus of grain on their hands. For all that the Canadian government has done to sell grain, Mr. Speaker, you might suppose that the Minister of Finance (Mr. Benson) and the Minister of Industry, Trade and Commerce (Mr. Pepin) were praying for drought in China. The situation was bad enough last year; this year there is an additional surplus on the prairies. What are the government doing about it now?
2617
The Budget-Mr. Rod Thomson
We lost some sales last year, Mr. Speaker, and I suggest that we are going to lose more this year unless our Department of Industry, Trade and Commerce gets busy and shows some imagination and initiative in this area as well. We have sent abroad salesmen from the Department of Industry, Trade and Commerce who admittedly have sold a lot of wheat. These people deal with governments and with international trading agreements, and that is fine. But what have they or the government done to sell wheat in the modern merchandizing sense?
Let me give another example, Mr. Speaker. I have been told that the people of India and some other Asian countries do not have a taste for wheat or wheat products in the sense that we in the western world have. Perhaps this product should be prepared in some other way in which they would eat it. For instance, corn could be turned into corn syrup or corn liquor. We might have to use different methods of preparing wheat for sale.
I should also like to suggest that to promote trade with these people we change the form of a product. Let us look for what the market demands, not at what we have for sale. We might also do a little research in other countries and be able to show them whether it is economical for them to buy wheat or to sell rice, or whether it is in their interest to purchase a high protein grain which could be used to more advantage in their country. I doubt whether we have done much in this area. We should actually search the market for ways to enlarge the sale of our products.
We in western Canada, Mr. Speaker, realize that you cannot hope always to sell the total crop that you have on hand. We must be prepared as farmers to carry some stocks in our own granaries as part of our business, if you like. Grain is a important commodity to Canada, and as a nation we might well consider establishing a national food bank, call it a strategic reserve, or what you will.
We might also explore the possibility of selling grain to the sterling areas, or to the Japanese, taking Japanese yen or sterling in return. I will give the house an illustration of what I have in mind. If we were to sell 100 million bushels of wheat, roughly $200 million worth, to Japan and we took the equivalent in yen, then the wheat could be paid for by using some of our supply of gold or U.S. dollars that we have on hand. We could pay the farmers out of this money, and it would not cost the Canadian taxpayer a cent. Admittedly, Mr. Speaker, it might reduce our

2618	COMMONS
The Budget-Mr. Fortin manoeuverability economically on the markets of the world, but my suggestion is that it is not in our best interest as a nation to be tied to any one market. If we were wise we would spread our trade among several countries. This is particularly so in view of the internal problems in the United States, with whom a large proportion of our business is done.
Very soon, Mr. Speaker, the Japanese will be holding a world trade fair. What better way could we honour them than by selling to them some of our products, taking yen in return? I have a yen to go to Japan to see that trade fair, and I should like some yen on hand to pay my way when I get there.
[DOT] (5:20 p.m.)
I should like to deal for a few moments with the effects agriculture has on the economy of Canada as a whole. Agriculture accounts, I think, for approximately 7 per cent of the gross national product, but believe me there are some sections of the economy which have a great deal more influence on the rest than dollars would suggest. Back in the 'fifties when we had a national surplus of wheat, the first industries in the east which felt the impact were those which were related to western agriculture

industries manufacturing farm machinery and the like. One week end when I was home I went around and asked a number of businessmen what the situation was, at that time, as far as business was concerned. They said: It has been slow this fall and unless larger grain sales are in prospect it will be slower still. When one sees dozens of high priced tractors or combines standing on an implement dealer's lot, it will not be too long before the problem is back in Ontario, or Quebec.
Let me suggest in closing that as we try to solve the problems of our neighbours, as we try to solve the problems of different regions in Canada, we frequently solve other problems as well. But if we are selfish and self-centered, tending to look after a particular area only, the other problems are likely to grow. By helping to solve the problems of other people we can frequently solve our own.


André-Gilles Fortin: Mr. Speaker, I have the honour, as the member for the riding of Lotbiniere, to participate in the debate on the budget which, in this instance, is the first budget brought down by the present Minister of Finance (Mr. Benson) in
fMr. Thomson (Battleford-Kindersley) .1
DEBATES	November 8, 1968
order to add to what the members of the Ral-liement Creditiste have already said in the house on what we think of the budget and its effects.
Mr. Speaker, our country must reorganize itself in the light of the past and the present. We live in a young country, but after 100 years of attempts, successes and failures, we must lay the foundation for a modern country, keeping what has served it well and improving what has failed.
For several years now, in the face of great difficulties and an alert and alarmed public opinion, our governments set up royal commissions on various topics, which commissions, headed by experts, heard the grievances, collected evidence, accumulated statistics, with a view to delineating each specific problem. In the light of those facts, the commissioners produced recommendations to enlighten our legislators in the heavy responsibility of drafting laws.
For instance, we know of reports equally famous and modernistic, such as the Glassco report on the administration of the government which was intended to make that organization more functional, more streamlined, according to modern standards.
We have had the Carter report on taxation, which aimed at redefining and altering the structure of our obsolete taxation system, tax-sharing formulas, and so on.
We have had-and there is still more to come, for it is not yet completed-the report on bilingualism and biculturalism, which deals with the problem of languages, races, cultures and minorities in Canada with a view to presenting solutions which will allow each individual and the whole Canadian people to develop fully, each according to his own means of expression.
We have had the report on foreign ownership and the structure of the Canadian industry. We have had the report on the Canadian banking system.
Mr. Speaker, we do not necessarily have to support all the recommendations found in each one of those reports. Nevertheless, the fact remains that these studies have been made at great expense to the Canadian people and should be used for a concrete purpose, helping us to build a modern country for a dynamic people.
I am clearly under the impression that those studies which cost millions of dollars of the taxpayers' money were only effected to calm down a storm, to suppress a tendency and to justify the inaction of the government.
November 8, 1968

Private industry, Mr. Speaker, is constantly reviewing its organization, its structures, its means and objects. It is not afraid of development, competition and modernization, otherwise it would run the risk of being left behind.
A private enterprise which would stop developing-as everybody knows and recognizes-could not remain in existence. The same applies, in my opinion, with a few exceptions, to the government.
That is the reason why, it is unthinkable that such serious studies made on such basic subjects should be consigned to oblivion or put off indefinitely.
In the meantime, the government is losing valuable time which could be better used for the progress of Canada. The government is gathering tools, but he remains passive, stagnant. That is not the way to progress, but to lose ground, and the last budget is the best proof of what I am saying. In order to convince ourselves of this, let us scrutinize this famous budget.
A few days ago the Minister of Finance tabled for the information of Parliament the 1968 White Paper on the Canadian economy: review and outlook, and his budget.
It is always an ardous task to read a budget, or a White Paper, because it is highly technical and mathematical. However it always makes for interesting reading since it analyzes a situation which otherwise would be difficult to grasp fully in all its details.
I wish first of all to thank the minister who with the help of his officials has so well depicted the economic situation prevailing in Canada today.
Secondly, I wish to blame him for his lack of solutions to the problems which are at the root of that economic situation.
As in every budget speech-and this one is not any different-no short or long term solution is offered to correct such and such a situation. This is what I regret. In order to find one or more solutions, we must inevitably refer, for instance, to the various reports of the Economic Council of Canada which sets forth the situation in a concise but specific manner, and which puts more emphasis on the solutions.
I shall first refer to the main points of the budget, on which are based the minister's contentions, in order to shed some light on the flagrant contradictions to be found in the present and past administrations.
29180-166J
The Budget-Mr. Fortin
On the one hand, hourly rates of salary keep on increasing and, on the other hand, unemployment keeps increasing. This trend, Mr. Speaker, has been sustained for twenty years or more. The main feature of our modem economy is the gradual taking over of labour by the machines.
Under our present monetary system, the purchasing power is nearly all distributed in the form of wages, salaries and other means of paying for work done in production or distribution firms. Meanwhile, the purchasing power is necessarily reduced, as manual labour is being replaced by machinery and payrolls are cut down, in spite of an increase in production capacity.
Our economy is subjected to tremendous pressures through unavoidable price increases caused by higher salaries. And these are just as unavoidable, as every worker wants naturally and normally more security for himself and his family, because this security is threatened by automation. As a result, what must come is what learned economists call the higher cost of living-higher unemployment relationship.
[DOT] (5:30 p.m.)
When you have a higher cost of living on the one hand, Mr. Speaker, and on the other hand a lower income because the work done by man-not the work done by machines-is reduced, the inevitable mathematical result is more poverty and less buying power. Such is the shame of our economy: "Want in the midst of plenty" as the Creditistes put it.
The former Minister of Labour (Mr. MacEachen) said in the August, 1965 issue of the Labour Gazette, and I quote:
Poverty, wherever it exists, is a threat to everyone's prosperity.
He was right, Mr. Speaker. What a pity that we should be satisfied with just saying so, satisfied with the lure of mere words!
What emerges from this government from the economic viewpoint can be summarized in this very short and accurate expression: "A sea of words, a desert of ideas and achievements".
The guideline of the International Labour Organization set forth by the Minister of Labour of that time must also apply to Canada.
In spite of the fact that most of our fellow citizens are comfortably off, we shall not truly be able to call Canada a prosperous country as long as poverty will exist within its borders. Such poverty, no doubt, exists. In fact, there are people in our country who
November 8. 1968

The Budget-Mr. Fortin have been left behind by progress and who, without assistance, will never get back on their feet. Paradoxically those people can barely survive and the government takes away once more, their purchasing power, under the pretence of social progress, which I fail to understand.
Our governments, for more than a hundred years, have been fooling themselves if they believe as they give evidence of it every day, that an increase in productivity will solve the problem of people being replaced by machines.
It is not a question of protesting against the machine, but rather of making each individual participate in the productivity by giving him his share of production which the machine has developed for him on his behalf.
We have the social responsibility to give the opportunity to each and every one, without exception, of enjoying an honest comfortable living. It is then only that we shall experience the benefits of a just society.
Experts agree that, in order to live, a family must earn at least $3,000 a year. According to the 1961 census, 23 per cent of Canadian families did not earn that amount. On the other hand, the same experts say that, in Canada, more than 4,200,000 persons live in poverty. These figures are provided by the Economic Council of Canada.
That is why, Mr. Speaker, it is illogical and inconceivable to take off another $120 by way of a social development tax which is an added burden on individual budget and the people in the low income brackets. The modern poor is not only cast off by the present system, but he is made to pay the ransom of modern development of automation. To be poor today is not only to lack essential goods, but also to be unable to take part in social activities. Now, if we deprive the poor of his income, how can he take part in the life of our society?
Mr. Speaker, our government had a deficit of $422 million in 1966-67, and another of $792 million in 1967-68. The deficit will be approximately $675 million in 1968-69, but we were told it would be almost $700 million.
Mr. Speaker, government expenditures keep rising year after year. When calculating where each dollar collected by the federal government comes from, we find that the part which is the income tax collected from the little man, from the middle income people, from the one who can hardly make ends meet, also keeps rising.

To make sure, let us look at the following figures: in 1966-67, the federal government was collecting 28.5 cents as personal income tax. In 1967-68, for the same tax, the federal government asked for 31 cents, an increase of 3 cents. In 1968-69, the same tax continues to increase up to 32 cents.
We could make the same comparison with several other taxes: corporation income tax, sales tax, custom duties, taxes on alcohol, tobacco and so on. However, the more money the government takes out of the taxpayer's pocket, the more expenditures increase.
On one hand, Mr. Speaker, production is increasing, on the other hand, poverty and distress increase steadily, which proves that even the increase in productivity will not necessarily solve the problem of poverty and injustice in our society. In fact, that is where we find injustice: the figures quoted are rather eloquent.
Mr. Speaker, in the chapter on perspectives for the period from June 1968 to June 1969, it is said and I quote:
The economic growth of Canada, in the next twelve months will depend in part on the economic conditions in the United States and certain overseas countries.
Yet an official study was made on behalf of the federal government. It is known as the Watkins Report, tabled by Mr. Walter Gordon, former Liberal minister of finance, who was dismissed and boycotted as his views did not agree with those held by big finance.
Our Canadian governments are puppet governments. They do not hold the purse-strings.
They have but one power, that of getting more and more into debt, for the benefit of the financial sharks and to the prejudice of the individual. For instance, on page 132 of this same budget document, one can read the following as to the operations concerning the unmatured debt:
Unmatured debt transactions in 1967-68 reflected an increase of $788 million in unmatured debt outstanding in the hands of the public.
In 1966-67, the increase was of $711 million, which means, less the net book credit, an increase of $792 million of our net debt, for a bewildering total of $16,757 billion.
A deficit of $792 million is a record in rashness and improvidence. Canada is not its own master any more; we are accountants in the pay of a big finance that controls us, controls our life and our economy.
In such circumstances, in the face of the enormous and inexhaustible need for money, slavery can but increase at the service of the god of big finance.
November 8, 1968


Donald MacInnis: Mr. Speaker, with the time
remaining to me-and before I am through you will wish it were six o'clock-my approach will more or less have to be in a shotgun manner. I do not wish in any way to
The Budget-Mr. Donald Maclnnis relate this to the gunboat philosophy adopted by the Pearson government not too long ago. It is a well known fact that parliament for a number of years now has been severely criticized. Never before has that criticism been more justified than it has been under this present government. The scheduled absence of ministers, the shuffling about and passing of the buck, as well as other performances here are things which the Canadian people could do without. It is regrettable that in this house members, whose first duty when coming to parliament was to take the oath of office, which includes an oath of allegiance to the Queen, go around speaking critically of the monarch.
We have a Prime Minister who on a public television show said that so far as he is concerned he doesn't care. This is the approach and the attitude of the Prime Minister and members of this government, who have taken an oath of allegiance to their Queen. They go out and try to undermine the very structure of this parliament. We speak of images and hear a good deal about codes of ethics, while at the same time we have the Minister of Transport (Mr. Hellyer), who has made charges of smear outside this house, failing to appear here to make them. I see no reason why he should not be here. He is the master of the art of smearing admirals in our navy, but he does not have the courage to come to this house and back up what he has said outside the house. Why is this minister not held responsible and why is he allowed to make these charges outside the house, when he lacks the courage to make them in the house? If he were to do so it would be necessary for him to stand up to the opposition members, who mean to make available to the Canadian people the developments behind the unusual business transaction in which he was involved. This was an image making transaction, as is very noticeable even by his own press report.
The equipment, so-called borrowed equipment, was made available to him long before the Prime Minister indicated any intention to resign. What was this for? It was to build up his image. After all this, what was that image? We saw the Minister of Transport running around at a national convention holding up the hand of his favourite minister and shouting "Go, Bob, go." That is all the equipment did for him. At the same time he pleaded that a Liberal leader be elected. I wonder how the Prime Minister can sit with him. I
2622	COMMONS
The Budget-Mr. Donald Maclnnis wonder how members of the opposition, considering the smear tactics he used on admirals and servicemen in this country, can consider that what he has brought upon himself is something he should be allowed to get away with. I am not smearing the minister; I am demanding that he come to the house and give a responsible account of the transaction which took place at that time. What is curious about this is that from information available it would appear that the person who lent the equipment never had it, but bought it and had it sent directly from where he purchased it to the home of the minister.
During the unification debate the same minister sat in his seat and allowed his viewpoint to be put across, with the support of a lie brought directly into the house from the committee. This is all in black and white for any members of this house to see. If any member wishes, he may take exception to this; but it is on the record and it will stay on the record. He allowed the unification problem to be solved with the support of lies coming from the committee. This is the type of man who today says attempts are being made to smear him. This is the master of the art. This is the man who tried to smear the servicemen while he jumped around with the unification problem.
It is odd that the present Minister of National Defence (Mr. Cadieux) is setting up a French speaking regiment and is setting up on shipboard all French speaking crews. This is a great record in respect of unification in the armed forces! It is segregation, the direct opposite of unification. Yet, this is the way this government operates. We talk about unification and ethics. Never more were these needed in this house, and never before have they been so lacking as they are in this particular government today. If one wants to know what kind of impression this government is making all he needs to do is read the speeches made by the hon. member for Coast Chilcotin (Mr. St. Pierre) or the hon. member for Halton (Mr. Whiting).


The Acting Speaker (Mr. Bechard):: Order.


Mr. Allmand:: Mr. Speaker, I wonder
whether I might ask the hon. member a question.


Donald MacInnis: Certainly. See me after six o'clock and I will give you the answer.
IMr. Maclnnis (Cape Breton-East Richmond).]
DEBATES	November 8. 1968


William Warren Allmand: Would the hon. member explain why the military vote was so overwhelmingly in favour of the Liberal party in the past election?


An hon. Member:: It was not.
Another hon. Member: Smarten up; that shows what you know about it.


Donald MacInnis: We are all aware of the undemocratic way in which the people in the forces are being treated with regard to their voting privileges in Canada.


Mr. Lundrigan:: Mr. Speaker, I take exception to the hon. member getting up in this house today and making reference to the way in which the people in the armed forces voted. This is a democratic country and they have their rights. The hon. member has no right to stand up here and make such a statement. It was a very undemocratic statement.


William Warren Allmand: I have been accused by the hon. member from Newfoundland of not having the right-


John Howard Lundrigan: The hon. member for
Gander-Twillingate.


William Warren Allmand: The hon. member from Newfoundland accused me of asking a question which I had no right to ask. I say I do have the right to ask it because 70 per cent of the military vote was in favour of the Liberal party.


J. Michael Forrestall: I rise on a question of privilege, Mr. Speaker, and it is a very simple one. The hon. member for Gander-Twillingate (Mr. Lundrigan) has pointed out that there is sufficient evidence, after all, in Canada today to make us as legislators a little ashamed of the position in which we are placing the servicemen of this country. The service vote is identifiable. I think that is sufficient, and this matter should be left to those who are interested, and should not be raised in the house. It transcends-
[DOT] (5:50 p.m.)


Mr. Blair:: Who raised the matter?


Mr. Deachman:: It was raised over on your side.


J. Michael Forrestall: Mr. Speaker, I wish the snake pit would quieten down and let me put my question.
November 8, 1968	COMMONS
The Acling Speaker (Mr. Bechard): Order, please. I do not think there is a question of privilege.


Donald MacInnis: Mr. Speaker, in answer to the question asked by the hon. member for Notre-Dame-de-Grace (Mr. Allmand), I should like to state to that hon. member and his colleagues on that side of the house that at no time did I say anything about the service vote. If hon. members over there want to make accusations, they had better make them about one another, because it was an hon. member on that side who brought up the question about the vote.
Let me also say to the hon. member that it is odd, in this house, to hear him asking questions of me about the service vote. Only a few days ago he asked a question of the Minister of Manpower and Immigration (Mr. MacEachen) about what was being done in his own province for his own people. The question he asked at that time involved a matter which was common knowledge to everyone else in the house.


Mr. Anderson:: The hon. member was talking a moment ago about whom to accuse of asking the question about the service vote. I suggest that if he waits until he sees Hansard he will realize who that was. He himself has made many accusations about the Minister of Transport, for one, and has suggested-
The Acling Speaker (Mr. Bechard): Order, please.


Malcolm MacInnis: Mr. Speaker, in my opening remarks I suggested that hon. members on the opposite side would be sorry it was not already six o'clock. Judging from the activity over there they are sorry it was not six o'clock before I began.
If this government wants to know what kind of impression it is making on the country, and for that matter on members of their own party, they should read the speeches of the hon. member for Coast Chilcotin (Mr. St. Pierre) and the hon. member for Halton (Mr. Whiting). They both had some uncomplimentary things to say about this government.
Perhaps I should also make reference to the former Liberal leader from British Columbia, who found it necessary at the first opportunity to debate a question on the adjournment motion at ten o'clock. This is a time set aside for discussion of answers from the treasury benches which are unsatisfactory to hon. members. In this case we had the former
DEBATES	2623
The Budget-Mr. Donald Maclnnis Liberal leader in the province of British Columbia showing dissatisfaction with an answer. That is exactly why the period between 10 and 10.30 is set aside. Surely his participation during this period is an acknowledgement that he was dissatisfied with an answer from the government.
I could range far and wide in speaking about the spending of this government, because there are many places where it has gone wrong. Perhaps the best and easiest example to give is the construction of a doorway in the back of this building next to the freight entrance. Apparently somebody on the Liberal side of this house did not like using the freight entrance which has been used for many years by hon. members. What did this government do? It decided to cut another hole in the wall right alongside a very big door, at a cost of $13,000 or $14,000.


Some hon. Members:: Shame.


Donald MacInnis: The Minister of Finance (Mr. Benson) sees something funny about this wasteful project. It cost $13,000 or more of the taxpayers money to put a door in the back of this building, where already there is a door which has been used probably since the construction of this building. Apparently it was beneath the dignity of some hon. members to walk out through the freight door, so the government wasted this money.
I should hate to let this opportunity pass without making a reference to the Liberal leader of Nova Scotia who has been running off at the mouth. In case he is not identified easily, he is the childish member for Halifax in the legislature. Those are not my words, but the words of an occupant of Your Honour's chair at an earlier date. Mr. Regan is still acting childish. Every day he has something to say about the expenditures brought about by the development of the heavy water plant at Glace Bay, completely ignoring the fact that the cost of this particular project tripled-which is a pretty good record compared to the increased cost of the arts centre here in Ottawa, which has multiplied by five times.
We never hear from Mr. Regan about wasteful projects supported by this government in Ottawa. This arts centre is a non-productive investment. All we hear from Mr. Regan is reference to the wasteful extravagances of the Nova Scotia government, particularly in respect of the heavy water plant in Glace Bay; completely ignoring the fact that there have been millions of dollars

November 8. 1968
Business of the House poured into Glace Bay as a result of the construction of this plant.
Let me say here and now, for the benefit of Mr. Regan and those people he works so closely with, that the development of the heavy water plant in Glace Bay is something the minister of industry of that time, and other organizations, considered. Apparently they were anxious to have it established at a location other than Glace Bay. If it is such a bad thing, as far as Mr. Regan is concerned, why is it that practically every other area where it could possibly be developed wanted it at that time?
The minister of industry of that day stated, and he is here in the house now-and it is an oddity to have a minister in the house-that the federal government had nothing whatsoever to do with placing the heavy water plant in Glace Bay. Mr. Regan also overlooks the fact that since that time-


The Acting Speaker (Mr. Bechard):: Order, please.



MESSAGE FROM THE SENATE

The Acting Speaker (Mr. Bechard):: I have the honour to inform the house that a message has been received from the Senate informing this house that the Senate have passed Bill No. S-14, an act to amend the Aeronautics Act, to which concurrence of this house is desired.



STATUTORY INSTRUMENTS-PERSONNEL OF SPECIAL COMMITTEE

Mr. Bernard Pilon (Chambly) moved:: That the special committee on statutory instruments appointed on September 30, 1968, be composed of the following members: Messrs. Baldwin, Brewin, Forest, Gibson, Hogarth, MacGuigan, Mar-ceau, McIntosh, Muir (Cape Breton-The Sydneys), Murphy, Stafford and Tetrault.


[Stage Direction]
Motion agreed to.

Donald Stovel Macdonald: Mr. Speaker, perhaps I could just confirm that the first order of business on Tuesday will be the continuation of the budget debate, to its conclusion. If there is any time left we will commence the Customs Tariff resolution. On Wednesday we will call as the first order of business the third reading of the C.N.R. finance bill.


The Acting Speaker (Mr. Bechard):: It being six o'clock p.m. this house stands adjourned until Tuesday next at two thirty o'clock in the afternoon, pursuant to standing order 2(4).


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Tuesday, November 12, 1968