1969-06-09

Mr. Speaker:: I have the honour to inform the house that a vacancy has occurred in the representation, namely, of Edward Richard Schreyer, member for the electoral district of Selkirk, by resignation.
Accordingly I have issued my warrant to the Chief Electoral Officer to make out a new writ of election for this constituency.



PRIVILEGE


Mr. James A. McGraih (St. John's East):: Mr. Speaker, I should like to rise on a question of privilege affecting all members of this house. My question of privilege arises from an article by John Gray in the Montreal Star of June 3 which, I understand, has been given wide distribution throughout the country by a certain group and which has only now come to my attention. It deals with the sixth report of the Standing Committee on Fisheries and Forestry. This is the first opportunity I have had to raise this question of privilege because, as I have indicated, the article came to my attention only this morning.
The article in question concerns the hearings held by the Parliamentary Committee on Fisheries and Forestry on the subject of seal hunting in the Gulf of St. Lawrence. I intend to back up my question of privilege with a motion.
To indicate that I have a very sincere and genuine question of privilege I need only to quote several sentences from the article by Mr. Gray. They read as follows:
Throughout their hearings on the seal hunt, the committee has functioned like a hanging jury in a kangaroo court. As usually happens in such cases, and as is evident in the report, they got the verdict they wanted.
The committee, dominated by Maritimers and led by a small core of Newfoundlanders, was determined to vindicate the annual slaughter of baby seals. For even the relatively few Atlantic fishermen who take part in the seal hunt, the extra
cash they earn is a happy bonus in a desperate economy.
To accomplish their purpose the committee members proceeded with vigour. They maligned and insulted opponents of the seal hunt; they accepted unquestioningly the testimony of witnesses whom they liked, and rejected the testimony which did not accord with their prejudices.
I believe that the article in question casts a reflection on every member of the committee and on every member of the house. It accuses the committee of deliberate dishonesty and of perpetrating a deliberate injustice and, in my view, is clearly in contempt of parliament.
I therefore move, seconded by the hon. member for Gander-Twillingate (Mr. Lundri-gan) that:
The article in the Montreal Star of Tuesday, June 3 by John Gray entitled "Seal Probers Lack Comprehension" be referred to the Standing Committee on Privileges and Elections, to determine whether such matter is a violation of the privileges of this house.


Mr. Speaker:: The question of the privileges of members of parliament is, of course, a very serious matter, and one of the responsibilities of the Speaker, who is acting on behalf of hon. members, is to ensure that these privileges are protected. Of course it is not always easy to establish a happy medium between the two requirements in our democratic society, that is the right of individual members of the House of Commons to be protected in the discharge of their responsibilities and, as a counterpart, the rights and privileges of the press to express themselves freely.
[DOT] (2:10 p.m.)
The article to which the hon. member referred is obviously rather strong in tone, and I should like to have an opportunity to look at it a little more closely. If hon. members have comments to make on the proposal of the hon. member for St. John's East that the article, or the matter in question, be referred to the Standing Committee on Privileges and Elections I would be pleased to hear their views; we should not, of course, go into the matter too deeply; we do not want at this time to revive the debate on the substance of the matter considered by the committee.
9856	COMMONS DEBATES	June 9, 1969
Seal Hunt Consideration by Committee
What might be helpful as far as the Chair is concerned are views as to whether there is an actual abuse of the privileges of hon. members, in commenting on parliamentary committees. If hon. members have views to express at this time they will be taken into account when I consider the matter further.


Mr. Lloyd R. Crouse (South Shore):: should like to accept your invitation to comment briefly, Mr. Speaker, by pointing out that the Committee on Fisheries and Forestry worked very diligently on this problem, after it had been referred to us for consideration. We examined all the facts as presented to the committee. We became aware that portions of the testimony given by some of the witnesses were in direct contradiction to facts which had been presented to us both by way of films and in other testimony.
After examining all the evidence it was the unanimous decision of the committee that the type of report which was eventually filed should be presented. Consequently we feel that the attitude taken and the expressions used in this particular newspaper article are not in accordance with the facts, and that the matter should therefore be referred to the committee for further examination.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I say on behalf of my hon. friends as well as for myself that we were quite prepared to leave this matter for you to decide. I think I am correct in assuming that Your Honour will check the record of the committee before reaching your decision.
As I say, we were prepared to leave it completely in your hands. However, in view of the fact that comments have been made from the floor in support of the motion we should like to register at least a question as to whether a matter of privilege is correctly before us merely because the press or outsiders comment on what goes on in parliament or in its committees. If we start referring to the Committee on Privileges and Elections every comment about the proceedings of parliament that we think is unfair, that committee will have a very busy time.
I have not studied closely the proceedings of this particular committee, but because of some correspondence I have received I have taken a cursory look at the record and it strikes me that witnesses and hon. members sparred off against each other quite well. I do not know whether one side or the other won, or whether it was a draw. I shall not try to settle that point at this time, but I think it would be a questionable practice for us to

regard the expression of free speech to which the hon. member has referred as something which should be called into question before a committee of this house.


Mr. Real Caouelie (Temiscamingue):: Mr. Speaker, if every journalist who writes something against any parliamentary body or any member of this house had to appear before the committee on privileges and elections, the committee would be kept busy all the time.
But we all want the freedom of the press to be protected, and therefore I endorse the statement just made by the hon. member for Winnipeg North Centre (Mr. Knowles). We leave the decision entirely up to you in regard to this matter, and we do not think that such a matter or any similar question should be raised in this house, as we know very well that all journalists do not carry us in their heart and that quite often they use rather harsh words when writing about us.


Mr. Speaker:: I thank hon. members for their comments. As I indicated a moment ago it will be my duty to look into the matter more deeply this afternoon, and a decision will be given later in the course of the day.



ROUTINE PROCEEDINGS


[Stage Direction]
Tenth and Eleventh reports of the Standing Committee on Transport and Communications-Mr. Lessard (Labelle).
[Editor's Note; Text of foregoing reports appears in today's Votes and Proceedings.]

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

Mr. Lalulippe: Did the findings of the studies made on the proposed construction of a causeway between New Brunswick and Prince Edward Island establish (a) that the project is physically feasible, strictly from a scientific and engineering point of view (b) that it would be of benefit to the population groups involved from the point of view of commerce and communications (c) that its cost cannot be calculated, even approximately, because of
June 9. 1969



possible and unforeseen risks (d) that the proposition to construct the causeway was not sound and impossible to implement?


Hon. Arthur Laing (Minister of Public Works):: (a) The project of a crossing between New Brunswick and Prince Edward Island is feasible in several configurations; (b) Yes; (c) No; each feasible configuration has been estimated to establish a ranking in order of cost. The more attractive configurations have been estimated in detail; (d) It is sound from an engineering point of view and possible to implement but was not proceeded with because of the excessive capital requirements.


LIFE INSURANCE TAXATION REGULATIONS
Mr. Salisman: 1.	When are the regulations concerning the taxation of life insurance companies going to be made public?
2.	Have the proposed regulations been submitted to representatives of the industry for comment?
3.	Have representatives of any other groups been given an opportunity to comment?
4.	Have any changes taken place in the proposed regulations as a result of these discussions?
5.	How many briefs have been received on the proposed regulations and from what groups or individuals?
6.	What is the reason for the delay in the publication of the proposed regulations?


Hon. E. J. Benson (Minister of Finance):: 1.	Draft regulations were published on May 9th. The final regulations cannot be made public until Bill C-191 has been passed.
2.	No draft regulations were submitted to representatives of the industry for comment until after they were tabled in the House on May 9th.
3.	See No. 2.
4.	See No. 2.
5.	No briefs had been received on any proposed regulations before May 9th, since no regulations had until then been proposed. However, several memoranda have been received from the Canadian Life Insurance Association concerning the application of the proposals in last fall's budget, and in addition, briefs and representations have been received from certain other associations and companies in the life insurance field and other individuals.
6.	The Bill to amend the Income Tax Act and the draft regulations took longer to prepare than is usually the case because of
Questions
the technical difficulties in designing the detailed legislation necessary to apply the principles set out in last fall's budget to a very complex industry which had been virtually exempt from income tax previously.


DEPARTMENTAL EMPLOYMENT OF INDIANS AND ESKIMOS
Mr. Paproski: 1.	How many Canadian Indians and Eskimos are employed permanently in the Department of Indian Affairs and Northern Development, and in each case, at what positions?
2.	Is the government taking steps to increase the number of Indian and Eskimo appointments at the top levels in the Department and, if so, what steps?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: 1. (a)
Canadian Indians employed permanently: District school superintendents, 3; Educational services, 7; Teachers, 144; Administrative officers, 5; Information officer, 1; Superintendents of Indian agencies, 5; Assistants, Indian agencies, 32; Community development and welfare workers, 28; Band constables, 42; Clerks, 81; Secretaries, stenographers, 49; Caretakers, 123; Labour services, 128; Total, 647. (b) Canadian Eskimos employed permanently: Clerks, classified, 4; General Services, Labour and Trades, 175; Total, 179.
2.	The Government is taking steps to increase the number of Indian and Eskimo appointments at the top levels in the Department by encouraging them to train for and enter competitions in order to join the Department or advance within it. Their opportunities for advancement are also enhanced by means of training and development programs provided by the Department.
In addition, a specific recruitment and development program has been launched, to recruit Indians and Eskimos into the Department, in decision-making positions as much as possible, and to provide thorough and useful training and development for them, as well as those Indians and Eskimos already with the Department. This year a personal letter from the Deputy Minister was sent to each Indian and Eskimo student at university pointing out the desirability of their entering the Department at graduation and offering summer employment in the meantime as a means of assisting their education and preparing them for advancement within the Department later. All but two contacted indicated interest in the Department and approximately 60 have joined it for summer work in all Branches.

June 9, 1969
Questions


GRANT TO STANLEY GRAY
Mr. Dinsdale: 1.	Has the Secretary of State received a report from the Canada Council with respect to the award of the $5,500 scholarship to Stanley Gray?
2.	Was this report submitted voluntarily or at the request of the Minister and, if so (a) when was it received, and (b) when was the request made?
3.	Has the Secretary of State issued any (a) advice, or (b) instructions, to the Canada Council based on the report?
4.	Does the report indicate that the award was made as (a) a form of political exile to remove Mr. Gray temporarily from the country, or (b) an attempt to reform his political views?


Hon. Gerard Pelletier (Secretary of State):: 1.	Yes.
2.	The report was submitted voluntarily, (a) It was received on April 3, 1969; (b) Not applicable.
3.	No.
4.	No.


ESTATE TAX COLLECTIONS
Mr. Rodrigue: 1.	What was the total amount of estate tax collected by the government for the year ended March 31, 1968?
2.	What amount was collected in the Province of Quebec?
3.	What amount was remitted to the provinces?
4.	What amount was remitted to the Province of Quebec?


Edgar John Benson: 1.	$102,192,358.
2.	Taxation Division of National Revenue Department estimates the amount collected in Province of Quebec to be 22 per cent of total amount collected in Canada, that is, some $22.5 million.
3.	Interim estimate (March 1969) of total estate tax payment for 1967-68 was $53,562,000.
4.	Interim estimate (March 1969) of estate tax payment to the Province of Quebec for 1967-68 was $12,420,000.


EXTERNAL AFFAIRS PUBLIC RELATIONS STAFF
Mr. Robinson: 1.	Does the Department of External Affairs have a public relations staff and, if so, how many?
2.	What is the total cost of public relations for the Department for each of the years 1960-68 inclusive?


Hon. Mitchell Sharp (Secretary of Stale for External Affairs):: 1. The Department of External Affairs has no public relations staff as such. Relations with the press and public and with foreign governments, in Canada and abroad, are part of the regular duties performed by foreign service officers, administrative services officers, and information services officers. At two posts, London and Washington, the counsellor (press) and minister-counsellor (information), respectively, were appointed by Order of the Governor General-in-Council.
2.	See question 1. An accurate estimate of the total cost of these activities is not possible.


Mr. Hopkins: 1.	Is Atomic Energy of Canada Limited or the responsible Minister, or any other person on behalf of Canada, seeking to make arrangements under which Canada will participate in the construction of any nuclear power generating plants in any other country and, if so, when may an announcement be expected?
2.	Is heavy water used in the operation of nuclear power generating plants and, if so, will heavy water produced by Deuterium of Canada Limited be available for use in any nuclear power generating plants constructed by or with the cooperation of Atomic Energy of Canada Limited in the immediate future?


Mr. R. J. Orange (Parliamentary Secretary to Minister of Energy, Mines and Resources):: In so far as Atomic Energy of Canada Limited is concerned: 1. Yes, and announcements will be made as arrangements are concluded.
2.	Yes. Heavy water is used in the operation of nuclear power generating plants of the CANDU types. It is not expected that any heavy water will be produced by the Deuterium of Canada Limited plant in the immediate future.


Mr. Soulham: Is the government giving consideration to providing relief grants to western provinces to help alleviate recent serious flood damage?


Edgar John Benson: Yes.
June 9* 1969


Mr. Fortin: 1.	Is the government considering, has it considered or will it consider, tax exemption for revenue derived from municipal bonds?
2.	What does the government propose to do to help financing municipal corporation capital expenditures?


Edgar John Benson: 1.	This is a matter of Government policy. If the Government proposes any exemption for income received for municipal bonds, it will be announced at the appropriate time.
2.	The Government of Canada proposes to maintain a fiscal and monetary policy which will reduce inflationary pressures on the capital market, and enable it to provide capital for economic development and for the social needs of the Canadian people. Where social needs are of compelling priority, as in the case of public housing and municipal sewage treatment, the government will continue to make funds available at less than market cost through CMHC.
Indirectly, the federal government makes substantial amounts of capital available, at rates based on the yield of Government of Canada bonds, through purchases by the Canada Pension Plan Investment Fund of provincial, or provincially-guaranteed securities. Where the provinces feel it is appropriate, these funds are used to assist in municipal financing. In 1968-69 the amounts made available to provinces from this source were:
($ millions)	1968-69
British Columbia	107.5
Alberta	68.4
Saskatchewan	35.9
Manitoba	42.3
Ontario	421.0
Quebec	2.4
New Brunswick	21.8
Nova Scotia	29.2
Prince Edward Island	2.9
Newfoundland	14.2
Total	726.6


Mr. Robinson: 1.	How many Canada Council grants have been awarded since the inception of the Canada Council, who are the recipients and how much was each grant?
29180-624*
Questions
2.	Does the federal government intend to change the terms of reference for awarding Canada Council grants and, if so, in what respect?


Gérard Pelletier: 1.	I am informed by the Canada Council that the requested information is provided in the Canada Council annual reports.
2.	No.


Mr. Yewchuk: Could the Minister of Communications inform the House if any definite steps are being taken to provide alternative employment for persons whose jobs are being or have been eliminated by the recent Post Office reorganization?


Hon. Eric W. Kierans (Postmaster General and Minister of Communications):: In so far as
the Post Office Department is concerned: It is assumed that this question refers to the institution of five-day week delivery service. To prepare for the reduction in staff as a result of this change the Department for several months did not fill vacancies on a permanent basis and thus created a backlog of vacant positions. Through this action it will be possible to absorb those employees whose positions were eliminated through the five-day service.


Mr. Orlikow: 1.	Does the Canada Assistance Plan Act contain a provision requiring the participating provinces to establish provincial appeal boards to which applicants for assistance can appeal decisions respecting their applications for assistance with which they disagree?
2.	If so, how many provinces have established such appeal boards and which are the provinces which have established boards?
3 Which provinces have not yet established such appeal boards?
4. Has the federal government set a deadline at which time all provinces will be required to have established these appeal boards?


Hon. John C. Munro (Minister of National Health and Welfare):: 1. No. However, the statute does contain a requirement that an agreement made under Part I shall provide that the province will, inter alia, ensure the provision by law, not later than one year from the effective date of the agreement, of a

June 9, 1969
Questions
procedure for appeals from decisions of provincially approved agencies with respect to applications for assistance or the granting or providing of assistance by persons directly affected by such decisions. This requirement is embodied in agreements in effect with all provinces.
For the purposes of these agreements provincial law is defined as acts of the legislature of a province that provide for assistance or welfare services in the province under conditions consistent with the provisions of the federal statute and regulations and includes any regulations made under such acts. A provincially approved agency includes any department or government, person or agency authorized under provincial law to determine eligibility for assistance.
2.	All provinces have met the foregoing requirement by providing, in a provincial act or regulation, for appeals against decisions in relation to eligibility for assistance through administrative review, the use of bodies originally established for other purposes, the creation of special boards or a combination of these approaches. While the terms of the agreements in this respect have been met, the Department of National Health and Welfare has continued to hold discussions with the provinces toward the development of the most effective forms of appeal procedures.
3.	See 2 above.
4.	See 1 above.


Mr. MacDonald (Egmont): 1.	With reference to the answer to Question 1,964, when does the government intend to make such comment?
2.	What action has Canada taken or is it contemplating with regard to the violation of the NATO Charter by Greece and Portugal?


Mitchell William Sharp: 1 and 2. Both Greece and Portugal, as members of NATO, have accepted certain obligations as signatories of the North Atlantic Treaty including the obligation to safeguard "the principles of democracy, individual liberty and the rule of law". The Canadian Government places great emphasis on these principles. On the other hand, we cannot be the sole judge of how they are implemented and we do not think it would

strengthen the Alliance if we were to try to impose our judgment on others.
The Canadian Government has expressed the sincere wish that there will soon be a return to parliamentary institutions in Greece not only for the benefit of the Greek people but also to enhance co-operation between Greece and other members of the community of democratic countries in which Greece has played a helpful and welcome role in the past.
Portugal was a founding member of NATO but its government has also been criticized for following undemocratic and illiberal policies. We do not wish to interfere in Portugal's internal affairs any more than in those of Greece but we have constantly made clear our disapproval of Portuguese policy respecting Angola and Mozambique. We hope that the new Portuguese administration of Prime Minister Caetano will bring about changes in those policies to meet the legitimate aspirations of the people of the territories concerned.


Mr. Lamberf (Bellechasse): 1.	Does the Post Office Department buy the stamps that are sold to the public in post offices?
2.	Are stamps printed by a press belonging to the Department, or by the Office of the Queen's Printer?
3.	If not, where are they printed?
4.	What were the costs of printing, if any, in the years 1967-68 and 1968-69?
5.	What were the total profits realized by the Post Office Department on the sale of stamps to the public in the years 1967-68 and 1968-69?


Eric William Kierans: In so far
as the Post Office Department is concerned: 1. Yes, under the terms and conditions of contracts with the two security printing firms located in Canada.
2.	No.
3.	Postage stamps are printed at Ottawa by the British American Bank Note Company Limited and the Canadian Bank Note Company Limited on equipment belonging to the companies.
4.	1967-68: $1,263,800; 1968-69: $1,153,200.
5.	Profits on postage stamps are confined to philatelic sales. Sales by the Philatelic Service at Ottawa less the associated salary costs and the printing costs of such stamps were $1,067,600 for 1967-68 and $1,187,660 for 1968-69.
June 9, 1969


Mr. Robinson: 1.	Does the Department of the Solicitor General have a public relations staff and, if so, how many?
2.	What was the total cost of public relations for the Department for each of the years 1960-68 inclusive?


Hon. G. J. Mcllraifh (Solicitor General):: 1. No.
2. Not applicable.


Mr. Brewin: 1.	How many CF 5 aircraft are on order for use by the Armed Services of Canada?
2.	How many CF 5 aircraft are in the course of construction and how many have been delivered or are ready for delivery?
3.	What is the per capita cost of each CF 5 aircraft, what is the total expenditure contemplated and what has been expended to date?
4.	Is the Government of Canada, in the light of the Prime Minister's comments in Parliament of May 8 and 9, giving consideration to cancelling the balance of the CF 5 aircraft order?


Mr. D. W. Groos (Parliamentary Secretary to the Minister of National Defence):: 1. 115.
2.	15 are in the course of construction; 18 have been delivered and seven are ready for delivery. However, virtually all material and equipment has been procured and is in some stage of manufacture and assembly.
3.	The flyaway cost of each CF 5 is estimated to be $1,143,000. This does not include research and development, reconfiguration or support costs. Total program cost is estimated at $215 million for aircraft and $9 million for weapons systems, of which $178,400,000 has been spent to April 30, 1969.
4.	No.


Mr. Brewin: 1.	How many DDH280 class destroyer escorts are being constructed and what is the total estimated cost of this program?
2.	Have any destroyer escorts been delivered to the government?
3.	How many destroyer escorts are in the process of assembly?
4.	Where and for what purpose is the DDH280 class destroyer intended to be used by the Government of Canada?
5.	Is the Government of Canada, in the light of the Prime Minister's comments in Parliament on May 8 and May 9, considering cancelling the DDH280 program?
Questions


David Walter Groos: Mr. Speaker, the answer to the first part of the question is, four, at a total estimated cost of $225 million. The answer to the second part is, no. The answer to the third part is, four. The answer to the fourth part is, these destroyers will be employed in the anti-submarine role by Maritime Command principally in the Atlantic area. The answer to the fifth and last part is, no.


Mr. McCleave: What is the target in numbers for 1970 of the Department of National Defence for (a) military personnel, and (b) civilian personnel?


David Walter Groos: Mr. Speaker, the answer to this question is as follows. The 1969-70 estimates are based on a military strength of 98,238, and a continuing civilian personnel strength of 36,685, together with 3,674 man years of non-continuing employment. The target for the 1970-71 estimates will not be known until the defence review has been completed.


Mr. Orlikow: 1.	Which Minister is responsible for the . operations of the Treasury Board?
2.	Which Minister is responsible in general for the science policy of the government?
3.	Do the Chief Science Advisor and the Science Secretariat report directly to the Privy Council Office?
4.	If not, which specific aspects of the Science Secretariat's work are directly responsible to the Privy Council Office?
5.	Which specific aspects of the Science Secretariat's work is the responsibility of other government departments or agencies?


Mr. J. E. Walker (Parliamentary Secretary to the Prime Minister):: 1. The President of the Treasury Board.
2.	The Chairman of the Privy Council Committee on Scientific and Industrial Research, the Hon. C. M. Drury.
3.	The Chief Science Adviser to the Cabinet is also the director of the Science Secretariat. On most aspects of his work, he reports directly to the Chairman of the Privy Council Committee on Scientific and Industrial

June 9, 1969
Questions
Research. On matters coming before the	3.	Not	applicable.Cabinet itself, in which scientific and tech-	4.	Not	applicable,nological considerations are relevant, the c nnniinnhio Chief Science Adviser works as part of the	'	'Privy Council office through the Secretary to	o.	Not	applica e.
the Cabinet.
4. Answered in 3 above.	loan to commonwealth trust company
5.	None.


Mr. Howard (Skeena): 1.	Does the government have any knowledge of the procedures used to obtain estrogens from pregnant mares?
2.	If so, what are the details about such procedures and, if they are considered of a cruel nature, are any plans underway to limit the degree of such cruelty and, if so, what are the details of any such plans?


Hon. H. A. Olson (Minister of Agriculture):: 1. Yes.
2. The general sanitation, care, and management under which these mares are kept compares favourably with husbandry practices on the average premises where horses are maintained.
Urine is collected for about 4i months during which the mares are stabled, with daily exercise, and the remainder of the time they are at pasture. The supply of water and the diet is regulated in order to have urine of high quality. A controlled salt intake lessens the desire for water.


Mr. MacDonald (Egmoni): 1.	When was the Federal-Provincial Manpower Committee established?
2.	What are its terms of reference and responsibilities?
3.	To whom and when does it report?
4.	Who are the present representatives on this committee and by whom were ey appointed?
5.	How often does it meet an' when did it last meet?
6.	What expenses has it incurred?


Hon. Allan J. MacEachen (Minister of Manpower and Immigration):: 1. No committee having the name: federal-provincial manpower committee has been established by the Minister or by the Department of Manpower and Immigration.
2. Not applicable.
,


Mrs. Maclnnis: 1.	Did the Commonwealth Trust Company apply for a loan to the Canada Deposit Insurance Corporation during 1968?
2.	Did the Canada Deposit Insurance Corporation find the state of the financial affairs of the Company unsatisfactory?
3.	Did they make any recommendations to the Company to rectify this?
4.	Was this information transmitted to the Government of British Columbia or to any of its officials?


Edgar John Benson: 1, 2, 3 and 4. As was stated on May 21 in answer to the similar question No. 2,112, Hansard page 8888, it has not been the practice nor is it considered appropriate for the Canada Deposit Insurance Corporation to make public any information relating to the affairs of any member institution.


Mr. MacDonald (Egmoni): 1.	Since January 1, 1967, what advertising or publicity material had been prepared for or circulated by the Department of Forestry and Rural Development or the Department of Regional Economic Expansion?
2.	In what provinces was it distributed, in what manner and at what times?
3 What firms prepared or produced this material and at what cost?
4.	Were tenders called and, if so, what were the bids of the unsuccessful firms?
5.	Who were the chief executive officers in firms awarded contracts for advertising or publicity purposes?


Mr. Russell C. Honey (Parliamentary Secretary to the Minister of Regional Economic Expansion):: 1 and 2. Five advertisements were distributed in all provinces and one in Quebec. All related to programs of the Rural Development Branch of the former department, and were placed in selected daily and weekly newspapers and farm journals and on selected radio and television stations in January, February, March and May 1968.
June 9, 1969



3.	Inter-Canada Advertising Agency Limited at a cost of $15,397.
4.	No.
5.	President, Micrea Seni; Vice-Presidents, Henri A. Dutil, Yvon Fortier; Secretary-Treasurer, Zacharie Hara.


Mr, McCleave: 1.	Do any officers, directors or members of the Board of Directors of the C.B.C. (a) belong to labour unions (b) work in offices at positions below the executive level (c) work in the primary industries of farming, fishing or forestry outside of executive offices (d) work at an hourly wage rate (e) live in old peoples' homes or in buildings occupied at least 90% by those of 65 years of age or more?
2.	If so, who and in what category?


Gérard Pelletier: I am informed by the C.B.C. as follows: 1 and 2. The information in the Corporation's files relating to members of the Board of Directors does not contain the answers to these questions.


Mr. Yewchuk: Does the government anticipate introducing legislation which would expand the present copyright laws sufficiently to permit libraries to make use of modern methods of photocopying?


Hon. Ron Basford (Minister of Consumer and Corporate Affairs):: Canadian Copyright Law is at present under review by the Economic Council of Canada and until a report is received from the Council the Government does not anticipate introducing legislation that might be considered as prejudging any copyright matter.


Mr. Marshall: How much was spent on FRED Program Research for Newfoundland in 1965-66, 1966-67, 1967-68 and 1968-69?


Russell Clayton Honey: 1965-66, Nil; 1966-67, $31,217; 1967-68, $93,661;	1968-69,	$253,456; Total,


[Stage Direction]
Questions
Mr. MacDonald (Egmont): 1 Is a federal-provincial working group presently reviewing and revising the Interlake FRED Agreement for Manitoba?
2.	What are the terms of reference for this activity?
3.	Who are presently members of that group?
4.	What is it considered will be the essential changes made in the present Interlake Agreement?
5.	What representations have been received from the Interlake area and what attempt is being made to consult the various area and regional boards with regard to these revisions?


Russell Clayton Honey: 1. Yes, in accordance with the terms of the agreement.
2.	To examine what program changes, if any, would assist in achieving the objectives of the plan.
3.	Staff of federal and provincial departments, under the joint co-ordination of the federal and provincial managers of the plan.
4.	The guidelines for the review are based on the view of the two governments that the Agreement is generally working satisfactorily. Consequently they envisage no fundamental change of the plan, and no important modification of the Agreement's present overall financial structure. They do, however, call for improved co-ordination by bringing more existing federal programs within the plan, thereby broadening its capacity to meet the problems of low income and low participating people.
5.	The local chairmen of the ten Area Development Boards have presented their views to the Manitoba Minister and to the Interlake Advisory Committee. Representatives of the Area Development Boards have presented their views on each sector to the review working groups. Draft findings incorporating these views have been discussed with the boards. There have been consultations with the chiefs and councils of Indian bands in the Interlake area.


Mr. Yewchuk: Does the Honourable Minister of Consumer and Corporate Affairs foresee introduction of new legislation governing the labelling of food and non-food items this session?


Stanley Ronald Basford: No.

June 9, 1969
Orders for Returns
QUESTIONS PASSED AS ORDERS recreational purposes, and where are such projects EOR RETURNS	located or to he located?

 Return tabled.


[Stage Direction]
EXPENDITURES	FOOD CONTAMINATION BY DDT
Mr. Rondeau: What were the 1967 and 1968 totals of expenditure by the Department of National Defence and the various other departments on bookbinding (a) to whom were the contracts awarded (b) what was the total value of each of these contracts (c) on what basis were contracts awarded to one contractor rather than another?
Return tabled.


Mr. Robinson: 1.	Does the Department of Indian Affairs and Northern Development provide subsidies and/or support programs for any segment of the economy, groups or individuals inside Canada and, if so, to what extent, in what amounts and to whom are the amounts paid?
2.	What amounts have been paid for subsidies and/or support programs during each of the years 1960-68 inclusive?
Return tabled.


Mr. Coales: 1.	What are the names of information officers and Ministers' councillors (information) serving in Canada's missions outside of Canada?
2.	What is the salary and special allowances paid to each and is any part of such special allowances received a non-accountable, tax-free allowance?
3.	If so, what is the amount in each instance for the individuals who receive this non-accountable, tax-free allowance and why do they receive same?
4.	Were any of the individuals appointed to these positions appointed without their submitting to the normal public service competition procedures that apply to federal government appointments within Canada and, if so, what are the names of the individuals and the reason for the elimination of the normal public service competition procedures?
Return tabled.


Mr. Kaplan: How many projects have been commenced since the beginning of 1961 under the provisions of the Agricultural Rehabilitation and Development Act (ARDA) for which the Government of Canada has agreed, among other things, to pay 371% or more of the cost of acquisition of land to be used for
[Mr. Basford.j

Question No. 2,346-Mr. Danforlh:
1.	What is the tolerance level of the pesticide residue commonly known as DDT as an ingredient in food before it becomes dangerous for human consumption?
2.	Has the government been made aware that American authorities have placed a quantity of Cohoe Salmon taken from Lake Michigan under detention as having approached the danger level with regard to DDT impregnation?
3.	Can the government state the quantity of fish involved and if contamination was confined to this one species?
4.	Has the government, either on its own initiative or in conjunction with the United States, initiated any investigation to ascertain whether all the Great Lakes are contaminated by the chemical residue that could cause a health hazard by contaminating fish used as their food either by humans or animals?
5.	Have tests revealed that fish is the only food involved or is there a chemical residue buildup in other foods?
6.	Is the chemical residue known as DDT the only potential hazard or are there other chemicals in this category and, if others, what are chemical names and their nomenclature in common usage?
7.	How many registered pesticides include DDT as a component part and what are their chemical and common or brand names?
8.	Since the responsibility of testing, evaluating and registering of pesticides is the responsibility of the federal government, is there any reassessment underway on the basis of current information re residue hazard?
Return tabled.


Mr. Mather: 1.	In each of the last ten years, what has been the total number of physicians graduated by Canadian medical schools?
2.	In each of the last ten years, what has been the number of immigrants to Canada whose intended occupation was physician or surgeon?
3.	In each of the past ten years, what has been the number of physicians emigrating from Canada to the United States and, of these, how many were Canadian citizens?
4.	In each of the past ten years, what has been the net gain or loss of physicians in Canada?
5 In each of the past ten years, what has been the number of physicians who have written the specialty examinations of the Royal College of Physicians and Surgeons of Canada in each specialty and what number have attained specialty qualification in each specialty?
Return tabled.
June 9. 1969

[DOT] (2:20 p.m.)



ORAL QUESTIONS


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I had hoped the Minister of Finance would be in the house to answer questions which arise from increases in the prime lending rate in the United States. The rates have risen from 7| per cent to 8 per cent.
May I nevertheless direct a question to the Prime Minister about something else. Does he intend to let parliament see a copy of the agenda for the federal-provincial conference to be held this week? If so, when does he propose to do this?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, with respect to the first question, my hon. friend knows that the Minister of Finance is to be in the house tomorrow. To answer the second part of the question, it has been agreed by the provincial premiers and myself that no part of the conference working papers, notes or agendas will be made public in advance of the conference. So the answer to that question is that the house will not know that.


Robert Lorne Stanfield: A supplementary question, Mr. Speaker. Will the Prime Minister say whether any progress has been made by the ministerial committees on proposals relating to the Senate, the Supreme Court, and the declaration of rights prior to this week's meeting? Or is it the intention of the government, as indicated in some apparently inspired newspaper articles over the weekend, to leave this matter aside and turn to proposals to do with spending power and regional disparity?


Pierre Elliott Trudeau: Mr. Speaker, I think the hon. gentleman is wrong in assuming that these were government inspired stories. I did not see them myself, but obviously, we are bound to respect the decision of the provinces made in conjunction with ourselves to keep this a private working session. Therefore to comment on this session would be a breaking of that commitment on behalf of the federal government.
Inquiries of the Ministry


Robert Lorne Stanfield: Mr. Speaker, I have a further supplementary question and I suppose I will receive a similar sort of answer. However, we must continue to ask for information on behalf of parliament and the country. Has the federal proposal on the spending power been circulated among the provinces in order that this proposal be discussed during this week's meeting? Also, will we in parliament be given an opportunity to see this?


Pierre Elliott Trudeau: Well, Mr. Speaker, whether parliament will be given an opportunity is a question which is separate from the issue of this week's federal-provincial meeting. If the opposition parties so desire, I would be prepared to consider in the next session of parliament our having a committee on the constitution. Perhaps it could be a joint committee of the House and Senate. That is something we can discuss when the time comes around.


Some hon. Members:: Hear, hear.


Pierre Elliott Trudeau: This is independent once again of this meeting of the federal-provincial conference.


Robert Lorne Stanfield: Well-


Mr. Speaker:: Order, please. Has the hon. member for York South a supplementary?


ATTENDANCE OF PREMIERS-OPPOSITION MEMBERS AS OBSERVERS
David Réal Caouette: Mr. Speaker, I would like to ask the Prime Minister a supplementary question.
Is he assured that the provincial premiers will be at the conference? Secondly, will opposition members be registered as observers and, thirdly, will a debate on the Canadian monetary question be on the agenda?


Pierre Elliott Trudeau: In reply to the first question, Mr. Speaker, I must say we expect all premiers to be present, since they all agreed on the date. Because of elections-those in Manitoba-one premier had asked whether it was possible to change the date, but since too many provinces could not agree on a new date, we agreed on the original date, this week, and I understand that all premiers will attend.
With regard to the second question, Mr. Speaker, every province is free to form its

June 9, 1969
Inquiries of the Ministry delegation as it wishes. As far as the federal government is concerned, it does not intend to invite observers. There will be no federal observers at the conference, but some provincial delegations may include members of the opposition. I doubt it very much, but we are not in a position to ascertain the composition of delegations formed by the premiers themselves.
With respect to the third question, Mr. Speaker, the answer is the same as the one I gave to the Leader of the Opposition. The order of the day has not been made public.


David Réal Caouette: Mr. Speaker, I would like to ask a question of the Prime Minister.
Following up on the answer he gave me a while ago, the representation at the federal-provincial conference is left to the discretion of the provinces-that is understood-but hon. members do not represent one province in particular, but in effect, I believe, Canada as a whole. The government will be represented but with a view to safeguarding national unity and establishing better understanding between hon. members and the people of Canada, would it not be wise to invite the members of the opposition to attend this conference as observers only, so that all will be aware of what is going on there?


Pierre Elliott Trudeau: Mr. Speaker, I think it would be only fair to say that the leader of the Ralliement creditiste has always been a strong advocate of national unity.


Some hon. Members:: Hear, hear.


Pierre Elliott Trudeau: But the fact remains that under the system by which government operates, it is its role to voice the executive's position and this is what we intend to do at that conference. For the time being, we do not feel any need for the valuable services of the hon. member.


David Réal Caouette: Mr. Speaker, I have a supplementary question.
I wish to thank the Prime Minister for his kind words, but the government is in office and can speak out. As far as I am concerned,
I do not ask permission to take the floor at that conference. But the Prime Minister speaks so well that we would like to be there to hear him.


LABOUR CONDITIONS
Mr. David Lewis (York South):: Mr. Speaker, I should like to direct a question to the Minister of Manpower and Immigration. In view of the consistent reports that thousands of high school and university students are unable to find summer employment, can the minister inform the house whether his department has taken or is developing some special emergency programs to deal with the situation at this time?


Allan Joseph MacEachen: Mr. Speaker, I have described to the house and in committee the steps the department has already taken. We do not have any new steps under consideration at the present time that will be in effect this summer.


David Lewis: A supplementary question, Mr. Speaker. In view of the fact the minister's statements to the house have been in reply to questions, although I appreciate he made a fuller statement to the committee, will he undertake to make a full statement to the house as to the program that is in process to assist students looking for summer employment?


Allan Joseph MacEachen: Yes, Mr. Speaker, I will be happy to consider that.


Robert Lorne Stanfield: As a supplementary question, Mr. Speaker, I would like to ask the Minister of Manpower and Immigration whether the advisory committees planned for his department have been established, and whether one of these committees is to be given responsibility with respect to advising his department on the subject of summer employment and student employment generally?


Allan Joseph MacEachen: Mr. Speaker, the Manpower and Immigration Advisory Council and the four subsidiary boards were named last week. It is hoped to have the first meeting on June 25, and at that time it will be possible to lay before the council quite a number of issues on which advice would be very helpful.


Robert Lorne Stanfield: As a further supplementary, Mr. Speaker, may I ask the minister whether he would consider making certain that the appropriate subcommittee is in being and at
June 9, 1969

work on this matter during the summer so that it can observe the difficulties and assist the department in coming forward with a more constructive program?


Allan Joseph MacEachen: Yes, Mr. Speaker, we have to do that. We expect that the Manpower and Immigration Advisory Council will be able to offer very useful advice, and we do have under consideration within the department and the government further programs that may be possible in future years, but that are not appropriate at the immediate moment.


STUDENT LOANS
David Lewis: May I
address this question to the Prime Minister? In view of the possibility that many young Canadians may not be able to resume their studies this fall because of the employment situation this summer, will the government in co-operation with the provinces consider expanding its student loan program? Will it also consider reviving the idea of student scholarships that was promulgated by his predecessor some years ago?


Pierre Elliott Trudeau: Mr. Speaker, the Minister of Finance has dealt with this question at various times. I think it might more properly be asked of him, but in a holding way I might say his answer has generally been that we have in the past increased the amount available through loans, so that the amounts available were always sufficient to cover the demands made through the provincial governments to the federal government.


PRESENTATION OF CANADIAN VIEWS TO U.S. TASK FORCE
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, in view of the large and notable list of ministerial truants I am driven to ask the Prime Minister whether the government has filed its views with the task force appointed by the President of the United States with relation to gas and oil imports into that country and, if so, in view of the fact that these submissions will be available for inspection by people in the United States will the Prime Minister agree to table the contents of the submissions made by the government, or at least make them public?
Inquiries of the Ministry


Pierre Elliott Trudeau: Mr. Speaker, the Minister without Portfolio (Mr. Lang) from Saskatchewan, who normally would answer for these affairs, is not a truant. He is not expected in the house today; he is expected in the house tomorrow. Perhaps the question could be asked of him then.


CANADIAN SOVEREIGNTY
Gerald William Baldwin: Mr. Speaker, perhaps I might direct a supplementary question to the Prime Minister's attention. Some time ago he indicated he would be making a statement in the house with regard to the Canadian government's position on our sovereignty over Arctic waters surrounding the islands in the north. May we expect this before the recess, or will the Prime Minister stall long enough so that the house will not be in session when he makes an announcement?


Pierre Elliott Trudeau: Mr. Speaker, if I stall, it will be until the house is in session again, and that might be some time.


WHEAT-RETENTION BY CANADA OF TRADITIONAL MARKETS
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. As the admission of Britain into the European Common Market will mean that certain exporting countries will be selling grain in a protected market, has the government developed policies to retain and regain Canada's traditional markets? I am thinking in particular of our market in Britain, and of our loss of sales to China because of sales that were negotiated by France?


Horace Andrew (Bud) Olson: Mr. Speaker, the Department of Agriculture and the Department of Industry, Trade and Commerce obviously have an interest in what would happen if the United Kingdom made application and were accepted into the common market, but it would be impossible to give any details about this matter in answer to a hypothetical question such as this.


Eldon Mattison Woolliams: Mr. Speaker, I shall ask the minister a supplementary question, and maybe the Prime Minister would like to

June 9, 1969'
Inquiries of the Ministry answer it. Has opposition been expressed by the government to Britain's joining the European Common Market, keeping in mind that if it did join it would not be bound to import agricultural products from Canada, and also keeping in mind that France and other nations in the Common Market heavily subsidize their agricultural exports?


Horace Andrew (Bud) Olson: Mr. Speaker, I am sure it is very clear to the hon. member that the detail he is asking for now is not available with respect to Britain's decision, and with respect to the conditions that the Common Market might impose regarding Britain's entry.


WHEAT-ADDITIONAL TECHNIQUES TO INCREASE EXPORTS-ACTION OF WHEAT BOARD
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, may I direct a further question to the Minister of Agriculture, related to this matter. Are the minister and the government considering other techniques to secure more export sales of grain, such as barter arrangements, acceptance of the currency of the buying nations as part payment, and better and longer term credit arrangements for the purchasing nations?


Horace Andrew (Bud) Olson: Mr. Speaker, the government, and in particular the Minister of Industry, Trade and Commerce, are considering all such things that may be helpful to enhance our international marketing.


Leslie Gordon Benjamin: As a supplementary question, Mr. Speaker, in view of the statements made last week by the Minister of Industry, Trade and Commerce about his concern regarding Canada's wheat surplus and the glut of wheat in world markets, is the government taking any action to provide authority and funds for the expansion of the Canadian Wheat Board, in particular its sales facilities and its research into marketing and products?


Horace Andrew (Bud) Olson: Mr. Speaker, here again I have to give the same answer because it is the one that is most accurate, and that is that many of these things, including the details, are under consideration, and when an announcement is ready it will be made.


Leslie Gordon Benjamin: Mr. Speaker, I wish to direct a further supplementary to the Prime Minister. In view of the repeated answers of this same nature that we have had all winter 
and spring, will the government establish an emergency committee of the cabinet to deal with these proposals and to take action on increasing our export sales?


Pierre Elliott Trudeau: Mr. Speaker, I don't see any need to follow this suggestion.


ASSISTANCE TO FARMERS TO BUILD STORAGE FACILITIES
Hon. D. S. Harkness (Calgary Centre):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. In view of the fact that a large proportion of the grain storage facilities on western farms is filled with last year's crop, have any plans been formulated to provide assistance to farmers to build more storage facilities, in view of the fact that in two to three months what looks like another big crop will be coming off the land?


Horace Andrew (Bud) Olson: As I have said a number of times in the house, Mr. Speaker, when any further or additional programs of assistance with respect to this difficult market situation are ready we will announce them in the normal way in the house. It may be of some interest to note that while there is a prospect for a good crop in some parts of the prairies, there is also some concern about drought.


WHEAT-REQUEST FOR GOVERNMENT ACTION TO MEET LOWER PRAIRIE INCOME
Robert Lorne Stanfield: Mr. Speaker, may I direct a question to the Minister of Agriculture. Recognizing the vast energy that he is putting into this matter may we expect him, or one of his colleagues, to announce the government's decision on requests for aid to the western farmer to meet the western farmer's cash problem? May we expect an announcement before the house rises for the summer recess?


Horace Andrew (Bud) Olson: Mr. Speaker, I am not exactly sure, but about five or six times since last October the government has made announcements respecting its assistance programs. There many be additional assistance programs decided upon and, as has been indicated, as soon as the policy decisions are taken an announcement will be made in the usual way.


Mr. Lome Nystrom (Yorklon-Melville):: Mr. Speaker, may I direct a supplementary question to the Minister of Agriculture In view of
June 9, 1969

the fact that last week the Minister of Finance forecast a budgetary surplus of $250 million, has the minister made representations to the government in an attempt to divert some of this surplus into an emergency assistance plan for western farmers?


Mr. Speaker:: Order, please.


CONSUMER AFFAIRS
Mr. Ray Perrauli (Burnaby-Seymour):: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. Is the minister in a position to state whether investigators from his department have been able as yet to determine the reason for the substantial increases in the prices of beef and other food commodities which have occurred in recent months in the lower British Columbia mainland area.


Stanley Ronald Basford: I do not really think I *can add anything to what I said in the house Thursday night last. My office is receiving daily reports from British Columbia concerning the situation there. I have asked merchants in the lower mainland area of Vancouver, where there is a labour-management dispute, to exercise restraint, and said that I would name those who do not exercise restraint.


BEQUEST FOR APPOINTMENT OF PRICES AND INCOMES COMMISSION MEMBERS
Gerald William Baldwin: Mr. Speaker, may I ask the minister whether his investigators have been able to come up with additional names for the prices commission.


Stanley Ronald Basford: As I have said, I hope to make that announcement very shortly.


INQUIRY AS TO ACTION TO MEET RISE IN PRICE INDEX
James Aloysius McGrath: Mr. Speaker, can the minister tell the house what steps his department is taking to deal with the rise in the consumer price index as forecast by the Dominion Bureau of Statistics, indicating another rise for May.


Mr. Speaker:: I suggest to the hon. member that he is asking for a statement of a very general nature which I suggest should be made on motions.
Inquiries of the Ministry


KENNEDY ROUND-PASSING ON OF LOWER PRICES TO CONSUMERS
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, a few days ago the Minister of Consumer and Corporate Affairs was asked about the technique or method by which the consumer would be assured of any reduction in prices resulting from tariff reduction under the Kennedy Round. His answer then was that he was unable to give an answer. Did he himself thereafter tell the press outside the doors of this place that he did not want to say what the government would do, as he wanted to announce it in a speech in Vancouver.


Stanley Ronald Basford: Well, Mr. Speaker, I am sorry if the right hon. gentleman feels he has been scooped.


John George Diefenbaker: Parliament has been
scooped.


Stanley Ronald Basford: As I said in the house the other day, I hope to make an announcement on this matter shortly, and I hope it is an announcement the right hon. gentleman will be able to agree with because I know he, as a fellow westerner, is as anxious as I am to see the policy of liberalization of trade carried forward as fast as possible.


John George Diefenbaker: It is not I who will be scooped. I should like to ask the minister whether he thinks that scooping parliament is in accordance with the responsibility of a minister.


Stanley Ronald Basford: No, but I think Vancouver is an extremely important place also.


Mr. Speaker:: Order, please.


AGRICULTURE
Mrs. Grace Maclnnis (Vancouver-Kings-way):: Mr. Speaker, I have a question for the Minister of Agriculture. Has the minister received representations from the Mainland Dairymen's Association of British Columbia opposing the legalization of the sale of filled milk or imitation milk on the ground that it would destroy the dairy industry on the west coast? If so, what is the position of the government with regard to this matter?

June 9, 1969
Inquiries of the Ministry


Horace Andrew (Bud) Olson: We have received representations from the organization named and from many other organizations respecting filled milk and modified milk. There have been some meetings and there will be further meetings between the federal and provincial authorities involved in the matter. I am sure the hon. lady realizes that the prohibition or sale of some of these products lies exclusively within provincial jurisdiction.


Winona Grace MacInnis: Mr. Speaker, may I ask the minister whether he would be willing to make a statement on this matter before the house rises?


Horace Andrew (Bud) Olson: Mr. Speaker, I would be willing to make a statement at any time when there is an agreement between both levels of government concerning the approach to this matter. As soon as that agreement has been reached, and I hope it will be soon, I would be willing to make a statement on motions, but I cannot give an undertaking at this time that it will be done before the house rises later this month.


CANADIAN BROADCASTING CORPORATION
Lloyd Roseville Crouse: Mr. Speaker, I should like to direct a question to the Secretary of State for Canada. Did he have an opportunity to hear and see the attractive and very entertaining opening concert of the Don Messer's Jubilee farewell tour at the Capital Theatre on Sunday, June 8 and, if so, will he use his good offices to urge upon the officials of the C.B.C. the desirability of reinstating on the national television network as soon as possible this outstanding group of talented Canadian musicians and performers.


Mr. Speaker:: Order, please.


INQUIRY OF THE MINISTRY
Mr. Thomas M. Bell (Saint John-Lancasier):: Mr. Speaker, this question is for the Prime Minister. Due to the fact that four ministers are not here today, on a day they should be here to carry out their responsibilities, will the Prime Minister arrange that this matter be placed on the agenda of the Liberal caucus think-in to be held this month.


POST OFFICE DEPARTMENT
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, this question is addressed to the Postmaster General. In the light of further spontaneous sit-downs by letter carriers, this time in Vancouver at Station "D" and in west Vancouver, can the minister advise what is being done to mitigate the obvious dissatisfaction of the letter carriers with the five day delivery procedures.


Mr. Speaker:: Order, please. I suggest the hon. member is merely repeating a question he has already asked on a number of occasions, including last week.


Heath Nelson Macquarrie: The strike has been
repeated, sir.


ZONING IN METROPOLITAN AREAS- NATIONAL CODE
Mr. R. N. Thompson (Red Deer):: Mr. Speaker, is it possible to ask a supplementary to a disallowed question?


Mr. Speaker:: Hardly; but the hon. member may ask a related question.


Robert Norman Thompson: Mr. Speaker, my question is related. I should like to ask the Postmaster General whether he intends to clarify government policy regarding the zoning of major metropolitan areas in Canada, to eliminate the present confusion in large corporations which depend upon their mail.


Eric William Kierans: Mr. Speaker, there is no need whatsoever for any confusion. What has happened is simply that the zones which presently exist shall remain. We expect and hope that all business firms will use them. In the meantime, as part of an interim study made by one of the task forces, we find there is a possibility of having a national code for all Canada, which would make it much more feasible for us to automate the entire post office.
Therefore in order to judge the feasibility and economics of a national code, while we are making a judgment we have preferred not to continue with additional zoning in other municipalities such as Vancouver, because this would then-


Mr. Speaker:: Order, please.
June 9, 1969


Gerald William Baldwin: Mr. Speaker, would the minister advise it automation will proceed to the extent of dispensing with the office of the Postmaster General.


Eric William Kierans: I would enjoy it.


FINANCE
Mr. J. M. Forrestall (Darimouih-Halifax East):: Mr. Speaker, this question is directed to the Minister of National Health and Welfare. I welcome him back from God's country. As a direct result of his visit, particularly to the Dartmouth area, and following discussions both in Nova Scotia and with the Black United Front, does he propose to make any particular recommendation to his colleague the Minister of Regional Economic Expansion.


Mr. Speaker:: Order, please. I suggest the question is not in order. The hon. member is asking the minister whether he intends to make representations to another minister. The question may not be asked in this way.


J. Michael Forrestall: Mr. Speaker, if I may rephrase the question I would ask the minister whether he contemplates any action as a result of his visit to the area of Dartmouth.


John Carr Munro: Yes, Mr. Speaker. I can advise the hon. member that my colleague the Secretary of State and myself and our respective departments are getting together with regard to the details of a grant that will be of assistance to the Black United Front.


NATIONAL DEFENCE
Mr. John Lundrigan (Gander-Twillingate):: Mr. Speaker, this question is for the Prime Minister. Could the Prime Minister indicate whether he has received a comprehensive brief from the provincial command of the Royal Canadian Legion in Newfoundland recommending a permanent force for that area, and if so would he indicate his response.


Mr. Speaker:: I think the question is of a type that should be placed on the order paper,, unless there is a matter of urgency involved.
Inquiries of the Ministry


John Howard Lundrigan: Mr. Speaker, may t ask a supplementary question?


Mr. Speaker:: Order, please. The hon. member might consider asking another question, because I have suggested the question he has asked could not be answered at the present time. The hon. member may wish to ask a related question.


John Howard Lundrigan: Mr. Speaker, as a related question, may I ask either the Prime Minister or the Minister of National Defence to make a statement on motions in the very near future to indicate the exact extent of Russian activity off the coast of Newfoundland, and relate this to the matter of a defence force for that area.


VETERANS AFFAIRS
Douglas Scott Harkness: Mr. Speaker, I have a question for the Prime Minister. Will he table a copy of the speech made by the Canadian Ambassador to France on Friday last, in connection with the D-Day celebrations in Normandy. I have a considerable number of questions in regard to this matter which I should like to direct to the Secretary of State for External Affairs as soon as he returns to the house, but I think it would be advisable first to have a copy of the speech.


Mr. Jean-Pierre Goyer (Parliamentary Secretary to the Secretary of Stale for External Affairs):: Mr. Speaker, this will be done tomorrow.


TRAIL, B.C.-REQUEST FOR SHARED COST CONTROL PROGRAM
Mr. Randolph Harding (Kootenay West):: Mr. Speaker, I would like to direct a question to the Minister of Public Works. In view of the recent disastrous flood in the Trail area, will the Department of Public Works assist in a shared cost program with the provincial government for flood control work on the creek which caused the trouble?


Mr. Speaker:: Order, please. Perhaps the question might be placed on the order paper.

June 9, 1969
Inquiries of the Ministry HIGHWAY SAFETY


TIRES-INACCURACY IN ADVERTISING CLAIMS
Winona Grace MacInnis: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. Given the serious implications of this matter, may I ask the minister whether his officials are investigating advertising claims misrepresenting the safety performance capabilities of automobile tires which obviously involve serious hazards to life and safety, and if so, would he indicate the results of this investigation?


Stanley Ronald Basford: I am quite sure they are, Mr. Speaker, although I am not personally familiar with the situation. I will check into it.


IMMIGRATION
Robert Norman Thompson: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. Is it new immigration policy that American citizens desiring to emigrate to Canada must first have a certificate of essential employment, or a work permit, from the Canadian government manpower services before such an immigrant application can be considered?


Allan Joseph MacEachen: Mr. Speaker, the regulations apply to American citizens who want to be landed immigrants in Canada in exactly the same way as they do to all other immigrants. There is no special treatment of Americans, or special requirements in respect [DOT]of them.


Robert Norman Thompson: A supplementary question, Mr. Speaker. Has a new regulation been implemented in recent weeks in regard to this matter, or do the original regulations apply?


Allan Joseph MacEachen: There is no new regulation, Mr. Speaker.


PUBLIC WORKS
Stanley Howard Knowles: Mr. Speaker, may I direct a question to

the Minister of Public Works. Has the federal government reached an agreement with the City of St. Boniface under which certain federal money will be made available for important engineering studies in that city, and will the minister say whether an announcement about this matter will he made at an early date?


Mr. Speaker:: Order, please. I do not know whether this is a matter of urgency. The way the hon. member has asked the question leaves some doubt in my mind.


Stanley Howard Knowles: May
I try my hand at rephrasing it, Mr. Speaker? Will the Minister of Public Works be making an early announcement which might affect the employment situation in greater Winnipeg?
Hon. Arlhur Laing (Minister of Public
Works): Mr. Speaker, I have had constant representations from the member of parliament for St. Boniface in connection with protection work at the river bank. There is responsibility to a degree there because it is a navigable stream, and I think it is accepted that some of the erosion is caused by the shipping that uses it. I will look into the matter, and hope to make a decision shortly.


WHEAT-REDUCTION IN CAR LOADINGS
Leslie Gordon Benjamin: Mr. Speaker, I would like to ask the Minister of Agriculture a question in the absence of the Minister of Industry, Trade and Commerce. In view of the fact that the latest figures from the Dominion Bureau of Statistics and the Canadian Wheat Board show some four thousand fewer carloads of wheat loaded as of May 21, compared with the same time last year, would the minister make representation to the Wheat Board and the railways with a view to having this situation rectified; and would he advise the house as quickly as he can when we will catch up on the number of cars loaded, compared with the same period last year?


Horace Andrew (Bud) Olson: I can get that information, Mr. Speaker, but I am sure the hon. member realizes that the total number of cars loaded has to be equal to and cannot be in excess of the total amount exported, and the space created by that export.
June 9, 1969	COMMONS



GOVERNMENT ORDERS


[Stage Direction]
The house resumed, from Tuesday, June 3, consideration of the motion of Hon. E. J. Benson (Minister of Finance) that this house approves in general the budgetary policy of the government.
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I am glad to see that the Minister of Finance (Mr. Benson) has been let into school, not just excused from school, and is now here to respond to criticisms and comments made in respect of the budget. It is highly proper that he should be here to discuss the question of interest rates and the statement he is supposed to have made. I do not know how the Prime Minister (Mr. Trudeau) arrives at priorities as to where information should be given, but it seems to me this is another attempt to disregard completely the rights and prerogatives of this house. Government announcements and policies are being made before the television camera or in Calgary, Vancouver, wherever a minister may be at the particular time and wherever he thinks he will make the most political kudos.
Last Tuesday night we were discussing the budget. At first blush it is, of course, rather difficult to see all the detail of the budget. I was in no different position this year from the immediate past when I looked at the budget in order to comment upon the detail of it. I will say to start with that the minister indicated this was to be an anti-inflationary budget. I suppose we are expected to join him in three cheers because the government has finally recognized that inflation is one of the worst problems we face. There has been passing reference to inflation. The minister's predecessor used to rather pooh-pooh it, and then in 1967 came into the house with great tales of woe with regard to inflation and the evils thereof.
If the minister feels that having now given a budget message it is incumbent upon the government to deal with the problem of inflation, I say to him and members of this house that he has missed the mark entirely, because I do not think this budget deals adequately with the question of inflation. The minister did not say anything with regard to interest rates except that they were unfortunately high. Interest rates, including those which the
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The Budget-Hon. M. Lambert government has to pay, are constantly climbing. I would refer hon. members to the weekly bulletins of the Bank of Canada. I need not go into detail about these because I do not want to take up time beyond what I think is reasonable in this limited debate to put on the record in chapter and verse all the vagaries of interest rates in so far as they affect the government.
Today it is absolutely essential that the minister be here because it was announced in the United States-the minister always indicates when interest rates in Canada are discussed that we are affected by those of the United States, and of course we are-that the prime rate in New York would be advanced to 8J per cent, a rise of 1 per cent. The minister should be here to indicate to the house the result of the conference he had with his officials consequent upon that announcement this morning.


Edgar John Benson: I am here.


Marcel Joseph Aimé Lambert: A great to-do was made last week in the house about the rise in the prime rate to 7J per cent by one of Canada's chartered banks. Are we now to expect that the rate of the Bank of Canada will be further increased and that the chartered banks will have to follow suit and we will see a prime rate of 84 per cent? If there is to be a prime rate on commercial loans of 84 per cent, are we going to see 10 per cent on housing mortgages within the next quarter? These are the points that we have to discuss and this is what the minister should talk about in the house this afternoon.
[DOT] (3:00 p.m.)
The minister also did not give any indication in his budget speech with regard to the level of government expenditures, although there is some information with regard to that in the budget white papers. There has been much self-praise by the government because of the surplus. I have also read a transcript of the minister's performance on a certain television program which followed his budgetary presentation in which he indicated that the government has taken care of the problem. He said that the government has taken care of the problem of inflation to the extent of taking out of the economy some $11 billion, which is a great deal. There are the additional taxes imposed by last October's budget, as a result of which almost $1 billion more will be taken out of the gross national product.
The minister was faced with an expenditure increase of some $880 million. Actually,
June 9, 1989

The Budget-Hon. M. Lambert his budgetary deficit amounted to some $735 million. He was aiming at a budgetary surplus on March 30, 1970, of $5 million. Now he says that we are going to have a net revenue of about $250 million to $275 million, give or take a few millions. I quite readily understand that a variation of a fraction of 1 percent in the estimation of revenues can produce quite a few millions of dollars; therefore I will not pin the minister down to the exact million dollars. But in effect, if there is no downturn in the economy between now and March 31, 1970, we may expect to see an extra $1 billion brought into the federal coffers as a result of those tax increases. Since 1965 we have had nothing but a succession of tax increases. If we want to see why, we only have to look at the expenditure side.
I should like to quote some figures from National Finances, 1968-69, issued by the Canadian Tax Foundation, table 20 as it appears at page 15. According to the table, in 1963 the total expenditures of the federal government were $6,570 million. That year there was a budgetary deficit of $691.6 million. The revenues amounted to $5,878.7 million. In 1969 the expenditure forecast was $10,780 million. We have to go a little higher than that because the total of the main and supplementary estimates A and B for 1968-69 turns out to be $10,823 million. The revenues in 1969 were $10,105 million, again on an estimates basis. The estimated deficit was $675 million. The revenues were higher because the added 2 per cent social development tax yielded some $55 million to $65 million in the balance of that fiscal year. Therefore the actual deficit on the basis of the predictions for 1969 was about $735 million.
What are the estimates for this year? When a man deals with his expenses and sees he just cannot meet them, either he goes to his boss and says "I would like a pay increase so that I can meet my expenses", or he takes the other alternative and cuts his expenses. The Minister of Finance did both of those things. He went to the country and proposed to tax the people an extra $1 billion. He did not cut his expenses. His thinking was to increase expenditures by $880 million and thereby have total estimates of some $11,858 million.
The other night the minister made a few minor changes. He will give the taxpayers a little bit of sugar to coat the very bitter pills which they have to take by saying, "all right, you can bring in some extra goods when you go travelling after I have hit you with an additional tax on the ticket you will buy". The minister lets us bring in from the United

States or from other countries abroad the equivalent of $100 more in goods that will be duty free. You are not allowed to bring in cigarettes or tobacco or an unexpended bottle of liquor duty free but you are allowed some little things up to $5 every time you flip down to the United States for 48 hours, and it will cost us about $25 million in order to give the taxpayer that tiny crumb.
All I say is that the government has continued to tax up to the level of its expenditures, and that is where I say that the government of Canada, being the senior government and the senior participant alongside the provincial or municipal governments, is setting the wrong example in taking some 35 per cent of the gross national product every year. All it does is to say that it is going to increase its expenditures and the taxpayer will just have to take it in the neck.
Of course the minister is interested in maintaining inflation. Why? Because of the nature of our income tax, both corporate and personal. As wages and profits go up in inflated dollars, the minister's stake is that much higher. The continual increase in revenues is not in real dollars. This year we saw a new cost of living index based on 1961 at 100 points, according to which we are already up to a little over 125 points, a shameful state of affairs especially for people with fixed incomes or pensions. What people who have put aside money in the form of insurance policies or annuities for their dependants have saved was frittered away last year at an increased rate of 3.9 points. Since 1963 the cost of living has continued to increase by an average of about 3J to 4 points. That is a shameful situation. The government has blithely ignored it and is not doing anything about it in this budget.
In order to assist the house I will read the motion which I wish to put to the house, but I also have a number of remarks to make on the various proposals. However, I will read my motion first.

I move, seconded by my colleague the hon. member for Calgary Centre (Mr. Harkness):
That all the words after "house" be struck out and the following substituted therefor:
"regrets the continuing inability of the government to curb the relentless increase in the cost of living since 1965, while increasing the hardship on the unemployed, the poor, pensioners, farmers and other victims of the just society."
June 9, 1969



I have here in English and in French the appropriate number of copies.
I am told that in the interpretation my colleague who seconds my motion was misnamed. He is the hon. member for Calgary Centre (Mr. Harkness), not Calgary South (Mr. Mahoney). I apologize if there was any confusion. Do you wish to put the question, Mr. Speaker?
[DOT] (3:10 p.m.)


Mr. Speaker:: Perhaps the hon. member should continue his speech, because the moment I put the question he may find some difficulty in pursuing his remarks.


Marcel Joseph Aimé Lambert: Thank you, Mr. Speaker. Now we look to see whether this government has been handling its finances in the proper way and whether the country believes it is dealing effectively with the problem of inflation. I would say its record is so appalling that even the government's own political supporters will not give it their approval. The Canadian Institute of Public Opinion reported during the first week of June that only 24 per cent of the Canadian population approve of the way the government is managing the economy. This is in contrast to the situation in other years, in 1959, for example, when less than a third of the population-31 per cent-expressed dissatisfaction with the government in this respect.
In both Ontario and the west only 28 per cent are satisfied with the government's feeble attempts to control inflation. What is more, this lack of approval extends most strongly to the very province from which the government is supposed to derive its strongest support, that is,

the province of Quebec, where 17 per cent of the people have been consulted and, according to them, the government now has satisfactory control over the economy.

The remainder, 83 per cent, fail to join the great shouts of joy which government backbenchers have been raising both here and in the country for the Minister of Finance. Liberals outside the house are almost equally divided between those approving of the government's action and those disapproving. And

The Budget-Hon. M. Lambert there is another 27 per cent who are obviously ashamed of the performance but who content themselves with saying they have no opinion. Only 37 per cent of all Liberals approve the action of their government in managing the economy.
Now let us look at something which was not affected by this budget except to the extent that it continues, namely, the 2 per cent social development tax imposed on October 22 last. This tax has been attacked as being regressive. I do not intend to comment upon the decision of the house when it approved the last budget, but in any event this tax is regressive for two reasons. First, we shall continue to protest about the ceiling provision. It would have been open to the minister to remove that provision at the present time. I intend to show that had he done so he could have raised a further $100 million on the basis of the estimates of income and that he could have left us alone with regard to other taxes. The maximum $120 payment makes the effective tax rate lower for those with incomes above the cut-off point. The cutoff level ranges from $7,100 for single persons to $10,500 for a family of more than seven persons. For a family of four, the cut-off is $8,700-the level the Prime Minister (Mr. Trudeau) was thinking of when he said they did not want to discourage people, that is, over $10,000.
It is odd that though the social development tax, in other words, medicare, sets the income ceiling for a family of four at $8,700- in other words, they are paying maximum tax at that level-one is not entitled to buy a house under the National Housing Act if one's income is below $8,000. This shows the inconsistency in the thinking of the government. The impression has been given that the cutoff point is reached at an income of $10,000. This sounds good, but on the basis of the figures I have been able to examine the cutoff point really comes at about $8,500. Yet, as I say, $8,000 is the figure below which the average family cannot buy a new N.H.A. house with the maximum term of repayment and under the most advantageous conditions.
This tax is still regressive. If it were extended through the removal of the ceiling, incidence would rise as income increased, assuming increasing ability to pay. After all, income tax is applied on the basis that the more you earn the higher the rates. Some people say this discourages incentive, but that is another argument. What we have is a system based on progressive income tax. This is a social development tax-medicare, and, I
June 9, 1969


Edgar John Benson: A thousand.


Marcel Joseph Aimé Lambert: A $1,000 million or $1 billion-that by doing so there is a lessened demand for goods and services to the extent of $1 billion? What is going to happen? Goods will accumulate on the market and people will not be hired. This, frankly, is a policy to encourage a certain degree of unemployment simply by non-production or under employment of the goods and assets now used. That is all there is to it.
In addition to taxation, the Bank of Canada has been forcing the chartered banks into a policy of tight money. The minister approved of increasing interest rates. Is the minister going to speak tomorrow as he spoke on Friday with regard to the increase of the prime rate of one of our chartered banks? The minister in effect said that high interest rates help to fight inflation; they are antiinflationary. That is the way the minister is reported. They discourage people from borrowing. We will, of course, expect the minister to approve of the increase of the prime rate to 8J per cent or 9 per cent. I trust the minister will correct the impression, but that is the way he is quoted in part. He is quoted in part as saying that the increase in the prime rate of a chartered bank is in effect an anti-inflationary tool that will discourage people from borrowing and therefore they will not spend. I cannot see that, Mr. Speaker.
Is the minister's answer to inflation idle plants, idle hands or fewer occupied, less wages, unemployment or under-employment? Is that what the answer is going to be? The provinces also have reacted to this continuing use of the surtax and the social development
June 9, 1969

The Budget-Hon. M. Lambert tax. They too seek additional funds, but the minister is being very careful to block off a certain source of funds.
Last week we also discussed income tax and the social development tax for the purpose of medicare. We were told the social development tax will take care of all the costs to individuals in the provinces that sign up with regard to medical care. The money they now pay to M.S.I., P.S.I. or some other program will now be paid to the Minister of Finance. There will be a limit of $120. A number of the provinces, including my own province of Alberta, have now set fees. As of July 1, a single person will begin to pay $60. A married person with a family will pay $120. Medicare allegedly was brought in to relieve the effects of medical expenses above the 3 per cent which is not allowed, in other words, the crushing burden of heavy medical expenses.
There is a joker in all this, Mr. Speaker, because Bill C-191 which was passed last week denies the inclusion in the exemptions in the medical income tax form of all other medical expenses paid by publicly administered medical care plans. A man with $500 medical expenses in excess of the 3 per cent not allowed him by the Income Tax Act used to be able to claim this amount at the marginal rate of income tax. Now he will not be able to claim the $120 that he pays in the social development tax. He could not claim what he paid to M.S.I., but everything M.S.I. paid on his behalf was figured in the schedule of medical expenses. It is very simple to figure out that an individual faced with heavy medical expenses will now lose under medicare compared with a plan such as M.S.I. He will lose the benefit of the deduction he was permitted by the Income Tax Act at his marginal rates.
[DOT] (3:50 p.m.)
If an individual had permitted medical expenses over the 3 per cent of, say, $400, and his marginal rate of tax was 25 per cent, that is, 25 per cent on the last thousand of income that was brought into calculation, he would gain $100 thereby. He paid his $120 to M.S.I. and he got back an exemption of $100 from taxable income. Now of course he is going to pay $120 to medicare and he does not get back his $100 exemption. Therefore there is this additional cost to the taxpayer under medicare. This was carefully concealed, Mr. Speaker.

Many of my colleagues want to speak on this measure but before concluding, I wish to speak about the nature of the minister's forecast surplus. He claims a surplus of $250 million. How is that made up this year? It is helped by $275 million of windfall payments on the speed-up of corporation income tax which will not be there next year. If the minister is to continue his pattern of expenditures he will have to provide additional taxes to make up the $275 million which will not be there next year.
My colleagues will be speaking about the customs tax changes with regard to incoming passengers, the air ticket tax on travel in and out of Canada, and other matters. I have already read to Your Honour and the house the amendment I have prepared, and I now formally move, seconded by the hon. member for Calgary Centre (Mr. Harkness):
That all the words after "House" be struck out and the following substituted therefor:
"regrets the continuing inability of the government to curb the relentless increase in the cost of living since 1965, while increasing the hardship on the unemployed, the poor, pensioners, farmers, and other victims of the 'just society'."


Mr. Max Saltsman (Waterloo):: Mr. Speaker, this budget will further aggravate the problems of unemployment and regional development. It neglects the tremendous, immediate problems facing the western farmers. It gives no indication of major federal initiatives which require urgent attention. And, finally, there are no measures to deal with Canada's eroding economic and political independence.
A huge budgetary surplus is a false and artificial priority for any government to seek. Problems and the spending necessary to solve them are only postponed to another day. Hospitals and many other health services, housing, education, pensions, and pollution are but a few of the areas where people are denied the goods and services they badly need.
In fact the budget perpetuates the present situation in which 20 per cent to 25 per cent of the Canadian population live in degrading conditions of poverty. The budget is of no inspiration to Canadians except to those small numbers in the high income bracket who thrive on the present tax system.
To use a restrictive economic policy in an effort to curb inflation, much of it the result of our link with the United States, will result in increased unemployment and economic decline without being an effective curb on the rise in prices. In effect the Minister of Finance (Mr. Benson) is giving us more of the
June 9, 1969	COMMONS
same treatment of last year, treatment that did not work last year, treatment that gave us the worst of both worlds, higher unemployment and higher prices. There is no indication that his remedy will be any more effective now than it was then. It will certainly leave us much worse off than before.
As if the regressive 2 per cent social development tax introduced in the October budget was not sufficient, the minister has increased personal income taxes again by continuing the 3 per cent surtax which had been due to expire at the end of this year. This is not a budget in which taxes are not being increased. There is a definite increase in taxes because the minister is not permitting the 3 per cent surtax to expire.
The minister's predecessor in his November 30, 1967, budget first proposed a 5 per cent surtax on individual income taxes only, a measure which was subsequently defeated in the house on February 19, 1968. A subsequent bill passed on March 15 introduced a basic 3 per cent surtax on personal income and corporation profits, which was to expire on December 31, 1969. Thus the minister has increased taxes by continuing the basic 3 per cent surtax until the end of 1970. This is expected to bring in budgetary revenues of some $25 million in the current year, and approximately $155 million in the next fiscal year. Of the $155 million approximately $115 million is1 assessed on a personal income tax and the remaining $40 million on corporations. Thus the basic, regressive nature of our tax system, which penalizes those who earn salaries and wages, is continued in the present budget.
1 would like to say a word about the Kennedy Round measures. The minister seems to take great satisfaction in advancing the date of removal of tariffs. The immediate removal of these tariffs, while it is marginally a good step, will not do very much to correct the basic problems of inefficiency in Canada. In some cases the Economic Council studies on the level of effective protection afforded by the Canadian tariffs, before and after the Kennedy Round changes, showed that the change in the level of protection would be very minor. Some effective tariffs rise; some fall; some stay the same. Most of the tariff cuts relate to producer or intermediate goods rather than consumer or final goods, and there is no indication that these tariff cuts will result in benefits to Canadian consumers.
On looking over the schedule of tariff cuts one notices that many of them reflect no 29180-625
DEBATES	9881
The Budget-Mr. Saltsman change at all. There is one outstanding item here. In effect the minister has continued the tariff schedule on important items like walking sticks and walking canes of all kinds. The tariff schedule is now identical with what it was previously. One finds that many things which all along have been free on tariff are continued on a free basis. I think it is unfair and misleading for the minister to try to indicate that he is making substantial changes in the tariff structure of the country.
More importantly, the Kennedy Round reductions do little regarding the rationalization and structure of the branch plant nature of the Canadian economy. They do not tackle the question of multi-national corporations and international pricing policy by these corporations. I think the minister had an opportunity to bring in measures that would encourage the rationalization that would end the efficiency of our industry as a method of reducing consumer prices.
The minister's attitude toward interest rates is most disturbing, as is his attitude toward the capital needs of the government. He has announced that the federal government will sharply reduce its demands on the domestic capital market this year. Ottawa will have to raise $200 million to $300 million over the balance of the year compared with $721 million last year. This reflects the restrictive nature of the budget. On a larger basis it also reflects1 the inability of public bodies, federal, provincial and municipal, to raise necessary capital for public use from Canadian money markets. The present tax system is biased toward equity rather than portfolio or bond investment. And because of rising interest rates the pay-off for government bonds is1 even less attractive. Competition for savings is pulling money out of the federal government's Canada Savings Bonds at a record rate.
[DOT] (4:00 p.m.)
In spite of this the government has allowed and in fact encouraged the private sector to increase its expenditures and its access to the money markets in Canada, the very same money markets in which the federal and other governments compete for the same funds. In addition, the minister has introduced legislation which will increase the capital authorization of trust and loan companies, thus giving them greater access to Canada's money market. Newspapers state that he is tying his hands and inhibiting the ability of governments in Canada to get money at reasonable rates. A recent newspaper report
June 9, 1969

The Budget-Mr. Saltsman states that the Canadian government has restricted its entry into the money market and that Canadian businesses have done the opposite, borrowing more than the three government levels combined and almost doubling their amount of financing from the similar period a year ago.
I submit, Mr. Speaker, that at a time when there is pressure on us and a need for belt tightening, if we accept the concept that everyone must do his part in exercising restraint, why must it always be the public sector that is called upon to do this? Why is the private sector encouraged to do virtually as it pleases? This is not an act of responsible government. It is an abdication of the government's responsibilities. It is an abdication of its responsibility to ensure that the needs of the people are satisfied through public expenditures. While the minister gets out of borrowing, others rush in to take up the slack with the result that nothing really has changed. The same pressures exist and the same problems perpetuate themselves.
There has been a slight indication that the minister is aware of this problem. For the first time he has brought in a measure of selective depreciation whereby for the first two years on certain kinds of construction depreciation will not be allowed. While the principle is good and one which for a long time we have advocated the government should introduce, we have pointed out that the general levers of economic direction are no longer adequate for the times in which we live and that you cannot really control or manage the economy with fiscal and monetary policy alone. Selective measures are required.
In speech after speech in this house we have pointed out that while we are not able to meet our needs for hospitals, roads, schools and so on, office buildings are erected across the country, and we have called upon the minister to take some action. I must say the kind of thing he has decided to do is disappointing because it will not work. It is unrealistic. Even the minister admitted that it would be of marginal benefit when he was asked this question on television the other day. I hope I am summing it up fairly accurately. He said there are occasions when it might influence some people. I have had an opportunity to discuss the question of selective depreciation with various groups of people who have building plans. None of them indicated that they intend to defer any of their plans. If the minister had been serious 
about this there were ways in which he could have brought in a selective investment policy. But he was not really serious. He just wanted to point out that he understood the problem or knew something about it and was going to make a gesture in the direction of the problem. Certainly nothing of any significance can come from the selective depreciation that has been introduced.
We have been critical of this budget for many reasons. We think the minister has misunderstood the state of the economy and has placed excessive emphasis on the question of inflation to the detriment of other requirements of the country. He seems to show very little concern for the problems of employment growth or for the problems facing agriculture. We would like to say, we hope in a constructive way, something about the things this budget should have contained and some of the things about which the budget should have been concerned.
One of the major items is the question of agriculture because agriculture today is in a crisis condition. I come from one of the most highly industrialized areas of Canada, the area of Waterloo. I want to say something about how important agriculture is to our country. When the people who come from the farm areas outline the problems in respect of agriculture it is more or less taken for granted that as the spokesmen for these areas they must do this. I think it is important, however, for us from the industrialized areas to be concerned about the difficulties which face the farmers in this country. Industry, and the people who live with industry, owe a debt of gratitude to agriculture, one that should not be forgotten.
At this time agriculture is at a turning point. Unprecedented dangers face the industry. This is not something that will go away next year or the year after. Agriculture has always had its problems but this is worse than hail, drought, the box car shortages we hear so much about, or the dampness or price of wheat. The farmer today confronts the greatest crisis of his life. All that he has worked for may turn to nought. His years of toil and continued reinvestment may be lost. Nor will it be the western farmer alone who will be hurt. The desperate search for alternatives to grain will challenge the farmers of eastern Ontario within a short time, adding new difficulties to the many already existing farm problems of eastern agriculture.
What has the budget to say about this? Absolutely nothing. We ask how is it possible
June 9, 1969
for a government to be so oblivious to the heartaches of the prairie people. How shortsighted can they be? If the farmer goes, a livelihood on the prairies goes with him. Perhaps the government's policy is to let nature take its course and let the farmer go broke. If so, let the government say this. At least it would be more honest than its present policy. The government, by its indifference, seems to be proposing a solution of a kind, the solution of the grave. In the past we have had too many solutions of this kind and the country is strewn with and haunted by the ghosts of that neglect. Will the government later try to revive the corpse with industrial incentives, paying as they seem to be willing to pay up to $1 million in order to create 33 jobs? How much better and decent it would be to provide help now. It would certainly be much cheaper and far more effective.
It seems to us that two kinds of assistance are needed. The first is immediate cash payments to the farmer to keep him and his community going. The second is long term programs which would take into account heavy capital losses in the farm community. The farmer is not asking for special treatment, nor are we. After all, the government is willing to help industry which is hurt by the Kennedy Round changes through assistance programs. Is the farmer less entitled, particularly when he has reason to believe that industry has benefited at his expense?
The government must do something about interest rates. The cavalier attitude of the Minister of Finance the other day, when answering a question by the hon. member for York South (Mr. Lewis), is really to be condemned. Interest rates are rising fantastically in this country and yet the minister's attitude seems to be that it is a good thing to let interest rates rise because it holds down inflation. Surely that myth has been exploded a long time ago. Interest rates have a great effect on employment. A real attempt must be made to do something about them.
During the debate on the Bank Act we stood up in the house and pointed out the difficulties that would arise if the interest ceiling were removed from bank loans. At the time the argument was: You cannot do this to the banks and let the other institutions off scot-free. We asked that the federal government seek a meeting with the provinces to point out the difficulty and take some acion in bringing all financial institutions under an interest rate program.
9883
The Budget-Mr. Saltsman [DOT] (4:10 p.m.)
No one is naive enough to believe that we can simply dictate whatever interest rate we desire or can hold back the dike on rising international interest rates. But it seems to us that, while recognizing some of the limitations involved in the pricing of money, we can do a number of things which should be done. Whatever the defects of the ceiling may have been, at least it acted to restrain a rapid rise in interest rates. An attempt must now be made to place some control on interest rates.
We believe that Canada is being challenged today as it has never been challenged before. We think there are great dangers to our economy. There is the danger of our being taken over by continentalism. We are gradually being absorbed into the industrial structure of the United States without having any say whether this is where we want our future to go. There are inequalities in this country between the rich and the poor. There are shoddy values-a value system that says we can put more chrome on cars but we cannot build more houses, a value system wherein we spend more on soap and deodorant advertising than we do on correcting the pollution of our air and waters with which Canadians must live. There is a great gap between what we are doing and our potential.
Inflation is a great danger. It creates problems but surely it also creates opportunities. I suggest that at this time we have the opportunity to increase the productivity of this country. Our greatest hope of reducing the inflationary forces and containing price rises must surely lie in the direction of improving the efficiency and productivity of our industry. We have spoken on this subject many times.
One would have thought the minister would take the opportunity provided by this budget to do something about the problem. It is the presence of a danger that stimulates people to take action that they might otherwise not have taken. Instead, the minister has given us a budget which is a stagnant wasteland of squandered opportunity. It is a budget in which we have no confidence, a budget that I hope will be defeated. Therefore, Mr. Speaker, I move, seconded by the hon. member for Comox-Alberni (Mr. Barnett), the following subamendment:
That the amendment be amended by adding at the end thereof the following words:

9884	COMMONS
The Budget-Mr. Caouette
"and its failure to assist these people by granting relief from income tax to all single persons with incomes below $2,000 a year and all married persons with incomes below $4,000 a year".


David Réal Caouette: Mr. Speaker, I greatly deplore the fact that the Minister of Finance is the only one occupying his seat and that very few Liberal members are present, when we are debating a budget that we did not expect a few months back and that was presented to us on June 3 last.
We are now considering a sub-amendment to the amendment to the main motion, stating that the government should exempt from income tax all single persons whose annual income is less than $2,000 and all married persons whose yearly income is less than $4,000.
We shall certainly support this motion which aims to help the low-income people. As a matter of fact, the Ralliement creditiste has for many years been suggesting that the annual income of single people that is less than $3,000 and that of married people that is less than $5,000 should not be taxed.
Besides, members of parliament enjoy these exemptions on the portion of their income that goes for expenditures, and no one seems to complain about it. Even the ministers are entitled to an expense account which is tax free.
[DOT] (4:20 p.m.)
We are going to support the amendment moved by the hon. member for Edmonton West (Mr. Lambert) which reads as follows:
-regrets the continuing inability of the government to curb the relentless increase in the cost of living since 1965, while increasing the hardship on the unemployed, the poor, the pensioners, the farmers, and other victims of the "just society".
These are good grounds. This is a logical and true argument. However, when the Conservatives were in power, what did they do to rectify a similar situation? And today what is suggested to fight efficiently against the cost of living increase?
The minister does not know what to do because generally speaking, his budget speech the other night, was nothing but a poultice on a wooden leg.
I saw the government members applaud when the minister said: We will continue to levy the 3 per cent surtax until the end of 1970. They applauded the minister because he will keep a tax the small wage-earners can no longer pay.

DEBATES	June 9, 1969
But the government has no solution, and they tell us about the problem saying: We are faced with inflation. But we have been hearing the minister say that for 10, 15, 20 years now. There is no magic solution. We are not economists; yet week after week, month after month, session after session, we hear the same idle stories and the Minister of Finance tells us he is powerless in that area.
Mr. Speaker, what does the budget boil down to? First of all, to an increase in the interest charges on the debt, which means that we will pay more interest on the debt than we have ever paid; the figures are there to prove it. If you look under the heading of all government expenditures, you will see that the interest charges amounted to $817 million in 1961, $1,147 million in 1964-65 and $2,102 million in 1968-69, and a fairly high increase is predicted for 1969-70.
Where federal government expenditures alone are concerned, interest charges on the debt in 1968-69 cost $1,479 million and of course, this year, the Minister of Finance will have to redeem government bonds that were put on the market and bought by the Bank of Canada.
Then the government went to the chartered banks for loans because they can, according to the law passed here by parliament, multiply government bonds by 14. And the government, the Minister of Finance, like a good little boy, on his knees, flat on his face before the system, borrows at higher interest rates to pay bonds sold perhaps 5, 10, or 15 years ago.
That will add to the interest charges on the debt this year. Besides, the minister says so in his budget: We will pay more on the national debt.
The minister has not opposed this increase in the interest, but the government, the Canadian people will have to pay for it, in the long run and they cannot afford it.
The minister has no answer to provide. He says: we do not perform miracles. As if miracles were needed to tidy up Canada's finances. As if miracles were needed to make wealth available to the Canadians. No indeed, it is scarcity we are making available to the Canadians and nothing else.
Mr. Speaker, according to the budget, interest charges on the debt will go up.
Then, the minister tells us there will be no further taxes. As for the 3 per cent temporary surtax, which was to end in December 1969,
June 9, 1969

it seems that it will be with us until December 1970. Does the minister have the cheek to pretend that this is not an increase in taxes? Indeed it is and the surtax which was supposed to be a temporary one will become permanent.
I say at this stage to the Minister of Finance and to the government that this surtax will never be abolished and that should it be removed, it will be replaced by another tax which will become permanent. That is mere window-dressing and the people are being fooled that way.
The minister says there will be no tax increase. In his budget, he says airplane tickets will be taxed. This means passengers will have to pay more for their airplane tickets as well as people using air carriers to ship goods. There are no tax increases, no, but there are increases in airplane tickets.
The minister states on the other hand that customs duties will be abolished on certain goods imported from the United States. I know that this measure will perhaps help the wholesalers and the retailers, but will the minister really reach the consumer? Can he guarantee that the consumer will pay less?
The customs duties are to be removed to enable the Canadian industry to compete with other industries. But since when can the Canadian industry compete with the American industry? The United States have a population of 200 million and when they produce, for instance, 150 million television sets while Canada produces perhaps 10 million sets, can we say that we can produce at the same cost as the United States? We must, of course, be logical and honest and let the truth be known. With such methods, the Canadian industry will face such competition that, in a few months, we will perhaps see an increasing number of industries closing, employees being laid off and unemployment growing. That is the prospect put before us by the Minister of Finance.
Mr. Speaker, instead of abolishing the customs duties imports, which deprives the government of revenue, the minister should have used those customs duties to subsidize the small Canadian industries in order to enable them to reduce their costs and to compete effectively with the Americans and the other countries. By so doing, the government would have made a positive move. Instead, it did nothing but worsen the situation of these industries.
It seems to me that the government would have acted more logically if it had kept the
The Budget-Mr. Caouette revenues coming from such duties because, as I mentioned a while ago, the customs duties now bring in $760 million to the government. As for what will be exempted from duties, let us suppose that it is a matter of $200, $250 or $300 millions, that could have helped the small Canadian industry to survive, and not to wind up, as seems the government purpose at the present time.
[DOT] (4:30 p.m.)
In other fields, the minister tells us that from now on tourists will be allowed to bring back from the United States $100 worth of goods instead of $75. However, not all Canadians spend 48 hours in the United States. Members of Parliament, businessmen, those who have decent positions can go. But can the unemployed, the poor, the sick, the disabled visit the United States and avail themselves of the right to bring back $100 worth of goods after a 48-hour stay? Most Canadians have never set foot in the United States and probably never will.
Mr. Speaker, I would have thought that the government would have announced in the construction field, for instance, the removal of the 11 and 12 per cent tax. But no! The government says:	We cannot change the
income tax or the taxation system. It looks as if taxes are not increased but they are really.
This afternoon I asked the Prime Minister (Mr. Trudeau) if some opposition members would be invited as observers to the conference to be held in Ottawa on June 11 and to which the provincial premiers and the Prime Minister of Canada will meet to discuss the Canadian constitution and determine if the provinces are entitled to more revenue and to taxation adjustments more satisfactory than those existing at the present time. So, Mr. Speaker, there will be cultural exchanges and talks in the finance field. The provinces will tell us, as asual, that they lack the necessary powers and that Ottawa should impose more taxes in order to distribute the proceeds among the provinces. It would be a kind of national UNESCO. There is the international UNESCO for exchanges in the art field and so on. This would be a UNESCO in the national taxation field, but not with the same meaning as the international UNESCO. My interpretation of a national UNESCO is as follows: Union naturelle des essouffles sociaux avec les cocos officiels (Natural Union of Social Windbags and Official Eggheads). That will be their UNESCO. That is the kind of people who will have a meeting in Ottawa two days from today.
9886	COMMONS
The Budget-Mr. Caouette
We already know the results. The federal government will say: We cannot afford to give you more, so if you need more money, take your responsibilities and impose your own new taxes; you know where to go: in the taxpayer's pocket. The provincial representatives will go gack home in poor shape, and the results of the conference will be exactly the same as in the past.
Mr. Speaker, there is another point which the Minister of Finance strongly underlined, saying that: the sums granted to date to the rich provinces of Canada, that is British Columbia, Alberta and Ontario, will be decreased so as to stimulate the construction of public buildings in the underdeveloped provinces. Which means there are seven underdeveloped provinces and three are economically sound.
I must point out that among those three provinces, two have been under Creditiste administration for a number of years: Alberta for 33 years and British Columbia for 18.
Now, because those provinces were lucky to have efficient administrators, they will be penalized by being asked to help the deprived provinces, while there are opportunities to improve the conditions in every province without taking anything away from any of them. But the government does not have the necessary means to act and most of all it does not want to assume its obligations and responsibilities.
Mr. Speaker, this brings me to speak about economic matters. On May 22 last, the Rallie-ment creditiste introduced in the house a motion which read as follows:
That, in the opinion of the house, the government has failed to take adequate measures in order to give Canadians the benefit of a policy of distribution of goods and services which would allow each citizen to obtain his share of Canadian abundance.
Mr. Speaker, it seems to me the motion is logical, not demagogic but realistic. To debate the motion, the government called upon two ministers who evidently could not praise Social Credit and, in fact, did not do it.
The Minister of Regional Economic Expansion (Mr. Marchand) said he was not an economist, and that I was not one either. It is obvious that I am not an economist, in the present system, to try to distribute scarcity opposite abundance, and the scarce thing is money. However, I say that the Minister of Regional Economic Expansion, who says he is not an economist, has nonetheless pointed out to the house that the Creditistes are inspired by the Holy Ghost, know magic solutions, and

DEBATES	June 9, 1969
everything was repeated by the Postmaster General and Minister of Communications (Mr. Kierans) who is an economist, but in the system which lies in the distribution of scarce money in an abundance of goods and services.
I shall quote first the Minister of Regional Economic Expansion who said: I congratulate the hon. member for Temiscamingue for having attracted the attention of the province and the country for 25 years with the same speech. It is quite a feat.
Mr. Speaker, why have I made the same speech? Because we have been faced with the same problems for 25 years. I should like to point out to the Minister of Regional Economic Expansion that he has also delivered the same speech for 25 years, although he has been singing a different tune these past years. For 25 years, while he was a union leader in the province of Quebec, the Minister of Regional Economic Expansion made the very same speech on every occasion, lashing all Canadian and Quebec politicians for being rotten. He repeated the same thing time and again.
I regret that the minister is not in the house. Today, he is making another speech because he is on the other side of the fence. Today, he is not so eager to encourage, to assist unions. He finds them unreasonable, while for 25 years he spent his time stirring up employees against employers. The minister was a professional strike organizer in the province of Quebec. In 1949, when workers' blood was shed at Asbestos, in the province of Quebec, the Minister of Regional Economic Expansion was responsible for it.
# (4:40 p.m.)
The minister was then speaking to workers, rousing them against employers. The minister should know that I never wanted to indulge in demagogy, which consists in rousing social classes one against another. I never did that, no matter who were involved, Noranda or Asbestos' miners, farmers, settlers, white collars, professionals, industrialists or merchants. The minister, who spent most of his life rousing employees against employers, social classes one against another, in the province of Quebec, for many years, is aware of that.
Today, he has other ideas. For many years, the minister was an avowed socialist in the province of Quebec, because all political parties and all politicians were rotten. Today, the minister is among the rotten politicians and he no longer speaks in the same way.
June 9, 1969

Mr. Speaker, for 25 years, he has tried to have some political influence. All the power and influence the Minister of Regional Economic Expansion has, he got them when he was accepted into the Liberal party and appointed to the cabinet; the same is true of the Secretary of State (Mr. Pelletier). As a matter of fact, they were called the three doves in the province of Quebec.
The three doves are now leading the Liberal party by the nose. Some people do not agree at all with such ideas but they blindly accept them nonetheless, because partisanship wants it so. The hell with one's country when the party must be saved. It will be saved at all costs and by all means. The end justifies the means.
Mr. Speaker, we are not that sort of people and I repeat that it is not through demagogy that we gain victories in the province of Quebec. The Minister of Regional Economic Expansion said that we are always making the same speech, that we always pity the poor; he then recognized that there are poor people and that their fate deserves our attention, and so forth.
Anyway, Mr. Speaker, the minister should know that we do not stir up the poor against the rich. We stir up the poor against governments' injustices and not against the rich. We are sure of one thing: a millionaire does not keep his millions in a corner of his bedroom; he invests them in a country or in a province because he wants them to bring in a return. Then, he sets up new industries, hires manpower, fights against unemployment much more efficiently that this government and that of the province of Quebec. We must not exterminate millionaires, Mr. Speaker. We need more of them to provide employment, to promote industrial development, agriculture and so forth. We should not crush them to serve the purposes of a government which more and more becomes th slave of a barbaric financial system disrespectful to the human being.
Mr. Speaker, the minister said that the Social Credit doctrine has never been implemented anywhere, thus, he concludes that it is no good.
I know that the Social Credit doctrine has never been implemented anywhere. However, we all know that things are also going badly everywhere. We all know that problems are of a financial nature.
I went to India last winter, in January, 12,000 miles away from Canada. I met the
The Budget-Mr. Caouette vice-president as well as the Speaker, hon. Mr. Ready. I asked them frankly: What is your No. 1 problem? Is it a problem of production? They answered: No. Then I asked: is it a problem of population? They said: Yes. We have too many people. Why? Because you do not produce enough goods? Exactly, we do not produce enough.
There exists a problem of production, I agree with that. However, Mr. Speaker, their main problem is of a financial nature, it is a monetary problem. Everybody talks about it.
What about England. What is the major problem there? Money. They are not trying anything new, but retain the present system. Therefore, they do not solve their problems which are persistent.
It has been clearly established that in many regions of India, four crops are grown each year. But the Indian people are not used to growing four crops a year. They are content with one or two and after that, they wait. They do not manage to get the third or the fourth.
I realized that instead of controlling birth, or sterilizing men, India should adopt an educational system to teach the Indians how to work, how to produce. There is enough space in India to feed at least five times the present population.
The real problem is not a problem of population but one of working habits. In that regard, I agree with the Postmaster General and Minister of Communications who says that we must work.
Yes, we must work, we know that. And the Creditistes know it. The Creditistes work differently from the Postmaster General and Minister of Communications to inform the public. We reach the public and the Postmaster General, the Minister of Communications and economist and former president of the Montreal Stock Exchange, former leader of the Montreal loan sharks-I greet him, for he is in his place-knows that what I say is true.
The Postmaster General and Minister of Communications said: Those who become Creditistes have no education, they are lumber-jacks, they come from the backwoods, from Abitibi and Lac Saint-Jean. He even went to Chicoutimi to give the Creditistes a blast.
There is another minister, Mr. Speaker, who is not enlightened by the Holy Spirit, nor by any spirit, for that matter. The light has gone out as for the Minister of Regional Economic Expansion.
June 9, 1969

The Budget-Mr. Caouette
However, before pursuing my remarks about the Postmaster General and Minister of Communications I want to say a few more words about the Minister of Regional Economic Expansion. He said, for example:
Naturally, when guilelessly or guilefully a man starts making capital of peoples' misery, he soon knows the sweet taste of success.
That is exactly what he did all the time he was a labour leader in the province of Quebec. He was not that successful. At that time, he would have liked to be a politician but the workers rejected him as such.
And the minister went on:
Whether he is a Socialist, a Communist or a Creditiste, when he addresses a crowd, a group of people who are hungry, of people who are poor and when he tells them: "They should solve your problem, give you more money," I know of no speaker with a modicum of talent who will not be applauded.
It is not applause we are after, and the minister knows that. Neither is it a magic formula but a system which consists in taking the products now existing in Canada-not the potential, the uranium, the forest or water resources to be developed in 25 years from now-but what we have now which is the outcome of the labours of the Canadian people.
The Postmaster General and Minister of Communications is well aware that production is the outcome of labour. Somebody had to work to obtain that production. Whether it be man, machine, science,, progress, it does not matter: somewhere a certain amount of work was done.
We are not asking for people to sit idle waiting for a national dividend. That is not what we are asking for, but a national dividend based on existing products. And this is what the minister fails to understand.
It would not be a national dividend taken from someone's pocket to be put into the pocket of someone else, because that would be socialism. What we want is a balance between the purchasing power of the people and existing production, and nothing else.
The Minister of Regional Economic Expansion said, and I quote:
That is why he is generally-
Meaning me.
-against trade-unionism which precisely seeks to ensure a better distribution of wealth.
The minister has been saying that for 30 years. Where is that better distribution of wealth?
And the minister went on:
Will miracles happen?-
-through the legislation that has just been submitted to us in parliament.
I am sure that the problem will not be settled once and for all. I know, however, that there will be less people in hardship conditions. How many? I do not know.
When? I do not know. Why? I do not know.
[DOT] (4:50 p.m.)
-I am not a magician, like the people of the Ralliement Creditiste. I have not found the philosopher's stone or any magic formula, I have no direct communication with the Holy Ghost.
Apparently, he does not even have any connection with intelligence, because his statement is rather embarrassing even for his colleagues.
I am simply trying, within the economic, social and political structures which I know, to help the people whom I represent.
Let us recall how he helped them, in the last election, by promising to refit the famous ship New Liskeard in the Lauzon dockyards, in order to get votes in Lauzon and in his constituency. The day after the election everything was forgotten.
The same thing could be said about the Canadian Vickers in Montreal. What is he doing about it? Absolutely nothing. When he is asked to establish a merchant marine, Mr. Speaker, the minister is lost in conjecture. He is at a loss what to do. A commission is being set up to determine whether a merchant marine would be economical in Canada.
Mr. Speaker, those are a few quotations from the speech the Minister of Regional Economic Expansion made in the house on May 22 last, when he lashed at the Ralliement Creditiste. He said, in conclusion, that the legislation is not administered by angels, and I quote:
That is true. We know that many people are poor. We are eager to fight poverty-
Instead of fighting poverty, they fight the poor.
-blit as a human institution, we are, unfortunately, no match for angels.
To put finance at the service of Canadians, only angels could do such a thing. The present government is unable to do anything in that field. And those statements were confirmed by those of the Postmaster General and Minister of Communications, who said:
That is no longer economics, Mr. Speaker,
(Mr. Caouette.]
June 9, 1969	COMMONS
-Social Credit-
-is sheer madness.
Sheer madness! And he goes on:
In other words, our country is overflowing with raw materials-
Everybody knows that, including the minister.
-and energy resources, and our agricultural potential is tremendous. All those riches serve to guarantee the value of this new money.
On that point, the minister is entirely mistaken as always. It is not at all what the Ralliement Creditiste said. They advocate the establishment of a sound monetary system, not based on potential, but on production.
And the minister added: What would we do with the unsold uranium? What would we do with the unsold farm products? With the wheat we have not sold? What would we do with all our unsold products?
Mr. Speaker, the first thing to do with all the unsold production should be to feed the Canadian people. Let us consider that first of all, instead of sales abroad. Of course, we have a foreign customers to supply but when we ask for an increase in income, the minister says: Money would lose its value.
Money would lose its value if we took it in the pockets of the people to redistribute it, to increase the price of goods. If wages and prices of materials are increased, surely, that would increase prices twofold, threefold, fourfold or fivefold, as is the case under the present system. The minister is aware that it is not Social Credit that raises the cost of living now, but the monkey system which he defends so ably, so boldly and so arrogantly when he talks to businessmen, professionals and social clubs.
Somebody should bring water to the minister, he needs it, it is time.
Mr. Speaker, the minister said:
Free credit, whatever its objective, will always bring about destruction of property.
We are now wiping out property. Social Credit is not doing it, it is the present system. The minister is aware of it. If we want to build a federal public building, a highway, a school, a hospital, under the present system, on account of the interest rates, we have to pay for three hospitals to have one: one for us and two for the financing charges. How far will the minister go in this direction? We are living in a money debt system.
I previously quoted as an example the case of the Jacques-Cartier bridge, in Montreal, 29180-626
DEBATES	9889
The Budget-Mr. Caouette and I shall quote it again. The original cost of this bridge was $18 million. Well, so far we have paid $20 million in interests only, and we still owe $14 million. The Secretary of State said to me once: yes, but the hon. member does not take into account the fact that, thanks to the Jacques Cartier bridge, goods have been carried from the south shore to the north shore. Everybody knows that, but if with the $20 million paid as interest a second bridge had been built, the minister must admit that twice the same quantity of goods could have been carried and we would have had two bridges instead of only one. We have already paid for this bridge twice and we still owe enough for a third one. Yet, the minister thinks that there is logic in that, that this way of doing things is intelligent.
I wish to come back to this point: the Ralliement creditiste has never suggested that credit be printed without consideration. I challenge the minister to find such words in any of my speeches. But I did say that the monetary system should be balanced according to what the people are able to produce. There was no question of raising prices and thereby creating more inflation. Let the minister tell us, on the occasion of a forthcoming speech, that to create new credit through the Bank of Canada will in no way bring about an increase in the price of goods. Distributed as a national dividend based on production among all Canadian citizens, it will increase their purchasing power without adding to prices. Indeed, when do the prices increase? The minister should tell us one of these days.
We can increase the Canadian consumers' pruchasing power without creating inflation by always keeping in mind the statistics on Canadian production and increasing the purchasing power independently from the wages earned. It is in such a way that we will succeed in fighting inflation, not with silly plans like those outlined in this house by the minister when he says that the Creditiste doctrine is nonsense. It is easy to say that the Creditistes are crackpots, that they are not educated. In the field of economics, however, I think that within the present framework of the financial system providing for the administration of a country with borrowed money created entirely by a few individuals, the minister is proving that he is not too well informed either. He is not really an economist of scarcity amidst wealth. There are in Canada such economists who inform governments, advise the Prime Minister and the provinces, and who are lost in a fog. Yes.
June 9, 1969

The Budget-Mr. Caouette Their heads are in the clouds, their feet on the moon and they do not understand a thing. Why? Because they are asked to reason according to the system.
Let us administer the taxes which we can levy. It is the system which the Postmaster General and Minister of Communications knows so well. He added:
Bertrand de Jouvenel recalls an Armenian proverb-
The minister is well-educated!
-which says: "The earth is like a pot and man is like a spoon in that pot." And the hon. member for Temiscamingue (Mr. Caouette) goes further and says: "We will give you bread." Mind you, not work, but bread.
There is an abundance of bread, but Canadians go without it. Is it more stupid to distribute bread than to let it become stale and say like the minister: Well, what you need is work.
Let the minister rise, with the other minister who attacked Social Credit. Let them give work to the unemployed in Montreal! That is what they want. Presently, they are not given any and they are told: Too bad, but we are in trouble, there is an inflation crisis. Does it mean we must let goods deteriorate in stores, bread grow mouldy and the unemployed tighten their belts? Evey budget harps on the same string. As far as work is concerned, we cannot offer them any. There are no jobs for the unemployed in Canada.
Mr. Speaker, what solution is proposed? It is said that the Creditistes state: You will give bread and not work. The minister says, and I quote:


Mr. Deputy Speaker:: Order, please. I am sorry to interrupt the hon. member but his time has expired.


Some hon. Members:: Continue.


Mr. Deputy Speaker:: Is there unanimous consent for the hon. member to continue?


Some hon. Members:: Agreed.


David Réal Caouette: Mr. Speaker, I wish to thank my colleagues from both sides of the house for always being so kind to me, but I think what I am saying is of interest to them. Even the minister is happy for I caused the scales to fall from his eyes so that he will see things more clearly and refrain from saying all kinds of silly things with respect to Social 
Credit as he often does, because I sincerely believe that the Postmaster General and Minister of Communications is an intelligent man and that, should he take the trouble to study what Social Credit is, he would have been a Creditiste for a long time now and would have left the ranks of Canada's financial sharks. It is hard-I do not ask the Holy Ghost to descend upon him-but I ask him to use his judgment before embarking on a course of action or making a statement.
The minister said, and I quote:
Socialists and Communists are more honest than that: they recognize at least the value of work, and agree that the fundamental principle on which every society must rest must be some sort of reward proportionate to the effort, to the initiative and to the economic contribution of the individual.
Are there people who refuse to contribute to the economic expansion of their country? All the people I know, who are getting welfare benefits, are eager to find a job, which would allow them to earn $5,000 or $6,000 a year, instead of receiving allowances of $125, $130 or $135 a month, to take care of the needs of a family of five or six dependents at home. Those people would like to work. Does the minister give them work? No. They are told that things are not going well. We must wait for the economy to pick up again.
In the meantime, taxes are increased, we talk about welfare. All those who receive welfare benefits in Canada would gladly contribute to increase the Canadian production, were they given the means to achieve that, and were they paid to do it, instead of being paid for doing nothing. Indeed, if one of them is caught working, he is deprived of his benetfis.
If he works and makes $100 a month, he may lose his $150 monthly welfare allowance. Obviously, this man will not be anxious to go to work.
However, most Canadians want to work. We, Creditistes, know that work is necessary, but work is not the purpose of a national economy. The purpose of the economy, in Canada as in any country, Pope Pius XI described it in 1931. The Postmaster General and Minister of Communications, who is a Catholic as I am-at least he is a Christian-should understand that. Pius XI said that economics will be soundly established and will reach its true objective, only when it gives to all-not only to the Grits, the Tories, the Creditistes and the supporters of the NDP party-to everyone his share of the goods nature and industry can provide. That share should be sufficient to insure to each and everyone at
June 9, 1969	COMMONS
least a reasonable well-being. He did not say to rob the rich for the good of the poor, but to "insure to each and everyone at least a reasonable well-being".
The minister understands that. However, he wants to pretend that he does not.
He ended his remarks by saying:
I wish I could propose to the people oX Canada a means of receiving without giving.
[DOT] (5:00 p.m.)
Canada owes its tremendous productivity to its people. The government is inconsistent and so is the minister. He goes in western and in eastern Canada saying that the only way to increase the Canadian citizens' income is by increasing productivity. However, at the present time, steps are being taken in the field of agriculture for instance, to curb production in western Canada because there is a surplus. In eastern Canada, there is a milk surplus. Then, steps are being taken to discourage dairy producers. Measures are being taken in various sectors to decrease production. Then, in the house, we are being told that production has to be increased in order to raise the standard of living of the citizens. But where? Let us know about it.
Mr. Speaker, in closing, the Postmaster General and Minister of Communications stated:
X regret to say so- I
I cannot afford it.
-but such a policy does not exist. It is a myth: the Social Credit myth.
Because Social Credit has never been put into practice. Is it a reason for not giving it a try? Is it a reason for not trying the experiment which I have been suggesting for 25 or 30 years? I am being accused of making the same speeches over and over again, of being a demagogue and so on.
As I said, Mr. Speaker, I have never promoted dissension among the classes of society. As I said before, I have called the people's attention to the ill effects of finance. I have not launched a personal campaign against the Postmaster General and Minister of Communications nor against the Minister of Regional Economic Expansion nor the Prime Minister of Canada. I do not engage in personal strife; my struggle is ideological. I pursue an ideology and I say to the government that you do not fight an ideology in a warlike fashion.
DEBATES	9891
The Budget-Mr. Caouette
Communism is an ideology. Attempts have been made to fight it with weapons. Similar attempts were made with regard to nazism. An ideology is won with a better idea but never with weapons. That is why we are opposed to wars and we are engaged in an ideologic struggle.
The government's present ideology is not so good since they do not know where they are going.
I heard last night the Leader of the Opposition (Mr. Stanfield), on the television program "Under Attack" on channel 12. He did not put forward any solution. He was asked what was the difference between a Tory and Grit, and he said it was almost the same thing: The Tories are in favour of private enterprise. Then the interviewer asked: Are not the Liberals, the Prime Minister, also in favour of private enterprise? He said yes. Should we say he is a Conservative with a small "c"? Maybe. We might say he is a Conservative with a small "c". So, the Prime Minister of Canada would be a Conservative with a small "c"; the Leader of the official Opposition would be a Liberal with a small "1". A mixture of both gives the results we have known with the two old-line parties since Confederation. Big deal.
Social Credit is not a myth; it is something logical. The two old-line parties are trying at present to make the Canadian people swallow an ideological myth. The people are fed up. They have had enough of it and they want action. I repeat: we are not asking for the issuing of green bills or credit without any consideration or limit, but for a scientific, human balance between the purchasing power and the Canadian production. That is what we want.
Nothing is provided in the present budget to bring about an economic recovery; there is only talk about fighting against inflation, and during that time, the Canadian people are being penalized.
Mr. Speaker, we are definitely against keeping the people in poverty when there is abundance in Canada. If our country is rich, if it has a potential, as the Postmaster General and Minister of Communications said, let us use our unemployed to develop that potential, not the potential of which we have no need, but that which we need, that the people are asking for. Instead of letting the bread grow mouldy, as the Postmaster General said, let us distribute it to those who are hungry.
June 9, 1969

The Budget-Mr. Deachman Let us feed them, let us clothe those who are naked, and house those who are without decent homes. Then, the government, the Postmaster General and Minister of Communications, the Prime Minister, and the Minister of Regional Economic Expansion, together, will have helped the people. At long last they will have put the Canadian economy in the service of the human being.


Mr. Deputy Speaker:: Prior to recognizing the hon. member for Vancouver Quadra, I wish to advise the house of the questions to be raised tonight at the time of adjournment.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 40, to inform the house that the questions to be raised at the time of adjournment tonight are as follows: the hon. member for Winnipeg North Centre (Mr. Knowles)-Social Security-possibility of legislation to decrease family allowance and old age benefits; the hon. member for Hillsborough (Mr. Macquarrie)-Education-employment of Canadian scholars in Canadian universities; the hon. member for Nickel Belt (Mr. Serre)-Regional Development-program for northern Ontario.



GOVERNMENT ORDERS


[Stage Direction]
The house resumed consideration of the motion of Hon. E. J. Benson (Minister of Finance) that this house approves in general the budgetary policy of the government, and the amendment thereto of Mr. Lambert (Edmonton West), and the amendment to the amendment of Mr. Saltsman.
Mr. Grant Deachman (Vancouver Quadra):: Mr. Speaker, in British Columbia the provincial government has been showing a film, "The Good Life", throughout the province. It is a portrayal of life in British Columbia as the Premier of British Columbia and his

officials believe it is lived. Before the Minister of Finance (Mr. Benson) becomes seduced by Mr. Bennett's portrayal of a dolce vita on the west coast, I wish to draw his attention to a few realities. A Vancouver teacher wrote to me very recently stating:
For the past five years I have been teaching in a transient area largely made up of foreign speaking families who don't know how to make the authorities aware of their problems.
She has written to me from Vancouver about an area in that city in which she teaches. She goes on to say:
Only the people who live there from day to day, year in and year out, haunted by real poverty, truly know what it is like.
Families move in and out and the housing gets progressively worse. One mother felt forced to move because she couldn't keep her children free from colds as their clothes and bedding never really dried out in their damp basement suite. Another family moved because the plaster was falling in chunks off the ceiling and the place wasn't heated. Another family, who have repaired and painted an old house at their own expense were forced to move when the landlord raised the rent for "improved accommodation" beyond their means. Where these people go heaven alone knows as they have little money for anything better.
For years there have been rumours of a public housing development for the area. But nothing comes of it and people continue to suffer.
Why can't money be found to defend today's children from disease, poverty and lack of opportunity for the good life-
[DOT] (5:10 p.m.)
I guess she has been hearing about the government's film as well.
-our country can give them if it wants?
I am cheered,, and I know we all are, that the Minister of Finance has been able, without raising either personal income or corporation taxes to produce a surplus in his budget, but I am also aware that we have hardly begun to fight the war on poverty or the housing crisis in metropolitan Canada, which is as real in Vancouver as it is in Toronto and Montreal.
Because I sometimes feel that members of this house believe that we who come from B.C. come from a land of milk and honey where such things do not really happen and where it is our privilege to contribute to those who are in need in other parts of the country, I wish to speak this afternoon of another crisis, perhaps even more far-reaching, more deeply rooted, more difficult to cure, and more significant for all Canadians than the housing crisis-the wheat crisis on
June 9, 1969	COMMONS
the western prairies. This problem is perhaps minimized because it is seldom stated in the house by other than prairie members. That is why I thought it would be useful this afternoon for a city man who does not live on the prairies to state the case here in the House of Commons, perhaps not in approved prairie terms but in terms that can be understood by city men such as myself.
The background of the crisis is stated by the Winnipeg Free Press in a recent reprint from editorial and news pages, in these words:
What are the major problems confronting the farmer? In the first place, he is confronted with formidable operating and living costs. The prices of many of the goods required for his operations are artificially enhanced by the protective system of which the government is the architect. On the other hand farm exports must be sold in markets, such as Japan, where demand is limited by the unwillingness of the Canadian government to remove the obstacles to imports from these countries. More specifically, however, the government through the Wheat Board controls marketing; it is not open to farm organizations to sell outside it. The board, after years made easy by the big deals with Chinese and Soviet state agencies, has simply not accomplished the selling job.
Behind the board is the government. With the rediscovery of the east, Mr. Alvin Hamilton encouraged the farmers to greater production with the doctrine of unlimited demand. His Liberal successors pursued the same course and the farmers produced as never before, ending with a surplus beyond anything previously recorded.
Here are the dimensions of the glut that now chokes and overflows the whole grain handling and storage system. I want to put this in terms that my city colleagues can all understand.
On July 31, 1968, about one year ago, we had a carryover of 665 million bushels, an inventory on hand of 665 million bushels before the new crop came on to the market, or an unsold amount equal to one whole year's crop, with another crop coming. We added to that the 1968-69 crop of 635 million bushels, making the astronomic total of 1,300 million bushels.


J. Michael Forrestall: Why didn't you sell it?


Grant Deachman: Perhaps the hon. member, coming as he does from the east coast, will be able to appreciate a western problem if he just listens to a city man telling it. He has been listening too long to his prairie friends.
After allowing for domestic use and exports we are going to end up on August 1 of this year with a surplus of 790 million bushels.
DEBATES	9893
The Budget-Mr. Deachman Behind that will be coming the current year's crop, so if sales drag and if the crop is good we could very well end up the crop year with almost one billion bushels of wheat on hand.
That is equivalent to $2 billion of unsold inventory. It is an amount so large in quantity that it would take an armada of 4,000 average grain ships ten years to carry it out of the port of Vancouver, with the facilities and the size of ships now coming in and out of that port. Is that a crisis? To put it in the words of the Winnipeg Free Press:
It seems clear that this country is in the final stretch of what can only be termed, from the wheat growers' standpoint, a disastrous year.
It requires little imagination for us to realize that the welfare of everyone in the west from Vancouver right through to the head of the lakes is going to be greatly affected by this crisis, and actually is affected by it now.
While the judgment of past governments and of the present government has been bad in regard to future demand for wheat, the judgment of western farmers has been no better in regard to beef and the demands for beef, which trades freely on the North American market, as opposed to wheat which is sold through the Wheat Board. Prices have suddenly gone up out of sight, and the western farmer is caught without sufficient feeder cattle to meet the demand or to take advantage of it. So we have a phenomenon in western Canada today of far more wheat than we are apparently going to be able to dispose of, with a $2 billion inventory in prospect, and a situation in which beef prices have gone out of sight but we are unable to feed the cattle and supply that market.
To return confidence to the western producer I hope we will shortly hear of comprehensive short-term programs designed to correct the current imbalance in agricultural production. For the longer term perhaps we need a royal commission to inquire into western agriculture and the agencies, such as the Wheat Board and the transportation systems, which serve it. We have had such inquiries in the past and they have done a lot to shape our thinking in regard to western agricultural and transportation economics.
As a Vancouver member I am closer to and more familiar with rail and shipping problems than I am with prairie agriculture. Vancouver began as a railway town and as a harbour town served by the railway. The planning and development of transportation in the lower mainland, or greater Vancouver
June 9, 1969

The Budget-Mr. Deachman area, has been hampered by struggles between competing railways, competing industries and competing governments. In a submission to the province of British Columbia and local governments and railways, the Lower Mainland Regional Planning Board recently protested such struggles in these words:
[DOT] (5:20 p.m.)
If the operating railways are not willing or are not able to co-operate to bring about this integrated rail service network on a joint basis, then immediate government action at all levels should be undertaken to institute a terminal rail system in the lower mainland.
The government of British Columbia and the government of Canada each operates a harbours board of its own that fights for possession and jurisdiction of the new superport at Roberts Bank. The C.P.R. and the C.N.R. have carved the inner harbour of Vancouver into two unco-ordinated and competing jurisdictions. The port of Vancouver development committee, which was established to give some guidance to harbour development, often finds itself on the outside looking at major transportation changes of which it had no knowledge, such as the Second Narrows railway bridge now nearing completion.
The National Harbours Board is too far removed from the scene to give strong direction and administration to the port of Vancouver and the other transportation facilities of the lower mainland. A complete overhaul of the National Harbours Board is long overdue. In the minds of many who are concerned about this problem such an overhaul should include the establishment of a crown corporation to run Canadian harbours with an autonomous western region capable of giving regional and local planning and administration.
I do not want to dwell at length on the transportation problem today. Let me say, however, that we need federal answers to a number of problems. What is to be the ultimate fate of the inner harbour of Vancouver? Is it to be a container port or will the great container cranes go to Roberts Bank? What is to be done to give the port more grain storage to take some of the stress off the rail system? What is the future of New Westminister harbour, caught between the conflicting ambitions of the inner port and Roberts Bank? What will be done to rationalize the conflicting federal and provincial jurisdictions and

the conflicting ambitions of the five railway companies that serve the lower mainland and the ports?
Still on the subject of transportation, let me mention a subject that greatly interests Albertans and British Columbians. On June 5 the Secretary of State for External Affairs (Mr. Sharp) told the house that a subcommittee of the United States House of Representatives will be in Calgary on June 19 to discuss with businessmen and local officials the paving of the Alaska highway. This highway comes under the Minister of Public Works (Mr. Laing). Formerly it was under the armed forces. It is not a provincial highway. For years westerners have urged the federal government to undertake an annual paving and improvement program for this highway. To head off local pressure, the government had two surveys undertaken, one by the Stanford Research Institute which indicated the route would not be very economical and another by the Department of Public Works which showed that the engineering would be costly and difficult.
If Sir John A. Macdonald had bought a couple of surveys like that he could have proved beyond doubt that the C.P.R. should never have been built. I ask hon. members, whether or not they are familiar with this problem, how can we possibly lose by building, maintaining and improving a highway which connects two provinces with the territories and Alaska, which connects Canada with the United States and in addition opens up a vast new area that constantly turns up new mineral resources? So I ask the government in its consideration of objectives to look toward the idea of a paving program for the Alaska highway in order that we may accomplish this task rather than beg the United States to do something for us which, if we do it ourselves, can only benefit us greatly.
When we bargain with the United States authorities on matters concerning Alaska and transportation between Washington and Alaska we should always bear in mind that area of Alaska, the Panhandle, which denies access to the sea to Canadian developers in northern British Columbia and the Yukon Territory. Any development which would benefit Alaska and Washington should have connected with it from the Canadian side negotiations for access to the sea through the Alaskan Panhandle.
In closing I should like to leave a thought with the minister concerning the mining
June 9, 1969	COMMONS
industry of western Canada which contributes greatly to our exports. This industry was alarmed by the suggestions of the Carter report in respect of the incentives which have developed that industry. I hope the Minister of Finance in preparing his white paper is prepared for a decent burial of those suggestions which affect the mining industry of western Canada and western Canada as a whole. The west has some great problems but they are not problems of poverty. They are problems which involve expanding our productivity and managing it in an imaginative and profitable way.


J. Michael Forrestall: Mr. Speaker, my remarks this afternoon will be in two parts. First I shall deal with one aspect of the budget and, second, I shall deal with the impact of certain statements in recent weeks having to do with our role in NATO. In his press release accompanying the release of his budget the other night the minister stated that the deferred depreciation measure should ease inflation by reducing demand in the construction industry in the 22 centres affected and that it should help to divert funds to housing, schools and municipal works. The budget provides for the deferral of depreciation allowances-I gather essentially for tax deduction purposes-for up to two years on commercial buildings put in place up to the end, as I understand it, of 1970. The term "commercial buildings" is defined to include buildings for wholesale and retail trade and services, office structures, banks, financial institutions and other commercial facilities such as hotels, theatres and service stations. This measure is to be applied only in those cities with a population exceeding 50,000 as per the 1966 census in the provinces of Ontario, British Columbia and Alberta. This covers, as I mentioned, 22 cities, 18 of which are in the province of Ontario. This is the reason my colleague, the hon. member for Edmonton West (Mr. Lambert), dealt primarily with Ontario in regard to this matter. Two of them are in British Columbia and two in Alberta.
The capital cost allowances, or depreciation, for tax purposes are the annual deductions companies can make from income subject to tax because of loss in value of the fixed asset itself. The allowance is 5 per cent a year on the diminishing balance of a non-wood, commercial building. For example, the tax writeoff for the first year on a $1 million building would be $50,000. It is estimated that the deferral provision will add between 6 per
DEBATES	9895
The Budget-Mr. Forrestall cent and 7 per cent to the cost of a building for the two year period. Deferred depreciation allowances will on this basis have little, if any, effect as an anti-inflationary device. I say this because the $850 million commercial construction expenditure, which is as near as we can come under the definition of what was set forth by the minister in his budget-this prediction for 1969 is to be found in "Private and Public Investment in Canada, Outlook 1969" represents only 8 per cent of total construction in Canada and only 5 per cent of all capital expenditures. My colleagues have said this, and I am sure that some hon. members who speak after me will say it.
[DOT] (5:30 p.m.)
My second reason for making this statement is that the three provinces whose large urban centres are affected by this measure account for 65 per cent of commercial construction, representing only about 5 per cent of total construction in Canada. The amount of construction affected is very small; therefore the impact of this anti-infiationary measure will be very small.
There are other factors which may render this deferred depreciation measure ineffective and, it has been suggested and I cannot dismiss it, even injurious to the aims that I am sure the minister holds quite sincerely. I would like to list these, Mr. Speaker. Let us recognize that income from building will be hurt for a two-year period because of the denial of this depreciation allowance. It is not for a long time; it is for just a two-year period. The developer is put into the position of being something of a gambler; he will have to determine whether costs will rise above that figure, and if he thinks they will he will bet in favour of building now. If the developer is forced to build outside urban boundaries, an injurious aspect that will come about is the furthering of uncontrolled urban sprawl. In any event, the ultimate effect will be increased cost which will be passed along to the consumer in the form of increased rent.
Commercial projects of any significance can take more than two years to build, so it is unlikely that anybody would hold up such building unless there is doubt that the provision will not be removed at the end of the first year after the completion of construction. This proposal might prove an incentive for people who feel it advantageous to move outside urban boundaries. This would have the effect of committing our municipalities and regional governments to greater expense and,
June 9, 1969

The Budget-Mr. Forrestall on an emergency basis, to control any further move toward uncontrolled urban sprawl.
This proposal would bring about increases in taxes in areas such as Toronto if commercial buildings, and thus the tax revenue derived therefrom, falls off. We must recognize that the construction season is well under way and the impact on construction during the next several months will be small; it might, as a matter of fact, be unnoticeable this year. The initial reaction of the Canadian Construction Association on this aspect of the budget was one of questioning whether it will have any effect at all on the inflation we are experiencing.
If the demand exists, developers will still build, and these increased costs will show up in the form of higher rents. With regard to commercial construction, as I have mentioned, in a city such as Toronto it will affect only a relatively small proportion; only 8 per cent of the total construction in the province of Ontario will be affected. For Alberta the figure is 5 per cent, and for British Columbia it is 6 per cent.
Two types of projects which probably will be affected because of the difficulty of financing are marginal operations and large operations such as urban renewal schemes, and so on. Since the minister made his budget speech I have found no economist predicting a substantial hike in the total volume of construction; in fact, I have found it predicted that the figure will remain the same. There will probably be some transfer of funds from commercial buildings, as defined by the minister, to the area of high-rise apartments. Here again, rents will be increased and because of this the cost of living will rise. Many points could be made in respect of the budget but these are the four or five points that occurred to me and which I wanted to bring to the minister's attention. It seems to me that the minister would have been a great deal better off if, instead of introducing these proposals, he had taken positive steps to reduce prices and the cost of living index. Statistics issued by the Dominion Bureau of Statistics indicate that the price of ham has risen from 117.9, on the basis of the policy instituted in 1961, to 131. The same increase is seen in respect of a great many dairy products, beef, pork, various meats, fats, oils and bakery products. I notice that the price of hamburg has not risen too much; this is probably because it is all most of us can afford to eat.
Because we are limited to 20 minutes in this debate and there are other areas of concern to me, I should like to direct some

observations to the question of maritime command and the intentions of the government in this respect. If we are to accept the principle of acting in our own defence, we must consider the first line of that defence to lie in the area where conflict would first erupt. Accepting this principle, I reiterate my concern for the continuation of forces in being in Europe. I qualify that by simply recognizing that because we are now limited to a defence budget of some $1.8 billion, change has to occur. In my view this change must come through the orderly development of the area of our greatest expertise; that is to say, I hope the current defence review has taken into consideration, and will continue to do so, the military role in which Canadians have developed their greatest expertise and credibility.
It is true that our reconnaissance squadron in Europe is the best in the world, but this is only a small part of our defence make-up. Our peacekeeping forces in Cyprus and elsewhere have developed extraordinary skills, but again this represents only a small part of our defence posture. We have a highly qualified defence interceptor system in Canada. However, in none of these areas have we developed full credibility in the eyes of our allies. There is one area in which Canada has in the last 15 or 20 years emerged as a leader among the nations of the world. I refer to our expertise in the anti-submarine warfare role. I say seriously that if we are to achieve and maintain the trust and respect of our allies, then it seems to me that whatever we specialize in we must be capable, in the eyes of our friends, of accepting a full share of the responsibility for our nation's sovereignty and continental defence.
[DOT] (5:40 p.m.)
I suggest that it is within the context of maritime command that we have the only rational course of action open to us. I am not saying that we should abandon the concept of a highly mobile brigade or that we should diminish our contribution under NORAD. What I am saying rather is that it appears from the freezing of the budget and from statements that have been made by the Minister of National Defence (Mr. Cadieux), the Prime Minister (Mr. Trudeau) and other leading government spokesmen, that cut-backs are inevitable and that the specialization of Canada's military role into the 1970's is a necessary consequence.
It is a matter of personal regret at this time that I do not share the apparent immediate
June 9, 1969	COMMONS
enthusiasm for the masterpiece of equivocation of the Minister of National Defence in reply to a question I asked him on June 4 about our maritime role. I want to quote it because I do not want false optimism to sneak into the picture. The minister said in reply to my question:
Generally speaking, I think people who have a special interest in naval affairs should be encouraged by the policy statement by the Prime Minister, because evidently this is a role which has to be enlarged. So I suppose there is no such worry.
Are we to accept on this basis the proposition that there will be an enlarged navy? Not by a bloody long sight!
I can only suggest to the house that I do not accept this as an assurance that there will be an increased role for the navy in the immediate future; quite the contrary. In reply to written questions posed by my colleague, the hon. member for Halifax-East Hants (Mr. McCleave), we learned that the Department of National Defence is giving consideration to a follow-on aircraft to replace the Argus. On the other hand, however, there is no indication that similar consideration is being given to a follow-on aircraft for the Tracker. We have had, in the last three or four weeks now, every indication in the world to believe that the Bonaventure is going to be scrapped. Indeed, in Halifax now they are beginning to pay off officers and put them on strength at Stadacona. In addition, there has been no denial, either in private conversations or in public statements by the Minister of National Defence or anyone else, of the very persistent and current rumours that under the base consolidation program the C.F.B. Shearwater will close. In the light of these two or three very brief examples I can only conclude regretfully that there will be a reduction in the structure and strength of maritime command.
It may well be that the Prime Minister foresees surveillance of our own territory and coastal waters as a matter of first priority; indeed, in April in Calgary he listed it ahead of continental defence, NATO and peacekeeping. But it must be pointed out, and it must be remembered by people who are affected, that from concept to full operation in our northern waters will possibly take from six to seven years. So while the mid or late 1970's might see an enlarged maritime force, I repeat that there is nothing by way of evidence to support the speculation of an enlarged navy through the five year period immediately ahead.
No small part of my concern stems from the fact that an identifiable $150 million a
DEBATES	9897
The Budget-Mr. Forrestall year is contributed to our economy in Nova Scotia as a direct result of the presence of maritime command in its present form. It is difficult to determine the actual generation of dollars that results from this investment. However, recent studies have indicated that some 28 per cent of the Dartmouth-Halifax economy stems directly or indirectly from this investment. I suggest that the base supports another 20 to 30 per cent.
I do not want to be an alarmist, but I must point out the grave, moral responsibility of the government to announce its intentions clearly and honestly at the earliest possible time. Some of the questions that must be answered involve the intention of the government with regard to the base consolidation program, the total number of service personnel involved; those that are to be maintained at Shearwater, at Stadacona, at the dockyards and on the ships on the east coast. We must know what is to happen at Greenwood, Cornwallis and C.F.B. Summerside. The truth must be told about the government's plan for the navy as it relates to its anti-submarine warfare role. We owe this to our friends. We must know whether planning has already started for an Arctic role for the navy, as has been suggested. We must know whether the government intends an expansion of the Bedford Institute of Oceanography paralleling as near as possible a reduction in the numbers of servicemen in the Halifax area. We must know if contingency plans are being worked out to meet any vacuum that might be created as a result of force reductions. We must know if consultations have begun with the provincial government over this matter. Rumours are persistent that they have. If consultations have started, we must know what the nature of them is; and if they have not started, why they have not.
No other metropolitan area in Canada or any other province in Canada is as dependent on a stabilized flow of defence dollars as is Halifax, Dartmouth and Nova Scotia. If reductions are to come, then we must be told so now so that planning can begin. Otherwise, the cost to the Canadian taxpayer in terms of the transition services will outstrip by many times the cost of maintaining the maritime role in its present context. Indeed, so serious is the misinterpretation of the Prime Minister's remarks at Calgary in April by the Minister of National Defence, as was evident in his reply to my question, that Nova Scotians and indeed all Canadians are entitled now to a detailed statement of what is intended.

June 9, 1969
The Budget-Mr. Winch


Mr. Harold E. Winch (Vancouver East):: Mr. Speaker I am not a professional economist. I am not an expert on high finance. I am not a constitutional lawyer. But, as a down-to-earth citizen of Canada with an experience of almost 38 years as an elected member of parliament I believe that I know Canada. I claim to have a knowledge of the Canadian economy and to understand the possible and probable results which will follow the fiscal policy enunciated by the Minister of Finance (Mr. Benson). Therefore, I want to make a few comments on the budget speech.
Many of us were most disappointed when the Minister of Finance, in what we anticipated would be an attack on inflation in Canada, announced the bringing in of discriminatory legislation so far as the construction industry is concerned. It has always been my understanding that discriminatory taxation was not only unparliamentary but unethical. Yet, here we have the Minister of Finance stating that in an attack on the inflationary tendencies across Canada he will bring in discriminatory taxation against the provinces of Ontario, Alberta and British Columbia.
I did not believe that it was possible for this taxation to have the effect which he had in mind. I always like to speak on the basis of facts when I rise to my feet in the House of Commons. So most of this morning I was in conversation with people in British Columbia. I telephoned the B.C. Trades and Building Council; I was in touch with the B.C. Chamber of Commerce; and I was in touch with a top executive of one of the biggest corporations in British Columbia. What was the result of the conversations? The B.C. Trades and Building Council informed me that they did not expect any major impact on construction in B.C. for two years because the major buildings now under construction or committed in financing were sufficient to keep the majority of the skilled tradesmen of B.C. and Vancouver working most of the time. As a matter of fact, they anticipate a shortage of skilled tradesmen this fall. When I spoke to officials of the chamber of commerce I was told they could not foresee any impact on construction in British Columbia for reasons similar to those given by the trade unionists, though the proposal might have a small impact on some projects-nothing of an important nature, however. No one to whom I spoke thought the proposal would have any serious impact during the next two years and no one, certainly, believed it would have a dampening effect on the inflationary spiral.

* (5:50 p.m.)
It was also the general opinion that any alternative capital investments to be made by industry would not in any case go into the depressed areas which the minister has in mind. But the important thing I learned from my telephone calls this morning to the chamber of commerce, industrialists and trade unionists was this: it is not the next two years which will be important, but the third and the fourth years. This is because it is necessary to plan two years ahead.
Those who are directly concerned with these projects ask: what will the situation be at the end of two years? They do not know, because, some say, they cannot trust a Liberal minister of finance. Mr. Speaker, less than two years ago the former minister of finance brought in a 3 per cent surcharge on income tax and corporation tax to expire at the end of this year. Now, the government has broken its word. It has broken faith with the Canadian people. The tax is to be renewed for another year. What people are asking in British Columbia is this: how can we trust a minister of finance who will break his word with regard to taxation? Will he also break his word and break faith when it comes to this discriminatory fiscal procedure against British Columbia, Alberta and Ontario? Will it not be extended as the surcharge was? This is a serious matter and we have to take account of the attitude expressed by spokesmen for the construction industry, their fears for the future of the industry and its economy. Account must be taken of this loss of face, or loss of faith inasmuch as the Minister of Finance and the government are ready to break their word and extend legislation beyond the period set when it was introduced and accepted by parliament.
There is one other matter which I find most interesting; it is the proposal to impose a tax on airplane tickets. I find this proposal most intriguing and I should like somebody to tell me whether or not it is constitutional. I suppose the minister has gone into this aspect, but I still wonder whether it is constitutional to place a tax on airplane tickets. I know that under the British North America Act the federal government has jurisdiction over interprovincial and international communications and transportation. But when it comes to finance, the act says that direct taxation is the field of provincial governments while indirect taxation is the field of the federal government.
June 9, 1969


An hon. Member:: No, it does not.


Harold Edward Winch: Unless you bring in the argument that the federal government has imposed income tax, which some provinces still say is unconstitutional. But this was the result of an agreement made during the first world war.


Mr. Gray:: May I ask the hon. member a question?


Harold Edward Winch: Not at the moment. My time is limited. A tax on aircraft tickets is a tax applied to the consumer at the time he buys his ticket. Then again, why should there be a tax on one form of transport? We subsidize the railways on a mileage basis when they build railroads. I think it runs to about $25,000 a mile. We have been paying millions in subsidies to the railroads. We also grant subsidies with respect to highway construction- the Trans-Canada highway is an example. In one way or another we subsidize road travel and railway travel. Of course, I realize that we spend a lot of money on airport facilities, too, but why should we discriminate by imposing a tax on one form of transport and not on another? So both from a questionable constitutional angle and on the grounds of discrimination I do not like this tax and I think it should be entirely reconsidered.
May I call it six o'clock, Mr. Speaker?
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
DEBATES	9899
Seal Hunt Consideration by Committee House of Commons to exercise their responsibilities and to discharge their duties as members without undue interference. The question is whether the newspaper comments referred to by the hon. member for St. John's East constitute such undue interference as to be tantamount to a breach of privilege.
Privilege has been defined as the sum of the fundamental rights enjoyed by each house collectively, and by members of each house individually, without which they could not discharge their functions and which exceed those possessed by other bodies or individuals. May, in the 17th edition of his Parliamentary Practice, page 43, states:
When any of these rights and immunities, both of the Members, individually, and of the assembly in its collective capacity, which are known by the general name of privileges, are disregarded or attacked by any individual or authority, the offence is called a breach of privilege, and is punishable under the law of Parliament.
Generally speaking, newspaper articles considered to exceed the bounds of fair comment on parliamentary activities have been judged over the years as being in the nature of contempt of court and have been held to constitute breaches of parliamentary privilege. The question is to determine whether in this particular case the article quoted by the hon. member for St. John's East goes beyond the limits of fair comment, whether it offends the privileges of parliament, or whether it interferes with the rights and immunities of individual members in the exercise of their parliamentary duties.
Citation 113 of Beauchesne's fourth edition states that:
An attack In a newspaper article is not a breach of privilege, unless it comes within the definition of privileges-


Mr. Speaker:: Order. Before we resume the business at hand I thought that with the consent of hon. members I might give a ruling on the question of privilege raised earlier today by the hon. member for St. John's East (Mr. McGrath). Over the dinner hour I have had an opportunity to consider the matter very closely, to look at precedents and to consult learned advisers, whose wealth of experience and knowledge is always of great assistance, as it was in this particular instance.
It is clear that parliamentary privilege includes the right of hon. members of the
Beauchesne then gives the following examples of breaches of privilege:
Libels upon members and aspersions upon them In relation to Parliament and interference of any kind with their official duties, are breaches of the privileges of members.
In paragraph (3) of citation 108 Beauchesne says:
-but to constitute a breach of privilege they must concern the character or conduct of members in that capacity, and the libel must be based on matters arising in the actual transaction of the business of the house.
Paragraph (4) of that same citation:
Scandalous charges or imputations directed against members of a Select Committee are equivalent to libellous charges brought against the House itself-
June 9, 1969
9900	COMMONS DEBATES
Seal Hunt Consideration by Committee
I indicated this afternoon that when one considers the matter of parliamentary privilege in relation to newspaper comments, two conflicting interests must be taken into account. The first is the privilege of hon. members to exercise their duties free from undue interference. The second is the freedom of the press in relation to its reporting of parliamentary activities. On this point I should like to refer to a ruling of Mr. Speaker Macnaughton reported at page 4434 of Hansard of June 18, 1964. This ruling reads, in part, as follows:
It seems to me that if this editorial referred in general terms to members of parliament none of us, I suppose, would be so thin-skinned that we could not accept some rather healthy criticism-
At the same time I would suggest that the language used is very strong and might well be considered to constitute contempt of parliament. Against this, there has to be weighed the requirements of a free press reporting and commenting objectively on parliamentary activities. In view of the language used in the article in question there might have been some support for a finding of a prima facie case of breach of privilege. This would allow the hon. member for St. John's East to have his motion put to the house. However, there are, to my mind, two serious procedural difficulties which stand in the way of such action.
In this presentation, the hon. member acknowledged that the matter has to be raised at the earliest opportunity. On this point I refer him and hon. members to May's 17th edition at page 378 as follows:
A matter of privilege which claims precedence over other public business should be a subject which has recently arisen.
By way of example, the learned author quotes the following:
A matter which occurred during the recess was refused precedence as a matter of privilege because it was not raised at the commencement of the session.
Similarly a matter concerning an article in a newspaper published on 6 May was refused precedence because it was not raised till the 14th and a speech reported on a Saturday because it was not raised until the following Tuesday. On the other hand, when special circumstances justified it, the Speaker has permitted a Member to raise a matter on the day following the date of issue of the newspaper containing the article complained of.
In this instance, the article appeared in the Montreal Star of Tuesday, June 3. The question was raised today, Monday, June 9, nearly a week later.

In my view, the fundamental rule that a question of privilege should be raised immediately and without delay should be enforced. I appreciate that in some cases there might be extenuating circumstances, as where a newspaper is published in a remote section of the country, or if the offending article is published in a language other than that of the aggrieved member. In such circumstances a delay might be permitted. Such mitigating circumstances do not seem to exist in the case now before the house.
The second procedural difficulty comes from the form of the motion proposed by the hon. member for St. John's East. In my view, the motion should follow the question of privilege as a logical sequence. Such a motion cannot merely ask that the committee investigate whether or not there has been a breach of privilege; it must allege a breach of privilege. It should not simply propose that a matter be investigated to determine if there is or is not a breach of privilege.
This proposed motion is in fact a simple reference of a newspaper article to the committee, asking the committee to make a finding. That is not a motion of privilege but, in my view, an ordinary substantive motion which, of course, can only be moved in the usual way with the appropriate notice.
In view of the procedural difficulties to which I have alluded, and in spite of my serious misgivings about the allegations contained in the article in question, I have to conclude that the hon. member's proposed motion cannot be put to the house.
[DOT] (8:10 p.m.)



THE BUDGET


[Stage Direction]
The house resumed consideration of the motion of Hon. E. J. Benson (Minister of Finance) that this house approves in general the budgetary policy of the government and the amendment thereto of Mr. Lambert (Edmonton West) and the amendment to the amendment of Mr. Saltsman.
Harold Edward Winch: Mr. Speaker, since I have only ten or elven minutes left, I will not refer again to the two subjects I raised prior to the dinner recess. It seems to me, to judge from the facial expression of the Minister of Finance (Mr. Benson) and the way he nodded his head, that he does
June 9, 1969

not think I understand the nature of the general taxation power which is vested in the federal government under the British North America Act. I am aware of those powers and was aware of them when I spoke. I am aware of the provisions of the British North America Act. I still feel most strongly, nevertheless, about having the federal government intervene, through its taxation powers, indirectly in a field which, ethically, comes under the aegis of the provincial governments. Indirect taxation-Federal:	Direct taxation-provincial.
I wish to raise two other matters of concern to the city of Vancouver. Primarily, I am asking the government to show consideration to that city when policy is being implemented. I was pleased to hear the hon. member for Vancouver-Quadra (Mr. Deachman) speak this afternoon about the need for planning in connection with the inner harbour of Vancouver, the harbour at Point Roberts and the harbour at New Westminster. I wish to add a few words to his. An over-all plan of harbour development is long overdue. Developments at Vancouver, Port Moody, Point Roberts and New Westminster ought to have been considered long ago. I ask the government to consider developing Vancouver's inner harbour. The majority of piers, wharves and all grain elevators on the south side of the inner harbour are in the constituency of Vancouver East. I wish the government and the harbour commissioners would pay attention to air pollution emanating from the grain elevators. The federal government built four of the grain elevators. It has sold two, elevators No. 1 and No. 3. Having been sold pursuant to an agreement of sale, those elevators are now the responsibility of their purchasers, but is not too much to ask the federal government to make sure that the new owners abide by the terms of recent by-laws enacted by Vancouver City Council. That legislation seeks to control air pollution.
The federal government still owns elevators No. 2 and No. 4 in Vancouver East. It has been trying to lease or sell elevator No. 2. Having talked to members of the harbour commission this morning, I now understand that a possibility exists that No. 2 will be leased or sold. If it is leased, again I ask the federal government to obey the new bylaw of the city of Vancouver, which seeks to control pollution arising from grain dust. That pollution affects the centre of Vancouver and Vancouver East. On the other hand, if the elevator is sold the government ought to make it
The Budget-Mr. Winch clear to the purchaser that he, too, must obey the bylaws of the city of Vancouver and prevent pollution of the air by grain dust.
As for No. 4 elevator, the government has been trying to lease or sell it without success. Tenders for demolition have now been called. This elevator stands in the inner port of Vancouver on most valuable property. I ask the federal government not after demolishing the elevator then present us with a fait accompli. Instead, it should work with Vancouver City Council to ascertain the best use of this most valuable property. A deep sea pier might be built on the property, or even a new elevator.
In my remaining few minutes I wish to comment on another major topic. Not only is Vancouver the third largest city in Canada, it is also a seaport containing many different ethnic groups. West of Toronto, no constituency contains a larger number of ethnic groups than mine does. We have thousands of Italians, Chinese, Ukrainians and East Indians. I think there are over 30,000 Chinese in Vancouver and 10,000 of them live in my constituency. I was, therefore, most amazed to hear last week that the immigration department in Vancouver, which employs interpreters of various nationalities, had fired two Chinese interpreters. Fair is fair, Mr. Speaker, and I want publicly to express my appreciation to the minister and his office and, in particular, to his executive assistant for taking action. Immediately I drew this matter to their attention it was investigated and within 48 hours the interpreters were back on the job, pending a thorough investigation. That was a marvelous piece of cooperation, sir, and I appreciate it. I have raised this matter to ask for greater liason to be introduced between the minister's office in Ottawa and officials in Vancouver who are 3,200 miles away. When two interpreters are summarily fired in an international seaport containing thousands of people of different ethnic origins, confusion and heartbreak may be the result. I have expressed my amazement that an action was taken in Vancouver without the full understanding of Ottawa. I have expressed my appreciation for the speed and the co-operation I received from the minister's office. Coming from Vancouver, I know of the immigration problems that arise when there are many thousands of people of an ethnic origin other than English. I sincerely hope when a survey is made some interpreters in the different languages will be maintained in the immigration offices in Vancouver.

June 9, 1969
The Budget-Mr. Givens
[DOT] (8:20 p.m.)
As my time is now up, I will conclude by saying I have been only able to raise four points. However, I would appreciate it if the thoughts I have expressed and the recommendations I have made receive the full study and understanding of the ministers involved because irrespective of the various parties in government or opposition, it is my strong belief that we are imbued with the desire to arrive at final decisions which will be in the best interests of our country.


Mr. Philip Givens (York West):: Mr. Speaker, I find this matter of budgeting very exciting and interesting. I have had some budgetary experience. I was the budget chief in the city of Toronto. I keep reminding people here that city has a population larger than the population of seven of the provinces. It also has a larger budget than seven provinces.
In municipal financing, you must pay as you go. You have to be self-liquidating. You have no arsenal of weapons or tool-kit of gimmicks like the federal Minister of Finance (Mr. Benson). If you want to spend, you have to tax. You cannot spend the money without raising it in that year because you cannot borrow on a current account. You cannot have a deficit in a tough year and expect to pay it off in a good year because in municipal financing every year is tough.
As far as capital account is concerned, you cannot borrow money as freely as you would like in order to do the things you want. In the province of Ontario there is an Ontario Municipal Board and they have a ratio in which they work out a net debt to per capita assessment. They set up a formula which limits the municipality to a certain amount. There is a ten year projection which is a Procrustean bed within which they fit you. That is all you can do.
In Metro Toronto for a number of years we had a $100 million limit on our borrowing. That is what enabled us to maintain our triple A rating in the money markets of the world. The Minister of Finance must be a combination of Mandrake the magician, the medicine man and a manipulator of money. I often have visions of the Minister of Finance on a Monday morning calling up the Governor of the Bank of Canada and saying, let's increase the bank rediscount rate today; then let's phone Allan Lambert, President of the Toronto-Dominion Bank, and give him hell for increasing the prime rate. However, these things cannot be done in municipal financing.

What is the main problem which we have in this nation today? I think we are all agreed it is inflation. It is a dire threat which can lead to a catastrophe. Of what great moment is this matter of building higher skyscrapers if we are going to have runaway inflation, and our fixed income and low wage people go to the wall. The truth of the matter is that no one has all the answers on inflation or how to cure it. The Minister of Finance, who is an honest man, was honest enough in his speech to admit he does not know all the answers. Having listened to all of the opposition speeches that have been made today, I don't think they have all the answers either. Until we know what the final solution or answer is, we have to try all kinds of remedies.
I think the remedies proposed by the Minister of Finance in his budget speech are good. Incidentally, the main two proposals he made were suggested in the Carter Commission report. I have heard the members of the New Democratic Party on various occasions say that the Carter report is something they like. I wish to quote the suggestions made in the Carter report which are being implemented in this budget. One relates to the expansion of productive capacity. I quote:
If bottlenecks do occur, temporary specific measures should be used to restrict demand in these areas until productive capacity has increased,.. . What is needed, therefore, are good indicators of the degree of utilization of capacity in each geographic and industrial sector of the economy, reliable forecasts of the future changes in capacity and demand, methods of controlling aggregate demand that make it possible to vary the rate of expansion without stopping the expansion, and techniques for controlling demand in particular sectors of the economy when bottlenecks occur.
I wish to quote from another section dealing with tariffs:
For example, selective tariff cuts to inject more foreign competition where domestic competition has been unable to limit the wage price spiral might be of use in some circumstances.
That is exactly what is being implemented in this budget. The Minister of Finance was wise to build on these suggestions. Various members of the opposition have raised the bogey of discrimination. They have stated that this budget discriminates. It is meant to be discriminating. Perhaps a better word to use would be selective. This is probably a more proper word. The capital cost allowance deferral that is, the depreciation deferral, is only, a deferral. It is not a cancellation, or an elimination. It is not intended to cut down spending on building, but to divert building
June 9, 1969

materials and labour to residential and industrial purposes, even within the sectors where it is being applied in the three provinces of Ontario, British Columbia and Alberta. It is intended to divert these needed resources from sectors in the community where the capital has become overheated.
Some members of the opposition say this will kill building. In the same breath they say it will not work, that the people in the building industry will go ahead and build because they figure there is going to be a rise in price. The hon. gentlemen cannot have it both ways, Mr. Speaker. You cannot suck and whistle at the same time. Either it will work or it will not work. We say it will work.
The Leader of the New Democratic Party, the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), in the last election campaign made speech after speech deploring the fact that the government was doing nothing about the flashy new bank buildings, the theatres and the hotels. The government is now doing something about them in this budget. This is bound to affect the conduct of the lending institutions with respect to plans six months hence. I do not believe any significant change will take place within six months, but in six month there will be a remarkable and definite change. Anyone who has ever been involved or had anything to do with construction knows that the first two years are not big earning years in commercial buildings because they have a high breakoff point. It is not until there is approximately 80 per cent occupancy that you start to make a profit.
This measure will undoubtedly divert finances from marginal, non-essential projects to housing and industry. This is what we want. We talk about this being discriminatory on a geographical basis. When we make a comparison between the provinces we find some rather startling facts. I draw the attention of hon. members to a booklet entitled, "Private and Public Investment in Canada Outlook 1969 and Regional Estimates". This is published by the Queen's Printer. Hon. members should get this booklet because it is very illuminating. It points out with respect to commercial construction that in the province of Ontario there will be an increase of 31.7 per cent in one year. In the province of Quebec there was a decrease of 6 per cent as compared with an increase of 31.7 per cent in Ontario. With respect to business investment, Ontario is up 20 per cent over all. In the
The Budget-Mr. Givens province of British Columbia business investment is up only 5 per cent, and in Quebec and the Atlantic provinces there is hardly any change at all. In Quebec it is down from $352.6 million in 1968 to $324.4 million in 1969.
[DOT] (8:30 p.m.)
So far as unemployment figures are concerned, in Ontario the unemployment figure is 3.7 per cent. In Quebec it is 8.4 per cent, and as hon. members know, anything over 6 per cent is serious. In the Atlantic provinces the unemployment figure is 10.5 per cent. So, Mr. Speaker, you see it is only sensible to apply regional remedies. You cannot cure a high fever by more fever, or high blood pressure by hypertension. You cannot cure my weight problem by asking the hon. member for Winnipeg North Centre (Mr. Knowles) to go on a diet.
Several hon. members have said, "Don't kill the goose that lays the golden egg." I say we don't want this goose to die of coronary thrombosis either. The hon. member for Edmonton West (Mr. Lambert) says, "Don't knock success on the head," but we don't want too big a head of steam or something will burst. This is designed as a safety valve and this is the way I feel it will work.
With respect to labour costs, last week the Toronto Globe and Mail indicated wage settlements for Toronto construction workers of 12 per cent for the next two years. Today, the Toronto Telegram had a front page article which showed that Toronto electricians are to get $6.20 per hour, which is $232.50 per week for a 37J hour week. This is more than we get paid as members of parliament.


An hon. Member:: That is because they give light.


Philip Gerald Givens: So, we give heat, and we make up for the difference. I shudder to think how much our housing freeze, imposed last fall, will cost us when the contractors come back to have their contracts adjusted with respect to these new wage rates. I believe that inflation is chronic. I really do not believe it can be cured. I believe it has become a way of life. I have been bargaining for almost 20 years with labour unions, and in that time settlements have always been in an upward direction. New administrations come in with the best intentions in the world, but they find their hands are tied with these negotiated increases. I am not being anti-labour. It is the

June 9, 1969
The Budget-Mr. Givens same with management, with lawyers, doctors and all other professional groups. As I say, it has become a way of life. We hail our ministers of labour as conquering heroes for getting us wage settlements at one half of what was asked for, when what was asked for in the first place was double what should have been asked. Inflation has got to be controlled and restrained, and we must fight desperately to increase productivity.
So far as new Toronto buildings are concerned, which we saw so much about and heard so much about in the newspapers, I believe that the minister's new depreciation allowance will not affect those new buildings where firm commitments have already been made. There is a provision for pro rata depreciation for multi-purpose buildings. For instance, I do not believe that the Campeau project, if it is to go ahead, can be stopped. I also believe that the new hotel on the south side of Queen Street opposite city hall will go ahead. So far as the C.N.-C.P. properties are concerned, in my considered judgment they are not ready to be developed before 1970, but since this is to be a multi-facet residential project the residential aspects could be proceeded with before going ahead with the commercial part. I think it is better to balance out the boom than to have a bust. We should have sustained, controlled growth. This would be obviously better than what we have now.
Editorial comment in Toronto papers on the budget has ranged from the Financial Post's "Very Tough Job Nicely Handled," to a shrill, shreiking Tely editorial which was captioned, "A Disastrous Budget." The Globe and Mail had a professorial treatise on the subject headed "Will the Budget Work?" and concluded that it probably wont. The Toronto Star says that it probably will. So, you pay your money and you take your choice.
I think it is a good budget. I have heard nothing today which would make me change my mind. It shows intelligence, adaptability, willingness to innovate and try new methods. I support it and defend it against all opponents, including peripatetic mayors, particularly those who shoot from the lip in public interviews before they've even heard or read the budget speech.
One innovation I would like to see would be an interest tax credit, similar to the 20 per cent dividend tax credit granted to investors in the shares of Canadian companies. If I were minister of finance I would grant this to those who invest their money in housing mortgages at an interest rate of 8.5 per cent

or less. I sincerely believe that the revenue lost from such a measure would be far outweighed by the mortgage money it would attract to the housing field, and I think it is worth a try.
Now, I should like to speak for a few moments about a few remarks that appear on page 12 of the text of the minister's budget speech. This has to do with the write off of $125 million of Expo deficit during the current fiscal year. Oddly enough, Mr. Speaker, nobody has said anything about this so far. Nobody has said anything about this little bit of government largesse, which has already been paid in accordance with an agreement which was made when hon. gentlemen opposite of the Conservative party were the government of this country. They gave carte blanch whereby the federal government would assume 50 per cent of any deficit of Expo. What a blank cheque that was, and now we are paying the bill. This does not include the latest federal agreement to postpone the debt of the city of Montreal for a further five years, at our expense. That will cost another few million but, after all, it's only money and it's for the city of Montreal.


Some hon. Members:: Hear, hear.


Philip Gerald Givens: But since we in metro Toronto contribute approximately one third of the income tax, the succession duties, the corporation taxes and the customs and excise duties of this nation, perhaps we may be permitted to say a word about this matter. If we are going to help pay for the hangover after the binge, I would like to say something about it. I remember that when I was mayor of the city of Toronto, the mayor of Montreal, Jean Drapeau, came to me for support. He said, "Phil, Expo will be good for all of Canada." And I agreed. He said, "Expo will unify the whole country." And I agreed. He said, "It will build bridges of brotherhood." And I agreed. He said that Expo would bring in lots of business to Canada, and I agreed. I went out and publicly supported it and asked the people of Toronto to go to Montreal to visit Expo.
But there was one more thing he said. He said, "Once we have finished with this world's fair we will never compete with the Canadian National Exhibition." He said this publicly and privately. I was not so naive to believe it. I did not expect this undertaking to be kept and I was not disappointed. "Man
June 9. 1969	COMMONS
and His World" is alive and kicking and competing, and "Man and His World" will also have a deficit.
I want to make myself absolutely clear. I begrudge Montreal nothing. If they have got a champagne taste and a beer pocket that is their business. I would be willing to go along and pay for a few drinks just to keep them happy. But my only concern is this-and through you, Mr. Speaker, I appeal to Metro Toronto members whose support I want-that the Canadian National Exhibition which has been in existence for 91 years, and has stimulated the agriculture, trade, commerce and industry of Metro Toronto and Ontario for 91 years, which has brought happiness to millions of people, millions of children, brought in tourists and paid sales taxes for so many years, should get comparable treatment-not special treatment-comparable treatment. The Canadian National Exhibition has always paid its own way, and has not asked for money to cure a hangover. Sure, the Canadian National Exhibition was never as spectacular as Expo, but its directors never had the key to the federal mint like Montreal had. So, Mr. Speaker, I hope that the Minister of Finance will remember this when the Canadian National officials come here looking for some face-lifting assistance and some financial Geritol that they so badly need. And I hope that the Minister without Portfolio (Mr. Lang), who has the responsibility for water resources, will stop making a big federal case about a paltry $1,200,000 worth of land purchased by the Metro Toronto and Regional Conservation Authority for parks purposes, and which he wants back as a credit. This has become a big legal dispute around here.
This $125 million is a lot of bread. I say again that I do not begrudge Montreal anything, especially in the present plight it is in;
I just want a few crusts of the loaf for the people I represent.
[DOT] (8:40 p.m.)


John Howard Lundrigan: Mr. Speaker, it is very fitting that I should follow the hon. member for York West (Mr. Givens), the former mayor of the great, fat city of Toronto, since I am from the lean province of Newfoundland and the lean riding of Gander-Twillingate. I am not reflecting on the weight of the hon. member. I should like to have the name and address of his speech writer. His speech was stirring, but it left me cold because we had the impression the hon. member would do a job on the
DEBATES	9905
The Budget-Mr. Lundrigan Minister of Finance (Mr. Benson) and reflect on his anti-Ontario budget. Of course, the hon. member did use Mayor Drapeau as the scapegoat and took a strip off him. I shall not become involved in this kind of fight. I will leave it to others.
I perhaps should not say anything at all about the budget because basically that is what the budget did-it did not say anything at all. I did not say anything about the first budget because I was a new member and the government was a new government. I realized that since the government had just come into power we could not expect too much in such a short time. Basically, the budget hit the central theme of the government's intention to curb inflation and perhaps the subtheme of regional disparity, as well as the reflection by the minister on the great array of programs advanced to assist regions of Canada.
In my few remarks I should like to tie the budget in with the minister's statement about regional disparity. When we speak of regional disparity in this country we are not necessarily talking about the effect on a few fishermen in Gander-Twillingate, a few spud farmers in Surrey or a few people who make their living from seal fishing in the Magdalen Islands. We are speaking of the vast number of Canadian people in the Northland, the people in the remote mountain regions of British Columbia, although I am just guessing at this, the interlake area of Manitoba, the micro-urban ghettos and most of rural Quebec as well as most of Atlantic Canada. By geographical definition we include most of Canada. We are talking about a sizeable portion of Canada when we speak of the problems of regional disparity.
I want to reflect on the matter of regional disparity because I have indeed been annoyed by the lack of action and the great deal of talk by the government about trying to help the people of the depressed and slow growth areas of this nation. One reason I am a little disillusioned is that I have just finished reading a book written by T. N. Brewis on Regional Economic Policies in Canada. On page 93 he quotes a speech made by the then minister of finance to the tax structure committee on September 14, 1966, in which the minister said:
Where circumstances-whether natural or manmade-have channelled a larger than average share of the nation's wealth into certain sections of the country, there should be a redistribution of that wealth so that all provinces are able to provide to their citizens a reasonably comparable level of basic services, without resorting to unduly burdensome levels of taxation.
June 9, 1969

The Budget-Mr. Lundrigan I could go on and reflect on the concept of regional disparity held by the former minister, but I want to reflect on the budget in the sense that there has been a misrepresentation made to the Canadian people by the statement that there is a great array of programs proposed and being followed by this government to meet the needs of those people who are affected by regional disparity in Canada. But firstly, I wish to reflect on the monetary policies of this government which are supposed to be geared to regional disparity and which, in my opinion, are anything but. I believe that if one were to speak with Canadians in most of the slow growth areas one would find that this is one of the worst years in the history of the Canadian nation so far as unemployment is concerned and so far as general living conditions are concerned. I have had an opportunity to visit around a little. I am not as widely travelled as some hon. members, but I do travel a bit in Canada. Things really are not too different in certain of the slow growth areas. We have seen evidence of this fact this year in New Brunswick. We have seen the repercussions from the back of policy in Newfoundland and a good number of other places.
A national policy has been applied right across the whole nation in an effort to curb inflation. I agree that perhaps there are some moves being made by the Department of Regional Economic Expansion, but I am not prepared to accept any practice, policy or philosophy aimed at curtailing inflation which is put into effect across the board equally in all parts of Canada. Last year, in the budgetary white paper, the Minister of Finance indicated some policies which now are having the effect of increasing unemployment in the Atlantic provinces. He asked how we could curb inflation and, at the same time, not hurt the slow growth areas. This is a dilemma. The minister, in his recent budget, did not seem to be too concerned about this dilemma.
I could go on to mention little things which might not seem to be too important. The Department of Public Works has gone on a holiday so far as facilities for the operators and fishermen in Atlantic Canada are concerned. We talk about the application of the policies of the Postmaster General (Mr. Kier-ans) which might not seem to be important in terms of their effect on the hundreds of postal operators in eastern Canada. This might not seem to be too important in relation to the numbers affected throughout Canada; but it seems important to the people in this area. 
We were happy when the Minister of Transport (Mr. Jamieson) who got his new job because it reduced the unemployment in Newfoundland a little bit, by at least one.
Again, we have the problem of the roads to resources program which was cancelled. This was a move towards national restraint. A number of transportational aids to various parts of Canada have been cut out again to curb inflation and in an effort, so-called, to balance the budget which the minister has promised but has never been able to achieve. Again, this year we have the lifting of the 5 per cent interest rate on loans to farmers and fishermen under the new farm and fishing improvement loans acts. This also was a move perhaps to curb expenditures or lending which certainly imposed additional hardships on the people.
We have the business about the elimination of tariffs. When the minister was speaking about reciprocal arrangements we heard no mention about our neighbours to the south, for example, coming up with similar packages. But he goes on with things of this kind. I do not know whether the representatives of the small industries which are spread around the coast have had an opportunity to talk this over with the minister to learn his attitude and express their reaction to it. He says there has been a fair amount of involvement. I wonder what will happen to the small textile industries in Winnipeg which are now relocating in places like Peguis Indian reserves, and which are trying to make their way. These are very marginal industries, but they are surviving. What about the problem in the eastern townships of Quebec in respect of the marginal textile industries. Again, the minister shakes his head to indicate there will be no effect. I shall wait to see proof of this.
I shall wait to see proof in respect of the marginal industries in Canada, those small industries which are barely existing right now. Extra competition could very well force them out of existence. They are the industries which are in slow growth areas. They are not making very many sales and have transportation costs. These are likely to be the type of industries which will be forced out of existence. I ask the Minister of Finance what kind of policies he has designed to offset the kind of increased unemployment which I forecast will occur in the eastern townships and other parts of Canada in which marginal industries are barely surviving. These are the problems I would like to talk about.
June 9, 1969

[DOT] (8:50 p.m.)
There was in the minister's budget speech, of course, no mention of the fish and chips part of the problem or, if you like, the fish and potatoes-as we call it in my province- part of the problem. I am talking about proposals by the Minister of Fisheries (Mr. Davis) who a few weeks ago announced that special tariff arrangements ought to be made between the United States and Canadian governments in order to allow marine products to go across the border free of tariffs. This would put our fish products in a very favourable position and would increase the competitive nature of our product. It would put more dollars into the pockets of the fishermen on the east coast, who depend largely on the sale of fish, as well as the fishermen on the west coast.
What about the tariff on potatoes produced in Prince Edward Island, or Spud Island as it is affably called at the present time? What about those farmers having to compete under difficult circumstances because of tariffs and not receiving a fair return? These are the kinds of tariff arrangements I would have liked to hear about. But we in this house will not hear anything about fish and chips issues, because, in my opinion, the problems of the so-called slow growth areas of Canada are not recognized by this government. The government is out of tune with these problems; it is so sophisticated in its policies and thinking that it will not consider any of these matters.


James Aloysius McGrath: Liberal red herrings!


John Howard Lundrigan: I will get around to that in a minute. Another policy of this government which has had a detrimental effect on a great many Canadians is the universal application of certain tax measures. We thought there would be no increase in taxation. I was getting excited about planning a holiday; then I realized that the minister had broken his word to the Canadian people and reimposed the surcharge, if you like, on income tax. The minister has made no effort to bring forward any kind of progressive taxation policy which would help those people who cannot afford to be taxed. In this regard I refer to the old age pensioner who earns $1,100 plus a year and has to pay income tax. If you make more than $1,100 as a single man or $2,100 as a married man, you pay tax on those earnings. These people cannot afford to buy food, let alone pay taxes. But the income tax provisions are applied universally to all
The Budget-Mr. Lundrigan Canadians and in consequence the lives of many of them are made much more miserable.
I would like to reflect for a moment on the minister's statement about the array of programs under the new Department of Regional Economic Expansion and the philosophy of the government with respect to same. I contend that this is a very misleading statement. Many people in Atlantic Canada and other parts of this country thought this was the biggest joke in the whole budget speech. I advise the Minister of Finance not to go to Atlantic Canada and tell that kind of joke. We do not mind Newfie jokes, in fact we get a great charge out of them; but we do not appreciate this kind of joke. It really is a joke, because we have the highest rate of unemployment in Canada, and have had for many years. We have the highest cost of living. New Brunswick is on the verge of bankruptcy. Quebec is facing financial constraint. Newfoundland is politically, in one big mess as far as the Liberal party is concerned. However, I will not become involved in that question. We in Newfoundland have an economic situation that is so unfavourable it is almost unbelievable. In spite of these things, the minister tells us about the great array of programs available for our benefit.
If the provincial premiers cannot take a little of the starch out of the hard-nosed attitude of the Minister of Finance and the hardhearted attitude of the Prime Minister (Mr. Trudeau) in the next few days when they are here, I will be very disappointed. I hope they can do this in their conversations about taxsharing and the constitution, which are the biggest excuses for not doing anything that I have ever heard. If they do not, I will be a disappointed Canadian. The pseudo strait-jacket of the constitutional argument is one of the biggest farces ever perpetrated. Every time one talks about becoming involved in human resource development, the revision of tax sharing arrangements, and so on, this is the kind of argument we get from the government.
I contend that the government has no policy of regional economic expansion; it has no policy of regional development. Many European countries which have been faced with the same problem show that Canada is perhaps not as aggressive as she should be with regard to regional development. Regional development and regional disparity are defined basically as applying to areas in
June 9, 1969

The Budget-Mr. Lundrigan which there are large pockets of unemployment, where there are extremely high costs of transportation, low income, and centripetal relocation toward certain parts of Canada which results in a brain drain and the like. These are some of the characteristics of regional disparity. I would like to have heard from the minister a clear statement on government policy in this respect.
As far as government announcements and policies are concerned, we have had a great many escape-hatches and red herrings. A moment ago the hon. member for St. John's East (Mr. McGrath) talked about red herrings. I tell the Canadian people that there are more red herrings in parliament than there were in Placentia Bay. I can talk about red herrings there and here, because I have seen both and am aware of what is going on.
The people of this nation are very disillusioned at the moment because they have been promised the stars, a just society and the elimination of regional disparity, but these things have not come about. I could refer to a number of bills which have been referred to as curing these problems. The house leader is very competent in calculating what the government is doing and is not doing. If he were here he could tell us that 75 per cent of our time has been taken up with such issues as NATO. NATO is very important! Red China has been brought on the carpet. That is a real red herring. We have had the amendments to the Criminal Code; we have set everything up for abortions and homosexuality in Canada. The Vatican has been brought into our discussions and has become quite a controversial issue. We have had the government reorganization bill.


Edgar John Benson: Mr. Speaker, I wonder whether the hon. member would permit a question?


John Howard Lundrigan: I have only a few minutes left. When I have finished my speech I will be delighted to respond to any question put by the Minister of Finance.


An hon. Member:: Let him raise a question of privilege.


John Howard Lundrigan: Or he can rise on a point of order or question of privilege and I will gladly respond. The government reorganization bill took up a good deal of the time of this house. It is like the jellyfish trying to reshape itself. We have had the official languages bill, which again took up a good deal of the time of the house. Although I believe 
that the language question and having bilingual Canadians is very important, the basic and most important problem facing this country as far as unity is concerned is the economic one.


Some hon. Members:: Hear, hear.


John Howard Lundrigan: Let us consider the situation of a typical rural farmer of Quebec. Quebec has a great deal in common with the part of Canada from which I come. If you gave this typical Quebec farmer $13,000 or $15,000 a year, put a solid chunk of money in his pocket, gave him a coloured television set, a good car in which to drive to work, good roads upon which to drive, enough bread in his cupboard and a good school to which he could send his children, what do you think he would say about the language problem? I do not suggest he would not say anything about it, because if he is from the province I have mentioned he might very well have something to say about the problem, but I suggest he would be a fairly happy man.
[DOT] (9:00 p.m.)
We should be assisting those parts of Canada which are disadvantaged because of economic circumstances which frequently have political causes, such as ministers and governments, who do not have the gumption to take issue with these economic problems. They do not do so because they just love keeping their seats warm. If we had a government that took issue with some of our economic problems, I do not think we would have as much talk about the language problem as we have today. In any event there are many Canadians in this nation who are disappointed with a government which, after a year in this parliament, has nothing to tell them so far as economic policies are concerned, so far as programs of development are concerned, and nothing to tell them about the cost of living or the unemployment problem. The minister can sit there and think he is doing a great job. Undoubtedly he is making a great effort, but let him not try to tell the unemployed Canadians, he is doing a great job or the people who now have to pay 2.5 per cent more for their week's groceries than they did in January of this year. Let him not say this to the Canadian people because they will just ask him embarrassing questions. All of us here are protected from the average Canadian because we are removed from him. Perhaps this secluded and protected environment of parliament means that we
June 9, 1969

are not as attuned to the problems of the Canadian people as we could be, and this goes for me too.
I will not continue at any great length because I hope to have another chance before the next four years are over to elaborate on some of my points. However, I will say that if we do not get some action quickly-and this is my candid feeling and my feeling deep down on this-and if we do not have a government which will show some gumption by taking issue with some of the economic problems facing our nation, then there will be more danger of disunity in Canada than we already have.
I will conclude by saying that I would never get involved in an argument or fight with anyone. In fact, I would laugh at a Newfie joke about me or at anyone reflecting on my accent or my general background, but I would certainly fight if I had no chance to provide a livelihood for my family. I think this is the attitude of most Canadians.


Edgar John Benson: Mr. Speaker, I wonder if the hon. member would permit me to ask him a simple and easy question. Does he realize that since 1963 when the Liberal government decided to spend some money on the Atlantic Development Board the sum of $60,728,000 has been committed for Newfoundland, $54,892,000 has been committed on New Brunswick, $12,566,000 has been Committed on Prince Edward Island, and $59,134 has been committed in Nova Scotia-


Mr. Depuly Speaker:: Order, please.


John Howard Lundrigan: Mr. Speaker, may I-


Edgar John Benson: -and $2,198,000 for the Atlantic Region in general for a total commitment in the Atlantic provinces of $189,512,000.


John Howard Lundrigan: Mr. Speaker, may I say in reply that when one can draw this kind of response from the Minister of Finance (Mr. Benson) one realizes immediately that the minister must have got his toes hurt a little. Perhaps I am wrong, perhaps there is no unemployment problem in Canada. This might just be a dirty rumour spread by a lot of people out of work. Perhaps there is no regional disparity in Canada. This may be another dirty rumour spread by many Canadians who cannot find a dollar with which to feed their families. I may be wrong entirely. If I am wrong I will be the first to apologize, but if the minister is wrong I will demand the same kind of courtesy from him.
The Budget-Mr. Matte


Edgar John Benson: Mr. Speaker, may I rise on a point of privilege.


Robert Lorne Stanfield: On what point?


Edgar John Benson: I thank the hon. member for his concern about unemployment. I can assure him that ours is just as great, but I consider $200 million committed in the maritime provinces since 1963 a rather substantial amount.


Mr. Deputy Speaker:: Order, please. I will recognize the Leader of the Opposition (Mr. Stanfield) but I wonder if we wish this debate to continue.


Robert Lorne Stanfield: Mr. Speaker, I just want to draw your attention to the fact that the Minister of Finance is abusing the rules of the house.


Edgar John Benson: And so is the Leader of the Opposition.


Mr. Rene Matte (Champlain):: Mr. Speaker, the Ralliement creditiste is conscious of the inflationary dangers faced by Canada and it wishes to make its contribution in order to find remedies while the government at this time seems to be running out of effective solutions.
On May 8 last, when several hon. members were asking the Prime Minister (Mr. Trudeau) what measures the government intended to take in order to curb the increase in the cost of living, the Leader of the Ralliement creditiste (Mr. Caouette), in turn, asked the Prime Minister whether he would not consider the serious suggestions made in the house by the Ralliement creditiste and this is what the right hon. Prime Minister answered at that time, and I quote:
Mr. Speaker, I think that all those who know about such things agree that the suggestions coming from the Creditiste system are, essentially, of an inflationary nature and inflation is precisely what we are trying to fight.
It should be noted that the Prime Minister did not say that his government was going to fight inflation, he simply said that they were going to try.
It will be a test, an attempt, because the Prime Minister knows fully well that he has no assurance of success since the means available to him have never been successful; they have always failed, while prices keep going up, salaries and actual income are subject to erosion and the savings and all forms of ownership are undermined.

June 9, 1969
The Budget-Mr. Matte
Since the lanterns of the government and of the Prime Minister in particular seem to be switched off, we will attempt to throw some light on this debate without any assurance of success, because, as a rule, the government closes its eyes, and shuts its ears upon hearing of Creditiste suggestions.
To sum up, Mr. Speaker, the causes of inflation may be stated as follows: Efforts on the part of the wage-earners to catch up with rising prices; exaggerated income of some directors and exorbitant profits of certain enterprises; combines, trusts and monopolies that impose unjustified prices of Canadian consumers; taxes and duties of all kinds levied by governments and finally, the hanking and monetary policies that are used. Such are in short the causes of inflation. It is on the last one that I should like to lay emphasis, Mr. Speaker.
In 1963, a man went around Quebec and Canada railing against the Creditistes and the solutions they were putting forward on the occasion of the federal election at that time. That man, enjoying the high influence that goes with the title of President of the Montreal Stock Exchange and of the Canadian Stock Exchange, was to find very soon his political reward. He is now in this house, as Postmaster General and Minister of Communications. You know now whom I meant; it is the man who trusted upon the Canadian people the most questionable and the most scandalous postal increase and who contributed, in his own way, to the inflationary pressure.
The Postmaster General and Minister of Communications (Mr. Kierans) was then speaking about a new myth, the "Kierans myth".
Speaking of rising prices and the present inflation, he said, as can be seen on page 8971 of the May 22 Hansard, and I quote:
-what would we gain? We are all affected by inflation, as the value of our dollar, of our deposits in credit unions, of our savings bonds and of our wages, disintegrates under the effect of that cancer.
[DOT] (9:10 p.m.)
The Postmaster General and Minister of Communications uses the word "cancer" when speaking of inflation. Inflation is a cancer, he says.
But he must know that a cancer cannot be cured, because we have not yet discovered the medicine, the antibiotics capable of killing the virus which provokes cancer.

In the present financial system, the cancer of inflaton will remain incurable as long as they merely put a poultice on a wooden leg, and as long as they refuse to use the new methods which the Creditistes have been proposing for a very long time.
The Postmaster General and Minister of Communications was discussing in the house, on May 22, the value of our dollar which is decreasing. He added that the value of our savings was diminishing, as well as the value of our bonds. The value of our salaries is going down because of inflation. That is what he finally recognizes. Nothing could be truer, Mr. Speaker.
Federal statistics indicate that in March 1969 the cost of living index reached 123.2, compared with 122.6 in February, and 118.6 in March 1968; that is an increase of 4.6 over one year.
And so, the cost of living is rising. Prices are rising. The value of our dollar is going down, we are faced with inflation. The Postmaster General and Minister of Communications is right. Inflation exists. Even the government admits it.
But who leads Canada? The Liberals or the Creditistes? What financial doctrine is applied in Canada? The financial system dear to the Postmaster General and Minister of Communications, or that which the Ralliement creditiste proposes?
The answer is obvious. The Liberals are in power, and there is inflation in Canada. The financial system that the Creditistes denounce governs every economic activity in Canada, and we have inflation.
It could not be otherwise, Mr. Speaker, because the present financial system is, by its very nature, a source of continuous and progressive inflation.
I shall try to prove it in the few minutes I have left.
We have already shown, Mr. Speaker, that there is not a single dollar in circulation that was not created by the banking system. All credit now in existence in Canada was created by the banking system.
And what are the results, Mr. Speaker? Let us give an example:
Suppose an industrialist wants to market his products and applies to the bank to finance his production costs. Having brought the necessary guarantees, that is his equity in his business, the bank grants him a $100,000 loan, on condition he will repay $108,000 in one year, as the interest rate is 8 per cent.
June 9, 1969

The industrialist, with $100,000 credited to his bank account, starts his production. He pays salaries, buys raw materials and retains his own salary-all those expenses will be included in the consumer prices of his products. Let us say for the sake of argument that the full amount of $100,000 was spent on production and that it is now in the hands of the prospective consumers who are thus able to purchase the products. Please note that the Creditistes deny this.
But the manufacturer does not forget that he must, at the production stage, repay the $100,000 loan he got from the bank.
Neither does he forget that he must also pay $8,000 in interest,, on top of the $100,000 he borrowed from the bank.
This manufacturer must thus include this extra $8,000 in his prices, and therefore, a total amount of $108,000 will have to be paid by the consumers who want to buy his products.
This means that the manufacturer will have to get back $8,000 more than he paid into the distribution system. He will have to take in more money than he has handed out. Money must come in in larger quantities than it was distributed. For consumption that results in a deficit in purchasing power and just as in the case of a bank, money must be returned in larger quantities than it was lent out, which is absurd, of course.
The trick will succeed only if the consumers abstain from buying another production. The manufacturer will manage to recover the $108,000 only if he can get from the existing purchasing power the part earmarked to buy that other production that had created this purchasing power. But then,, it will be "that other production" which will be confronted with a deficit in purchasing power and which will remain unsold. Thus, a deficit in purchasing power.
I would now like to refute in advance a current objection. We are told that banks put back in circulation as loans the amounts which are paid back, plus the interests.
Let us see what this statement is worth.
Let us suppose that our manufacturer, in addition to paying back $8,000 in interest the first year, repays also part of the loan, say $10,000. This amount of $10,000 will also have to be included in the cost of products, so that the cost will no longer be only $108,000, but $118,000. That is the amount the consumers will have to pay the manufacturer for his production. But since the manufacturer has
The Budget-Mr. Matte disbursed only $100,000 during his production, this means that he will have to get $18,000 more from the consumers, the result being an $18,000 deficit in purchasing power.
Let us say the bank puts the $18,000 back in circulation, as new loans. There will be an $18,000 increase in purchasing power. But the $18,000 will have contributed to bringing on the market a new $18,000 production. It is quite clear, except to the Minister of Communications and Postmaster General and to the Minister of Regional Economic Expansion (Mr. Marchand) that the deficit in purchasing power cannot be made up through a new loan to production.
It creates a new debt that only aggravates the previous deficit, consequently there is a progressive and continuing deficit in the purchasing power.
A moment ago I associated the Minister of Regional Economic Expansion with the Postmaster General and Minister of Communications. It is because I was reminded of a moral report that the former president of the C.N.T.U. presented to the members of that organization in 1962, in which he blamed the Social Credit, and I quote:
If Douglas' theorem was true, the whole of the economy would be paralyzed for some time for and we would be in a state of permanent crisis. We have numerous grievances against the economic system under which we live. We cannot accept, for instance, that so little energy is spent to attack the problems of unemployment, slum clearing and social security.
[DOT] (9:20 p.m.)
Today I ask the Minister of Regional Economic Expansion whether it is not a fact that the economy is crippled and that we are going through a crisis. The Postmaster General and Minister of Communications says that we suffer from cancer.
Of course, goods end up by being sold, if they are not left to spoil or if they are not finally destroyed, the effect of which is to boost production and give work to the unemployed. But that is possible only if we pay the price.
And that price, Mr. Speaker, is the indebtedness at every level of government, the indebtedness of corporations and individuals to such an extent that it is unthinkable that such debts can be paid up one day.
The indebtedness of the federal government: $32,926 million; of provinces: $12,642 million; of municipalities: $6,597,437,000; and of individuals: $9,030 million; towards sales

June 9, 1969
The Budget-Mr. Matte financing companies, consumers loan companies, chartered banks, Quebec savings banks, etc.: $61,954,437,000.
It is because of that indebtedness and at the cost of financiers controlling the whole national economy and the life of every Canadian that our economic system has not yet collapsed, and still subsists, though dangerously.
But as the Postmaster General and Minister of Communications said so well, it suffers from cancer and the end is near.
It is not surprising, Mr. Speaker, that so little effort is expended to deal with the problems of unemployment, housing and social security, as the Minister of Regional Economic Expansion also stated.
It is not surprising because the present system is on its last legs. It is finished, broken; the people, the governments are broken, submerged by debts, and the only remedy is to propose austerity measures, to ask us to tighten our belts, because money is scarce.
During the 1963 election campaign, the apponents of the Social Credit party, with the Liberals in the lead, proclaimed far and wide that a Social Credit system would create monetary inflation.
The Liberals paid for full-page ads in the newspapers owned by financiers to show that under a Social Credit government money would lose so much of its value that a truckful would be needed to buy a pair of shoes.
They even published photographs showing people in Hungary and Germany burning their money or using it to paper their walls because their banknotes were worth less than ordinary wallpaper. However, they forgot to mention that such things happened under the present financial systems of Hungary and Germany and not under a Social Credit regime.
For under a Social Credit system, inflation would be impossible, whereas the present financial one cannot escape it.
What is inflation? The word "inflation" means simply "swelling". Inflation recalls some unhealthy and abnormal distension.
For instance, obesity is a kind of swelling and the dropsical subject happens to be inflated. Such distension is unhealthy and unnatural. The growing child, who puts on weight, does not swell. It does not get inflated, although it gets taller and bigger to a much larger extent than the dropsical or obese subject.

As applied to an increase in the volume of money, in the number of dollars in circulation, the word "inflation" constitutes an unhealthy expansion, an abnormal swelling.
On the other hand, some economists give to the word "inflation" the pure and simple meaning of an increase in the quantity of money in circulation. Thus, some may contend, to the great confusion of the public who does not understand too well, that inflation must be prohibited, ostracized, while others claim that it is desirable, because they recognize that the volume of money should be increased and that a certain amount of inflation is necessary.
As for us, we think that inflation is definitely wrong, harmful and that it should be denounced. But that kind of reasoning should not be pursued so far as to fear any increase in available funds on the ground that any monetary expansion is a catastrophe.
The Creditistes are of the opinion that a greater purchasing power essential to the people's prosperity and welfare, which would correspond exactly to the increase in production, would not affect in any way whatsoever the value of money and would be put in circulation without causing inflation, if the monetary growth is equal to that of production. This is a technical and mathematical problem. Owing to statistics which the government receives all the time through its various departments, it is aware of the increase in production, chiefly by analyzing the price index. A Creditiste government would put in the consumers' pockets the money corresponding to such an increase. This new purchasing power to buy a new production, being directly distributed to consumers without going through a production system and not being therefore related to prices, would not cause inflation.
When taxes become insufficient money is the loser.
They want to dominate the economy, socialize welfare, give to everybody but in order to do that they must take from everybody. What is not received from taxes is obtained from money.
Mr. Henri-Ernest Blanchenay, banker, chairman of the board of the Private Bank in Geneva, and member of the Edmond Rothschild group, gave the history of the Eurodollar in those terms and he established the possible repercussions of that market on currencies and their progressive depreciation. Mr. Henri-Ernest Blanchenay was the lecturer, on April 23, 1969-
June 9. 1969	COMMONS


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


Mr. Sian Schumacher (Palliser):: Mr. Speaker, when the Minister of Finance (Mr. Benson) delivered his second budget last Tuesday evening he said it was not calculated to increase his popularity. This may be true, but what I, and I believe a good many other Canadians, would like to ask is why it had to be calculated to increase his unpopularity.
At the outset of my remarks and before going into the many shortcomings of this budget, I should like to say that the minister should be congratulated for introducing the concept of selectivity in the taxation policies of this government. I only hope that this important principle can survive its clumsy and perverse application by the minister to the successful and productive regions of our economy, in a way that has little hope of assisting poorer regions and with no possibility of significantly increasing our national productivity, which surely must be the key to solving the problem of inflation in this country. Let us hope that this policy called selectivity is not discarded through dislike or the failure that will surely result from the application of discrimination, which is the real villain of the piece. Because let us face it, Mr. Speaker: this budget is in fact a very discriminatory one. What the minister should have done-and one does wonder just what the great thinkers in the minister's department were really up to when they produced such a budget as this-was seriously to consider which type of construction is desirable and which type is not; in other words, which type of construction will be productive in real terms and which type will not.
I think one can say, because it is pretty well agreed, that the service station type of construction is not really essential in increasing productivity in this country. This being the case, what great good is going to come to our economy by discouraging such construction in Toronto, or Calgary, or Edmonton, or Vancouver in the expectation of its being shifted to Montreal or Halifax? About the only good that can come from this type of discrimination is some sympathy from the so-called wealthy urban centres for the position of the western dairy producer, who has been discriminated against by the transfer of some eight million pounds of cream quota to Quebec at a time when the area is a net importer of butter.
DEBATES	9913
The Budget-Mr. Schumacher
In summary of this aspect of my remarks, I would say that the reward-punishment approach to the location of industry has proved to be a failure. I would cite the example of the move made by Clairtone to the province of Nova Scotia, which has not worked out as well as was hoped. The important thing is to decide which industries are to be assisted and get production flowing. It does not really matter where they are located if they are in fact producing goods. We do not want to cut down in one area merely to add to another. That is no way to increase productivity in the country. It would be more logical to limit the types of buildings authorized on a selective basis. Thus, the builders of gasoline stations, shopping centres and movie theatres could be penalized on a national scale, with far more productive results.
[DOT] (9:30 p.m.)
If I may, Mr. Speaker, I should like to turn to a glaring omission in this budget. It concerns the area of consumer credit. Nothing has been done to limit instalment purchases. Surely, the minister must realize that those buying on time are not using the most appropriate weapon to fight inflation. That method of buying is utilized by hundreds of thousands of persons who, frankly, do not believe that this government is determined to lick inflation. They use time purchases as a hedge against the results of this government's spending policies. The high interest rate solution to this problem proposed by the minister might work if we could see one scintilla of evidence that the government is really serious about solving the problem of inflation.
How can anyone take this government seriously in this regard, especially when it steadfastly refuses to cut back its own outrageous spending habits. The minister boasts he will balance this budget. I hope he will forgive my saying so, but I will believe that when I see it. Even if he were to balance the budget, Mr. Speaker, what comfort could our taxpayers take from a balanced budget of $11,775 million. That is $1 billion greater than the previous budget. I simply ask, Mr. Speaker, why should you or I, provinces, municipalities and corporate and private citizens in this country, hold the line in expenditures when the federal government makes evident by its actions if not by its words what it really thinks about the problem of inflation. I ask, where are those glaring examples of government restraint? There is to be an increase of over $3 million to the Canada Council, which now milks the Canadian taxpayer for almost $24 million annually and does not live on the $50
9914	COMMONS
The Budget-Mr. Schumacher million endowment with which it was originally established. What about the $15 million increase in the grant to the C.B.C., which now receives a total of $166 million annually? To that figure must be added the $65 million which is the cost of the headquarter building to be erected in Montreal. There has been no restraint in that area at all.
To help in controlling this problem of consumer credit and to assist the bond market, I suggest a practical approach would have been for the government to allow tax credit for that portion of a person's income invested in bonds, no matter whether they be federal, provincial or municipal. A ceiling should be set on the amount invested so that the extremely wealthy people of this country do not take undue advantage of this provision. If that idea were adopted it would have the effect of attracting money into savings, and pressure would be taken off the consumer credit field.
I think it is apparent to everyone that high interest rates do not deter people from buying on time. They still expend their resources in fields of consumer credit. Of course, one of the difficulties of our situation has also to do with the money supply. Last year, in one of its gross miscalculations, the government decided to increase the money supply; between May and September it increased that supply at an annual rate of 20.5 per cent. Is this the way to cool the economy, Mr. Speaker?
I think the minister and the government ought to consider abandoning the fixed exchange rate with respect to the Canadian dollar. Such action would force the government to practice what it preaches because, if it were to carry on as it now is carrying on, our dollar would be driven right down in value. If we were to abandon the fixed rate of exchange we could stop importing inflation from the United States. As I say, such action would force the government to behave reasonably. After all, prevailing conditions now are not similar to those of 1962 when the fixed exchange rate was established. The government should face that fact.
Those able to travel to other countries are the beneficiaries of new regulations affecting duty. In that regard the government has discriminated against lower income people of this country who cannot afford to travel and who are hardest hit by this great social development tax which was imposed in the previous budget.


An hon. Member:: Shame.

DEBATES	June 9, 1969


Stanley Stanford Schumacher: Why did the government not make reciprocal arrangements with other countries? Our economy would benefit from money spent by visitors from other countries. The same could be said about changes in the tariff rates. Before saying that the rates which were to come into effect in 1972 will come into effect now or in the near future, why did the government first not enter into reciprocal arrangements with other governments to make sure that our goods enjoy lower tariffs when entering other countries. Apparently our government made no such effort which would have helped the Canadian economy. All the government did was introduce certain changes which will have the effect of throwing thousands of our people out of work. They will bear the brunt of the changes. That may not have been the intent of the government's policy, but the practical results of that policy will be hardship for some in our country. Why did the government not try to ease our burden by obtaining reciprocal benefits from our trading partners.
As I said at the beginning of my speech, I hope the selectivity principle the government seeks to implement in this budget will not be abandoned in the future. I think it is a good principle. Nevertheless, I think we all recognize that it is a mistake to impose selective programs on a geographic basis. By tackling the problem that way you are not getting at the root; you are only penalizing success. Surely, we want increased productivity in this country. Increased productivity should cure our inflation problem. We must obtain growth in real terms. To penalize our productive areas in order to help our unproductive areas will not help in the solution of our problems. So far as possible the principle of selectivity ought to be applied on a national basis. Of course, we should try to help those areas that will respond most quickly to aid. If necessary, such areas ought to be assisted at the expense of potentially less productive areas.


Robert Norman Thompson: Mr. Speaker, may I first congratulate the Minister of Finance (Mr. Benson) for his budget speech, the most commendable aspect of which was its brevity. I believe he established a precedent. It was one of the shortest speeches in recent years. Another aspect which I think will go to the minister's credit is the fact he has been able to bring in a balanced budget after many years when budgets have not been balanced. I recall the statements of some of
June 9, 1969	COMMONS
his predecessors about the necessity of keeping unbalanced budgets in a period of inflation such as we have at the present time. We must commend the minister's policy in this regard and his determination to bring about a balance between expenditures and income.
[DOT] (9:40 p.m.)
There is one aspect which really has not been emphasized as it should have been and that is the means by which the minister brought about the balanced budget. There is no doubt that one of the main reasons for a balanced budget is the extra income that has come through the social development tax on both personal income and corporations. Last fall, in his first budget speech, the minister introduced this special tax. He made it very clear that this was to be a temporary tax and that it was intended to cover the extra cost of medicare and social development. That is how this tax levy on incomes was described.
If this was the basis for collecting this tax, since most of the provinces have not seen fit to use this money by not participating in the medicare program, this money should either have been refunded to the Canadian taxpayer from whom it was collected for a specific purpose or at least put into a trust fund to take care of the inevitable escalation of cost when medicare is actually adopted by the different provinces, if it ever is.
It seems the budget has been balanced on what might be called false pretences or by a false tax that was intended to provide a social service and not to make up the lag in income or assist general income in catching up with expenditures. This point, although seemingly insignificant, is important because the government should assume the responsibility of ensuring that taxes are used for the purpose for which they are collected.
If medicare is part of social development, and if the various services that come under this classification are not extended to the point where they use the money collected to finance them, then this money certainly ought to be held in trust for that purpose. At this time, however, it is going to help add a bit of glitter to the Finance Minister's crown for his ability in having balanced the budget.
There is a false philosophy behind the whole area of finance as it relates to the problems of governments and taxpayers. After all, there is only one source of tax dollars and that source is the taxpayers' pockets. Regardless of whether the money is
DEBATES	9915
The Budget-Mr. Thompson expended by the federal, provincial or local government, it is the taxpayer who pays.
Some of the greatest needs in this whole area of governmental expenditure do not really fall within the responsibility of the federal Minister of Finance (Mr. Benson), but rest with the provincial Ministers of Finance, and in a greater way are the responsibility of local government. Unless in this whole taxpayers' pie there is sufficient money for local government in particular to pay for those services which they are expected to provide to the public, then government is the weaker for it.
I think the most legitimate criticism of this budget is that which comes from those responsible for local governments who are desperate in their need of public funds, which finance much of the social services which Canadians require. Whether it applies to housing or to the development of such social programs as health and education, it is the local governments which are responsible for carrying these out. This is why the discriminatory tax policy as it relates to the three have provinces, Ontario, Alberta and British Columbia, seems to be a backward philosophy.
How can cooling down the economy in Calgary help the economic situation in Halifax? How can cooling down the economy in Toronto help the city of Winnipeg? The whole philosophy of cooling down, in my opinion, is a philosophy which ought to be reversed. Those who are blessed with the good fortune of being able to move forward at a greater speed of development than other areas should be encouraged to do so, with the incentives and if necessary the assistance going to those areas less fortunate so that all can move forward at a greater speed. It is a false premise that in holding back in some areas, somehow those less progressive economies as far as regions are concerned are going to catch up with the rest of the country.
This kind of philosophy that has entered into this budget is something new. While it may be new, it certainly is not getting at the root cause of public financing as far as individuals in this country are concerned. Unless the federal government, which has financial prerogatives within its areas of authority, does more to assist the lesser governments in the country in their problems, then progress as far as economic development is not going to go forward. This applies to housing as well as urban renewal. One of the main problems facing Canada today as it
9916
June 9, 1969

The Budget-Mr. Thompson relates to housing is the shortage of capital on the one hand and the tremendous cost of the available capital on the other.
The kind of policy the Minister of Finance is bringing out in this particular budget will only increase the cost of money and do nothing about freeing the sources of money that are necessary for the kind of development which housing represents. It is not just housing, but urban development. It is not just urban development but the capital cost of services such as hospitals, schools, sewage and water systems. Perhaps there is no more important area in this whole field of local governments, and as it relates to provincial governments as well, than the field of education. Presently in the hands of our secondary governments, particularly local governments, there is not sufficient access to tax capital to pay for the cost that these governments face, except at exorbitant interest charges.
While on the one hand we congratulate the Minister of Finance for bringing in a balanced budget, on the other hand we must face up to the fact that the kind of policies that permitted this to come about at the present time are not the policies that are going to fit the future needs of Canada as they relate to some of the inevitable responsibilities that other levels of government face.
It is interesting to note the Prime Minister (Mr. Trudeau) clearly talks about getting out of tax-shared programs and turning back to the provinces responsibilities which the federal government has taken unto itself in recent years in increasing measure. In many cases provincial governments have had shared programs imposed upon them about which they have had very little to say in determining policy. He now says such programs can be turned back to the provinces. He can get rid of this responsibility and put it back in the hands of the people where the constitutional authority and responsibility lies, but where will the tax resources come from?
[DOT] (9:50 p.m.)
It is all right to say this on the one hand, Mr. Speaker, but it is another thing to meet the over-all problem of finding the financial resources for governments at these other levels to carry out these responsibilities. This is why it is imperative for the federal government not just to set the tone, or establish policies but to take the lead in working out over-all responsibilities that face local and provincial governments in these vital areas that have so much to do with the development of social programs, programs which we

certainly ought to be able to finance at this time.
This brings us to a consideration of the over-all tax picture as it relates to tax income and tax resources of governments. I do not believe the Minister of Finance is giving consideration to this area. At least if he is, he is not informing us about it, and we can only hope that the promised white paper will bring out something on it. I am speaking of the relationship of the total cost of government to the actual earnings of the Canadian people.
We find ourselves in a position where nearly 50 per cent of all the money that Canadians earn-and here I am speaking of net earnings-go to pay the cost of government. I am not talking about gross national product at this time because gross national product is a fictitious term that has only an indirect relationship to the actual earnings of people. If you add up the cost of the federal government, of the provincial governments and of local governments you arrive at a figure that comes to very nearly 50 per cent of the total earnings of the Canadian people as those earnings relate to salaries, commissions, dividends, the sale of produce and all of those areas of income that can be directly classified as earnings coming in to the pockets of the taxpayers.
Historically, the danger signals flash when one looks at this picture. History shows that no free society has every remained free, and sustained the vitality that brought it to the point where it became free, when governments took back from the citizens of that society more than 50 per cent of that which they actually earned.


Eric William Kierans: May I ask the hon. member a question?


Robert Norman Thompson: The Minister of Finance may feel very smug and happy with his budget at this time-


Eric William Kierans: Mr. Speaker-


Mr. Speaker:: Order. Is the minister rising on a point of order?


Eric William Kierans: I would like to ask a question of the hon. member.


Mr. Speaker:: Order, please. The hon. member for Ked Deer has the floor and a question can be asked of him only if he will allow it.


Robert Norman Thompson: I have only a few minutes left, Mr. Speaker, and so I will just finish the thought I have.
June 9. 1969	COMMONS


Eric William Kierans: I was only going to ask the hon. member would he furnish the house with his information relating to this 50 per cent?


Mr. Speaker:: Order, please.


Robert Norman Thompson: Mr. Speaker, I would be very glad to do that, although I do not have the actual statistics tonight to be able to quote them exactly.


Eric William Kierans: You certainly haven't.


Robert Norman Thompson: But you add the cost
of the federal government, which is now approximately $11.5 billion according to this budget, to the total of the provincial budgets -the actual amount the provincial governments spend-and add that again to the cost of local governments and you come up with a sum total that nears 50 per cent of the total earnings of the Canadian people, according to the last statistics that are available.


Eric William Kierans: You said 50 per cent.


Edgar John Benson: It is really 35 per cent.


Mr. Speaker:: Order.


Robert Norman Thompson: Mr. Speaker, there was an interjection from the other side to the effect it is really 35 per cent. It is 35 per cent of the gross national product, but the G.N.P. and the net earnings of the Canadian people are very different. In the gross national product there are many elements that have nothing whatsoever to do with the earnings of the Canadian people, and the Minister of Finance ought to know this.


Edgar John Benson: Would you define gross
national product?


Robert Norman Thompson: I beg your pardon.


Edgar John Benson: Would you define gross national product?


Mr. Speaker:: Order please. The hon. member has only two or three minutes to go and perhaps he might be allowed to continue his speech without interruption.


Robert Norman Thompson: The Minister of Finance is asking me to define the gross national product. If he does not know what the gross national product is he had better go back and learn some basic economics.


Edgar John Benson: I certainly do know.


Robert Norman Thompson: There are at least a dozen elements in the gross national product that
DEBATES	9917
The Budget-Mr. Thompson have nothing to do with the earnings of the Canadian people. When you collect taxes out of the taxpayers' pockets you collect money which they earn and which comes into those pockets either as salaries, dividends or from the sales of produce.


Eric William Kierans: How about governmental
transfers?


Robert Norman Thompson: Governmental transfers do not enter into the picture on this at all.


Eric William Kierans: I am trying to help.


Robert Norman Thompson: Mr. Speaker, if the Postmaster General (Mr. Kierans) will-


Eric William Kierans: I am trying to give you some help to get up to your 50 per cent.


Robert Norman Thompson: Mr. Speaker, if the Postmaster General would do a little better job in looking after the situation that he has in the Post Office Department as it relates to the delivery of mail, since some of the policies he has established have upset many of the areas of the economy, some of the metropolitan areas of the country would have less of a problem so far as the financial picture is concerned.
But, Mr. Speaker, the Postmaster General has brought up a very interesting question, and so has the Minister of Finance. As it is now ten o'clock I serve notice that tomorrow I will bring you the exact statistics relating to what these gentlemen are talking about so that if they do not know what I am talking about I will be able to provide the statistics for them.


Mr. Speaker:: Order. I understand the hon. member has approximately two to two and a half minutes left to complete his speech. I wonder if it is the sense of the house that he might be allowed to complete his remarks tonight, or would the hon. member prefer to have his two minutes tomorrow?


Robert Norman Thompson: It is ten o'clock and I have only had about 15 minutes.


Mr. Speaker:: The hon. member has had more than 15 minutes now. It being ten o'clock the house will now proceed-


Robert Norman Thompson: I started by that clock opposite at a quarter to ten.


Mr. Speaker:: The hon. member is not the timekeeper of this institution.
9918	COMMONS
Proceedings on Adjournment Motion Mr. Benson: On a point of order, Mr. Speaker, we on this side of the house would be very pleased to give the hon. member extra time tomorrow to explain his definition of what he is talking about.


Mr. Speaker:: In accordance with Standing Order 40, a motion to adjourn the house is now deemed to have been made and seconded.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Stanley Howard Knowles: Mr. Speaker, a good deal of the discussion that has taken place today has revolved around the problem of inflation. I am concerned about those people in our country who suffer most because of inflation, and I feel that they cannot be asked to wait for some future millenium when the problem of inflation will have been solved. I believe they have the right to expect an improvement in their position right now. I refer to those on old age pensions and others on fixed income. That is by way of an appropriate preamble to the question which puts me on this late show tonight.
My question was asked on Monday, May 12. It is to be found in Hansard at page 8563. My question was as follows:
Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. Does the government have any intention of introducing legislation to eliminate or cut back either the family allowance or old age security pensions?
The Minister of National Health and Welfare (Mr. Munro) replied as follows:
There is no government decision one way or another in respect to this matter. If there should be any intention on the part of the government in this regard, it will be announced as a matter of government policy.
Hansard then records me as follows:
A supplementary, Mr. Speaker. Is the minister not in a position to assure us that, whatever else will be done in the field of social legislation, the means test will not be put back on either of these two pieces of legislation?
IMr. Speaker.]
DEBATES	June 9, 1969
At that point there followed one of those friendly confrontations that we sometimes have with the Chair and of course the Chair won, whereupon I simply said, "Ten o'clock". Accordingly I am here tonight to express the hope that the parliamentary secretary, who I see is in his place to respond for the Minister of National Health and Welfare (Mr. Munro), has been authorized to make a clear and simple statement in response to my question. I feel very strongly that the old age security pension and the family allowance should be increased. But at least I believe that all Canadians are entitled to the assurance that there will be no cut-backs and that the means test will not be put back on either of these pieces of legislation.
[DOT] (10:00 p.m.)
In my view the most significant, the most important steps ever taken by the parliament of Canada in the social welfare field were those steps which put these two pieces of legislation, family allowances and old age pensions, on a basis of universality so that their benefits go to our people as a matter of right. I believe that any step away from the principle of universality would be a retrograde step unworthy of the parliament of Canada and unworthy of the group of people who happen to form the government of this nation.
The noises made by the Prime Minister (Mr. Trudeau) and by the Minister of National Health and Welfare in recent weeks have given some people cause to fear that the reviews which are taking place should result in a cut-back on these programs, the elimination of one or other of them or the implementation of a means test in respect of either family allowances or the old age security pension. I plead in the name of all Canadians that this not be done. I plead as a member of parliament that this most important social advance, the principle of universality, stand for all time. Indeed, I ask the parliamentary secretary tonight to give us the assurance that whatever else may be done as a result of the review of our social legislation there will be no cut-back in family allowances or in the old age security pension and that there will be no means test put on either of these important pieces of Canadian social legislation.


Mr. Rosaire Gendron (Parliamentary Secretary to the Minister of National Health and Welfare):: Mr. Speaker, I think that the concern expressed by the hon. member for Win-
June 9, 1969

nipeg North Centre (Mr. Knowles) is a generous concern shared by this government.
I had the impression that on May 12, the minister had answered in the house the hon. member that the government was in the process of reviewing the whole area of social welfare legislation, including family allowances and old age pensions.
This review is still going on and if, following discussions, suggestions are made, they will be announced by the minister in due course. And I think there is reason for hoping that the hon. member will be able to commend those measures which, I have no doubt about it, will prove very timely.



EDUCATION-EMPLOYMENT OF CANADIAN SCHOLARS IN CANADIAN UNIVERSITIES

Heath Nelson Macquarrie: Mr. Speaker, I much regret that the Minister of Manpower and Immigration (Mr. MacEachen) is not here. This question was asked on May 20, a long time ago, and arrangements could have been made to answer it. As he knows this is one of the questions which greatly trouble the Canadian people today; namely the problem of the products of Canadian universities not being utilized in Canadian universities. I am sorry the minister is not here because I should like to say to him that the indictment that was made by a certain newspaperman some time ago has made me reluctant to bring up this matter. I did so on May 20 because of my own background in the halls of academe, to which I may return before too long.
I know it is easy to talk of the free market of ideas, the universality of education and to sneer at nationalism and chauvinism. When I became interested in this question it was not because I had any truck nor trade with anti-Americanism. If there is anything that would cause me more pain as far as our universities are concerned-and I recall this very well-it would be Canadian universities to be conducted again in an Oxford accent. But I do think there is no clear picture of what is happening in Canadian universities today. Both federal and provincial governments should try and find out what is indeed happening. It is a very serious matter and we should face up to what is happening to the products of our universities. Are the products of Canadian universities not good enough for employment in Canadian universities?
Proceedings on Adjournment Motion
If this indeed is the case, it is a serious an damning indictment of the existing institutions so dominated at the present time by non-Canadian faculty and administrators. Ii there is definite discrimination agains' Canadian products of Canadian universities the Canadian people should know. Universities, if they ever were, are no longer isolated from the stresses and strains which tear a society apart in this and other countries. Universities today must also be alert to dangers they once thought of, if I may be pardoned the expression, as academic, if they thought of them at all. Academic freedom today is not assailed from big business or big politics without, but frequently from a minority faculty and a minority of students from within. This, together with other questions, should be examined by universities, not in the ancient cliches of the past but in the needs and portents of the moment.
I congratulate Professors Steele and Matthews, whom I have never met, for bringing this important matter into the arena of debate.
I note some of their frightening data: In the past academic year Canadian universities hired 1,013 United States professors, 545 British professors, 722 from other countries and 362 in Canada. I am less troubled about those who were hired than I am about many distinguished graduates of Canadian universities and Canadian backgrounds who must have had to go elsewhere when they were rejected or not even considered for employment in Canadian universities.
As I have said, the data is frightening. The Department of Manpower and Immigration must be concerned about the multitude of university undergraduates who this summer cannot find jobs, whose careers are blighted by the dismal employment prospects. Surely, that concern-must be extended to the products of our graduate centres, to the end product of the university process in Canada.
We in this house and elsewhere call for ever increasing governmental aid to our institutions. This is how it should be. I was particularly impressed by the Macdonald report, brought out not long ago, which underscored the need for greater and greater assistance in this respect. But if we turn out Canadian people who are scorned by the very Canadian institutions we are seeking to sustain and advance, should not searching and perhaps painful questions be asked?
I repeat that I know the old slogans of the free market of ideas, the universality of the educated community and the ecumenical
June 9, 1969

Proceedings on Adjournment Motion nature of scholarship. But when I read that only 16 per cent of university positions last year went to the graduates of Canadian universities, I wonder whether Canadian universities are perhaps becoming the fall guys of the intellectual community. Perhaps without chauvinism, without narrow nationalism and without anti-Americanism we should very soon take a hard look at this. Of all ministers this minister, to whom I originally directed my question, who is not here and who did not have the chance to answer, must and should be concerned about the mobilization and utilization of our intellectua7 resources. It is hardly original to say that ,nese are the resources which will mako Canada great or something less than great in the years ahead.
[DOT] (10:10 p.m.)
I submit that it is time for the government of Canada, so deeply involved in sustaining our universities, to look at what happens or does not happen to the products of these universities. I think there is in this a useful avenue for the, Department of Manpower and Immigration ,,o take note of what is happening to our educated people in this country.


Mr. Gerard Loiselle (Parliamentary Secretary to the Minister of Manpower and Immigration):: Mr. Speaker, I want to congratulate the hon. member for Hillsborough (Mr. Mac-quarrie) for asking the question again. It is too bad that we only have three minutes in which to reply concerning all the work and the concern of the Department of Manpower and Immigration about the question of employment of Canadian scholars in Canadian universities. The proportion of foreign born teachers in our universities is substantial. There are two reasons for that. First, the rapid expansion of university facilities and enrolments in recent years has created a strong demand for teachers. Second, the graduation of Canadian scholars in the past has not been so large that one could expect it would meet all the needs of universities and research organizations.
Estimates made in the department indicate that Canadian universities will not graduate enough Canadian scholars to fulfill their academic needs until at least 1973. These studies have been made by the Department of Manpower and Immigration. The department makes placement services available both to universities and to faculty members through their network of more than 50 student placement and career planning offices at university and community colleges across Canada where

more than 200 manpower counsellors are employed on a full time basis. Through our operation retrieval, teams which included a representative of Canadian universities have travelled abroad, interviewing Canadian students with a view to informing them on employment prospects in Canada.
Academic vacancies in Canada are made known by at least two reports. The Association of Universities and Colleges puts out a listing of academic vacancies in Canada which is made generally available. The department, for example, purchased several thousand copies of this report which were mailed to Canadian scholars in other countries. The department also produces a directory of Canadian employers of university graduates, which includes academic as well as other opportunities. Published information is also widely distributed, both about Canadians looking for employment in universities and about university openings available for potential academics. For example, the department publishes a list of Canadians studying abroad and seeking employment in Canada, which is provided to Canadian universities as well as to other Canadian employers. The Association of Universities and Colleges of Canada sent out lists of N.R.C. and Canada Council award holders to all Canadian universities.
The department recognizes that the labour market for university teachers is an international market, and tries to adapt to that condition. For example, on direct requests from Canadian universities, our immigration offices abroad will assist in the recruitment of teaching staff and specialists not available in Canada, and the department is always looking forward to improving the situation in that field.
If the hon. member knows of some other way of proceeding, the department will certainly be interested to hear of it. A few moments ago he mentioned that there is no clear picture. Perhaps the hon. member does not see the picture as clearly as the department does, but the department is working very hard on that serious question.



REGIONAL DEVELOPMENT-PROGRAM FOR NORTHERN ONTARIO

Mr.   Gaeian-J. Serre@Nickel Belt: Mr. Speaker, recently I asked the Minister of Regional Economic Expansion (Mr. Mar-chand) whether his department was contemplating the drafting of an economic expansion program intended for the less fortunate areas of northern Ontario.
June 9. 1969	COMMONS
Mr. Speaker, I could not get an answer to that question of the utmost importance for the population of northern Ontario, and I am grateful to you for having allowed me to discuss that matter in the house tonight.
Mr. Speaker, northern Ontario is a wide area-four-fifths of the province-which is extremely rich in natural resources. There are in many centres of northern Ontario almost inexhaustible ore deposits and forests, but it seems that those resources are not developped as they should be.
We all know that those mining deposits are not inexhaustible. They are called to disappear one day. As soon as a mine is being worked, it has started to die because what is extracted from the earth is gone forever.
We must recognize that the large mining companies have greatly contributed to the development of northern Ontario. However, only one sector of the population benefits from mining operations. The people who live in areas far removed from the mines do not get any advantage and even in those mining centres there is a considerable number of people who cannot find decent work.
Northern Ontario greatly needs secondary industries. Everybody cannot work in mines.
I am especially thinking of older persons whose health prevent them from working in mines, but who could certainly work in manufactures or other secondary industries. We meet a considerable number of those people who can no longer work in mines while they are still relatively young, even in their forties, because of ill health.
I am also thinking of the increasing number of young people who have studied to practise a profession or a trade and who have to leave to seek their fortune elsewhere, in the southern part of the province, for example, on account of the lack of opportunities in the North.
There is no employment for young people in the North. This problem is becoming increasingly acute and the student population in northern Ontario is at present one of the largest in the province.
I am also thinking of women who have trouble finding adequate employment, considering our industries are oriented towards mining and forestry.
There is also the large number of farmers who vegetate due to lack of financial assistance for the development of their farm into an economic undertaking and also due to lack of assistance and coordination for the marketing of their products.
DEBATES	9921
Proceedings on Adjournment Motion
The ARDA program does very little to help and lead the farmers who are disappearing from the whole northern region of Ontario.
Mr. Speaker, the need for an economic development program is urgent in northern Ontario.
First, I think the Department of Regional Economic Expansion should initiate immediately a socio-economic study of that region.
Moreover, unemployment should not be the only criterion to designate an area. Those figures do not always give a true picture of a region. Even if they show, for instance, very good economic conditions in the Sudbury area, I want to point out that there is extreme poverty in some spots in my riding of Nickel Belt and in many regions of northern Ontario.
Mr. Speaker, the northern part of Ontario has not always received adequate attention from Toronto or Ottawa authorities. There have been many major problems for a long time. The means of transportation and communications are not sufficient.
We have to import everything from the outside: goods, various products, for example, machinery and various mining equipment which could very well be made in the region.
Freight rates are very high in northern Ontario. A review of those tariffs is necessary so that local producers may compete with other areas in the province and in the country.
[DOT] (10:20 p.m.)
Mr. Speaker, I could give you a long list of many other problems peculiar to northern Ontario and come up with many suggestions to solve them, but time is running out.
However, I propose to take those representations to the Prime Minister (Mr. Trudeau) and to the Minister of Regional Economic Expansion, both having shown much interest in the situation in northern Ontario.
The Minister of Regional Economic Expansion has already shown a marked interest in our area of northern Ontario by coming last weekend to see what the problems were, while visiting various centres in our region, in particular North Bay, Cochrane and Kapuskasing.
I strongly wish that the Minister of Regional Economic Expansion, when choosing new designated areas, will seriously take into consideration the constituency of Nickel Belt which is not as developed as the city of Sudbury.
9922	COMMONS
Proceedings on Adjournment Motion
In concluding my remarks, I hope that he will give favorable consideration to the claims I am setting forth tonight and that he will see fit to implement an economic expansion program in northern Ontario as soon as his bill providing for grants to regional development becomes effective.


Russell Clayton Honey: Mr. Speaker, the hon. member has presented a very good case and given a very good description of the situation as well as some of the conditions in northern Ontario. I think this is to be expected, because in his time in the house he has shown a concern not only for his own riding of Nickel Belt but for the situation in all of northern Ontario. Certainly, that has been demonstrated to those on this side, if I may speak for the minister who has responsibility for correcting regional economic disparities in Canada.
As the hon. member has mentioned, the minister was in northern Ontario this past week looking at the conditions there and talking with officials and interested people. He was pleased that the hon. member who has raised this matter was one of the people whom he met in northern Ontario last week.
DEBATES	June 9, 1969
As the minister has previously told the house, officers of his department have been consulting the provinces about the future programs of the department. As the minister has said, no decisions in regard to naming designated regions under the new legislation will be taken until the legislation, Bill C-202 in respect to the Regional Development Incentives Act, which was given second reading on Friday last and is now before the Standing Committee on Regional Development, has finally been passed by parliament.
When this happens there will, of course, be further consultations with the provinces before final decisions are made in regard to designating regions, as provided under the legislation. However, I can assure the hon. member, as the minister assured those he met last week in northern Ontario, that the interest and concern shown in the area will be very much in the minister's mind. Indeed, the situation in northern Ontario is very much in the minds of the officials of the department. As I say, further consultations will take place with the provinces prior to any final decisions being made.
Motion agreed to and the house adjourned at 10.27 p.m.

Tuesday, June 10, 1969