1969-12-11

ROUTINE PROCEEDINGS


[Stage Direction]
Third report of Standing Committee of Privileges and Elections, in both official languages-Mr. Laflamme.
Second report of Standing Committee of Transport and Communications-Mr. Lessard (LaSalle).
C.Editor's Note: Text of foregoing reports appears in today's Votes and Proceedings.]


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I have the honour to table, in the two official languages, the conclusions of the third meeting of the Constitutional Conference which closed yesterday in Ottawa.


Mr. Baldwin:: That is a lot of paper for so little accomplished.


Pierre Elliott Trudeau: There are many copies, so you can instruct yourself.



POST OFFICE


Hon. Eric W. Kierans (Postmaster General and Minister of Communications):: Mr. Speaker, pursuant to Standing Order 41(2) I have the honour to present the report submitted by the Task Force, "Blueprint for Change, Canada Post Office", November 1969, in the two official languages.


Mr. Macquarrie:: On a question of privilege, Mr. Speaker, I would like to point out that the minister in tabling the report seemed to admit the priority of right of this House to receive this document first-an important
right. I read in this morning's paper a statement referring to the impending tabling of this document and it commented on its contents. I deplore this as a further deterioration of the rights of parliament and another advance toward mass news. Neither development is helpful to a stable or free democracy.


Some hon. Members:: Hear, hear.


Mr. Speaker:: Order, please. Perhaps in fairness the minister might be allowed to reply. I have to mention to the hon. member that he can only raise a question of privilege in the way he has attempted to do by giving notice to the Chair.


Some hon. Members:: No, no.


Mr. Speaker:: Order, please. I am referring to the fact. The hon. member is complaining that there was a comment in the newspapers. I, of course, do not know to which notice he is referring. If it is an incident which happened outside the House, the rules require him to give notice before the matter can be debated. However, as the matter has been raised I think the minister should be given an opportunity to reply.


Gerald William Baldwin: Don't explain, just apologize.


Eric William Kierans: Mr. Speaker, for many weeks I have made it quite clear that we expected to table this report momentarily. We received it about five to six weeks ago. It is a lengthy document that took some time to translate. I may say on the specific point that I was as surprised as the hon. member for Hillsborough and, indeed, angry. Because I was occupied with other duties this morning I have not had a chance to investigate the source of the report in the Globe and Mail.



ORAL QUESTION PERIOD


[Stage Direction]
Hon. Robert L. Stanfield (Leader of the
Opposition): I wish to ask the Prime Minister a question. In view of the almost imperceptible rate of progress at the conference during
December 11. 1969
[Stage Direction]
Inquiries of the Ministry the last few days, which must be as disturbing to the Prime Minister as it is to us, is the Prime Minister prepared to give the House an assurance that the contemplated parliamentary committee will be established either during the coming week or during the first week after we return following the Christmas recess?
Hon. Donald S. Macdonald (President of the Privy Council):: Perhaps I can respond to this question. I have spoken to certain members opposite, in particular the hon. member for Peace River, and we expect to be meeting later this day to discuss possible terms of reference of that committee. It would appear now, bearing in mind the list of items set down for completion before the House rises for the Christmas recess, as indicated by me last week, that there will not be the opportunity we hoped would exist for a two-day debate on this subject. It seems likely, therefore, that the arrangements to be made among the representatives of the parties will relate to some time after the House reconvenes following the Christmas recess. It would certainly be my intention to have the committee reference called as early as possible in the next part of the session.


Mr. Stanfield:: My question was whether a reference would be made next week or during the first week of our return following the Christmas recess. Could either the Prime Minister or the leader of the House give such an assurance?


Donald Stovel Macdonald: I do not want to repeat the answer I have given, but it seems to me fairly obvious that there will not be an opportunity to debate it next week. However, we shall certainly seek an opportunity to have it debated as soon as we get back.


Robert Lorne Stanfield: I know there have been discussions about the terms of reference. I will ask the Prime Minister whether he is prepared to assure the House that the terms of reference will be broad enough to enable the committee to consider not only proposals put forward by the government of Canada but also proposals put forward by provinces or proposals which may come from other sources for consideration by the committee? In other words, can the Prime Minister assure us that the terms of reference of this committee will be broad enough to enable it to examine fully the constitutional question as a whole, not merely the federal position?


Pierre Elliott Trudeau: I understand from the leader of the House that this is precisely the subject which is being discussed at present between him and the leaders of the other parties.


Hon. George Hees (Prince Edward-Has-tings):: A supplementary to the Prime Minister. Since it has become obvious that it is very difficult, if not impossible, to get agreement or even consensus about the important matters discussed at these conferences, is the Prime Minister giving consideration to arranging for a great deal more intergovernmental discussion at ministerial and prime ministerial levels long before the ministers gather in Ottawa for these conferences in order that the chances of reaching decisions and making solid progress can be materially improved?


Pierre Elliott Trudeau: If the hon. member had read any of the reports which have been tabled he would know that all these meetings are prepared at considerable length by meetings of officials and, in many cases, by meetings at the ministerial level. He is therefore suggesting that something should be done which we have been doing for two or three years now.


George Harris Hees: Whatever has been done has not been very effective. If the Prime Minister considers that what was achieved in the last two or three days amounts to progress, is it not obvious why the economy of the country is moving downhill?


Mr. Speaker:: Order.



WHEAT-DISCUSSIONS WITH U.S.S.R.

Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: My question, Mr. Speaker, is for the Minister without Portfolio who has responsibility for the Canadian Wheat Board. It has to do with the discussions which are going on in Moscow with respect to getting the Soviet Union to take up the balance of its requirement for wheat under the old agreement. Has agreement now been reached between the Canadian Wheat Board and the government of the Soviet Union regarding the sale of wheat to the Soviet Union by Canada?


Hon. Otto E. Lang (Minister without Portfolio):: I have said frequently that I prefer not to comment on negotiations in progress. However, I can confirm that the Chief Commissioner and the Assistant Commissioner are still in Moscow. I will also confirm that, as I have been for some time, I am full of hope.
December 11, 1969


An hon. Member:: Full of oats?


Thomas Clement (Tommy) Douglas: In view of the large sale of wheat which the Australian wheat board has made to the People's Republic of China, may I ask the minister whether any negotiations were carried on by representatives of the Canadian government or the Wheat Board in an endeavour to get some of that order for Canada?


Otto Emil Lang: It was only a short time before that sale that the Wheat Board negotiators were in China and came back with a very large contract indeed.


Some hon. Members:: Hear, hear.


Right Hon. J. G. Diefenbaker (Prince Albert):: In no way dealing with the negotiations which are presently going on, may I ask whether it is not a fact that the government of Canada was apprised in December of 1968 that the 135 million bushels which would remain untaken as of July 31, 1969, would be taken, and that in the month of April the Canadian government was apprised by Russia that so far as the 135 million bushels were concerned the Soviet Union intended to take that wheat, and there was never any question about it?


Mr. Speaker:: The question as asked by the right hon. gentleman was clearly asked by way of argument, or at least in an argumentative manner. I hesitate to suggest that it might be asked in a different way, but perhaps that might make it easier for the Chair to accept the question.


John George Diefenbaker: Mr. Speaker, the last thing in the world I want to do is to ask a question that is not clear. I asked a very simple question: Did not the government of Canada know full well as far back as December of last year, and finally in the month of April, that there was only to be a postponement of the taking of the 135 million bushels and that Russia was going to do so?


Mr. Speaker:: Order. The rephrased question is just as clearly argumentative as the first one. The hon. member for Saskatoon-Biggar.


John George Diefenbaker: Mr. Speaker, I seldom rise on a point of order, but surely a question is not argumentative because it asks for information. What is argumentative about that?
Inquiries of the Ministry


Mr. Speaker:: The hon. member for
Saskatoon-Biggar.



WHEAT-AUSTRALIAN PRICES IN SALE TO CHINA

Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, my question is directed to the Minister without Portfolio in charge of the Wheat Board. Previously I directed a question to the Secretary of State for External Affairs when he was Acting Prime Minister in regard to the sale to China by Australia of some 80 million bushels of wheat at a price of approximately $100 million. Now that the Minister without Portfolio is in the House, may I again ask whether this wheat deal was made at prices substantially below those prevailing under the International Grains Arrangement?


Otto Emil Lang: Mr. Speaker, we do not have official confirmation of the exact price of the reported sale of wheat by Australia to China. However, it might help the hon. member to know that contrary to what appears in some of the press reports the $100 million figure referred to is Australian dollars rather than Canadian dollars. In other words, the price referred to in the press report would be $120 million Canadian.


Alfred Pullen Gleave: A further supplementary question. There would be a difference in exchange, of course, as there is between the Canadian dollar and the United States dollar, but do the minister and his officials not concern themselves with whether or not the price levels under the International Grains Arrangement are being observed?



PLANS TO INCREASE WHEAT AND FLOUR EXPORTS

Mr. George Muir (Lisgar):: In view of the fact that Canadian exports of wheat and flour have dropped 43 per cent in the first two months of the crop year compared with the same two months of last year, what plans does the government have to increase our wheat and flour exports?


Otto Emil Lang: Mr. Speaker, it is true that actual shipments out of the country in the first two months of the year were quite low, largely because of the gap in deliveries to China. However, sales made during that period are running very well indeed. There has been in recent months a very rapid pick-up in deliveries of wheat from Canada, and this is beginning to be reflected in deliveries from country elevator points as well.
December 11, 1969

Inquiries of the Ministry INDIAN AFFAIRS



MORTALITY RATE IN NORTHWEST TERRITORIES

Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, in light of today's reports that Indian mortality rates in the Northwest Territories have risen even in the infant age group, which is not the case in the rest of Canada, will the Minister of National Health and Welfare comment on the reasons for this situation in view of the fact that in these territories the federal government has clear primacy of responsibility?


Hon. John C. Munro (Minister of National Health and Welfare):: Mr. Speaker, I am sure the hon. member is referring to a statement made by a regional employee in the Northwest Territories who stated that what he did say was that there was an ever decreasing rate of Indian mortality in that area.



HEALTH AND WELFARE


Mr. P. B. Rynard (Simcoe North):: Mr. Speaker, I should like to ask the Minister of National Health and Welfare this question. In view of the apparent serious situation in medical services, when does he expect to fill the position left vacant by the resignation of his deputy minister last August?


John Carr Munro: The government has that under consideration, Mr. Speaker.



SOCIAL SECURITY


Hon. Martial Asselin (Charlevoix):: Mr. Speaker, I have a question for the Prime Minister.
When the government claimed the right, at the federal-provincial conference, to pay directly the social security benefits to the individuals in each province, was it paving the way for a guaranteed annual income for all Canadians?


Pierre Elliott Trudeau: I was not paving the way for anything, Mr. Speaker, but I simply pointed out that this has been done for 100 years under the Canadian constitution and that we did not want of a constitution under which the federal gov-

ernment would have only the right to tax Quebec citizens without being empowered to pay them some benefits when they are unable to provide for themselves on account of old age, illness or unemployment.


Some hon. Members:: Hear, hear.


Mr. Speaker:: Does the hon. member for Shefford wish to ask a supplementary question?


Mr. Rondeau:: No, Mr. Speaker.


Martial Asselin: Mr. Speaker, I have a
supplementary.
Would the federal government intend to substitute shortly to all subsidies granted in the field of social security a program designed to extend to all Canadians an annual guaranteed income? Do they wish to abolish the social security program to replace it with an annual guaranteed income for all Canadians?


Pierre Elliott Trudeau: Mr. Speaker, I do not know whether this would help to clarify the question if I were to say that during the discussions, we divided the general problem of social security by talking about social services We also recognized that the provinces alone must have the jurisdiction in the field of social services. As to guaranteeing the income of Canadians through allowances, we feel that a new constitution should continue to leave to the federal government alone the jurisdiction in that respect. I do not know if that clears up the issue.
As for programs to be established, that is not a constitutional matter, but a question of policy to be announced in due time by the ministers.



POLLUTION


Gilbert F. Rondeau: Mr. Speaker, I have a question for the Prime Minister.
Does he seriously consider having the Supreme Court of Canada rule on jurisdiction over air and water pollution, as recommended in the white paper on taxation?


Pierre Elliott Trudeau: As far as I know, Mr. Speaker, the white paper on taxation does not say anything about referring this question to the Supreme Court, but I can always inquire.
December 11, 1969	COMMONS


EXTERNAL AFFAIRS
Mr. David Lewis (York South):: Mr. Speaker, on November 25, again on November 27 and again on December 5, in the absence of the Secretary of State for External Affairs, I asked the Prime Minister certain questions arising out of the alleged atrocities by United States troops in Viet Nam. I should now like to pose all the questions to the minister with your permission, Mr. Speaker. The first is whether the government or his department has instructed our representative on the International Control Commission to busy himself with investigating this matter. The second is whether the government has instructed our permanent representative at the United Nations to take the matter up with the Secretary General of that body. The third is whether the department has studied the suggestion made by certain law professors, of whom the Prime Minister expressed great approval, with regard to action that should be taken at the United Nations.


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, I am prepared to answer these questions. The statement I have to make, however, would be somewhat longer than you would permit. I am prepared now to make the statement if the House wishes to revert to motions.


Mr. Speaker:: Is it agreed that we revert to motions for the purpose of hearing a statement by the Secretary of State for External Affairs?


Some hon. Members:: Agreed.
And the House having reverted to motions:



ROUTINE PROCEEDINGS


Mitchell William Sharp: Mr. Speaker, as the hon. member for York South has said, he asked several questions with respect to atrocities allegedly committed by the United States, South Vietnamese, Viet Cong and North Vietnamese forces in Viet Nam. With the House's permission I should like to make a statement on the subject now.
DEBATES	1847
Statement on Viet Nam Atrocities
It is, I trust, not necessary for me to stress how appalled all of us in Canada have been by the wave of reports coming out over the last two weeks concerning the alleged behaviour of combatants on both sides in this tragic conflict toward each other and toward innocent civilians. Every war is abhorrent, whatever its origins, whatever the explanation made for it by the belligerents or by the historians. It becomes particularly abhorrent when even the normal rules of military behaviour are discarded: when there is deliberate individual terrorism and assassination; when there is indiscriminate bombing and shelling; when there is rejection of internationally accepted treatment of prisoners of war; when thousands of civilians from a particular city are methodically executed and dumped into mass graves; when women and children in villages are shot in cold blood. There may be explanations, but there can be no justification for such action by either side. It seems to me that the agony the American people are going through at this time shows that they too believe deeply that there cannot be such justification.
Since the events at My Lai came to the attention of the United States government and public, that government has acted in a manner consistent with the normal practice of a democratic society. A committee of the United States Senate has reviewed the evidence. An inquiry at the highest level has been instituted by the Secretary of Defence. Criminal charges have been laid against those accused of complicity in the matter. Secretary of State Rogers told us in Brussels last week that his government is determined that the criminal proceedings will be carried out as vigorously as possible and that any United States personnel found responsible will receive the punishment that they so obviously deserve. At a televised press conference on Monday night President Nixon told the American people:
What appears is certainly a massacre and under no circumstances was this justifiable . .. We can never condone or use atrocities against civilians to accomplish our goal.
He also had this to say:
I'm going to do everything I possibly can to see that all the facts are brought to light and that those who are charged-if they are found guilty-are punished.
The normal course of the inquiries and criminal proceedings now under way in the United States will bring to light the facts of
December 11, 1969


Mr.  R. Gordon L. Fairweaiher@Fundy-Royal: Mr. Speaker, as I said the other day, I have serious doubts about the usefulness of what I might call instant comment on what must have been a statement rather carefully prepared by the department, and I hope that some day Parliament will be able to take a look at the formula that we have followed up to now.
Having said that, perhaps I can add the comment that surely we must accept, in our attitude toward the agony which the American people are going through as the result of the disclosure of the atrocities at My Lai, that the vast majority of them are just as deeply troubled by this event as is obviously the case with people in the rest of the world. Perhaps it is trite to say that, but I think we have to try to balance such statements with a recognition of the best features of the life and ethics of the American people. We also have to remember that we have just had an example of another side of American life which was welcomed here in a very moving way the other day when the astronauts honoured us by visiting Parliament. The tragedy and the irony are that their superb achievement in the technological and, yes, in the human sense, is clouded in the eyes of the world because of events in South Viet Nam.
I am sorry that the minister could not have been more forthcoming about the International Control Commission. Perhaps it is not fair to say this, but it is my feeling that the commission has been plagued throughout its history by withdrawals from activity just at the time when one could have expected it to play some useful role. Indeed, the latest manifestation in the withdrawal of the commission personnel from Cambodia troubled a good many thoughtful people involved in international affairs.
I read the proposals of the professors of international law with great interest. I wish I could be more optimistic, but all I can say is that it seems to me to be a rather bitter and ironic comment on man's progress toward civilization that in 1969 we are having to
December 11, 1969

update the rules of what is right in war or what limits civilized man will accept in waging war.


David Lewis: Mr. Speaker, of course I appreciate the fact that the minister was prepared with a statement today, and of course I appreciate the fact, as does every Canadian, that the majority of the American people are as outraged by what they heard as are people all over the world. But I as one member of this Parliament cannot feel happy-indeed I feel rather outraged-that it took several questions before this government declared its abhorrence of the atrocities that have taken place in Viet Nam.


Some hon. Members:: Oh, oh!


David Lewis: Members opposite can groan as much as they like, but the fact is that throughout the immoral U.S. war in Viet Nam, the government of Canada has not had the courage to state its position against that war.


Some hon. Members:: Oh, oh!

Statement on Viet Nam Atrocities heard against the American atrocities in Viet Nam. I know that atrocities are committed by the other side, but we are not associated with the other side; we are associated with the Americans. The Secretary of State for External Affairs is not associated with the Viet Cong and the North Vietnamese-


An hon. Member:: But you are.


David Lewis: Furthermore, we do not ship arms to the North Vietnamese or the Viet Cong. Therefore we are directly implicated in this situation which lays upon us a particular obligation to speak out against these atrocities.
I say finally to the minister that he has an immediate opportunity to show where Canada stands. According to press reports, a resolution is now before the United Nations sponsored by Sweden and some other members of the UN condemning the use by the United States of chemical warfare in Viet Nam. I hope the minister will have the courage to instruct our representative at the UN to support and, if possible, to co-sponsor that resolution.


David Lewis: It is also a fact that when the Secretary of State for External Affairs made his statement this afternoon he spoke in generalities about the pain he feels with regard to these atrocities, following which he clearly indicated that he is not prepared to condemn, as I believe all Canadians do, the kind of atmosphere which has been created by the immoral war in Viet Nam and which enables good Americans to act in that way.


Some hon. Members:: Hear, hear!


David Lewis: The minister said he knows for certain that there will not be general support at the United Nations for a certain action. How does he know? When did we arrive at the point at which the minister takes solace from the fact that the Communist members of the United Nations have acted in a certain way? Since when has that prevented him from taking a position? He has always failed to take a position when the Americans have not wanted it. Are we now to refuse to take a position because the Communist countries do not want it?


An hon. Member:: You support the
Communists.


David Lewis: I say it is the duty of this government and our smiling Prime Minister to make certain that the voice of Canada is
[DOT] (2:40 p.m.)


Mr. Real Caouette (Temiscamingue):: Mr. Speaker, the statement by the Secretary of State for External Affairs (Mr. Sharp) makes clear enough Canada's attitude with regard to the events which took place in Viet Nam.
It is obvious that the courts will have the opportunity of meting out due punishment to the parties responsible for the atrocities perpetrated over there and which were acknowledged by the President of the United States. However, we should not overlook the fact that the atrocities committed by both belligerent parties have spawned in a war atmosphere and that in every war situation there are abuses.
During the Second World War, atrocities were committed both by the Allies and Germany. Armed conflicts necessarily lead to hatred, always.
We must not try to do what the hon. member for York South (Mr. Lewis) has been trying to do for several months and maybe several years in this House, namely try to stir up the Canadians against the Americans. He does recognize that North Viet Nam has also committed atrocities. However, since we are allied with the Americans we must blame them all the more. Besides, it is not the first time that the member for York South shows
December 11, 1969

Inquiries of the Ministry he is squarely against U.S. intervention in Viet Nam-


David Lewis: Agreed.


David Réal Caouette: He agrees. However, while he wants parliament to ask the Americans to withdraw from Viet Nam, he also wants the Canadian government to interfere in Biafra's internal affairs. That is not logical. Therefore, the member for York South is inconsistent when he pretends to support South Viet Nam. I sincerely believe that he is supporting North Viet Nam.
Mr. Speaker, I think the Viet Nam war must end as soon as possible, because I believe no war is justified. In my view, there is so much room in the world for understanding, co-operation and friendship that conflicts should not exist. I think the primary role for any Canadian government and for the Canadian people as well is to intervene in every area where peace can be established, so that nations will understand one another and human beings will enjoy maximum economic security in freedom.


Mr. Speaker:: We will now return to the question period.



ORAL QUESTION PERIOD


Mr. Georges Valade (Sainie-Marie):: Mr. Speaker, may I direct a question to the Secretary of State for External Affairs?
Following the statement he has just made to the House, I would like to ask him whether, as a member of the International Control Commission, Canada is able to make sure that in North Viet Nam a judicial body will be set up to condemn or to examine criminal acts which the Viet Cong might have committed?


Mitchell William Sharp: No, Mr. Speaker. As I said in my statement, the International Control Commission has been frustrated in every effort it has made to investigate atrocities on either side.


Georges-J. Valade: Mr. Speaker, the purpose of my question was to ask the Secretary of State for External Affairs what judicial mechanism exists in North Viet Nam to deal with such matters as atrocities by the Viet Cong?


Mitchell William Sharp: I have no special knowledge of that, Mr. Speaker, and I would hesitate to answer the question. I would not want to do an injustice to any country.



IMMIGRATION


Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, I have a question for the Minister of Manpower and Immigration which I asked on December 8. In fact I gave his office notice of it and I wrote to the minister, and I expected an answer from the acting minister. Now that the constitution is at rest for a while, may I be informed why Dr. K. Laski was refused admittance to Canada?


Hon. Allan J. MacEachen (Minister of Manpower and Immigration):: Mr. Speaker, I understand that the question has been put down for the late show and I would like to take that opportunity, or a later one, to amplify this case beyond the normal answer. Until that opportunity comes I would like to tell the hon. member that Professor Laski was denied admission to Canada because he did not meet immigration requirements, and I would like to amplify that later.



INDUSTRY


Mr. J. Edward Broadbent (Oshawa-Whit-by):: Mr. Speaker, I wish to direct a question to the Minister of Industry, Trade and Commerce. Given indications that there may be cutbacks in North American production of automobiles, will the minister assure the House that in forthcoming talks with United States government officials he will take steps to ensure that the percentage of Canadian labour employed in this industry does not fall below the existing level?


Hon. Jean-Luc Pepin (Minister of Industry, Trade and Commerce):: One way of doing that, Mr. Speaker, is to maintain the autopact safeguards that exist now and try to improve upon them, if at all possible and this is our policy.

December 11, 19B9



USE OF ALBERTA PRODUCTION IN EASTERN CANADA

['If there is anything definite to report, Mr. Speaker, I shall be glad to do so.']
Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources.
As the Canadian government authorizes imports of unrefined oil, when Alberta is producing only half the oil that it could produce, does the minister intend to take the necessary measures to remedy the situation?


Hon. J. J. Greene (Minister of Energy, Mines and Resources):: Mr. Speaker, the
object of our discussions with the Americans is to ensure a larger market for western oil and, should our representations be successful, we may have an even better market for Canadian oil.


David Réal Caouette: I
should like to ask a supplementary question to the minister.
He tells us that his department is now negotiating in order to conclude better trade agreements with the United States, but it remains to be seen whether Canadian consumers of crude oil could get it in Alberta rather than in the South of the United States as they do now?


John James Greene: Mr. Speaker, if oil were sent from Alberta to Quebec, in the East, it would be very costly. Indeed, pipelines would have to be built from western Canada, which would not be profitable.
Presently, if the oil consumed in the East contains equal parts of Canadian and foreign oil, that contitutes a good market for western oil. Besides, it is possible to get oil cheaper, in the East. In our opinion-


Mr. Speaker:: Order.


John James Greene: -it is the best mixture.


Mr. Speaker:: Order. I must interrupt the minister.


Some hon. Members:: Hear, hear!



Robert Lorne Stanfield: Mr. Speaker, I would like to ask the Prime Minister whether he has reached any decision with regard to the request by

Inquiries of the Ministry Canairelief for government support? I ask this question because it is two weeks today since we had a discussion in the House on this subject and at least a month since Canairelief renewed its request to the government for such support.


Pierre Elliott Trudeau: Mr. Speaker, Canairelief has been told that we are at present working on an alternative scheme to attempt to provide relief to the people of Biafra. If this scheme does not prove feasible, then we will come back tc discussion of the Canairelief scheme.


Robert Lorne Stanfield: A supplementary question, Mr. Speaker. Could the Prime Minister indicate to the House when the government of Canada will be prepared to come back to the Canairelief request? In other words, can the Prime Minister indicate to the House the approximate length of time the government is going to take in seeking an alternative course of action?


Pierre Elliott Trudeau: My information is, Mr. Speaker, that my office informed Canairelief a few days ago that we were taking a further period of three weeks. Part of that three weeks is up now. We have given ourselves this extension to work on this alternative method which would have the incomparable advantage of bringing much greater relief supplies to the people of Nigeria-Biafra.


Mr. Andrew Brewin (Greenwood):: Mr. Speaker, I have a supplementary question. Would the Prime Minister undertake to make a statement to the House before the Christmas recess on the subject of relief either by means of Canairelief or whatever other means the government sees fit to pursue?


Pierre Elliott Trudeau: If there is anything definite to report, Mr. Speaker, I shall be glad to do so.



PENITENTIARIES


John George Diefenbaker: Mr. Speaker, in the absence of the Solicitor General and the President of the Treasury Board I should like to ask a question concerning the position of penitentiary guards and custodial officers who inform me that at Prince Albert, and I assume this applies elsewhere, 2 per cent is the extent of the salary increase that they are to be allowed in the coming year. In view of the fact that they have no recourse to press for

December 11, 1969
Inquiries of the Ministry
an increase over and above that amount, is there. The 16,000 ton vessel has a lot of oil which is inadequate, will the minister have on board and is creating a pollution problem, this matter looked into to assure that these We are trying to develop some scheme where-officers shall receive fair and reasonable by the oil can be dispersed without being compensation?	harmful to the marine life there.


Hon. John N. Turner (Minister of Justice):: Mr. Speaker, I shall certainly bring the representations of the right hon. gentleman to the attention of the President of the Treasury and the Solicitor General.



PUBLIC SERVICE


Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to ask the Prime Minister, because I think this is important, whether he would investigate-and I use that word in its proper sense-the effect of the Civil Service cutbacks on war amputees who are of the opinion that they are being picked out because they are on pension due to injuries received in the war?


Some hon. Members:: Shame!


Pierre Elliott Trudeau: I shall certainly ask the President of the Treasury Board to look into that matter, Mr. Speaker. I am quite sure that their impression is not accurate but I should like to see why they have arrived at it.


Eldon Mattison Woolliams: Mr. Speaker, I wonder if I could ask one more question. When the investigation is made would the Prime Minister or the appropriate minister investigate the particular cases of Harry Weir and Charles Kent, who are typical of these cases across Canada although they happen to live in Calgary? They are being let out at a time of year when unemployment is at its highest in Canada.



POLLUTION


Mr. David Anderson (Esquimall-Saanich):: Mr. Speaker, I have a question for the Minister of Fisheries or the Minister of Energy, Mines and Resources who seems to be in very good voice today. What steps are being taken to control pollution by fuel oil from the 16,000 ton Greek freighter which went aground at Ferrer Point 70 miles north of Tofino recently and which is presently being broken up by the gale force winds of the past few days?


Hon. Jack Davis (Minister of Fisheries and Forestry):: The fisheries protection vessel Tanu



DUMPING OF OIL AND OTHER WASTE IN GREAT LAKES

Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, my question arises from the concern over the continued dumping of oil and other waste from ships on the Great Lakes in direct contravention of the provisions of the Fisheries Act. In view of the fact that months, even years, of protracted negotiation will be required after final approval by Parliament of the Canada Water Act to make it an effective anti-pollution measure, will the government take immediate action to increase the low fines provided in the Fisheries Act so that we shall have some means of acting effectively against such pollution in the interim?


Mr. Speaker:: Order, please. The member's question is in the form of a representation which he has to assume has been noted.



NATIONAL FILM BOARD


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, my question is for the Secretary of State. In view of the fact that lay-offs proposed by the National Film Board are much higher than indicated earlier by him and as a result it is likely that a number of long service employees will be dismissed, will the minister give consideration to making a statement on motions at an early date about the future of the National Film Board?


Hon. Gerard Pelletier (Secretary of State):: Mr. Speaker, I asked for a complete report in that matter, which I hope to get on Monday at the latest. Indeed, that might lead to a restatement.



RECONSIDERATION OF ORDER LEVYING CHARGES FOR USE OF FILMS

Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I have a supplementary question. I should like to ask the minister whether he will reconsider a recent order to levy certain charges for films distributed by the National
December 11, 1969	COMMONS
Film Board primarily for educational purposes since librarians in Saskatchewan have indicated to me they are returning these films?


Mr. Speaker:: Order, please.


Stanley James Korchinski: Mr. Speaker, could I rephrase my question and ask the minister whether he will not at least consider withdrawing the order to charge for films that are being used for educational purposes?


Mr. Speaker:: Order.



LABOUR CONDITIONS


Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I should like to direct a question to the Right Hon. Prime Minister. Do the remarks he made in a speech in Hamilton to the effect that workers displaced by changing government programs and policies are entitled to reasonable income maintenance benefits apply to the men laid off at Fairey Aviation of Canada?


Pierre Elliott Trudeau: Mr. Speaker, I am not aware of that particular case but I shall look into it.



AGRICULTURE


[Stage Direction]
Mr. R. R. Southam (Qu'Appelle-Moose
Mountain): Mr. Speaker, I have a question for the Minister of Agriculture. Is it the intention of the minister to have the chairman of the Standing Committee on Agriculture submit a report on the committee's tour of Canada? If so, when, and if not, why not?
Hon. H. A. Olson (Minister of Agriculture):: Mr. Speaker, the last two parts of the question do not apply because the Minister of Agriculture does not give instructions to the chairman of the Standing Committee on Agriculture.


Mr. Southam:: A supplementary question, Mr. Speaker. Is the minister aware-


Mr. Speaker:: Order, please. I have to ask the co-operation of hon. members. We are running short of time so perhaps we should limit supplementary questions as much as possible.
DEBATES	1853
Inquiries of the Ministry ADMINISTRATION OF JUSTICE



JUDGMENT IN CASE OF HUNTING INFRACTION BY ESKIMO

Gerald William Baldwin: Mr. Speaker, my question is for the Minister of Justice whom I welcome back from his daring and successful pursuit of the status quo over the last few days. Some time ago I asked the minister about the case of an Eskimo who had been convicted of an infraction of an ordinance of the Northwest Territories on an ice floe seven miles from the shore line. Is the government going to move to have that conviction quashed or does it accept the position that it has sovereignty in that particular area?


John Napier Turner: Mr. Speaker, I gather that the hon. member is referring to the case of Tootalik. In the question the hon. member assumes that there was a finding of fact that the offence took place more than three miles from the shore line. Crown counsel for the Northwest Territories advises me, however, that the evidence is not clear on this point. In any event no decision is going to be taken on the position the Crown will take until we have made a review of the evidence.


Gerald William Baldwin: A supplementary question, Mr. Speaker. In view of the fact that I understand the reasons for judgment indicate that the offence did take place that far out, will the minister not consider moving to quash the conviction in view of the government's position on the question of jurisdiction?



WHEAT-OVER-QUOTA DELIVERIES TO PURCHASE SEED

Mr. A. B. Douglas (Assiniboia):: Mr. Speaker, I have a question for the minister in charge of the Wheat Board. Has a decision been reached yet by the Wheat Board on whether or not prairie farmers will be allowed over-quota delivery privileges for the purchase of registered and certified seed?


Otto Emil Lang: Mr. Speaker, I have been informed by the Wheat Board that the discussions have been successful and it is now intended to reinstitute over-quota delivery privileges to the extent of 400 bushels per permitholder with some additional regulation with regard to the use of this privilege which would assure the limitation of abuse.
December 11, 1969

Inquiries of the Ministry INQUIRY AS TO BUILDING OF ELEVATORS IN NEWFOUNDLAND


Mr. John Lundrigan (Gander-Twillingale):: A supplementary question, Mr. Speaker, to the Prime Minister. In view of the fact that according to reports the Wheat Board has experienced difficulty in meeting sales commitments because of grain not being in "a forward position", is the government giving consideration to building grain elevators in Canada's east coast province, Newfoundland?


Otto Emil Lang: Mr. Speaker, I will be glad to have a look at the report to which the hon. member is referring and see what substance there is to it. Of course, the question of the adequacy of facilities to carry and store Canadian grain is constantly under review.



UNEMPLOYMENT INSURANCE


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, in view of the alarming statistics released today regarding unemployment in this country, I intended to direct a question to the Minister of Labour. I see by the roster he is supposed to be in his seat and I saw him in the building a while ago. Perhaps in his absence I can direct it to someone else. Will the legislation to amend the Unemployment Insurance Act, promised for this session, be introduced at this session?


Allan Joseph MacEachen: Mr. Speaker, I will take that question as notice and draw it to the attention of the minister.



THE CANADIAN ECONOMY


Hon. W. G. Dinsdale (Brandon-Souris):: My
question is directed to the Minister of Consumer and Corporate Affairs. In the light of proposed rent increases of 27 per cent for tenants in federal government housing in the Yukon, will the minister explain to the House how this proposal relates to his expressed serious intention of applying restraints in order to curb inflation in the Canadian economy?


Mr. Speaker:: The hon. member for
Shefford.


Walter Gilbert Dinsdale: On a point of order, Mr. Speaker, I think the minister intended to


reply because high costs are one of the great deterrents to settlement and development in the north.



COMMUNICATIONS


Gilbert F. Rondeau: I should like to ask a question to the Secretary of State.
Can the Minister say whether negotiations or discussions took place between the federal government or the Canadian Radio-Television Commission and the government of Quebec before the latter tabled a bill to establish provincial jurisdiction over means of communication.


Gérard Pelletier: do not know precisely, Mr. Speaker, what bill the hon. member is referring to. I am ready to answer this question but I have to get information about it first.



VETERANS AFFAIRS


Mr. W. C. Scott (Vicloria-Haliburlon):: Mr. Speaker, I have a question for the Minister of Veterans Affairs. Is the Department of Veterans Affairs restricting social and financial counselling to those veterans who are in need of these services and who, in the past, have derived much benefit from them?


Mr. Speaker:: I think the question could be placed on the order paper. If there is urgency, perhaps the hon. member would not mind suggesting to the Chair that it be considered at the time of adjournment.


William C. Scott: Ten o'clock, Mr. Speaker. IMMIGRATION



PROVISION OF CHINESE INTERPRETER SERVICE AT VANCOUVER

Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, I should like to direct my question to the Minister of Manpower and Immigration. In view of the difficulties encountered by the Chinese people in conversing with the immigration officials in Vancouver and surrounding area, will the minister consider reinstituting the Chinese interpreter services which have been eliminated without any explanation?
December 11, 1969


Mr. Speaker:: I think this question could be placed on the Order Paper. If there is urgency, it could be considered at the time of adjournment.



OPENING OF QUEBEC OFFICE IN PARIS- DECREASE IN FEDERAL OFFICERS

Steve Eugene Paproski: I have another question for the Minister of Manpower and Immigration. In view of the fact the Quebec government is going to open an immigration office in Paris in a few weeks, can the minister tell the House if the number of federal government immigration officers in France will be reduced?


Mr. Speaker:: This is the type of
information which I respectfully suggest the hon. member should seek by way of a written question.



ASSISTANCE TO JEWISH PEOPLE LEAVING POLAND

Steve Eugene Paproski: I have another very important question for the Minister of Manpower and Immigration. I will attempt to phase it in such a way that the minister will be able to reply. In view of the mass exodus of Jewish people from Poland-I do not consider this very funny, gentlemen. It is a very important question. In view of the mass exodus of the Jewish population from Poland, and in view of the action France and the Scandinavian countries are taking to assist these people, could the minister say whether Canada is planning any speed treatment or giving any special thought to assisting them?


Mr. Speaker:: I have the same reservation about the third question. It may be that the minister might think these three important questions could be answered at the same time by way of a statement. That might be a helpful suggestion.


Steve Eugene Paproski: Could I put my questions at ten o'clock, Mr. Speaker?



DECREASE IN FRENCH IMMIGRANTS

Georges-J. Valade: Mr. Speaker, I want to raise a point of order in connection with the question asked by the hon. member who has just resumed his seat.
Would the Minister of Immigration be ready to make a statement on motions, referring to the answer he gave to question No.
Excise Tax Act
345, which appears in yesterday's Hansard on page 1800.
Could he supply us with any explanations as to the decrease in the number of immigrants from countries such as France, and the substantial increase in that of immigrants from Germany. Could he also-


Mr. Speaker:: Order, please. The hon.
member for Sainte-Marie seems to suggest to the minister to make a statement on motions and, obviously, that would be the simplest solution.



BUSINESS OF THE HOUSE

Gerald William Baldwin: Mr. Speaker, might I have the permission of the House to ask the Government House Leader about the business for the balance of this week and for next week? He might possibly be able to make a statement.


Donald Stovel Macdonald: Yes, Mr. Speaker, I thank the hon. member for the question. There will be a meeting of House Leaders later this afternoon at which the business for the balance of this part of the session will be discussed. If I could, I would prefer to make the statement at the close of the business today. I ask hon. members to bear that in mind when looking for the business for next week.



INQUIRY OF THE MINISTRY

Mr. Thomas M. Bell (Saint John-Lancaster):: I have a question for the Government House Leader in connection with the urban affairs vote last Monday night. I appreciate I am not entitled to comment on it, but will the minister consider having coloured slides made, preferably yellow of the Toronto members?


Mr. Speaker:: Order, please. The question period has expired.
[DOT] (3:10 p.m.)



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, November 26, consideration of the motion of Mr. Benson that Bill C-155, to amend the Excise Tax Act, be read a third time and do pass, and the proposed amendment thereto of Mr. Lambert (Edmonton West), (p. 1273)
[Stage Direction]
December 11, 1969
Excise Tax Act
Donald Stovel Macdonald: On a point of order, Mr. Speaker. Before the debate continues I would like to address some remarks to the question of the proprietry of the hon. member's amendment from the standpoint of the rules of the House concerning the imposition of taxation.
As I understand the effect of his amendment, it would be to change the incidence of this particular taxation from a 5 per cent ad valorem tax against certain air fares and propose to the House that the Committee of the Whole should consider the raising of the same amount of money by a flat fee. In simple terms, the tax which was recommended to the House by the Governor in Council proposed a percentage tax. The hon. member's proposal would change the effect of this tax so that some people would pay less in the way of taxation of this kind while others would pay more. It seems, if the amendment is to have any purpose at all, it must then have that effect.
The effect of the amendment is to refer back and therefore have the committee engage in a study in which, under our procedures, I submit it could not engage in any event. I wish to refer Your Honour to citation 263 (2) of Beauchesne's fourth edition, page 220. I wish to quote that provision which I believe covers this particular case:
The principle that the sanction of the Crown must be given to every grant of money drawn from the public revenue, applies equally to the taxation levied to provide that revenue. No motion can therefore be made to impose a tax, save by a Minister of the Crown, unless such tax be in substitution, by way of equivalent, for taxation at that moment submitted to the consideration of Parliament: nor can the amount of tax proposed on behalf of the Crown be augmented, nor any alteration made in the area of imposition.
I also draw your attention to Beauchesne's 4th edition, citation 276 (1):
The royal initiation in taxation implies the exclusive right to define the incidence as well as the amount of burdens to be placed upon the people, an amendment which transfers a burden to taxpayers not previously liable is an infringement on this initiative.
May I also draw your attention to citations 268 (2) and 276 (6) in the same volume; the latter is a brief one and it reads as follows:
On the third reading of a bill to authorize the levying of a tax, a private member cannot move in amendment, even with the approval of the government, that the bill be referred back to Committee of the Whole with the object of having the tax increased.

On the basis of these citations, and of the practice of this House in the past, I would argue that the latter restriction would apply equally with regard to a motion such as that of the hon. member for Edmonton West which would change the incidence of the tax. For that reason, the amendment to the motion for third reading should not be received.


Hon. Marcel Lambert (Edmonton West):: wish at this time to limit my arguments to the points raised by the Government leader of the House; I do not intend to cover other points which Your Honour may have in mind. If there is any question in Your Honour's mind as to the propriety of this amendment I am tempted to request that, before I begin addressing you as to the acceptability of the motion, you might indicate the areas-


Mr. Speaker:: Order. I appreciate the
suggestion made by the hon. member for Edmonton West. He is referring to the fact that I have already had a number of conversations with him during which I indicated what reservations the Chair had in mind in connection with the proposed amendment. As he knows, and as I suggest to the House now, this proposed amendment would appear to be an infringement of the financial initiative of the Crown. Substantially, the objections are those which have been raised by the President of the Privy Council. I would certainly welcome any argument which the hon. member for Edmonton West might care to advance in support of his con'ention that the amendment as drafted at the present time should be put to the House.


Marcel Joseph Aimé Lambert: That is fine, Mr. Speaker. At the time I spoke to you it was not clear you were limiting your objections to the one point; it is just as well to clarify that question so that we may not be arguing in a void.
To deal, first of all, with the propositions advanced by the hon. member for Rose-dale, I would say that the citations which bear on this point all refer to the resolution stage. If we turn to the citations in May's 17th and 15th editions, we find that everything there is related to Beauchesne's 276(1); they all refer to the resolution stage and there is nothing in the text at all dealing with third reading. In addition, with regard to Beauchesne's 263(2), may I say that this, again, deals entirely with the question of the resolution. I have examined some of the record and I recognize that a private member cannot at any time advance any
December 11, 1969

amendment which would have the effect of imposing a new tax or increasing a tax recommended by the Governor in Council. Nor, under the later authorities, in accordance with changes in the British practice, can a private member advance an amendment which would affect the incidence of taxation. At one time it was definitely recognized that it mattered not to the Crown where a tax was imposed, because ways and means were subordinated to supply. But there has been a change. I admit that.
Let us consider the wording of the amendment which I have put forward. We request the committee of the whole to reconsider clause 1, paragraph 10, so that it be made to provide for air transportation tax on a flat fee basis to be determined by the committee as yielding an equivalent return to, and in lieu of, the tax therein provided.
First of all, the principle of equivalence is adhered to; there is no derogation from that, one way or another. Second, as to incidence, there is no new class of taxpayers brought in; the people affected would be those who were paying the air transportation tax under the government proposal. But instead of using an ad valorem basis I suggest there should be an equivalent flat fee tax. If we look closely at the authorities, we find that the provisions they have laid down have been strictly and religiously adhered to. If we turn to page 827 of May's 17th edition, because we are at the third reading stage of a finance bill, we find that all it says is this:
On third reading of a finance bill, debate and amendment must be strictly relevant to the contents of the bill, and the expenditure of the year and alternative methods of providing revenue may not be discussed.
I submit that I am clearly within the narrowest confines of that citation. This amendment meets all requirements. It is relevant to the contents of the bill; there is an immediate direction to one of the clauses. The paragraph I have quoted is the only mention in May's 17th edition which is pertinent. It is true there is a general reference to some of these considerations in May's 15th edition, but one finds that those comments are all directed to the resolution stage. There was a great controversy in the United Kingdom parliament in the last century as to the wording and nature of resolutions, and as to the practices which had arisen in writing up the resolutions. I invite anyone who is interested to read May on this aspect; in these passages he will see what was done. In 1937, a committee of the House brought in a recommendation for the
Excise Tax Act
government to follow, precisely on the point that the resolution had to be wider in its ambit and much more simple. This was necessary because of earlier bad practices.
Let us not cloud the issue. I suggest with all due deference that if Beauchesne's 276(1) is taken to refer to the study of the bill rather than to the resolution, too much importance is being attached to the citation, and that the citation may be in error. I suggest to Your Honour that we go to May and read the paragraphs dealing with the general rules of procedure in the committee of ways and means. I see nothing there which would cause my amendment to be out of order. We can turn to page 733 where the procedure for dealing with taxation is outlined in detail. There is reference there to financial procedure and rules for amendment. All of the citations referred to earlier concerned resolutions.
[DOT] (3:20 p.m.)
May I just repeat my argument. My amendment does not alter any ways or means. Secondly, it does not introduce any new class of taxpayers; the taxpayers are precisely the same. Therefore, I submit that my amendment is in order.


Stanley Howard Knowles: Mr. Speaker, Your Honour has already indicated the direction in which your thinking is going, so I suppose that what we are engaging in this afternoon is not just the interpretation but the making of law. However, even though I am afraid I have to anticipate what might be your ruling, I should like to make one last defence of the right that the hon. member for Edmonton West has sought in the amendment he has proposed.
May I deal with two of the objections that were raised by the President of the Privy Council. In the latter part of his comments, he referred to a citation which said that it was not possible on third reading to move for reference back in order to increase a tax. It seems to me that it is quite clear that the change sought by the hon. member for Edmonton West is not for the increase of a tax. Certainly, the change is not to increase the total amount of revenue to be obtained, because the amendment specifically provides that the amount to be obtained shall be equivalent to the amount already obtained. Therefore, I do not think that that citation applies to this situation.
What really puzzled me was the use by the President of the Privy Council of paragraph

December 11, 1969
Excise Tax Act
(2) of citation 263 of Beauchesne's fourth edition. It seems to me that the middle portion of that paragraph is the best defence there is for the proposition of the hon. member for Edmonton West. Let me reread that paragraph, but perhaps in a different tone of voice:
The principle that the sanction of the Crown must be given to every grant of money drawn from the public revenue, applies equally to the taxation levied to provide that revenue. No motion can therefore be made to impose a tax, save by a Minister of the Crown,-
I stop there because I want to emphasize the next few lines.
-unless such tax be in substitution, by way of equivalent, for taxation at that moment submitted to the consideration of Parliament;-
I cannot imagine any better description than that of the amendment proposed by the hon. member for Edmonton West. He proposes a tax in substitution for a tax that is now before parliament. He proposes that the amount to be raised shall be equivalent thereto; and he imposes the tax on the selfsame people. I know it is perhaps time that we had a new Beauchesne, but that provision is still in the book; we use it when we like it and we discard it when we do not like it. Nevertheless, as I say, that sentence is still there, and to re-emphasize it, it states: -unless such tax be in substitution, by way of equivalent, for taxation at that moment submitted to the consideration of Parliament:-
At the end of that paragraph there is a notation indicating that this provision came from page 511 of one of the editions of May. I have not been able to find on the table that particular edition-I think it is the 13th edition to which Beauchesne is referring-but I have obtained the 15th edition of May. I find there an interesting historical review of this whole business, particularly at pages 678 to 684 or thereabouts. During the course of those pages there is a reference over to page 769.
May admits in this edition that the procedure with respect to making amendments in taxation matters has been changing through the years in the British House. But even when May says there are certain things that cannot be done, it seems to me, by implication, that that means that things not prohibited can be done. For example, let me read from page 682 of May's 15th edition:
In modern practice this view is regarded as incomplete,-
[Mr. Knowles (Winnipeg North Centre) .1
I need not read what went before, but the reference is clear.
-and as requiring to be supplemented by the view that the royal initiative in taxation implies the exclusive right to define the incidence as well as the amount of burdens to be placed upon the people, and that an amendment which transfers a burden to taxpayers not previously liable is an infringement of this initiative.
The amendment of the hon. member for Edmonton West does not transfer a burden to persons not previously liable. It puts the tax on precisely the same people, and it seeks to raise the same amount of money, simply using a different formula.
In addition to the interesting paragraphs on that page and on the next page, page 683, we are invited to go to pages 767 to 769. I am not going to take the time to read those pages; what they seem to provide, in effect, is that most of the things that members had earlier been able to do without the initiative of the Crown have been ruled out in practice. However, nowhere can I find a ruling out of an amendment which proposes a substitution that in total amount is the same and which is imposed on the same taxpayers. Therefore, Mr. Speaker, it seems to me that the hon. member for Edmonton West has a case.


Mr. Speaker:: I thank hon. members for their contributions and for the advice they have given the Chair in connection with this very difficult problem. In fact, I felt that since it was so complex I owed it to the hon. member for Edmonton West to discuss the matter with him before today, to indicate to him what my reservations were. I also indicated to the hon. member for Winnipeg North Centre that I foresaw some difficulty and invited both hon. members to study the matter in the same way as I did over the last few days. A protracted debate on the Canadian National Railways bill had at least the advantage of giving the Chair added time to consider this very important matter involving a procedural point, and to study it from all angles.
The Chair has been asked to consider, from a procedural point of view, the acceptability or otherwise of the amendment proposed by the hon. member for Edmonton West. As I indicated to some extent when I asked him to advise the Chair on this point, it was the precise form adopted by the hon. member in his amendment that made it difficult for the Chair to accept it. He recognizes, of course, that it might be moved in an analogous way by recent amendment or perhaps by removing some of the second part which proposes a
December 11. 1969

referral back to the committee as is the normal form of such amendments.
[DOT] (3:30 p.m.)
I recognize, of course, that there is a great deal of imagination in the amendment proposed. As the hon. member for Winnipeg North Centre suggested, the hon. member for Edmonton West has a case. The question is whether it is a good case or a bad case. I am afraid, after considering the matter at some length and giving serious thought to the arguments advanced this afternoon by hon. members, I tend to conclude that the case is not quite as strong as I would like it to be on behalf of the hon. member. The amendment he has proposed is as follows:
That all the words after "That" be struck out and the following substituted therefor:
"Bill C-155 be not now read a third time but be referred back to the Committee of the Whole with instructions that clause (i), paragraph numbered 10 be reconsidered to provide an air transportation tax on a flat fee basis to be determined by the committee as providing an equivalent return to and in lieu of the tax therein provided".
We all recognize that if this amendment were accepted as put to the House it would have a rather far reaching effect in that it would establish new principle. I recognize that we should not be afraid to accept a new principle simply because of the fact it is new, but we should look at such situations perhaps with even more attention than is normally accorded to such procedural matters. As I have said, the Chair has had an opportunity to review and study the amendment in relation to the bill, and having done so I have come to the conclusion that the amendment is irregular. I will attempt to give the reasons why I have reached that conclusion.
The proposed amendment terminates with the words "in lieu of the tax therein provided". These words, it is suggested, if they have a meaning, would direct the Committee of the Whole to delete a complete provision from Bill C-155 and substitute in lieu thereof a new taxation provision.
The President of the Privy Council has quoted Section (2) of Citation 263 of Beau-chesne's 4th edition. I would agree with the hon. member for Winnipeg North Centre that this citation does not help the hon. minister's case at all. The effect of the citation would appear to support the proposition that a private member may move to substitute a taxation provision for a proposal in a Government bill provided it is estimated that the new provision would yield an equivalent in the
Excise Tax Act
amount of moneys to be collected. That would appear to be the logical conclusion which could be drawn from that citation. In this respect, I fully agree with the hon. member for Edmonton West and the hon. member for Winnipeg North Centre, but Beauchesne's citation is based on May's Parliamentary Practice, 13th edition. This is the authority given by Beauchesne for his citation.
However, at page 733 of May's 17th edition it is stated:
The view which made the proposal of taxes dependent upon the demand for supply prevailed at the time when it became necessary to find a procedure which would protect the financial initiative of the Crown from being infringed by amendments. It tended to connect the royal initiative exclusively with the amount of revenue which it was the object of a tax to raise. Hence, in early editions of this book, it was stated that "the Crown has no concern in the nature of distribution of taxes". Hence, also, amendments were at first permitted which proposed the substitution of a different tax for a tax proposed by the Government (provided that both were estimated to yield an equivalent amount) on the ground that the necessity of new taxation to that extent had already been declared on behalf of the Crown. In modern practice this view is regarded as incomplete, and as requiring to be supplemented by the view that the royal initiative in taxation implies the exclusive right to define the incidence as well as the amount of burdens to be placed upon the people, and that an amendment which transfers a burden to taxpayers not previously liable is an infringement of this initiative.
The principle outlined in the foregoing citation from May's 17th edition is also set out in Section (1) of Citation 276, Beauchesne's 4th edition. That has already been brought to the attention of the Chair by the three hon. members who took part in this discussion. At page 826 of May's 17th edition it is stated:
Amendments must not exceed the scope, increase the amount or extend the incidence of any charge upon the people, defined by the terms of the Ways and Means resolutions, as agreed to by the House, by which the provisions proposed to be amended are authorized.
The hon. member for Edmonton West raised a difficulty with which I had to contend, inasmuch as the procedure we follow now is different from the procedure on which this citation was based to the extent we have no Ways and Means resolutions but Ways and Means motions. I suggest that the House has to make a decision in connection with a Ways and Means motion in the same way which, in past	years-previous	centuries-decisions
were made by the House on a Ways and Means Resolution, which of course limited the initiative of private members when the bill was considered at subsequent readings.

December 11, 1969
Excise Tax Act
The relevant provisions in the Ways and Means motion, as concurred in by the House, on November 19, 1969 reads as follows:
That it is expedient to introduce a measure to amend the Excise Tax Act to provide
(1) that a tax of 5 per cent be imposed on each amount paid or payable in Canada for transportation of a person by air where such transportation
(a) begins at a point in Canada and ends at a point in the taxation area.
May I again refer to page 826 of May's 17th edition where it is stated:
A new clause offered in committee on a bill, which proposed to alter the incidence of income tax as between landlord and tenant, was ruled out of order on the grounds that it increased the existing charge upon one of the parties.
An amendment moved in committee on a bill, proposing to vary the method of levying a new tax, was required by the Chair to be framed in such a way as not to increase the charge which would be imposed on any individual payer of the tax.
There is little question that the purport of the amendment proposed by the hon. member for Edmonton West is to reduce the tax in respect of transportation by some persons travelling by air and to increase the tax in respect of other persons. Even if the amendment is intended to affect precisely the same taxpayers and that, in theory at least, it means to provide precisely the same amount of revenue, it would of necessity transfer a greater burden of taxation to one particular class of taxpayers or to a particular group of taxpayers. In doing so, it is suggested that the amendment is an infringement of the financial initiative of the Crown.
I realize, and I have to say this by way of conclusion, that it was not easy to reach this conclusion. I recognize that the hon. member for Edmonton West had a very strong point or argument to submit in support of his point of view. However, on reflection and after having looked at all aspects of the situation, I think it would be very unwise for the Chair to accept the amendment from a procedural standpoint. I have come to the conclusion, after studying the authors and precedents, that there would be no justification for the Chair to accept the amendment as it is drafted at the present time.


Marcel Joseph Aimé Lambert: Very well, Mr. Speaker, then I will continue my remarks that I had interrupted at six o'clock on the night of-


Mr. Speaker:: Order, please. I do not wish to be unfair to the hon. member, but he can pursue his remarks only with the agreement 
of the House in view of the fact that the amendment he proposed has been refused. Perhaps it might be the disposition of the House to allow the hon. member to pursue his remarks. Is it agreed?
[DOT] (3:40 p.m.)


Some hon. Members:: Agreed.


Marcel Joseph Aimé Lambert: My remarks were not terminated, Mr. Speaker. I moved the amendment and called it six o'clock. I was speaking on third reading. I had not exhausted the time allotted to me on third reading.


Mr. Speaker:: Order. I appreciate the point made by the hon. member. I was under the impression he had put his motion and that was the end of his learned presentation to the House. Of course, I recognize he had called it six o'clock. If the motion was not put formally to the House, and we will assume it was not, the hon. member may pursue his remarks.


Marcel Joseph Aimé Lambert: Thank you, Mr. Speaker. I was hoping that was the way you would recognize the situation.
It is not necessary that I recanvass the argument I made. I shall deliberately refrain from any comments concerning the effect of the decision. The unequivocal opposition to this type of a tax has been indicated by me in committee and by a general collection of hon. members on this side of the House. Therefore, in order to express our disapproval of it, even though this involves the whole of the bill, I would now move, seconded by the hon. member for Saint John-Lancaster (Mr. Bell) the following:
All the words after "that" be struck out and there be substituted the following-
Bill C-155 be not now read a third time but be read six months from this date.


Mr. Speaker:: Has the hon. member now
concluded his remarks?


Marcel Joseph Aimé Lambert: Yes.


Mr. Speaker:: As the hon. member has now concluded his remarks I shall now formally put the amendment he proposes. The hon. member for Edmonton West (Mr. Lambert) seconded by the hon. member for Saint John-Lancaster (Mr. Bell) moves that:
All the words after "that" be struck out and there be substituted the following-
Bill C-155 be not now read a third time but be read six months from this date.
The hon. member for Grenville-Carleton.
December 11, 1969


Mr. D. Gordon Blair (Grenville-Carleion):: Mr. Speaker, I crave the indulgence of the House to make one or two remarks which might more appropriately have been made at the committee stage. At the same time, however, I submit they are in order at this stage. The motion which has been put by the hon. member for Edmonton West (Mr. Lambert) invites the House to dispose of the measure by burying it for this session. No measure imposing a tax is popular, but I think anybody who is familiar with commercial aviation in Canada knows that the method proposed by the government for the raising of money to support airport and other necessary aids to aviation is preferable to that which has been pursued up to the present time.
The government I believe has reached the very end of the present method of paying for airports, for navigational aids and for all the other modern methods required for the safe conduct of commercial aviation in this country. Indeed, there is ample evidence that charges now levied upon operators of commercial aircraft by way of landing fees, airport rentals and other service charges at airports have almost reached the stage of no return. In many instances, these charges are entirely disproportionate to charges levied not only by comparable airports in the United States but by airports in other parts of the world. That being the case, this method of raising revenue for the support of airports and other aviation facilities has come to the point where it actually is an impediment to Canadian aviation and to the various companies providing commercial air service in Canada. For this reason, I support the principle of the bill. It is for this reason also that I understand the majority of the people engaged in commercial aviation in this country support the principle of this bill, since the effect of it is to impose a charge upon the users of commercial aviation services and not only upon the companies engaged in those services.
The original proposal made by the hon. member for Edmonton West mirrors the difficulty everybody has experienced in determining what is a fair basis for the assessment of these charges. I support the government's position. I believe it is preferable, taking everything into consideration, to levy an ad valorem tax. However, Mr. Speaker, I have some reservations which are of such a nature that I hope they will be recognized by the government when this tax is put into force and administered. This tax will fall equally upon every purchaser of an air line ticket, no matter where he flies, where his point of
Excise Tax Act
origin is, and regardless of the airport facilities available to him or to the company that he flies with, at that point of origin or otherwise.
Without going into great detail I can state an obvious fact. Commercial air services are carried on in this country by the various licensed operators under conditions of considerable difficulty, and indeed hardship. Those of us who live in southern Canada automatically think of the great airports located in the major cities. We do not realize that the operators of commercial aviation services provide unit toll services over the length and breadth of this country and sometimes in the very far northern reaches of Canada. There are many places in this country where there simply is not an airport. Yet, a person may buy a ticket as if he were in Toronto, Montreal or Vancouver and thereby connect himself to the whole commercial aviation network of Canada and indeed of the world. But in many of these places where these unit toll services are carried on by commercial operators on a regular basis there are not only no airports but also no navigational aids. In the summer, properly equipped pontoon type aircraft provide services from water bases. In the winter, these services are provided by ski-equipped aircraft. I emphasize that there are no airports and there are few if any navigational aids. Indeed, in many cases where there are navigational aids they have been installed by the commercial air operators.
[DOT] (3:50 p.m.)
It seems to me that it is perfectly ridiculous to impose a tax to support airports and other services upon people who use aircraft from such far northern bases. It seems to be not only ridiculous, but unfair and unjust. I might mention certain obvious points for the consideration of the government. First of all, it is an established axiom of our national policy that the development of our northern territories depends upon aviation and upon the development of a growing pattern of air services. This will not be encouraged by excessive charges on the users of such services. Also, it should be mentioned that for many people, indeed almost every person in northern Canada, aviation provides the only means of transport. It is a necessity; they have no alternative but to choose to travel by commercial air services.
This being the case, if commercial air services are not provided and there is a lack of airports and of modern facilities, why should

December 11, 1969
Excise Tax Act
these people pay a tax to support the existence of such facilities? I refer to the whole of northern Canada although I know a little only about parts of it such as the Labrador, the coast of James Bay and Hudson Bay, the western arctic and the high arctic. These are all areas where commercial air services operate under conditions of difficulty that I have described, where airports are not provided by the federal government and where only minimal navigational aids exist. It is the ingenuity of the operators of such services and of the people who support them that makes it possible for these services to operate. I suggest that it is not proper to tax the users of such services, those who are most deserving, most vulnerable, and who certainly do not obtain benefits from the tax.
Therefore, I express the hope that the government, when and if the bill is passed, will take a careful look at the position of these far northern points of departure that I have described, the ones without airports and virtually without modern facilities, and will do something to relieve the users of air services at these points from having to pay the tax. I call the attention of hon. members to the fact that clause 18 of the bill gives the Governor in Council power to make regulations to cover a number of important contingencies. Paragraph (c) of clause 18 empowers the Governor in Council to make regulations which may:
exempt from the operation of this Part the transportation of a person by air on any classes or groups of commercial air services, commercial air carrier or aircraft.
I have no doubt that the wording of that paragraph is broad enough to enable the Governor in Council, acting under the authority of this statute, to exempt certain classes of air services, namely those provided from far northern points, from the application of this tax. It is my hope that notwithstanding the geat need for revenue to support the air services of this country, it will be possible to exempt northern air travellers from this tax.


Hon. Herb Gray (Minister without Portfolio):: Mr. Speaker, I presume that I am in a position to close the debate.


Mr. Speaker:: The minister cannot close the debate on third reading. If he wishes to speak, he will not necessarily close the debate.


Herbert Eser (Herb) Gray: Perhaps I can ask for Your Honour's guidance on a matter of order with

reference to the amendment just placed before the House.


Marcel Joseph Aimé Lambert: Question.


Herbert Eser (Herb) Gray: I wish to ask Your Honour whether or not my rising to speak at this time might terminate the debate.


Mr. Speaker:: I have just indicated to the hon. member that a speech made by the minister at this time, when there is an amendment such as the one proposed, certainly does not close the debate. As I said, the hon. member may participate in the debate now, and this might have just the opposite effect.


Herbert Eser (Herb) Gray: Thank you, Mr. Speaker. This was just a question of order on which I sought clarification.


Some hon. Members:: Question.


Mr. Speaker:: The question now is on the amendment moved by the hon. member for Edmonton West (Mr. Lambert). Is it the pleasure of the House to adopt the said amendment? All those in favour will please say yea.


Some hon. Members:: Yea.


Mr. Speaker:: All those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Speaker:: I have some difficulty in deciding, but in my opinion the nays have it.
And more than five members having risen:


Mr. Speaker:: Call in the members.


Mr. Speaker:: I declare the amendment lost. The question is on the motion for third reading. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: On division.


Mr. Speaker:: Carried on division.


[Stage Direction]
Motion agreed to, bill read the third time and passed.


Herbert Eser (Herb) Gray: that Bill C-139, to amend an Act to amend the Income Tax Act, be read the second time and referred to the Committee of the Whole.
He said: Mr. Speaker, this is the third of the bills arising out of the budget of last June. Its purpose is to continue during the 1970 taxation year the 3 per cent surtax which was approved by parliament in 1968 for the taxation years 1968 and 1969.
The House will recall that in his budget statement last June 1, the Minister of Finance (Mr. Benson) said that in addition to a restrictive monetary policy he was convinced, and I quote, that "maintaining a strong fiscal position is now essential to check the rise in prices and smooth the way toward more balanced and sustained economic growth." He went on to say he was not proposing any increase in either personal or corporate tax rates beyond their current levels, or an increase in sales tax, but he was proposing that the surtax, to which I have just referred, on both personal and corporate income taxes originally applicable for the taxation years 1968 and 1969 should be extended until December 31, 1970.
The surtax on individuals applies only to the amount of basic tax in excess of $200 and
Stewart (Okanagan-Kootenay)
Sullivan
Trudeau
Trudel
Turner (London East) Turner (Ottawa-Carleton)
Wahn
Walker
Watson
Weatherhead
Whelan
Whicher
Whiting
Yanakis-116.

December 11, 1969
Income Tax Act
it is estimated that about 2,500,000 taxpayers, or about 30 per cent of the total number of taxpayers, will be exempt from this tax in 1970. In the case of corporations, the surtax is 3 per cent of the corporation's tax before reduction by the provincial abatement and before adding the old age security tax. May I conclude therefore by asking the support of the House for this bill at this second reading stage.


An hon. Member:: Carried.


Marcel Joseph Aimé Lambert: Mr. Speaker, I do not know whose was the hopeful voice I heard coming from the government side. I thought I recognized the hon. member for York Centre (Mr. Walker) who is the automatic reactor button which says "Carried" when these measures are brought before the House.
But what are we being asked to do? We are being asked to carry into a new taxation year a surtax which had what was perhaps the most infamous origin of any tax placed before parliament. This is the tax which was finally brought back after a performance of which any government might be expected to feel dreadfully ashamed. It was brought back after its defeat in 1968, when, aided by we do not know what sort of legerdemain, the government was able to assure itself of sufficient support to obtain reconsideration of a measure on which it had been defeated.
Not only was the government unsuccessful in its first attempt to bring back the tax; it had to start again. That was the year of mismanagement, and we still have the mismanagement with us. This tax was imposed as a surcharge in order to put Canada's financial affairs in order. I see in his place the former Minister of Finance who was faced with pressure from the international money market and criticism from the International Monetary Fund. Canadian finances were running at unheard of deficits; their operation was in total disorder.
[DOT] (4:40 p.m.)
Then followed the defeat. Both the former Minister of Finance and the present Minister of Finance came to this House wearing sackcloth and ashes, saying they would be good boys in the future; that as a result of this surcharge, the cutting back of some $400 million to $500 million of estimates and restrictions on the public service, they would be able to do a much better job. Then, the present Minister of Finance brazenly stood up in

the House and said that, with all of these measures, he could guarantee a balanced budget and that the government would have its house in order.
We know what happened. Off went the members of the House to an election. When they returned, the government tabled revised estimates in the month of September, indicating they were going to be $400 million in the red. When they brought in the interim budget in October 1968, this budgetary deficit had increased to between $700 million and $800 million. So much for the computers that the present Minister of Finance said would assist the government. They were to eliminate problems with the supplementary estimates because, from then on, they would be handled much better.


Horace Andrew (Bud) Olson: Tell us about June 1962.


Marcel Joseph Aimé Lambert: I can tell the hon. gentleman a great deal. The hon. member was so far out on the prairies that he did not even know what was happening. He has the greatest misconception of what in fact happened, because in 1962 the Minister of Finance predicted the size of his deficit. But never was there practised the outright misrepresentation that the government had the effrontery to make in this House in early 1968. When attempts were being made to justify this misbegotten government's hanging on to power at any price, even the principles of parliamentary government were prostituted.
Today the whole raison d'etre for this 3 per cent surcharge has gone. We are told it is being retained to maintain revenue. Government expenditure has, of course, gone up fantastically since 1968. I recall that in 1968 we were dealing with a budget that was well under $10 billion. We know what the estimates for this year are. The main estimates total some $11,857 million, a mere $900 million increase over last year. We have just passed the first "supps" totalling about $66 million. There will be another set of "supps" before we get the final supplementaries in March. I would say that the total will easily reach $12.5 billion, give or take a few million.
This is the government that is supposed to be watching its expenditure. In view of some of the things that have been happening in the Prime Minister's (Mr. Trudeau) office and in the Privy Council, involving expenditures on equipment, accommodation and salary increases that are sheer prodigality, I should like to see exactly what the amount of the
December II, 1969

final supplementaries will be. Other ministries are having to put staff out on the street, but the Prime Minister's office has become the haven for high-priced help.
We are being asked to continue this 3 per cent surcharge next year. Let us not forget all of this fancy doubletalk in the white paper on taxation, which incorporates this surcharge in a new standard charge. No longer will it be a surcharge. What was supposed to be a temporary measure, subsequently further lengthened, will become permanent. The Canadian public is fed to the teeth with taxation and super-taxation, which is what this measure is proposing.
I would have thought that hon. members opposite who have some concern for our economy would be aware that last year 37 per cent of the gross national product was taken by the public sector. By that I mean the federal government, the provinces and the municipalities. Within five years their share will rise to 41 per cent of the gross national product. I have it on good authority, from studies made by persons far more competent than any of us in this House, that in order to get this 4 per cent increase in the share of the gross national product that is taken by the public sector, 45 per cent of the gross national product will have to be taken.
This is frightful to contemplate. Quite apart from inflationary factors, within five years the public sector will take 45 cents of every additional dollar of goods and services produced in this country. Is this an incentive to the Canadian economy? The reason the white paper is bereft of all incentive is that it contains philosophies such as that represented in the principle of this bill, which seeks to continue the surcharge.
I have no hesitation whatever in opposing this measure. Therefore I move that:
All the words after "that" be struck out and there be substituted the following:
Bill C-139 be not now read a second time but be read six months from this date.
[DOT] (4:50 p.m.)


Mr. John Burlon (Regina East):: Mr. Speaker, in my view Bill C-139 to extend the 3 per cent surtax for another year demonstrates the bareness and sterility of the Government's approach to economic affairs and the management of the nation's economy. It demonstrates in my view, as nothing else can, the incapacity and the inability of the Government to manage public finances and the nation's economic affairs.
Income Tax Act
This bill was first announced in the budget speech on June 3. At that time the Minister of Finance (Mr. Benson) made it clear that the purpose of extending the 3 per cent tax was not for revenue but for economic stabilization. He stated, as recorded at page 9417 of Hansard for June 3:
It will be clear to everyone, however, that the extension of the surtaxes at this time is required for the purposes of economic stabilization, and not for budgetary revenues.
The Government failed to have this bill brought before the House at that time. It chose to debate the rules instead. Now, the situation has changed since six months have elapsed from the time the government first proposed this measure. Last June, the budget speech of the Minister of Finance listed a number of factors which led to the government's decision to extend the surtax. The economy was demonstrating a strong performance in his view and on the basis of his analysis prices in Canada were continuing to climb. In addition, there were strong international pressures. That situation no longer prevails. The gross national product is now growing at a slower rate, consumer demand is slackening, unemployment is rising and the government's anti-inflation campaign has now proven to be a colossal flop.
Unemployment is now at a seasonally adjusted rate of more than five per cent and will likely rise to seven per cent or eight per cent before spring. Prices are still rising at an annual average rate of almost 4A per cent. The government's budgetary surplus rose to almost $850 million by the end of October in respect of the 1969-70 fiscal year. Furthermore, the continuation of this tax is simply a perpetuation and extension of an unjust tax system. The white paper on taxation admitted that the present system is unjust. The time to start tax reform is now, not some day in the future.
The Government's willingness to extend and continue the present tax system, and its unwillingness to introduce some of the obvious benefits of its tax proposals, is not a good portent of things to come. The government's reluctance can only mean that it is prepared to see its white paper proposals further butchered before they take effect. This can only mean that the lower and middle income tax groups in Canada will be hurt still more.
There is still another reason the government may want to continue to surtax into 1970. The hon. member for York South (Mr. Lewis), when he spoke on the resolution to

December 11, 1969
Income Tax Act
refer the white paper on taxation to the Finance, Trade and Economic Affairs committee, noted the probable timetable of tax changes. He suggested the white paper would be studied until some time in 1970; tax changes would be introduced in 1971, and whatever benefit there may be for some people would become apparent when they file their income tax returns in the early part of 1972, just prior to a federal election.
However, if the Government did not continue the 3 per cent surtax into 1970, rather than allowing it to expire December 31, 1969, many people would find their taxes reduced by not as much as the Government now claims in its white paper or they would find their taxes increased by more than is shown in the white paper. This bill is part of a grand design to manipulate Canada's tax affairs in a way that will help the Liberal party at the next federal election. This bill is an attempt at subterfuge and illusion on the part of the Government. This proposal has had a very chequered history, as has already been indicated. The original legislation was to expire at the end of 1969. In his budget speech of last June, the Minister of Finance indicated that he wanted to have it renewed for reasons which, I have already indicated, no longer apply. This measure failed to pass at the last session not because it was held up in any way by the members of this House, but rather because the Government chose to debate the rules instead. The Government wanted to get its own way in respect of the iniquitous rule changes it was attempting at that time to foist upon the House, and even-tally had to use the closure measure to achieve.
The present session commenced on October 22. One month later the Government finally got around to introducing this bill to put into effect this budgetary proposal of last June. Almost another month has gone by before we have been asked to debate the measure. I should note that this has taken place after the white paper on taxation has been published, and thus this proposal has been eclipsed. I assume there may have been some members supporting the government who thought that possibly one of the best ways of slipping this measure through this House with the least possible public attention would be to wait until the white paper on taxation had been published.


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



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Bechard):: It is my
duty pursuant to Standing Order 40 to inform the House that the questions to be raised tonight at the tme of adjournment are as follows: the hon. member for Hillsborough (Mr.	Macquarrie)-Post Office-December
Saturday delivery; the hon. member for Vancouver Kingsway (Mrs. Maclnnis)-Consumer Affairs-accident caused by spilling of sulphuric acid from toy car; the hon. member for St. John's West (Mr. Carter)-National Defence-Base Consolidation-Effect on maritime provinces.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely private bills, notices of motion (papers), and public bills.



PRIVATE BILLS


Mr. J. A. Jerome (Sudbury):: Mr. Speaker, I would ask with the consent of the House that the bills appearing in my name stand.


The Acting Speaker (Mr. Bechard):: Is it
agreed by unanimous consent?


Some hon. Members:: Agreed.



PRIVATE MEMBERS' MOTIONS FOR PAPERS


Mr. Walter C. Carter (St. John's West) moved:: That an humble Address be presented to His Excellency praying that he will cause to be laid before this House copies of all correspondence between the Government of Canada, Bedford Institute of Oceanography, and the Government of the Province of Newfoundland or any of its agencies regarding the establishment of the Electric Reduction Company phosphorous plant 1 at Long Harbour, Placentia Bay, Newfoundland.
He said: Mr. Speaker, on June 3, 1969, I caused to be placed on the Order Paper a Notice of Motion for the production of copies of all correspondence exchanged between the
December 11, 1969

Government of Canada or any of its representatives, the Government of the Province of Newfoundland, the Bedford Institute of Oceanography, and the Electric Reduction Company of Canada relating to the establishment of the Electric Reduction Company phosphorus plant at Long Harbour, Newfoundland.
At about the same time, the hon. member for Kootenay West (Mr. Harding) had a somewhat similar motion placed on the Order Paper wherein he requested copies of correspondence, etc. between this government and the Electric Reduction Company of Canada. His motion did not make any reference to copies of correspondence between the Government of Newfoundland or the Bedford Institute of Oceanography. My motion was subsequently set aside.
[DOT] (5:00 p.m.)
In the realization that the information I sought was not that which was supplied to the hon. member, I had my original motion reintroduced. Unfortunately, however, for reasons which I believe are obvious, it was not accepted by the government and hence this debate. A great deal has been said in recent weeks about pollution. Fears have been expressed concerning supertankers, dangerous oil waste and so on, as well as the chaotic effect this would have on marine life around the coast. I agree that a very serious threat does exist. I feel it is incumbent on this government to take every possible precaution against such an eventuality. The people of my riding, St. John's West, have first-hand knowledge of pollution and what it can mean. That is the reason I am anxious to have all available information on the Long Harbour Tragedy. What happened there this past year is our tragedy. A large number of people were deprived of a chance to earn a living. Their livelihood was very seriously affected and for a while completely destroyed by the pollution of the water in and around Placentia Bay by the Electric Reduction Company of Canada.
I feel these people have suffered to a very great extent and are entitled to have the complete facts concerning what happened and what steps should have been taken by this government, perhaps by the Newfoundland provincial government and by the company which caused the pollution. As I said before, I am anxious to have all the information which is available, including copies of all documents
Motion jor Papers
and letters exchanged between the government of Canada, the government of Newfoundland, the Bedford Institute of Oceanography and the Electric Reduction Company of Canada.	f
In the light of certain correspondence between the federal Department of Fisheries and the manager of the Electric Reduction Company, I am left with no alternative but to state that this government acted in a completely unbelievable and irresponsible manner with regard to the establishment of the Electric Reduction plant at Long Harbour. I have a letter dated January 9, 1967 to the Electric Reduction Company manager from the Regional Director of the Department of Fisheries in which the regional director in effect admitted that his department was incapable of making detailed predictions concerning the probable effect of the waste from the Electric Reduction Company plant on fish life in the receiving waters.
However, after admitting that they were unable to make proper predictions, he did inform the management of the plant that his department would not object to the plant's waste disposal system provided certain requirements were met. I believe it is quite obvious to all of us, particularly the people whose livelihood was destroyed because of this terrible tragedy, that the requirements laid down by the Department of Fisheries were completely inadequate. The results are well known to members of this House, and I suppose to all people of Canada. Certainly, they are well known to the people whose livelihood was affected by the waste from that plant. I suggest that the Department of Fisheries was prepared to gamble with the fishing industry of Placentia Bay and St. Mary's Bay. Indeed, if one realizes the ramifications there could have been, I would go a step further and say that the Department of Fisheries was quite prepared to gamble with the fishing industry perhaps of eastern Canada because what happened in Placentia Bay could very well have ruined the fishing industry of the entire Atlantic coast.
I realize that certain things have been done for the fishermen whose livelihood was affected, but I do not think it will be possible for either the government or the company to reimburse these fishermen completely for what happened this year as a result of this pollution problem. There are people who are still suffering and who will continue to suffer for the rest of this year and perhaps later because of the terrible gamble this government and the Department of Fisheries took in

December 11, 1969
Motion for Papers
dealing with the waste material from the Electric Reduction Company plant at Long Harbour.
Therefore, Mr. Speaker, as the member for the riding in which the people were seriously affected, I feel I am entitled to all the information and all the correspondence that was exchanged between this government, its agencies, the Bedford Institute of Oceanography, the government of Newfoundland and the Electric Reduction Company of Canada. As I said before, because a similar motion had been made by another member my original motion was set aside. I believe there are many questions which have not been answered so far as this pollution tragedy is concerned.


John (Jack) Davis: Mr. Speaker, perhaps I should begin by saying to the hon. member for St. John's West (Mr. Carter) that the department and the government have no intention of withholding any correspondence relating to this very important subject. Earlier, it was indicated to the hon. member and to others that we would have to obtain the permission of the government of Newfoundland before we could table all the correspondence. This permission was sought and we were told at the time that the government of the province of Newfoundland would prefer to withhold the correspondence until after the matter of compensation to the fishermen of the Placentia Bay area, which was then before the courts, was dealt with by the courts. Subsequently, indeed within the last two weeks, a settlement was reached out of court and the fishermen in question have had assurance that they will be compensated. The matter is no longer before the courts and we are therefore in the process again of endeavouring to obtain the consent of the province of Newfoundland to table all the correspondence involved.
I do not want the hon. member for St. John's West or any other member to feel we have anything to hide in this connection. Indeed, I would go so far as to say we are very proud of the people in the Department of Fisheries and the Fisheries Research Board who worked on this problem over the past year. We have a situation today at Long Harbour, which is a small harbour off Placentia Bay, where, looking back on what has been a very difficult situation over the last 12 months, we have the best of both worlds. The plant is operating again. There are some 400 plant employees receiving pay cheques for

gainful employment at the plant. The fishery is back in reasonably good shape. So far as we can determine the fishery is in as good shape as it has ever been.
We have passed through a very difficult year for the fishermen and a very difficult year so far as measures to control pollution in that area are concerned. The hon. member for St. John's West mentioned a letter which is attributed to one of the members of the staff of the Department of Fisheries which was written and sent to someone I believe in the Electric Reduction Company in January of 1967. I hope I am correct. That was a year or so before I became minister. The letter relates to correspondence between the Electric Reduction Company and the federal Department of Fisheries. I am simply going on memory and this can be confirmed by the actual correspondence when it is tabled, but the Electric Reduction Company applied to the provincial government and to the Department of Fisheries as well as to other federal departments for authority to build a plant, and to have access to certain funds, rights and privileges. In this application, there was an explanation of their process and what the company expected to be the character of the effluent from the plant. A letter describing the nature of the effluent did come to our department. Looking back on that correspondence, I think the people in our department would say that it was not complete, that it did not contain a full and adequate description of what turned out to be the effluent from the plant.
[DOT] (5:10 p.m.)
In any case, our federal scientists and engineers reviewed the information supplied to them, checked the site and the process, and so far as they could determine from the plans outlined by the company there was not any danger of contamination of those waters or of the poisoning of large numbers of fish. I think we can say in retrospect that the information which the department received then was not a proper forecast of what in fact occurred. Certainly, it was not a good indication of the character of the effluent which did in fact leave that plant during its early starting-up phase. As a result of colloidal phosphorus being found in the effluent-and my recollection was that there was no mention of the possibility of colloidal phosphorus being in the effluent in the correspondence sent in by the company-a large number of herring were killed; cod were seriously affected, and other marine life was destroyed.
December 11, 1969

Perhaps I should review the situation at Long Harbour. I should begin with the brand new $40 million facility at Long Harbour which started up 12 months ago. It started up and was shut down intermittently as teething problems in the plant were encountered and overcome. There was an early fish kill, then there was no kill; then, there was a second and eventually a third kill. Immediately after the first kill our own Fisheries Research Board people went to the site and from early January stayed on continuously. Within a few days we had a large number of fishery scientists, biologists and engineers on site. They were baffled for some time because they did not know the precise nature of the pollution, and for reasons which will become obvious they were not able to pin down say for certain that the source of the pollution, was in the plant.
The position in which the department was at that time, and still is today, is that unless you have not only evidence of fish killed but can definitely prove the cause of the fish kill, you cannot prosecute. This is the position under the Fisheries Act at the present time. This is one of the reasons why we want to up-date, amend and improve the Fisheries Act, that is, we want to put teeth in it.
Our scientists were also in the difficult position of finding that fish in cages at the very outfall of the plant did not die, so that they were unable to prove definitely within the first few weeks that the plant was the source of pollution. This was eventually established and the plant, which never ran for more than a couple of days at a time, was shut down as a result of an understanding with the Department of Fisheries and Forestry.
It did not start up again untill all the effluent was contained on the plant property, was treated in ponds on the plant property, and any water and other waste material likely to contain elemental phosphorus was recirculated within the plant and recovered within the property of the company itself. It was found that elemental phosphorus was the cause of the pollution; also that it was far more toxic than it was ever thought to be. No reference in the scientific literature which could have been turned up at the time indicated the degree to which this particular substance, colloidal phosphorus, was poisonous to fish and other forms of marine life.
We have a situation today where the effluent is totally recycled within the plant. There is no elemental phosphorus escaping from the plant, nor can it possibly escape. The bottom
Motion for Papers
of the harbour has been dredged out to remove any of the phosphorus material which was deposited there. This is the situation with regard to the plant.
I believe the government moved expeditiously. We called a halt to fishing in the area. We made provision for compensation for the fishermen. Not only did we buy all the fish that could possibly have been contaminated by phosphorus over a very wide area-not just Long Harbour but the whole of Placentia Bay-so that the fish would not get on the market and affect the reputation of fish from Newfoundland or from eastern Canada, but also our officers went to every fisherman whose means of livelihood had been cut off and arranged for payments to him to be made on the basis of his previous year's income. So the taxpayer of Canada, in effect, helped to carry each fisherman over the difficult period until fishing could be resumed. Fishing was interrupted for roughly two months and resumed again in July.
There was some scepticism as to whether the fish would be all right, but later it was proved that there was no problem. Again, the fish were held off the market to ensure that there was no threat to human health or to the livelihood of the fishermen.
Subsequently, settlements have been reached between the Electric Reduction Company and the fishermen. On the basis of earlier assessments by the Department of Fisheries and Forestry, the company offered to pay individual fishermen twice as much as had been loaned to the fishermen by the government. Close to half the fishermen accepted that payment and, I understand, signed a paper which in effect said that this put an end to their claims. Whether or not this is a good thing, it happened. However, a larger number of fishermen decided to band together. They retained counsel and launched a law suit against the company. In their case, a settlement has been arrived at which is of the order of two and a half times the loan which the federal government made to carry the fishermen over the two months interval in which they were forbidden to fish in Placentia Bay.
So, the fishermen have been in receipt of moneys for the fish which they caught and in relation to saleability, about which we were concerned, they received a loan from the taxpayers of Canada to bide them over the two months period when they were not allowed to fish. Then, they received a subsequent settlement from the company. It has been a very

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Motion for Papers
uncertain year for those fishermen, but it has not been a year without income for them. We cannot be sure whether or not there is a serious long term effect in Long Harbour and in Placentia Bay on the marine life there. However, our scientists are quite optimistic in this regard. They have carried out a number of tests, and if there is any further evidence of pollution, we will get the company to clean it up at the company's expense, as it has done in the past.
[DOT] (5:20 p.m.)
No taxpayers' money has gone into cleaning up facilities, or cleaning up the bottom of the harbour itself. I do not think the reputation of Newfoundland fish has been seriously damaged. I am sure the hon. member for St. John's West will tell us there are individuals in the area of Placentia Bay who are very concerned about the events of the past year. It will be a considerable time before they are convinced that the situation is in fact good, that the marine life is no longer threatened by the plant and that no irreparable damage has been done. Looking back, Mr. Speaker, it can be seen that we had on our hands a very difficult situation from the point of view of the fishermen. But I think it has been handled in an efficient way, although admittedly on a hand-to-mouth basis, and the fishermen have had a reasonable income in relation to the income they have earned from the fishery in previous years.
There is the much larger question of how we are to deal with pollution in the future. I think we now know how to deal with plants making elemental phosphorus. There had been little experience in the world with such plants, and indeed no such experience in Canada. In future we must insist that phosphorus plants treat all their effluent on their own property, and that nothing leaves the plant that would in any way be deleterious to marine life. We have to treat other chemical processes in the same way. We will have to be much more attentive to future effluents. We shall have to look at plants elsewhere in the world to see if there are parallel situations, although I understand that in this particular case there was no parallel situation elsewhere.
I must return to the unsatisfactory position in which the Department of Fisheries finds itself. We do not have legislation which is in the form necessary to deal effectively with-pollution ahead of the event. We do not give 
a licence to a firm to carry on a given practice, to install a given process. Under Canadian law the Department of Fisheries has monitored events, discussed matters and indicated to companies what was tolerable and what was not, what concentrations of material should be discharged into the marine environment and what should not. But it has not been in the position, under Canadian law, of being able to prevent an installation from taking place, or indeed to prevent a given practice being followed, unless such practice resulted in damage, and in most cases damage to the commercial fishery.
In the future, Mr. Speaker, with an amended Fisheries Act we will be able to point to standards which must be met in terms of parts per million of the effluent, effluent standards which can be shown to companies which are about to instal new plants, standards they must meet, and standards which if they are not met will lead to prosecutions by the Crown. This is the character of the amendments to the Fisheries Act which we will be bringing forward later this session.
In conclusion, Mr. Speaker, there was correspondence back in 1966 and 1967 concerning the setting up of this new phosphorous reduction plant in Newfoundland before construction actually began. There was correspondence which related to the possibilities of pollution. The effluent was described. In my opinion the description of the nature of the effluent was not such as to reveal what was likely to happen and did in fact happen. We learned by experience what can happen and what in fact did happen at Long Harbour. It has been unfortunate experience. It has been an extremely unfortunate experience from the point of view of the fishermen. But I think that during the short time I have been minister we have done everything we could.
The first thing we did was identify the source of the pollution. We moved to get the plant to shut down before we had a legal case, months before we had what one would call sufficient evidence for a prosecution. The company co-operated by shutting its plant down and installing all the facilities which we advised were necessary to treat the effluent on its property. In the meantime we helped to carry the fishermen over a difficult period, and in recent weeks they have been receiving compensation from the company. Whether this compensation is sufficient in the eyes of the fishermen I cannot say, but we have done something novel. The taxpayers of Canada have carried these fishermen over a difficult
December 11, 1969

period in which pollution interrupted their livelihood. I hope the fishermen themselves will recognize this, and that they will repay our loans so that this procedure of the Canadian people helping fishermen over a difficult period can be repeated if we ever run into a pollution problem of this kind again.
I hope we will be able to anticipate situations such as this and prevent them, although we can never be sure. With an amended Fisheries Act we will be able to move with certainty. We will be able to draw up guidelines, and with increased staff and increased competence we will be able to monitor situations like this to make sure that a Placentia Bay problem does not recur.


Mr. Barnett:: Mr. Speaker, the minister referred to anticipated events. Can he tell us in a few words what has been done to anticipate possible pollution from the oil installations which I understand are in the process of being placed in the Placentia Bay region?


John (Jack) Davis: The department endeavours to keep abreast of industrial development, to watch situations where new mines are opening up, where new processing plants are about to be installed, where new manufacturing operations are beginning and to contact the firms in question. But in the great majority of cases-I would say in 99 cases out of 100-where the chemical industry or a major mining operation is involved, the companies come to the Department of Fisheries and Forestry. We have the biologists, the people competent to assess the marine resources, who are in the best position to say whether the effluent will affect fish life.
The Fisheries Research Board and other officers in the department can express opinions as to whether the effluent will be harmful. A company then instructs its engineers to design its pollution treatment equipment to meet the standards which our biologists set. This is being done more or less on an informal, ad hoc basis, particularly in British Columbia.
Today no company in its right mind which has any expectation of discharging a toxic substance or any other effluent which is harmful to fish, into waters over which we have any direct jurisdiction, would pass up the opportunity of talking to our people first and of making sure that what is likely to be discharged will not incur a fine or cause serious damage to fish and other forms of marine life. This type of liaison is growing. It is being developed by the companies in self-defence, 21545-48
Motion for Papers
but there is also novelty here. This is a new trend. It is a new kind of liaison confined to the last few years. Companies now come to the fisheries department to talk about their problems and to do the right thing. This is all to the good, but I still think we need a Fisheries Act with teeth in it and we need more staff to be able to administer this aspect of pollution control more effectively.
[DOT] (5:30 p.m.)


Walter C. Carter: Mr. Speaker, I wonder if I might ask a question. The minister stated that his department did not have enough knowledge to prevent this type of pollution. I wonder if he would not agree that in light of experience with similar plants in England and one in Ontario, the department should have imposed more stringent regulations to prevent the problem arising to the extent it did last year in Placentia Bay.


John (Jack) Davis: I think the hon. member is right to the extent that if the department had known what it knows now, when Electric Reduction Company first applied a couple of years ago it would have insisted that the effluent be kept within the plant. I am quite sure that in future when our people are approached for an opinion by a chemical-type industry, they will demand that any waste material leaving the plant is in the safest possible condition and that the maximum treatment occurs within the plant itself.
Hindsight is wonderful, but a lot has been discovered in the last 12 months about the operation of phosphorus plants which was not known previously. We have investigated a few situations both in this country and overseas where there has been negligence, and it seems that no one was overly concerned about the effects of phosphorus in those places. Now everyone is. They will be in the future if a similar installation is proposed elsewhere.


Mr. Frank Howard (Skeena):: Mr. Speaker, you have been extremely generous, and I think properly so, because the subject matter raised by the hon. member for St. John's West (Mr. Carter) and dealt with by the minister extends beyond Placentia Bay and beyond the Electric Reduction Company plant. The minister recognizes this.
As the minister said, hindsight is a wonderful thing to fall back on, but generally speaking we do not seem to learn from it how to take proper precautions for the future. It

December 11, 1969
Motion for Papers
seems logical that if Electric Reduction Company has been able to maintain the effluent within its own plant, reducing the phosphorus there and discharging clean or non-polluted water into the ocean, the same process could be used in other types of industrial operation. This would apply, for instance, to pulp mills, mining operations, concentrators and industrial plants from which chemicals and water are discharged, that is, waste and pollutants, at the same time.
Surely there is available to chemists and engineers the techniques with which to meet the demands of the biologists and ecologists. In this day and age the Department of Fisheries should be able to solve problems of pollution within its jurisdiction. The federal government should face its responsibilities and not hide behind the constitution in this regard. Today more and more people are interested in preventing pollution and preserving the products of nature. It is regrettable that our constitutional structure permits practically all levels of government to place the responsibility on others. We should not permit this type of constitutional buck-passing.
Unless we control pollution in our total environment and maintain a proper ecological balance, we will bring upon ourselves something far more destructive to humanity than atomic war, which is itself awesome and terrible. Many studies have been made, in isolation, in cases where the balance of nature has been upset by effluents, sewage, pollutants, detergents and many other industrial substances. These studies indicate that pollution is destructive of humanity. They also indicate it is very destructive of foodstuffs obtained from the ocean, which seems to be almost limitless in its capacity in this regard. It is nevertheless being destroyed piece by piece.
I do not want to go too far in this direction, Mr. Speaker, because the wording of the motion is rather confined. But the minister has raised an extremely important subject. He spoke of the necessity of having a Fisheries Act with teeth in it. I am sure the only opposition to this concept would come from vested interest groups such as some of the pulp companies in my province. There is a company in Prince Rupert, in my constituency, which has created havoc with the plant life in the area and which continues to pump effluent into the supposedly limitless foodbearing capacity of the ocean. We cannot permit this sort of thing. The Fisheries Act should be made, and efficient the minister
[Mr. Howard (Skeena).
will not find any great objection raised if he tries to plug the loopholes. When the minister mentioned this matter to the fisheries committee last spring, I thought he was talking in terms of the present session. There should be no delay in introducing this type of legislation so that the question can be dealt with in respect of both new and old operations.
[DOT] (5:40 p.m.)
The minister said that perhaps these companies react out of fear or self-defence; that the threat of punishment or a fine is sufficient to make them consult officials of the department. In many instances this is probably the major deterrent, and it is not a moralistic concern about our environment. I think that only the threat of some form of punishment will work. We need forceful and determined means of impressing upon these companies that they now operate industrial plants which are destructive of life forms. They must not dump fluids and chemicals into our oceans and freshwater systems. As the minister knows, they are destroying plant and animal life.
The minister, provincial governments and people in various political parties have said the only way to deal with these companies is to tell them, "You are doing something which is criminally wrong, in the broad sense of the word." A reasonable time limit must be set. If the engineers and the biologists in the minister's department feel that six months is an appropriate period of time, the government must say to these companies, "You have six months to clean it up. Put in pollution-control systems. We want pure water coming out the other end, or we will shut you down." This would be sad for the employees and the economy of the area, but if we do not take such steps, within 15, 20, 30 or 50 years we may well have destroyed human life.
We hear about the inability to find the millions of dollars necessary for pollution control. We cannot delude ourselves any longer about the inability to find the money. We simply have to find it. For all the good it does, we could in the interest of preserving humanity scrap the entire budget of the Department of National Defence and put the money into pollution control; we would be doing society and humanity a great deal more good than using it for the Department of National Defence. That is only an example. The money is available within the structure of government.
December 11, 1969

The minister says he needs a larger staff in order to prosecute fully what he concedes should be the force of the Fisheries Act and its pollution-control provisions. If the minister needs more staff, we should not permit any false economy measures of the Minister of Finance (Mr. Benson) to impinge upon that concept. We should not permit ourselves to be blinded by the across-the-board cut-backs in money that is available to a department. In some departments money is wasted and does not bring to society the full benefits that it should.
Action under the Criminal Code has been advocated as a better system of correcting this situation. We could have a declaration by Parliament, because pollution control is in the national interest. There is one department of government that appears to have the authority, jurisdiction, power and desire to deal with this matter. I am, of course, referring to the Department of Fisheries. We should not be penny-pinching because the life that we all know is at stake. Humanity could very easily disappear. We as one section of government, and there are others involved throughout the world, have the authority to do something about the situation. If we do not, we are simply contributing to the decline and fall of the human race, to the destruction that is caused by pollution.


Thomas Miller Bell: I would like to say something on this subject, Mr. Speaker, particularly in view of my well-known interest in the conservation of Atlantic salmon. My remarks will take quite a while, and as it is nearly six o'clock I wonder whether the House would agree to call it six o'clock.


Mr. Deputy Speaker:: Is that agreed?


Some hon. Members:: Agreed.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
AMENDMENT TO CONTINUE SURTAX The House resumed consideration of the motion of Mr. Gray (for Mr. Benson) that Bill C-139, to amend an Act to amend the 21545-481
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Income Tax Act, be read the second time and referred to the Committee of the Whole.
John Stratford Burton: Mr. Speaker, before this debate was adjourned at five o'clock I had an opportunity of discussing the bill before us for a few minutes and I dealt with three main points. The first was that the tax system now in existence is unjust. This has been admitted in the white paper on taxation which the government has tabled. An interesting collection of levies, surcharges and other taxes has been superimposed on this structure, adding to the confusion and to the inequities which exist.
The second point I made was that the purpose for which the extension of this tax into 1970 was proposed is now outdated. The Minister of Finance made it clear on June 3 that the proposal had been put forward, not to secure government revenue but rather for the purpose of stabilizing the economy. I believe the situation has changed since that time and that this reason for imposing the tax for a further year is no longer valid.
Third, I suggested that this bill was part of a grand plan devised by the government, in connection with its tax proposals, to leave the impression with the Canadian electorate, perhaps in the early part of 1972, that the new tax proposals were a big deal, affecting a reduction, when in many cases the reduction would not benefit the taxpayer to the extent suggested in the white paper which was recently tabled. As we see this charade taking place, I wonder where the backbenchers on the government side are, the great silent majority-


An hon. Member:: They are in Manitoba. Where are those on your side?


John Stratford Burton: They are going along with these government proposals, content to see nothing, hear nothing and do nothing. They sit across the way and they watch the circus.


An hon. Member:: We are watching it now.


John Stratford Burton: They can loll in their comfortable pews while they may, because I believe they do not have too long to enjoy this farce. The day of reckoning is coming; the Canadian public is becoming increasingly impatient with the proposals of this government.


Mr. Mahoney:: Author?


John Stratford Burton: The hon. member asked me who is the author of this. I am the author-


Donald Stovel Macdonald: That is painfully obvious.

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Income Tax Act


John Stratford Burton: *-except for some remarks of the Minister of Finance which provide the foundation for concluding that this tax should not be proceeded with at the present time.
The bill before us is being introduced in the shadow of the white paper on taxation. Hon. members will notice that I am not using the phrase "tax reform". It is a white paper on taxation, or on tax changes. The government would have us believe that it intends to reach this never-never land of tax reform. Some people may believe it is taking shape in some of the proposals placed before the House this session, but I predict that whatever proposals are put forward they will be worked over by a bulldozer before they become reality, a bulldozer manned by the economically powerful, even though some minor benefits may accrue to the Canadian people. The evidence is in the bill before us; this measure is one further step in perpetuating the present tax system.
The white paper admits that the present tax system is unjust. But instead of the government taking the attitude that it intends to do better in the future, instead of following the injunction "Go, and sin no more", tax reform is put off until some time in the future. It seems to me that if there is indeed a resolve to reform the tax system, the time to begin is now, first by not proceeding with the measure before us and, next, by introducing some of the minor items in the tax proposals which all members agree are to the benefit of the Canadian people. Instead, the approach taken by the government throws doubt upon the whole question of the firmness of its resolve to improve the system or to even hold the line put forward in the half-baked approach of the white paper proposals.
It is obvious that pressure groups have been able to get the ear of the government-* groups which are economically powerful. They got the ear of the government even before the white paper was produced. My prediction is that these proposals will be further butchered before any enactment is placed on the law books of the country. One of my reasons for reaching this conclusion is the approach taken in the bill now before us. Some might consider this measure to provide for the extension of a tax. The fact is that when the government introduced it in the House of Commons about two years ago, it was made clear that it was to apply to 1968 and 1969. Those were the two years in which it was to take effect.

Now the government has decided to apply a 3 per cent surtax in 1970. The bill is really the latest hoary chapter of a sad and tragic story of Liberal fiscal mismanagement and bungling. Like the hon. member for Edmonton West (Mr. Lambert), I took the opportunity to do some research; I read the record in connection with this matter. Some hon. members will recall that on November 30, 1967- before I came into the House-the then minister of finance, now Secretary of State for External Affairs (Mr. Sharp), presented a budget statement in which he said, as reported on page 4906 of Hansard for that date:
[DOT] (8:10 p.m.)
I come now to my tax proposals. My first proposal relates to the personal income tax. I am asking the house to approve a special surtax of 5 per cent on the amount of the basic tax assessed on an individual in excess of $100. This surtax will take effect January 1st and would remain I expect until we have completed the transition to a slower rate of growth of expenditure or until economic and financial conditions call for a change in our fiscal policy.
I suggest that that last statement should be noted. The resolution was introduced in the House of Commons on December 14, 1967. Later, the minister introduced the bill in the House and on February 6, 1968, the measure came up for second reading. The remarks of the Minister of Finance in dealing with this important measure on second reading consisted of six lines. Then something happened that I suggest some members on the other side of the House will recall with a shudder. On February 19, 1968, the government's bill was defeated by a vote of 84 to 82. At that time I was viewing the situation from a vantage point outside this House, not being a member at that time.


Some hon. Members:: Hear, hear.


John Stratford Burton: But I am a member now, and I intend to stay here for some time. On the other hand, I suggest some of the members across the way will not be here very long. From my viewpoint outside the House at that time it seemed to me that the vote was a fairly clear indication of a lack of confidence in the government. Nevertheless, somehow or other the government managed to pull itself together and find a means of ensuring it would stay in office until a Liberal leadership convention was held; one was scheduled within a short time. The government must have had second thoughts on the matter somewhere along the line. I imagine it must
December 11, 1969

have said to itself, "We will have to do slightly better than we did in regard to the measure that was defeated in the House, because it is just possible that following the Liberal leadership convention we will call an election in a hurry".
I suggest that the bill presented on March 7, 1968, was not quite as inequitable or as bad as the original measure proposed by the government. That measure is essentially the one now before us. On March 7, 1968, the then minister of finance made the firm statement that this surtax would apply only to the taxation years 1968 and 1969; that is recorded at page 7394 of the House of Commons Debates. But the government's troubles were not yet over, because a few days later, namely March 11, the bill to which I have referred was declared out of order by Your Honour. Finally, the government had to introduce yet another bill in order to enact its proposals. That bill was presented on March 12, 1968, and the debate was led off by the then prime minister, the Right Hon. L. B. Pearson.
He made quite a lengthy speech. He defended the government's record. He attempted to point out how well the country was doing, but at the same time he indicated that some government agencies had pointed out the necessity for some measures of fiscal restraint and that the government had to watch very carefully the direction in which the economy was moving. At that time the Right Hon. L. B. Pearson quoted as authorities the Bank of Canada and the Economic Council of Canada. I hope hon. members will note that, because I will be coming back to it in a few minutes. Eventually the government got its bill through the House of Commons and it was enacted into law. As a result, the people of Canada have had to pay this surtax for the past two years.
On June 3, 1969, the Minister of Finance presented his budget in the House of Commons, during the course of which he pointed out, in dealing with the state of the economy, that one of the most important highlights detailed in the budget papers was the gathering momentum of activity toward the end of 1968 and the carrying forward of a strong advance into the current year. He pointed out that all elements of demand-consumer expenditure, capital investment, exports and total public spending-have contributed to the acceleration; that real production had turned strongly upward, unemployment was down from the previous year's figure, and so on.
Income Tax Act
The Minister of Finance was trying to make a case for the necessity of enacting measures of fiscal restraint, and he went on to reject any proposal for a tax reduction at that time. He also pointed out that one of the things the government was doing was budgeting for a surplus in the current fiscal year, and that this was to be contrasted with the deficit of some $566 million in the previous fiscal year, 1968-69. Finally, as recorded at page 9417 of Hansard, the Minister of Finance said:
In making this proposal tonight, I am mindful of the implication given last October that these surtaxes would be allowed to terminate as scheduled and that this was a factor in determining the series of tax measures then introduced. It will be clear to everyone, however, that the extension of the surtaxes at this time is required for the purposes of economic stabilization, and not for budgetary revenues.
There we have on the record the reason the Minister of Finance decided to continue this surtax into 1970. When one examines the minister's rationale for continuing the surtax into 1970, it is necessary to look at the situation in our economy today. At this time we see a much different picture from the picture last June. With regard to the gross national product, which is a measure of the performance of the economy, the figures for the third quarter of 1969 show that the rate of growth is slowing down. As pointed out by the Economic Council of Canada, there is not a strong element of demand in many sectors of the economy. In fact, we do not have a demand type of pressure on the economy at the present time. The most recent unemployment figures which are available to members of the House show that for the second month in a row the seasonally adjusted rate of unemployment is more than 5 per cent. I suggest that this figure should be the cause of considerable alarm to the government and to those in positions of responsibility.
With regard to the government's anti-inflation program, I have already stated that I consider it to be a colossal flop. It is clear that the rate of price increases is continuing unabated in spite of the government's policy of fiscal and monetary restraint. The rate of price increases in Canada at the present time is in the order of 4J per cent annually. The Economic Council of Canada has issued a warning, having conducted an analysis of the effect of the government's policies on the performance of the economy. In discussing the problem of inflation and rising prices and the government's policies to deal with them, the Economic Council of Canada, in its Sixth

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Income Tax Act
Annual Review published in September 1969, had this to say at page 163:
[DOT] (8:20 p.m.)
Further fiscal and monetary restraint could conceivably result simply in higher rates of unemployment and economic slack with no more than marginal effects on current rates of increase in prices and costs.
I pointed out just a few minutes ago that the prime minister of Canada in early 1968, in defending the introduction of this tax measure, pointed to the advice that had been given by the Economic Council of Canada. He said the Economic Council of Canada was calling for restraints and for measures to hold down the rate of price increases and to keep runaway inflation from breaking out. Now what is the government doing? It is ignoring the advice given by the Economic Council of Canada. I might point out that this advice was given in September, after the original budget proposals were placed before the House last June. This is the Economic Council's analysis of what should be done now.
At that time the surtax had not been extended to 1970 and the Economic Council was warning the government against taking further steps that would have the effect of imposing a restraint on the economy. Thus we have to look at the impact of the government's proposal on the economy and on the finances of this nation. We are continuing the same old tax system which has been termed unjust and inequitable by the government itself. We know very well that the government's programs, policies and fiscal restraints are not controlling inflationary forces. This measure also means we will have a higher level of unemployment.
We can very well foresee what will happen over the next few months. We will probably have a level of unemployment of 7 per cent to 8 per cent before this winter is over. It seems to me that a large part of the blame for this situation lies at the doorstep of the government. The government must accept responsibility for the situation because in the first place it imposed poor fiscal management. It lacked a policy of priorities in deciding that social capital is required in this country, that the social needs of our people must be given priority over some of the commercial projects into which private industry at the present time places its funds.
We see at the same time that the government is building up a very healthy surplus during this fiscal year. Last June the Minister of Finance predicted that for the current

fiscal year there would be a budgetary surplus of $370 million before making any provision for writing off the deficit of the Expo Corporation. After writing off this deficit he still provided for a surplus of $250 million. He made it quite clear that building up a surplus was part of the government's antiinflation fight.
We have the latest financial statements on a monthly basis, as published in the Canada Gazette. I note that for September, 1969, the government's budgetary surplus was $41.6 million, compared with a deficit of $54.2 million for the same month in 1968. We have the more recent figures for October, 1969. In that month the government's budgetary surplus was $38 milion. This compares with a deficit of $56 million for October of the last fiscal year. In total, from April 1, 1969, to the end of October, 1969 the government's budgetary surplus is $848.6 million. This compares with a deficit of $117.4 million for the same period in the fiscal year 1968-69. It is over and above what the government was budgeting for at the beginning of this fiscal year.
I recognize that there will be a rundown in this surplus during the balance of the fiscal year, because this is the general pattern with regard to government revenues and expenditures. I think it is now quite clear from the record that the government will be able to get the surplus it was budgeting for without proceeding with this tax measure at this time. I suggest that the surplus it will achieve without imposing this tax is such that it will have as much influence on fiscal restraints as it could possibly have in dealing with the economic problems of this nation.
I suggest now is the time to loosen some of these restraints in order that we do not have the spectre of unemployment hanging over the heads of many thousands of people during this winter. The government's policy for fighting inflation has to be termed a fraud and a total failure because we have growing unemployment, we have government cutbacks in essential services, civil servants are being fired and there are restraints on pensioners and on incomes for people in the lower-income brackets.
I suggest that the government is the prisoner of its own incapacity to manage the economic affairs of this nation. The government still expresses concern about inflation and inflationary psychology, but I suggest it is unwilling to tackle the corporations and is unwilling to even investigate their activities. This fact was made clear by the Minister of
December 11, 1969

Consumer and Corporate Affairs (Mr. Bas-ford) when last week he indicated that he was not prepared to investigate steel prices, nickel prices, copper and lead price increases, and so on.
The inflationary psychology exists in large part because of the confidence that corporations have that the government will really not do anything to thwart their plans or actions. On the other hand, it is due to a lack of confidence on the part of a large portion of the Canadian public that the government is not willing or is not capable of doing anything to control the situation. In particular, it will do nothing to control the activities of corporations operating in the private sector.
Many warnings have been issued on this question and they have been summed up by the term "economic overkill". That is a rather unfortunate term in many ways, but it seems to me it adequately covers the thought in mind. Warnings were issued by the Economic Council of Canada. It is interesting to note that there was a very sharp reaction by many government officials when it became known that the Economic Council was going to criticize the government for some of its policies for fiscal restraint. It would appear that the only support the government is getting publicly at this time is from its own advisers. It seems to me there is something of an attitude of going down with the ship. We are going to stick by the policies whether they are good or bad. I cannot see that anybody else in the country is supporting the government's stand, unless there are people behind the scenes who are in fact attempting to ensure that there is no real change in the status quo of our economy or in the control that is exerted over the private sector of the economy.
Many warnings have also been given by the Canadian Labour Congress, by university officials and various newspapers including the Toronto Star and the Financial Times. There is evidence that the deferred capital cost allowance system which the government introduced last spring is not working to the extent the government hoped it would work. It is certainly not doing the job that was claimed for it when the policy was introduced.
Thus, it seems to me that the government is ignoring many useful proposals that have been put forward to change our exchange rate structure and to curb private spending; in other words, to impose the controls necessary in respect of the capital investment plans of private companies and to change our
Income Tax Act
approach in respect of interest rates. The only response we get from the government when these proposals are put forward is: We are willing to study any proposals, any ideas that hon. members or members of the public are willing to put forward. However, as soon as ideas or proposals are put forward, they are rejected. This was certainly the case when the Minister of Finance appeared before the committee on Finance, Trade and Economic Affairs. He simply indicated that the government is not considering making any changes. At the same time he said it is willing to listen to any proposals in respect of changes.
[DOT] (8:30 p.m.)
I suggest the government is ignoring the problems of many people who are being hurt as a result of its financial and economic policies. I suggest that people living on fixed incomes are being hurt more severely than those of any other group. I suggest, also, that farmers, wage earners and many others in the economy are being hurt because of the government's blind adherence to its economic policy and because of its failure to come to grips with modern day reality in dealing with our economic system and structure. As a result, and because the government ignores all warnings and advice given to it, I shall certainly support the amendment moved this afternoon to give this bill a six months' hoist.


Mr. Cliff Downey (Battle River):: Mr. Speaker, with reference to Bill C-139 I can do no better than reiterate the sentiments and comments of preceding speakers. When this bill was introduced it was supposedly an emergency measure. It has been said that the emergency is long past, but this is not evident to us. In this bill we are asked to accept the inevitability of increased taxation. What were supposedly emergency taxes yesterday have apparently become the norm today. One might say this has been our situation in a never ending sequence since about the end of World War I.
Perhaps a great many people accept the words of Oliver Wendell Holmes when he said paying taxes did not bother him because they were the way he helped pay for civilization. I feel compelled to remind the minister, however, that a great deal of evidence is being amassed daily on this continent which indicates that money does not buy civilization, and that increased taxation and government spending does not assure the average citizen of an increased degree of dignity or, I might add, personal safety. In fact, the more

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governments spend, the more they attempt to control the lives and businesses of our citizens and the more our citizens absolve themselves of any responsibility either to themselves or to their neighbours. Therefore, we have the riots and disturbances that have plagued so many communities on this continent.
The bill now before us is an insignificant looking, two-page document but the multitude of principles therein were sufficient to defeat a government in February of 1968. The principles have not changed; they are the same today. The Minister of Finance (Mr. Benson) tells us that taxes such as this surtax will help control inflation. I say that they also represent a built-in business cost; they are passed on to the consumer and therefore contribute to inflation.
In the past year we have heard a good deal about inflation. A committee has been holding hearings on the problems of inflation. Many words have been spoken on the subject. But a simple measure such as a mandatory down payment on consumer goods would probably do more to control inflation than any measure which has yet been introduced. We are told, of course, of the ever-increasing financial demands on governments. I am sure we all acknowledge this to be true. People always want more and more services and goods. However, in a healthy economy revenues increase every year through the natural increase in the gross national product.
What we need in this country rather than taxes, taxes and more taxes is greater control and priority in respect of government spending. When I speak of priorities I do not have in mind the priorities followed by this government. I mention as an example the Department of the Secretary of State. The hon. member for Calgary North (Mr. Woolliams) pointed out just a week or so ago that in 1963 the expenditures of this department were between $4 million and $5 million. In 1969 so far they are over $340 million.
I would refer to the Bonaventure as another example. In this case $14 million was spent on a project that was destined for the scrap-heap. It is not very evident that these ministers are trying to get the most out of the tax dollars. We on this side of the House sometimes wonder if they are not just trying to build empires of their own. I can think of no better example than the Department of Consumer and Corporate Affairs. Here I feel we have a monster that is growing on the premise that what one is doing is not important,

but what one appears to be doing. I think that fits the situation very well. Here we have a new department, rolled out of nowhere, which has for this year projected costs of about $16 million.
The minister of that department has intentionally said things which have the effect of cutting down our gross national product and make increased taxes inevitable. I refer to the statement he made earlier in the year when he told the consumers of this country to boycott beef. He could just as well have told them to boycott the textile industry or the manufacturers of electronic products. He could have told them to boycott many products and we would have had the same result *-a consumer reaction.
I often wonder what the minister would have us do. Would he have us import Australian beef or Japanese textiles? His remark was certainly not calculated to improve the economy of this country. The Prime Minister (Mr. Trudeau) suggested we impose cut-backs as an economy measure. This is a very admirable move, but when I look at the record I see that just a year or so ago the government said we would have to try and hold to 5,000 a year any increase in the number of public servants. At that time it appeared that a normal increase in the public service was of the order of 15,000 a year. So when the Prime Minister speaks of a 10,000-man cut-back, it would appear to be really nothing when we consider the government's norm, which was of the order of 15,000 more persons on the payroll each year. If we are merely to accept these taxes and these situations, we will eventually be nothing but a nation of serfs. The United States now has a similar surtax bill before Congress and they are in the process of rejecting it; yet we in the House are asked to pass this bill.
[DOT] (8:40 p.m.)
This tax has been called inequitable because it discriminates against the lower-income groups. But I say-and I will not belabour the point any further-that to continue this tax or to further increase taxes in this country would create an impossible situation with which we could not live.


Lloyd Roseville Crouse: Mr. Speaker, it is not my intention to speak at any great length on this measure, but there are certain aspects of this bill on which I would like to comment. A measure to amend the Income Tax Act was introduced into the House and given first reading on March 7,
December 11, 1969

1968.	It raised a storm at that time because of the manner in which it was introduced and because of the new taxes it imposed on individuals and corporations. As hon. members will recall, this effort was really the second bite at the same cherry, only from a different angle. The first bite was taken with Bill C-193. Of course, on that measure the Liberal government was defeated on the night of February 19, 1968, and in all conscience the government should then have resigned.


Some hon. Members:: Oh, oh.


Lloyd Roseville Crouse: I hear some members saying oh, oh. If a government does not resign when it is defeated on a tax measure, I ask on what measure it would resign? What does a government use as its guiding light in this respect? The Canadian people learned at that time that conscience among Liberals is a commodity which they are sadly lacking. So we went through a period of Liberal dogged determination to hold on to office at all cost while the government made its excuses to the Canadian people and regrouped its forces.
The purpose of the bill we are now discussing is to extend for one year the temporary surtaxes imposed in 1968 under Part IA of the Income Tax Act. The explanatory note reads:
The surtax on an individual is 3 per cent of his "basic tax" in excess of $200. It will be extended to apply to the 1970 taxation year.
The surtax on a corporation is 3 per cent of its tax computed under section 39 or 69 of the Income Tax Act. It will be extended to apply to profits earned in 1970.
In view of the proposals in the amendment before us, it is well to look at the statement the then minister of finance made on this measure when it was first introduced on March 7, 1968, as recorded at page 7394 of Hansard. The then minister of finance said as follows:
Paragraph 2 proposes that a surtax of 3 per cent be imposed on corporations for the years 1968 and
1969.	The effect of this surtax will be to raise the rate of tax on the first $35,000 of corporate taxable income from 18 per cent to 18.54 per cent and to raise the rate of tax on taxable income in excess of $35,000 from 47 per cent to 48.41 per cent. The surtax will not affect the old age security tax on corporations and it will not affect the provincial abatement or the provincial revenues from corporations.
Paragraph 3 proposes that a surtax of 3 per cent be imposed on individuals. This surtax will apply to basic tax in excess of $200. It will not affect approximately 2,400,000 taxpayers, which is about 36 per cent of the total number expected to pay individual income tax in 1968. The proposed
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surtax will apply without any top limit. Finally, this surtax will apply only for the taxation years 1968 and 1969.
Paragraph 4 of the resolution proposes that corporations be required to move forward by two months the period during which they pay their income tax for a year. Corporations will be required to make five payments, each of which is equal to one fifth of their estimated tax. For example, a corporation with a taxation year which coincides with the calendar year will make its first payment for 1968 in June and will make a payment equal to one fifth of its estimated tax for 1968.
Mr. Speaker, I wish to refer the House especially to the statement made by the then minister of finance that "this surtax will apply only for the taxation years 1968 and 1969". However, we now learn that the government proposes to extend it to 1970. I ask: How can individuals, corporations or Canadian industry plan for the future when they are constantly faced with increased taxation by this government?
Is it any wonder that this cabinet is no longer credible in the eyes of Canadians? When a cabinet minister stands in his place and states without any equivocation, without any "ifs", "ands" or "buts" that surtaxes will apply only to the taxation years 1968 and 1969, and the same Liberal government, a little more than a year and a half later has the gall to say that the temporary surtaxes will be extended for another year, I ask you, sir, who in this nation will believe the minister or the government? The answer is no one. The truth of the matter is that these surtaxes will never be repealed.
The answer is contained in white paper proposals, and it is high time Canadians were told the truth about this government's plans. The white paper highlights the true story, if we read the fine print closely. For example, the following is one of the white paper highlights was presented to us by the Minister of Finance (Mr. Benson). Among other things he said this:
The present general schedule of rates, the old age security tax, the social development tax, the 1966 abatement, the 3 per cent surtax and the general 28 per cent provincial abatement would all be replaced by a new rate schedule.
The bill now before us is, in good Maritimes' language, nothing more than a gangplank bill. It is a bill to take this government over the gulf between 1968-69 and 1971 when the white paper proposals will take over and perpetuate the surtaxes forever. That is what we have before us. To use the word "temporary" as stated in this bill exposes the arrogance and the indifference of

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this government to the needs and aspirations of all Canadians.
In view of the minister's statement of March 7, 1968, the average citizen and the corporations affected had every right to expect that these surtaxes would be dropped at the end of the taxation year 1969-70, and they planned accordingly. But now they find the Minister of Finance still has his hand deep in their pockets, grubbing, grasping and groping for every last dollar in order to finance the extravagant expenditures of this government. In case there is any doubt about this-and some hon. members may not read Hansard as closely as they should-only last Tuesday we passed the supplementary estimates.
[DOT] (8:50 p.m.)
We were told then, when we voted $91,206,528, that they were supplementary estimates. Among other things, they showed there was for only one year an increase of approximately $350,000 in the cost of operating the Prime Minister's office. We were also concerned to discover the sum of $1,226,000 representing extra expenditures on Senate committees as compared with their cost last year. Has anyone on the other side of the House the audacity to stand up and say the government is not wasting the taxpayers' money in an extravagant fashion? There is no one.
Our thirty-bucks minister, the Minister of Finance (Mr. Benson), speaking on the white paper during curtain calls on his western road show stated, "If a tax system does not command the public respect, it will not work." Obviously the government has not the respect of Canadians generally, because its anti-infiationary policies are apparently ineffective.
In the last election a strange thing happened in my riding-


An hon. Member:: It sure did.


Lloyd Roseville Crouse: Yes, I was re-elected. I do not like to be vindictive to my friends, some of whom sit on that side of the House, but what I meant, Mr. Speaker, was that the Liberals ran advertisements in the weeklies in my riding saying, "Don't call us Liberals; call us Grits." Many of my supporters-and the tally is there to show how many there were-came to me and asked, "what does it mean, Lloyd?" Of course, Mr. Speaker, I have difficulty at the best of times explaining what Liberals mean, but I know now what they mean. I know that the word "Liberal" means to be

deceitful and I know it means deception, because Canadians cannot believe the Grits even when their words are printed in black and white in Hansard.
The government having betrayed the trust of Canadians by not keeping its word on this tax measure, is it any wonder that there are hardly any signs of restraint in the upward rise of wages and prices? Only a few weeks ago the Steel Company of Canada, following a 30 per cent wage increase over a three-year period, announced a 6 per cent increase in the price of their product. This was followed within a week by an increase of almost 25 per cent in the price of nickel, and it was followed by still further increases. We read in the Financial Times that the domestic price of copper is at a record high of 57 cents a pound-up 27 per cent since January. We also read:
Tin, the hardening agent in bronze, is also in tight supply. At $2.05 a pound, the price is the highest since 1965-
Cadmium, a by-product of zinc used largely in electro-plating, posted its fourth increase this year, reaching a record at $4 (U.S.) a pound.
These metals are used in the manufacture of many products in Canada and their price increases are reflected, in turn, in the increased price of products manufactured from them. This is what is happening in Canada. The much vaunted Prices and Incomes Commission seems powerless to do anything in the face of this rising tide of wages and prices. Perhaps the real reason the Prices and Incomes Commission cannot do anything to turn back the tide of inflation is the fact that the tide was running with irresistible force long before the Commission was appointed. That inflationary tide can only be further strengthened by a bill of this type, for this bill continues to take money away from the private sector, where it would be spent in developing our material resources, and diverts it to the public sector where it will be wasted by government extravagance.
This reaction is evident when we look at the national unemployment figures for October, which show 5.3 per cent of our labour force searching for work. Mr. Speaker, I would like to know how high the national unemployment figure must climb before the Prime Minister and his colleagues shout, "Eureka! We have reached Utopia." What is the figure? Is it 7 per cent? Is it 8 per cent? Is it 10 per cent? It would be interesting to know what it is.
The government's plans as evidenced in this bill call for still higher taxes. This will
December 11, 1969



mean still higher prices, which will cause still more unemployment. Since the beginning of this year the cost of housing alone is up 7 per cent. Investment charges have pushed the cost of non-residential construction up 7.3 per cent. The prices of machinery and equipment are up over 3 per cent, while over-all prices in our economy rose 3J per cent in the first nine months of 1969.
I could quote many other statistics to indicate the rising-cost trend in Canada, but the figures I have quoted are sufficient to show that the Canadian people have no faith in the government. The Canadian people do not believe anything will be done to curb inflation, and therefore they are still trying to acquire homes, furnishings and properties before costs escalate still higher. We can go back as far back as 1965, Mr. Speaker, and we find that the government at that time was talking about the dangers of inflation. It was referred to in the budget of 1966, in the minibudget of September, 1966, in the budget of June, 1967, in the mini-budget of 1967, and in the budget of March, 1968. On all these occasions we were warned of the dangers of inflation, and the government had apparently only one remedy to propose, namely, an increase in taxes.
These successive tax increases have been presented as anti-inflationary and no doubt they would have been if the money had been used to build up a government surplus so that the government could stay out of the bond market. Instead, these successive tax increases have been more than matched by increases in government spending, which have added to our inflationary spiral. We ask the government, "What do you plan to do with all the money you are taking away from Canadians? When are you going to inform this House, and Canadians generally, about your spending priorities?"
I believe that if the government really wants to reverse the trend it must first establish its own credibility. This it has not done, Mr. Speaker. It must stop introducing bills of this nature, which violate its word to the Canadian people. It must also strengthen the arm of the Prices and Incomes Commission. At present the Commission is like a punch-drunk fighter, swinging in all directions, but whose punches lack force. The type of diplomacy practised by the Commission so far has been nothing but a waste of time and effort. The Commission is nothing but window-dressing. It is the laughing stock of unions and management alike. Only when the
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man in the street is made aware that the government means business in its attempt to fight inflation, and only then, will we make any real progress.
The Prices and Incomes Commission is a child of the government. As a first step the child should take the parent aside and point out the economic facts of life, so that bills of this nature would not be brought before Parliament. The Commission should point out to the government the need for keeping its taxes, tax increases and spending growth to a minimum for the next two years, or at least until inflation is under control. In the public sector one of the problems faced by the Commission is that the people with whom it discusses inflation are not threatened directly by tough federal, fiscal or monetary policies. In fact, the government has what I would call a cream-puff policy toward inflation.
The government's present taxation policies cause the burden of unemployment to fall mainly on the low-income group. They are the ones who today are being asked to carry the heaviest load. Executives, civil servants, doctors, lawyers, and even labour leaders are in a strong position to keep their incomes ahead of inflation. None of the people in these classes is likely to be thrown out of work by what economists predict will be a more severe recession in 1970 than that which we are facing in 1969.
[DOT] (9:00 p.m.)
The Prices and Incomes Commission is therefore arguing its case for urgency that inflation be cured to a group that is still unconvinced that the problems of inflation and the consequences of announced government restraint are vital and urgent. One of the things we do not need is another study of inflation in order to advise the government how it can avoid another wage-price spiral in our economy. Surely the facts behind mounting inflation are now well known to the government and its supporters. What is now called for by the majority of Canadians is leadership and action and an indication of real economies in government operations. Anyone can increase taxes, and that is what the bill before us proposes to do. That is what it is, Mr. Speaker-an increase in taxes.


Some hon. Members:: Hear, hear.


Lloyd Roseville Crouse: The Canadian people expected this load to be taken off their backs. They were foolish enough to believe the then minister of finance when he stated this surtax

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would apply only for the years 1969 and 1970. I say, Mr. Speaker, they are an increase in taxes.
When speaking on this matter on March 7, 1968, the then minister of finance, Mr. Sharp, said: ".. .the measures proposed in this resolution are intended to produce $390 million in budgetary revenues in the 1968-69 fiscal year." Yet today when this measure was introduced to the House by the hon. member for Windsor West (Mr. Gray), he almost implied that we should pass it quickly-let's get this over in a hurry; it is only a small matter! From the wording of the bill one might suppose it is quite innocuous, that it does not have any great effect on Canada, but we cannot ignore any measure which proposes to take $390 million out of the Canadian economy and divert it to the government sector. The application of these taxes to the over-all development of Canada demonstrates, in the final analysis, the administrative ability of a government. In my opinion, Mr. Speaker, the extension of these surtaxes for another year is a frank admission that this government is giving weak and ineffective leadership in its efforts to curb inflation.


Some hon. Members:: Hear, hear.


Lloyd Roseville Crouse: We can only hope that the men who occupy the treasury benches will read the Financial Post and the Financial Times and learn what is going on in Canada. We have regional desks and I do not know what they are doing, but obviously there is a great space between the grass and the brass because they are not aware of what is happening in this country. We hope they will have such a realization very shortly and will bring in policies that will not create stagnation in our economy but will instead bring over-all growth and development to Canada. It is time this government showed its concern for stability in our economy; it is time this government showed some concern for increasing employment, not unemployment, in our labour force. By that I do not mean, Mr. Speaker, advertisements of the type I saw in the press this week extolling the benefits of being unemployed. That is not the kind of advertisement that built this country, and it is not what we want to see in our press, publicizing the inability of this government and its desire to bring in policies to keep people out of work, emphasizing the benefits of the dole.


Some hon. Members:: Shame!


Lloyd Roseville Crouse: Only when we bring back stability and growth to this economy, only when these prime objectives are achieved, can the government hope to attain some of its socialistic dreams. This will not be achieved, Mr. Speaker, by saying one thing and doing another, which was done by a former minister of finance, as reported in Hansard. It will not be achieved by making false promises to the people of Canada in an effort to buy time to use as a cover-up for inaction regarding the basic problems facing Canadians.
Inflation is the major problem today. The stability of our economy and the reduction of regional disparities should be the government's major goal. The puck is on the government side, and rather than watch some fancy stickhandling over there by individual players, let us see a team effort to solve our problems. Team effort, Mr. Speaker, is in the final analysis the only effort with any chance of success. For these reasons I am happy to second the motion moved by the hon. member for Edmonton West (Mr. Lambert).


Mr. J. A. Mongrain (Trois-Rivieres):: Mr. Speaker, with your permission, I will infringe for only a second the rules of the house, because of the outright provocation directed to me by the opposition by referring to Three Rivers.
This is not a matter of narrow-mindedness nor of out and out nationalism; it is that there is no such city as Three Rivers. In fact, we still have the English version of the incorporation act of the city of Trois-Rivieres, where it is actually called Trois-Rivieres.
By the way, I urge all members from other provinces to name cities having incorporation acts written in both languages, dating back to more than a hundred years, as in the case of Trois-Rivieres.
For instance, there is in Manitoba a city called Souris and nobody ever thought of translating that into Mouse. The Speaker's name is Lamoureux, yet I never call him Lover.
I have a few words to add concerning Bill C-139, for it would be unthinkable to leave Hansard readers under the impression that the wave of curses that has just unfurled on the party in power is justified. There are, after all, obvious principles, even for the opposition members, but they are not in a position to say so, because it would not be cricket.
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Everybody understands that it is not pleasant to maintain a tax, no more than to pay it. Everybody understands that it is not pleasant for anyone to undergo a painful operation or to deprive oneself of things one is most anxious to have, because one cannot afford them. But that is a part of the sacrifices people and individuals must bear to avoid a greater evil.
[DOT] (9:10 p.m.)
What does history teach us? A while ago, an hon. member quoted the memorable remark of the then minister of finance: "This 3 per cent surtax will apply only for the taxation years 1968 and 1969". Of course, he was speaking in good faith, according to information provided him by experts.
For instance, no opposition member can forecast next year's weather on this same date. One cannot guarantee what the economic climate will be in Canada or elsewhere a year from now, taking into account the crisis we are going through presently. Hon. members of the opposition know that Canada is now experiencing the same difficulties as almost all the industrialized countries of the West.
We have only to remember what happened in England and in France, and the situation there was infinitely more serious than it is in Canada. It even led to the overthrow of a giant in France. We can also see today what is happening in Italy. I will not speak of less fortunate countries which have been facing economic hardships for centuries.
It is an international phenomenon, but fortunately the government has taken up the challenge and prevented greater harm. It has even been able to find solutions.
I remember the vote we took in early March of 1968. I was sitting at the other end of the House. I was sitting as an independent for personal reasons which the electors of my constituency understood. However, they warned me: we do not elect you as an independent to systematically fight the government. We elect you to support the government when it is right and to make representations to it when it is wrong. When the vote was taken on the 3 per cent tax increase I had decided to vote against it. I had even advised my fellow-citizens that I would vote against it.
But a few days before the vote was taken, an international crisis arose on which my hon. friends are aware. I am not as learned as the universal experts we have heard tonight, and
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I am not a quack that tries to impose panaceas. When I do not have sufficient knowledge about a subject, I consult the experts. Well then, I consulted some Canadian and American financiers who told me: "We are going through a crisis so severe that if the government does not take strong measures, the Canadian and the American dollar might be devalued."
That is when we proceeded with a major operation. Therefore, I explained to my fellow-citizens why I had changed my mind. Anyhow, only imbeciles do not change their minds.
Why did I change my mind then? Because it was in the best interest of the Canadian nation. I take this opportunity to pay a tribute to the Leader of the Official Opposition (Mr. Stanfield); indeed, one day, he could have defeated the government. He had only to say so and the Liberal government would have been defeated. But he refused, in spite of the advice of some members of his party, to contribute to the defeat of the government, because he remembered that Lincoln had said: It is not best to swap horses while crossing the river. One does not rock the boat in the midst of a storm.
When the well-being of a nation is concerned, all political considerations should be put aside to support the government which is in fact that of our country. That is what the Leader of the Opposition did last year, disregarding the advice of some of his own members, and I have admired him a little more on that account.
As for myself, I have supported the governmental policy, because it has stood the test of time. To prove my point, I shall not bring forward my own testimony, but rather quote from a summary of the Sixth Annual Review of the Economic Council of Canada, "Perspective 1975", published in September 1969. I admit that the austerity policy of the government has been painful. It required some sacrifices, but the Canadian people understood. My electors understood so well that after giving me a majority of 2000 votes in 1965, they gave me one of about 7000 in the 1968 election.
On page 27 of this summary, we can read the following:
Up to the mid-1970's, Canada's rate of growth should keep going up sharply and even exceed in that respect the performance of most Industrialized nations.

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And 1 do emphasize these words:
-exceed ... the performance of most industrialized nations. Under such conditions, the welfare of the Canadian people will be greatly increased.
In the Review of the Economic Council of Canada, the authors do not deal in partisan politics but rather analyze carefully the situation prevailing in September 1969, as a result of the measures taken in the string of 1968.
A little further on, we can read on page 29 of the report, and I quote:
The success of the proposed measures, especially in the case of monetary policy, will depend upon the implementation of comparable measures in the United States.
I should now like to remind opposition members that it took over a year and a half to agree to that surtax, then a 10 per cent increase was imposed and it is that supplement we are still discussing now. In fact, it was the opinion of most of American economists then that the United States had missed the boat because they had passed this measure at least a year too late.
The quotation goes on:
It seems that, while moving away from the previous policy which was mainly geared to the short term cyclical fluctuations, this country is heading more and more towards longer term programs similar to those which we have been advocating for Canada.
This being so, our country will be prompted and encouraged to adopt similar measures.
And a little further, Mr. Speaker, we can read the following, and I quote:
For the fifth consecutive year, the public accounts established on the basis of the national accounts and including all sectors of government (including the revenue derived from the pension plans), show a surplus in 1968. We must note that for that year, this surplus was achieved at a time when the economy was slowing down a little while the unemployment rate was getting near 5 per cent. Had there been full employment, this surplus would have been sensibly more important. From 1969 on, austerity measures far more severe than in the United States were introduced in the budgetary policy, as shown by our analysis of the national accounts. It will be necessary to watch closely the opportunity of maintaining those restraints applied by the Canadian government at all levels.
Indeed, the organization responsible for this document says that of course, the government has taken very hard measures of restraint, the results of which will be better assessed within a couple of years. Besides, this is what the report says on page 30-as a matter of fact, it is the quotation the members of the opposition brought up on several occasions, but

without mentioning where it came from-and I quote:
-further fiscal and monetary restraint could conceivably result simply in higher rates of unemployment and economic slack with no more than marginal effects on current rates of increase in prices and costs.
That is merely an assumption, but when one is about to drown, one grabs the first branch available. Doing nothing does not help. Further on, we can read, and I quote:
Moreover, tight restraint in Canada this year is likely to have its main impact on the economy next year.
We shall see next year. When I hear members of the opposition criticize everything, I think we simply must do something. They are asking the government to engage in expenditures and investments that would reach several billion dollars but they have no practical answer to suggest.
The Creditiste member, at least, suggest a solution in which they believe since they have been upholding it for years, in the face of those who term it illusive.
I give them credit for that: they at least have a solution to suggest while most other members of the opposition are content with fighting against the government without proposing concrete solutions.
We are not playing at demagoguery, even though it would be easy to do so when there is unrest throughout the world and even in Canada. It is easy to play the demagogue, to set those who are the least informed in public affairs against the government, by claiming that the government in power it to blame for the unrest in the nation, as it has been done in other countries, without however solving any problem.
I heard the member for Edmonton West (Mr. Lambert) say: If things keep up this way, we will have a $12 billion budget this year. So what? The federal government gave more than ever to the provinces this year; the population has increased, as well as the needs and the cost of the social services. Had the government not imposed an austerity program, what would then be the situation! The government is blamed for being strict in its management of public funds and at the same time, it is blamed for curtailing expenses. Such is the logic of the members of the opposition. For instance, the government is taken to task for its failure to maintain certain positions which are not essential and, finally, for cutting down the number of some others.
December 11, 1969

[DOT] (9:20 p.m.)
The Prime Minister (Mr. Trudeau) is even blamed for having some thirty assistants at his disposal. But with his assistants, he works indeed. He has done more in one year than the opposition during all the time it was in office. It is constructive work and not necessarily party-oriented.
The hon. member for Edmonton West said that the public debt was increasing at an alarming rate. Federal and provincial governments, municipalities and school boards receive 45 cents out of every taxpayer dollar. He did not say however how much money found its way back into the taxpayers' pocket under the form of hospital insurance scheme, unemployment insurance benefits, old age pensions, pensions for disabled people, family allowances, and so on, and also under the form of assistance to universities and for the construction of hospitals and schools. You get nothing for nothing. In my opinion, the opposition could not make any miracle. If it wanted to meet the needs of the whole Canadian population, it would have to find the money where it is. Since it is not economical to manufacture synthetic gold, one must get it where it is.
I agree with some opposition members who feel that we should find ways to lighten the buren of the less fortunate taxpayers and to improve the lot of the unemployed. The members opposite will at least recognize that something new has been done: the designated areas have been delineated in a much more logical way than before. The granting of additional subsidies of more than $300 million has been approved to help the areas most affected by unemployment.
In my view, this measure is much more serious and its purpose is to eliminate poverty. It is much more efficient than the dreams and the lucubrations of certain quacks who pretend to solve everything here by condemning the government and laying at its door all the ills of mankind.
The situation is a difficult one, indeed. This government had the courage to enforce hard measures just before the elections and the Canadian people understood, as shown by the number of government members who were elected. We will complete the task. In spite of the lamentations of the Opposition members we will not stop until we have brought some stability to our economy, which will be achieved within a year, if I go by the quotation I read earlier.
Income Tax Act
I wish to ask the Opposition members to forget for a moment that we are poli.icians and that we may have different opinions on election matters. Let us remember, however, some fundamentals. We are first of all heads of families, responsible Canadians who want this country to survive, in the best way possible, even if, like individuals, it sometimes knows economic or other crises. When the economic climate is not the most favourable, it is not the right moment to say, as to a patient on the eve of an operation: I have seen many who have died of this. That would be encouraging! On the contrary, we must work hand in hand and tell the patient to cheer him up: Take courage and follow the doctor's advice even if it hurts. You will make it. This is what the people must be told, instead of being served a lot of baloney. They must be told to make sacrifices, because they have to in the circumstances.
We are going through a crisis, but we are weathering it better than any other country in the world. We are about to solve our economic problems. And we shall settle them before any other country in the world. All Canadians of good faith will agree on that. We shall discuss details when the crisis is over.


David Réal Caouette: Mr. Speaker, the bill now before us is called:
"an act to amend an act to amend the Income Tax Act."
Although the scope of the amendment is quite broad, it can be summed up quite briefly, and I quote:
The purpose of this bill is to extend for one year the temporary surtaxes imposed in 1968 under Part IA of the Income Tax Act.
The surtax on an individual is 3%-
The surtax on a corporation is 3% of its tax computed under section 39 or 69 of the Income Tax Act.
Mr. Speaker, this act was adopted initially in 1968, and if my memory does not fail me, this bill was the occasion of the government's defeat by a vote taken here in the House, while we had agreed to support the government if the famous 5 per cent tax, in the form proposed, was not brought again before the House.
Now, after the distinct promises of the Minister of Justice, the Minister of Manpower and Immigration and the Minister of National Revenue, the notorious bill levying an additional tax of 5 per cent was not introduced. However, immediately after the election, the government proposed a temporary surtax of 3

December 11, 1S69
Income Tax Act
per cent. We fought it then, and we will continue to fight any tax increases.
We, of the Ralliement creditiste, are accused of always talking about money, and of always repeating the same thing. But if we consider the contents of Bill C-139, we can say the same of the government, because this bill is the exact replica of a bill introduced last year and the preceding year.
We are asked to approve the extension of the temporary surtax of 3 per cent for one more year.
Mr. Speaker, at a time when prices are going up, when the government itself complains about inflation, it offers as a solution something which amounts to a reduction in purchasing power. How can we restore the economic balance and ensure markets for Canadian products while taking away from Canadians part of their purchasing power and at the same time telling them that it is indeed to fight inflation?
A moment ago I heard the member for Trois-Rivieres (Mr. Mongrain) say: I was against the temporary surtax when I was sitting as an independent, but I changed my mind because I consider that the 3 per cent surtax is a good thing. And to prove that it is a good thing, he added that he was elected with a majority of 2,000 as an independent, whereas he had a majority of 7,000 as a Liberal.
At this stage, I would like-


Joseph-Alfred Mongrain: Mr. Speaker, I rise on a question of privilege.


The Acting Speaker (Mr. Bechard):: The
hon. member for Trois-Rivieres rises on a question of privilege.


Joseph-Alfred Mongrain: My hon. friend generally is very clever and sharp of hearing, but I must point out to him that I have never said that the 3 per cent tax was a boon. I said rather that it was a necessary evil. There is a slight difference.


David Réal Caouette: A necessary evil is a boon, whether we like it or not.
If the member for Trois-Rivieres enjoyed a majority of 7,000 votes at the last election, it is not due to the 3 per cent temporary surtax and probably not to the Liberal party's platform either.
[DOT] (9:30 p.m.)
Although I do not endorse the political ideas of the hon. member for Trois-Rivieres

(Mr. Mongrain), I admit that his personality probably helped him getting elected in his area and not the popularity of the 3 per cent surtax. I challenge him to convince his constituents that such a surtax is a necessary evil.
The workers at the Trois-Rivieres plants in the hon. member's constituency are certainly opposed to this 3 per cent surtax and he knows that they need their whole income, that they already have too little. At the very moment when the hon. member is stating that this surtax is a necessary evil, his own constituents have to borrow from finance companies, to pledge their future wages in order to buy goods that were produced last year or will be produced this year.
And after having mortgaged their salaries for the next three or five years, these same workers look at the shelves of all the stores in Trois-Rivieres and find that they are filled more than ever before, even more than before they borrowed money from finance companies.
Is it a necessary evil or a solution to inflation to compel people to pay 15 or 18 p. 100 interest on loans from finance companies? And the hon. member for Trois-Rivieres will contend that the government is stabilizing the Canadian economy?
The government is stealing from the Canadian people. That is what it is doing.


Joseph-Alfred Mongrain: Mr. Speaker, will the member for Temiscamingue (Mr. Caouette) permit me a very short question?


David Réal Caouette: Certainly, Mr. Speaker.


The Acting Speaker (Mr. Bechard):: The
hon. member for Trois-Rivieres wishes to ask a question.


Joseph-Alfred Mongrain: Mr. Speaker, I would just like to ask the hon. member for Temiscamingue if in his business a finance company does not finance the cars he sells.


David Réal Caouette: Of course, but that is not my fault but rather the fault of people like the hon. member for Trois-Rivieres, if we are compelled to impose taxes and to demand high interests to our clients, because we have to live in this system.
Personally, I am not out of this system, I am inside it. But, at least, I have the courage and the spirit to want to get out of it, while the hon. member for Trois-Rivieres wants to
December 11, 1969

maintain the people in this damnable stagnation that now prevails in Canada. That is the difference between the two of us.
Mr. Speaker, I did not introduce this system, and neither do I tolerate nor promote it. But the member for Trois-Rivieres is among those who are responsible for the present system and I want the constituents of his riding to know it once for all.
Mention was made earlier of the report of the Economic Council of Canada which said that it might be necessary to consider seriously the Canadian monetary question. It is no longer possible to govern under the present financial system.
I just read yesterday in a Montreal newspaper that all the municipalities of the city of Montreal show at present a deficit of $6,225,000. The municipalities have to pay or to contribute, to the debt service only, 60 per cent of the municipal budget.
And we would consider as adequate a system which obliges us to levy 3 per cent surtax-which is called "a necessary evil" in order again to drain the taxpayers of their income and the Canadian consumers of their purchasing power.
We are told: Let us try it for one year and we shall see what happens. What were the results of this tax approved by parliament last year? Inflation is worse today than it was a year ago. Restrictions were imposed on municipalities, school boards and provinces.
A federal-provincial conference on the constitutionality and distribution of the tax base in Canada has just ended.
They quarrelled about taxation rights. One by one, the provinces told the federal government: We have had enough of Canada's taxation power. The federal government answered: We need it, we shall levy taxes and then we shall distribute this money to the people.
Mr. Speaker, that has always been done in Canada, there has been taxation but when the time came to distribute the money to the people, the failure was complete on all fronts, even if it is said today that, in consequence, we have social security. I could speak all night on the subject of social security and on the way it is administered in Quebec and in other Canadian provinces. Mothers are compelled to humiliate themselves in government offices, to make known their poverty, in a country where there is an abundance of resources of all kinds. For this, they are given the measly sum of $105, $110 or $125 per
Income Tax Act
month to support their spouse and five, six or seven children.
If that is economic stability, if that is the just society, I wonder where we are heading with the solutions now proposed by the government.
The hon. member for Trois-Rivieres has nevertheless been honest enough to say that the Ralliement creditiste proposes a solution to that problem. What are we suggesting? We suggest the opposite of what the government proposes by pretending to spend according to the taxes collected. The limit of expenses should be in accordance with the taxation system. If we tax for $10 billion, let us limit our expenses to $10 billion. And meanwhile production surpluses are piling up in factories, in shops, at the wholesalers, in warehouses, everywhere in Canada.
Recently I had the opportunity to visit Western Canada. There is too much wheat in Western Canada and too much wood in British Columbia. In Ontario there is too much corn in the Toronto area and too much wood in Northern Ontario. In Quebec there is too much milk and too many other products. In fact the farmers were here only two days ago to acquaint us of their problems concerning milk surpluses. If we go to the Maritimes, we find there is an overproduction of fish, pulp, and potatoes in New Brunswick, as well as in Prince Edward Island. In this situation, the government says: our spending power lies in taxation. And what do we reply? We say that a responsible government should recognize that its spending power lies in the country's production potential, that our expenditures should be based on our production.
If we produce goods worth $72 billion, we should issue enough credit to let our production reach the Canadian consumers. Then poverty would be efficiently done away with.
But Creditiste proposals are rather laughed at when they simply call on the governments to do in peacetime what they did so well in wartime. When we entered the war in 1939, under a liberal government, it was then said: Let us make financially possible what is physically workable. The first thing the Mackenzie King government did was to create, through the hon. J. L. Ilsley, Minister of Finance, to have the Bank of Canada issue 200 million dollars' worth of new, interest-free credits, to be used to start manufacturing guns, shells, destructive weapons and to "clothe" our young men who had gone naked for ten years, feed and house them, and pay

December 11, 1969
Income Tax Act
them besides to go forth and defend Christendom and civilization.
At that time, the services of the Bank of Canada were called upon, but when it comes to keeping our population alive, of allowing our young students to integrate into our present Canadian civilization, the government is powerless. Then we are told that we must accept what has become a necessary evil, last year a 3 per cent tax which was to be temporary, but which is still temporary this year and will be temporary next year again, and no doubt plus an increase, and all this in order to fight inflation.
[DOT] (9:40 p.m.)
Mr. Speaker, that is what we are so dead against, we, of the Ralliement creditiste. By the way, if the government can find millions to destroy, he should find some to allow the people to live.
The spending power of a responsible government and a sovereign government that wishes to discharge its responsibilities is its production power. To the extent that we can produce, let us organize a financial system able to allow the production to reach the consumer. How can we reach that goal? Simply by imposing a 3 per cent tax? Indeed not, but rather by distributing a national dividend to each and every Canadian citizen. This dividend has been laughed at, and it can still be laughed at, but there is only one way to find markets for the stockpile of products now existing in Canada: increase the purchasing power of Canadian consumers. And when we can do this without boosting taxes, we shall have found a solution. Of course, if we increase taxes or adopt the government's method which consists in taking from those who have and give to those who do not, the over-all purchasing power of the population will not be increased.
If a Canadian earns $8,000 a year and I take $1,500 or $2,000 from him and give it to someone else, the purchasing power is the same, that is $8,000 for two instead of only one. In the circumstances, we know very well that the one who earns $8,000 a year cannot afford to hide some of it under his mattress because he needs it all to support his family and buy a house which he cannot even afford to pay cash, and that in turn forces him to contract a loan with a finance company for the next 25, 30 or 40 years.
So, those who have a little more are deprived of their purchasing power in favour of those who have less; that is what is called State socialism or, better still, rank commu-IMr. Caouette.l
nism. This is what they are forcing us to put up with. Mr. Speaker, such solutions we can do without.
If we deprive someone of his assets to help a have-not, we will weaken the individual incentive which a government such as ours should encourage in its own interest. The measures proposed by this government surely do not encourage individual effort, any more than they encourage private or free entreprise.
Let us come back to our solution. Instead of allowing the levy of a temporary tax of 3 per cent, we will oppose it with our utmost energy as we will support the motion of the hon. member for Edmonton West (Mr. Lambert), which proposes to postpone for six months the passage of this bill. We feel that the government should find sources of revenue elsewhere than in the purse of the modest taxpayer or the Canadian consumer.
We have in Canada a most excellent institution. People may laugh, but the Bank of Canada can be used to such ends as it was used for military purposes in 1939. If the Bank of Canada must reflect the economic growth of Canada, it is up to the government to have the Bank realize financially what is physically possible.
Canadians in the Trois-Rivieres riding, as well as miners in Rouyn-Noranda, and workers and farmers in the St-Maurice region are ready to roll up their sleeves and to produce more.
Increasing production in Canada is not a problem. All our producers, all our manufacturers are prepared to increase their production, but the fact is that the government, with outdated measures, with measures that make no sense, bring them to a standstill by saying: listen, you have too much wheat, too much lumber, too much milk, too much of this and that. On the other hand, he tells them: we can improve the standard of living of the Canadian people inasmuch as we increase productivity. One day, production must be increased, and the next day production is too high, and since there is overproduction the government will have to tax more under the pretence of fighting inflation which, in my opinion, is due to the fact that the buying power exceeds the quality of products available, which causes a shortage.
If the hon. member for Trois-Rivieres takes his Larousse dictionary, and he used to be a teacher, he will see that inflation is to have worthless money when a shortage of products prevails.
December 11, 1969

What is the situation today? Is it that the 180,000 unemployed in the province of Quebec have too much money in their pockets, Mr. Speaker? Is it that the families living from social welfare have too much money? Is it that the poor people in Canada have too much money in their pockets? No, they have too little. Would a single hon. member say that he has too much money? No, but at least he has a little. It is a little too much to try to convince the poor that he has too much money.
Mr. Speaker, the unemployed in Canada, the hopelessly destitute need some purchasing power to get the necessary goods. The problem today is not excess money, but scarce money, considering the huge production in all fields and sectors of the economic activity in Canada.
The members of the Ralliement creditiste have been making suggestions for a long time. People refuse to listen to them in their own interests. In the lobbies, some liberal or progressive conservative members sometimes tell us: Boys, you are right, but we can do nothing. We are committed.
We, of the Ralliement creditiste, are not committed to anything. We are free to say what we please. It is our right. We are at liberty to say what we think, point out authentic facts to members of parliament, and nobody can deny us that right, not even the hon. member for Trois-Rivieres, and that, even if he tells us that we live in a fool's paradise and dream in colour.
At least, we dream of something, while the hon. member for Trois-Rivieres does not even seem able to dream.
This being said, I suggest that the solution to the current problem is not to increase taxes, but to reduce them, in order to give the consumers greater purchasing power, which will enable them to get the goods and services offered them.
Nowadays, builders, manufacturers and producers are penalized and they are told: Restraints on credit prevent us to undertake such project or to take action in such a field. Why should we go and get credit in the U.S.A. instead of creating it at home out of nothing? This credit would be guaranteed by the goods we can produce and the natural resources we can develop in Canada.
Recently, the N.D.P. government of Manitoba boasted that it had borrowed $15 million in the United States at 8.89 per cent. These $15 million did not exist in Canada before the
Income Tax Act
Minister of Finance of Manitoba borrowed them. Had the Bank of Canada created that money, would that have been more inflationary?
No, because the Manitoba government would have obtained the same amount but interest free. It would have been also used to build an hydro-electric complex in that province. It seems to me that this would have been more logical than to kneel submissively to American capitalists who, themselves, have created the necessary credit to get rich with the help of Canadian manpower and brain power.
Besides, as the Economic Council of Canada stated, as long as the monetary system is not changed, we will barely manage to live in a state of stagnation. We are ready to reform the institutions and to ask the citizens to reform. In fact, we ask the Canadian people to tighten their belt by requiring the payment of a 3 per cent temporary surtax for a year. At the same time, we say to financiers and others: Lend money at a higher interest rate. This is the government solution.
As was mentioned recently by a senator, the rich get richer in smaller number and the poor get poorer in greater number.
When the people become tired of that system and really understand the part played by finance, those who do not serve the people will be kicked out of the House of Commons and of the legislatures.
The solution that we propose is in no way miraculous. Credit is created by men like all of us, like the hon. member for Trois-Rivieres or like any other member. Those are men who draw up the financial and monetary policy of Canada, and when they will have realized the necessity of an adequate monetary system, geared to the needs of our population, according to the goods produced by it, then bills like Bill C-139 will no longer be introduced in this House.
[DOT] (9:50 p.m.)
I say it again the Creditistes will not perform miracles. But I must say the present government does not perform many either. They refuse to do anything.
When the Prime Minister of a sovereign state says that he does not have the means to solve problems, except through taxation, I say that government shirks its obligations. It is time for a government, supported by a Parliament made up of reasonable men, to

December 11, 1969
Income Tax Act
find solutions that are not poultices on wooden legs. The only real solution is that suggested by the Creditistes.
I heard a while ago a conservative member blaming the Liberals. The Progressive Conservatives governed this country from 1957 to 1962. Did they do any better? In 1960-61, there were a million unemployed in Canada. What did the Progressive Conservatives do to cope with unemployment then? That is one of the reasons why the Conservative government was defeated in 1963.
If the present government wishes to avoid defeat, let them change their opinion. As for the Progressive Conservatives, as the hon. member for Trois-Rivieres said-and I agree with him-let them suggest solutions. They have none. They say there is unemployment, there is abundance and there is poverty. There is a severe housing crisis, a lack of this and that. But just ask them to explain the Canadian monetary system, and there is not a single one who knows what it is. Maybe the hon. member for Red Deer (Mr. Thompson) can still remember, but as for the others, I doubt it.
As for us, we do have a solution and we will keep on proposing it until it is applied. We should certainly give it a try. And if it does not prove to be good, let us put it aside.
As the present Postmaster General and Minister of Communications said, people voted for Social Credit because they were told all about the lack of money. The minister explained it all in 1964 to the students of McGill University in Montreal while telling them about the Creditiste phenomenon, the Caouette phenomenon in Quebec.
He said: While we refrained from talking about money, Caouette spoke of the lack of money. That caught on in the Dorchester and Trois-Rivieres areas. That was to be known as the Creditiste phenomenon. The hon. minister said: "Scarce money or tight money is a bad thing."
That is exactly where we stand today and the Creditistes are not to blame for a situation that has brought about interest rates as high as 10 and 12 per cent. It is the government that should get the blame.
Today, the Postmaster General and Minister of Communications, an economist to boot, and former president of the Montreal Exchange, not only does not rise to fight Bill C-139 but he will vote for it tomorrow or the day after, while in 1964 he condemned the same method. Therefore, he has the same

attitude as the member for Trois-Rivieres. In 1964, both were against. Today, they have changed their minds, but not for partisan reasons they say. I do not know for whom the 3 per cent surtax has become a necessary evil. Certainly not for workers, farmers, white-collar or blue-collar workers. It can only serve the ends of a barbarian financial system that fleeces the entire Canadian population.
Mr. Speaker, we will continue to demand security with personal freedom through the establishment of a system promoting personal effort instead of discouraging it and protecting free enterprise instead of stifling and crushing it. We might have to wait 10, 15 or 20 years to make this clear to the people. We will take the time we need, but Canada will eventually have a Creditiste government making money available to the individual, which is the object of Bill C-139 now under consideration.


The Acting Speaker (Mr. Bechard):: The
hon. member for Dauphin (Mr. Ritchie).


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, in view of the time may I call it ten o'clock?



BUSINESS OF THE HOUSE

Donald Stovel Macdonald: Mr. Speaker, as I indicated earlier today, I should like to announce the business for next week. As you will recall, the items for tomorrow are No. 44, Bill S-8 to amend the Trust Companies Act, to be followed by No. 45, Bill S-9 in respect of the Loan Companies Act. Next week priority will be given to a bill, of which I gave notice this evening, to instal financial controls on the Company of Young Canadians. That is to be joined with item No. 26, Bill C-139 to amend the Income Tax Act, both of which will require urgent action in the coming week.
After the priority on those bills we would deal with the Loan and Trust Companies bills, followed by item No. 32 in respect of the white paper on tax reform and item No. 15 in respect of Bill C-12, to establish the International Development Research Centre of Canada. In addition, following in turn would be item No. 6, Bill C-4 in respect of the Canada Corporations Act, and item No. 28, Bill C-144 in respect of the Canada Water Act.
December 11, 1969	COMMONS



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 40 deemed to have been moved.

Heath Nelson Macquarrie: Mr. Speaker, it seems fitting that the Postmaster General (Mr. Kierans) and I should carry on in the pre-midnight hours in this pre-Christmas season with a discussion on Christmas mail. I wish to recall that some time ago I asked about the announcement he made outside the House that there would be three Saturday deliveries preceding Christmas. While at first blush the minister may look like a latter day Kris Kringle, I think in fact this is an indication that the non-movement on Saturday has been a great contributor to the deterioration of the mail service.


Some hon. Members:: Hear, hear.


Heath Nelson Macquarrie: In other words, it was palpably necessary to reinstitute the Saturday movement of mail in order to move the heavy volume of mail in the Christmas season. It follows I am sure-and I have information which leads me to believe it is true-that were it not for the blocking-out of the Saturday morning delivery, the other movements would have been more satisfactory since the minister adopted this ill-advised and ill-considered move. I note, too, the generosity with which he referred to the cost of $350,000. There have been discussions later than that date about the payments made for overtime work.
I am convinced that the five-day delivery has been a major contributor, if not the major contributor, to the unhappy state of the Post Office. So often mail which is found in the Post Office on Monday cannot be processed in time for Monday's delivery, and it is quite possible that many many articles of mail are in fact not moved from Friday to Tuesday. Therefore, I do not think it is surprising that people still complain in increasing volume about the slowness of the mail delivery.
I think all members of this House receive a consistent and indeed increasing flow of mail complaining about the mail service. One has only to look at the editorials, and letters to the editor in the newspapers to get an indication of just what is going on. I only wish we had some system of slides, dials or something whereby we could register in this chamber
DEBATES	1891
Proceedings on Adjournment Motion the impact that cartoons make. I was impressed by one by Stephen Leacock, a great humorist, in which he is shown reaching down toward a document, obviously held in the hand of the Postmaster General when he made the statement that 99 per cent of the mail in this country is delivered the next day 99 per cent of the time, saying, "C'mon Eric, there's room for both of us". Then there is a caption, "A stamp honouring our humorists".
[DOT] (10:00 p.m.)
The suggestion that 99 per cent of the mail is delivered the next day 99 per cent of the time, considering that on Saturday and Sunday there is no mail delivery, is a preposterous one from a man who had the humorous temerity-and I will use that gentle expression-to call me an exaggerater not long ago. If the minister thinks the mail is moving fast, he is not in fact the Postmaster General but the rationalizer general of this country.
I hope my friend, the leader of the New Democratic Party (Mr. Douglas) will not be upset if I repeat something he told me the other day. On the 2nd day of November he was invited by a group in the city of Ottawa to speak to that group on the 7 th day of November, and he received the invitation in Ottawa on the 9th day of November. It may be the age of expedition but it is certainly not the age of transmission of mail. This whole business of Saturday mail delivery has been a preposterous fiasco from the beginning.
If you live in rural Canada you get mail six days a week; if you live in urban Canada you get it five days a week. But try getting a stamp a little cheaper if you happen to live in rural Canada. The charge is the same, but the service is different. This is one of the great contributions to the unhappy situation which prevails in the Post Office, and I am being as charitable as I can in view of the approaching yuletide. This distortion,, this ridiculous discrimination between rural and urban people, and the foolish notion that you can move more mail in five days than you can in six, is preposterous. I say to the minister that one of the legacies which he will leave to the Crown corporation, if and when it is put into being to clean up the mess in which the Post Office is now, will result from this five day delivery.
I say to him that had he recognized long before Christmas that the system was not working, things would be much better now. There would be far fewer users of the mail writing to their members complaining about the mail, and there might be suggestions
1892	COMMONS DEBATES	December 11, 1989
Proceedings on Adjournment Motion among the people of Canada that the Post Office is once in a while doing a fairly good job. I hope it is not too late for the minister to reconsider his decision, and if he finds that the suggestion works out well in the Christmas season he might start the practice in the New Year and do a good job.


Eric William Kierans: Mr. Speaker, your consistent suggestions that the questions of the hon. member for Hillsborough (Mr. Macquarrie) could be more appropriately dealt with at the time of adjournment reflect not only your desire to avoid wasting the time of this House but also your impatience with the repetitious nature of his questions.


Some hon. Members:: Hear, hear.


Eric William Kierans: Saturday delivery during the Christmas season costs the people of Canada approximately $350,000 per day. The hon. member suggests that this be repeated 52 times a year. Today's task force report on the future of the Canada Post Office points out the impact of rising costs on the price of mailing first-class letters-26 cents per letter in less than a generation. That is what we in the Post Office want to avoid, by trying to equalize the amount of services rendered with their cost.
The hon. member has referred to me as a constitutional diplomat, Kris Kringle, and so on. Watching and listening to his performance this evening I thought of the character in that wonderful Shakespearean play "A Midsummer-Night's Dream", of which his former leader is so fond. The hon. member for Hillsborough would be very ably cast as "Bottom," but a blushing Bottom in this instance; for he is blushing as one who knows he lacks conviction in his cause and knows clearly he is saying nothing that he has not said many times before.
There is no Saturday urban delivery and will not be, except for Christmas, until the Canadian taxpayer says he is willing to subsidize Canadian business for 80 per cent of the cost of such a service. There will not be this service until the Canadian taxpayer says that there are not better ways of spending 52 times $350,000 a year, for example, on such things as housing, welfare, health, regional development, or any of the very many other needs that the Canadian people have. I plead with the hon. member to not only avoid the Christmas blush of always being late but also the Conservative blush, the blush of living in a day that is long past.



CONSUMER AFFAIRS-ACCIDENT CAUSED BY SPILLING OF SULPHURIC ACID FROM TOY CAR

Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, after that very fine display of oratory from both sides of the House I am afraid I must come down to some very simple probing which has to do with Christmas toys. It is now three weeks since Dr. Morton Shulman, former Toronto coroner and now a member of the Ontario legislature, raised the matter of the potential killer toy, the Poweride Car, which could have caused serious injury or death to a Montreal child when the sulphuric acid in its battery leaked out. It is two weeks since I asked the Minister of Consumer and Corporate Affairs (Mr. Basford) about the matter in this House. I drew to his attention the fact that an official of his department accompanied a member of the Canadian Toy Testing Council and that they saw no hazard in this toy car.
My interest stems from the fact that a lot of parents around the country are living in a fool's paradise. They believe themselves to be properly protected against buying dangerous toys. Actually, they have no such protection at all. So far as I can learn the only testing now carried out is done through the Canadian Toy Testing Council. I want to point out several things about that council. First of all, it is a purely voluntary body, composed of 17 people, mostly women who have a great many other responsibilities, and they do the testing. In the second place, the council can test only a very limited number of toys each year. They are up against all the resources of a multi-million dollar industry.
A third point which has not yet been raised is that they receive a grant of $500 a year from the Canadian Toy Manufacturers' Association, and one could hardly call that a disinterested grant. It is probably hush money, but it did not hush-up the sulphuric acid when it leaked out of the battery of that toy car in Montreal. In the fourth place, the council receives no assistance whatsoever from the department. Maybe it gets moral backing, but moral backing is not worth much when they do not have the financial backing necessary to test toys.
I want to show the result of the council not having had backing from the department. On November 25 a member of the Toy Testing Council, Mrs. P. J. Pocock, made a statement which, curiously enough, was released by Eldon Industries of Canada, Ltd., the Canadian subsidiary of the U.S. based manufacturer
December 11, 1969

who produced the Eldon Poweride Car that nearly killed the Montreal child. I quote part of Mrs. Pocock's statement as follows:
"I examined the car in the company of an official of the Department of Consumer and Corporate Affairs and could see no hazard to a child under normal use. The same conclusion was reached by the officer of Consumer Affairs," Mrs. Pocock is quoted as having declared.
[DOT] (10:10 p.m.)
Eldon Industries of Canada president and general manager Dennis E. Tiberis insists that 'we are certain it is perfectly safe for children to use.
'Almost 200,000 of these cars have already been sold in the United States and have been in use for several months, and we know of no instances of children being harmed in any way,' he said.
The matter was raised in the Ontario legislature. It was also raised in this House, and around the beginning of this month the T. Eaton Company Limited took the car off the market, having become convinced that it was not a safe car for small children. On December 5 another statement was made by Mrs. A. B. R. Lawrence, the president of the Canadian Toy Testing Council. Her comment at this time was somewhat different from the statement made by Mrs. Pocock before the matter was raised. Mrs. Lawrence said that the second appraisal was ordered because of numerous inquiries and she reported as follows:
'The consensus of the Canadian Toy Testing Council is that while the car should present no hazard if used strictly according to the manufacturer's instructions, one cannot rely on preschoolers following these instructions closely,'-


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


Mr. Paul Langlois (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, the first two speakers we had tonight brought us very near to the Christmas spirit and now, with the question of the hon. lady from Vaneouver-Kingsway (Mrs. Maclnnis) relating to toys, I think that brings us nearer still to Christmas day. I stand here trying to answer and I am trying to get a beard going, so I hope nobody takes me for Santa Claus.


An hon. Member:: It is not the right colour.


John Stratford Burton: I do not think his answer will be a Santa Claus answer.


Paul Langlois: I would like to make it quite clear that the Department of Consumer and Corporate Affairs does not have the machinery nor the legislative authority to approve
Proceedings on Adjournment Motion or disapprove of a specific toy. The department has not, therefore, approved or disapproved of this toy. However, because we had received some correspondence about this toy we wanted to learn more about it. Accordingly, an officer of the department examined the toy in the company of a lady connected with the Canadian Toy Testing Council. At that time the representative of the Toy Testing Council stated she did not believe that the toy was hazardous when used in accordance with the manufacturer's instructions.


An hon. Member:: Can the children read them?


Paul Langlois: Is anything wrong over there?


An hon. Member:: Yes. Can the children read the instructions?


An hon. Member:: Carry on.


Paul Langlois: I hope that as a Member of Parliament and a very notable man, the gentleman on the other side will tell his children what to do. I note that that opinion was reaffirmed by the Canadian Toy Testing Council after extensive tests. In issuing the results of these tests a few days ago, the Canadian Toy Testing Council restated its caution that the toy should be used according to the instructions and under appropriate supervision. While this toy car carries an explicit warning on the battery, in addition to the warnings in the instruction manual, I understand the company intends to add a warning label on the seat.


An hon. Member:: But can the child read it?


Paul Langlois: The department is developing a safety standard for toys. Officials are working very closely with their British and United States counterparts in an effort to develop an effective standard that will protect our children from unnecessary hazards. This is a difficult task, as is shown by the fact that the British worked on their standard for a number of years. It is hoped that our standard will be ready within the next few months. When the safety standard is developed, we will be able to use our legislative authority under the Hazardous Products Act to deal with toys that do not meet the standard. I will bring the hon. lady's remarks to the attention of the minister.
December 11, 1969
1894	COMMONS
Proceedings on Adjournment Motion NATIONAL DEFENCE-BASE CONSOLIDATION-EFFECT ON MARITIME PROVINCES


Walter C. Carter: Mr. Speaker, on December 8 I asked the Minister of Na.ional Defence (Mr. Cadieux) a question which was prompted by a statement which appeared in the St. John's newspaper on December 4 to the effect the Canadian Armed Forces are very much interested in taking over the Argeniia naval base if and when the Un.ted Slates decides to withdraw from that base.
We are all aware that some time ago a statement was made by the government of the Uni.ed States to the effect that some 300 U.S. bases were being phased out around the world. Shortly after that statement was released, over 200 people-260,1 believe-who were working on the Argentia naval base were paid off, which led people to believe that Argentia would be one of the bases that would be phased out amongst the 309 announced by the United States Secretary of Defence.
This is a very serious situation, Mr. Speaker. At the present time there are over 800 people working on that base. The economy of the entire area of Placentia Bay is fairly well dependent on the base. There is not a family in that whole area that does not in some way or ano.her derive a living from this United States base. For that reason I was delighted to read in the newspaper that according to ViceAdmiral O'Brien, Commanding Officer of the Canadian Forces Base at Halifax, the Canadian Forces may be interested in taking over Argentia if and when the United States decides to phase it out.
I have directed a number of questions in this House to the Secretary of State for External Affairs (Mr. Sharp) asking what information he had received from his counterpart in the United S ates government with respect to the future of this and other bases in Canada. The answer has always been the same, that he has not received any indication from the United States authorities that Argentia will be phased out. I say to the minister and this House that there are very strong indications that the base will be phased out on June 30, 1970. It is about time the Minister of National Defence or his colleague, the Secretary of State for External Affairs, put the question to their counterparts in the Uni ed States government and found out once and for all where we stand with regard to United States bases in Newfoundland.

As I mentioned earlier, if and when these bases are phased out the social and economic consequences could be very tragic so far as the people in that area are concerned. I do not ihink it is enough for this government and the ministers involved to adopt the old ostrich psychology of sticking their heads in the sand and hoping nothing will happen. I think it is obvious to all of us, par icularly the people in my riding, that the Argentia naval base is going to be phased out. I thunk the time has come for us to find out what is going to happen. The federal government, and other levels of government should start making plans to provide o.her employment if and when this base is phased out.
We have had two very tragic events in Newfoundland in the last ten years. The closing of Pepperrell Air Force base left a large number of people unemployed. The la er closing of Ernest Harmon Air Force base had very tragic effects on the area in and around Harmon Field and indeed all over Newfoundland. As the member for St. John's West, in whose riding the Argentia naval base is situated, I am not prepared to stand by and see the same thing happen. I do not ihink the people of the area deserve that treatment. I call upon the Minister of National Defence and the Secretary of State for External Affairs to put ihe question directly to the United States authorities.
[DOT] (10:20 p.m.)
What are the plans with regard to military and naval bases in Canada, with particular reference to the one at Argentia which, it is reported, will be phased out in little more than six months from now? If this base is closed, as I am reasonably certain it will be, serious thought should be given by the minister and by the government to reactivating it, even jointly, in order to give Newfoundland some of the defence dollar which it is not getting at the present time. I am not saying the money should be given out of charity but, after all, Newfoundland is in a very strategic position. This being the case, I believe the government should find some way to be fair to the province and make part of the so-called defence dollar available to our people, who are taxpayers and who are paying their share of defence costs.
Representations have been made by the Newfoundland command of the Royal Canadian Legion to the effect that Newfoundland is not getting its fair share of the defence dollar being spent in Canada today. I would certainly support their request-

December 11, 1969	COMMONS


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


Mr. D. W. Groos (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, as the hon. member for St. John's West (Mr. Carter) is aware, the reductions in civilian personnel at Argentia, Newfoundland, are part of the $3 billion defence spending cutback recently announced by the United States Secretary of Defence. The Canadian government was made aware of these reductions in advance and, incidentally, made a successful representation to the American authorities to improve the lay-off procedures for the affected personnel.
The two departments most directly concerned, Regional Economic Expansion and Manpower and Immigration, immediately made their resources available to assist the laid-off personnel to find other employment. I do not need to remind the hon. member that the Department of National Defence has been using Argentia as a staging base for the Tracker aircraft to carry out their coastal patrols, and will continue to do so. The department has carefully examined the feasibility of using Argentia as a permanent base
DEBATES	1895
Proceedings on Adjournment Motion but is unable at this time to extend its operation at Argentia beyond what is being carried out there now.
I can understand and sympathize with the concern expressed by the hon. member and I congratulate him on the representations he has made on behalf of those who are affected ,by the recent lay-offs. I recall very vividly the magnificent harbour of his beautiful and friendly province, the generosity of its people and the great part which was played by the Newfoundland bases of Argentia and St. John's in defending the lifeline to Europe during World War II. I can assure the hon. member that the government is equally concerned with this problem and that every effort is being made to alleviate the situation.


Walter C. Carter: Mr. Speaker-


The Acting Speaker (Mr. Bechard):: Order.
The hon. member knows it is not the practice at this time to raise questions of privilege or points of order.
Motion agreed to and the House adjourned at 10.27 p.m.
1897

Friday, December 12, 1969