1969-03-21

ROUTINE PROCEEDINGS


[Stage Direction]
Fourth report of Standing Committee on Broadcasting, Films and Assistance to the Arts-Mr. Reid.
[Stage Direction]
Fourteenth report of the standing committee on Finance, Trade and Economic Affairs, in French and English-Mr. Gaston Clermont (Gatineau).
[Editor's Note: Text of foregoing reports appears in today's Votes and Proceedings.]


Hon. Jean-Luc Pepin (Minister of Industry, Trade and Commerce) moved: for leave to introduce Bill No. C-183, to establish the Export Development Corporation and to facilitate and develop export trade by the provision of insurance, guarantees, loans and other financial facilities.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.


Hon. Jack Davis (Minister of Fisheries):: Mr. Speaker, I should like to make a short statement on recent developments in the seal hunt. It will answer several questions asked in recent days by hon. members and serve to bring the house up to date on the situation both in the Gulf of St. Lawrence and on the Labrador front in the North Atlantic.
There is real concern from a conservation point of view. The seal count, to date, has been small both in the Gulf of St. Lawrence and off Labrador. In the Gulf the count of adult female seals has been in the order of
only 250,000. In a normal year this figure would have been between 750,000 and one million. It follows that less than one-third as many adult female seals have been observed in the Gulf of St. Lawrence as compared to normal times.
The quota set by regulation for the taking of young seals, as hon. members know, is 50,000. It is 50,000 assuming a normal year in so far as adult females are concerned. This year we terminated the hunt at 35,000, our main concern being that, if the hunt had been allowed to continue for another day, an entire year class may have been wiped out.
The main problem on the Gulf of St. Lawrence has been the absence of ice suitable to the pupping of young seals. This, together with frequent storms has resulted in many drownings. The young seals have been drowned either at birth or as a result of the breaking up of the small ice floes which have been limited mainly to the Northumberland Strait between Prince Edward Island and the mainland.
The hon. member for Egmont (Mr. MacDonald) has quoted local fishermen as saying that there are a large number of seals off the north coast of Prince Edward Island. I regret to advise the house that there are no more than 6,000 young seals in the entire area at the present time.
The second phase of the hunt, Mr. Speaker, is now concentrated on the front off Labrador in the North Atlantic. The main seal concentration is around the mouth of Hamilton Inlet. Six Canadian ships are taking young seals there at the present time. Fourteen Norwegian vessels are also in this same general area.
I regret to inform the house that we have encountered some difficulties with the Norwegian sealers. When the season opened on the front on March 12 several Norwegian ships were observed inside our territorial waters. One is definitely known to have been taking seals on Saturday, March 15. Warnings were immediately issued by radio to all Norwegian vessels ordering them not to take seals and instructing them to leave Canadian waters.
[DOT] (11:10 a.m.)
Due to extreme weather conditions, thick ice and heavy Arctic fog, it was impossible

March 21. 1969
Depletion of Seal Herds for our fisheries protection vessel, the Cape Freels, to get into this area. We therefore requested the Department of Transport icebreaker, Sir Humphrey Gilbert to come up from St. John's, Newfoundland. This vessel, with a helicopter and fisheries protection officers aboard is now in Hamilton Inlet with instructions to pick up the Norwegian vessel, which was known to be taking seals on Saturday, if it is still within our 12 mile limit. Otherwise it would appear that the situation on the front is generally under control, as all the other Norwegian vessels are known to be outside of our territorial waters.
I should reiterate, in conclusion, Mr. Speaker, that our fisheries protection service is operating under very adverse conditions off Labrador. Lack of visibility, freezing of ships in the ice, high winds and poor radio communications have contributed to delays which have been encountered in carrying out orders which were issued some days ago.


Mr. James A. McGrath (St. John's East):: Mr. Speaker, the minister's statement just recently came to my attention. I have not had a chance to study it. The members of this house were interested to hear what the minister had to say regarding the seal herd in the Gulf of St. Lawrence. I believe hon. members realize the importance of the seal hunt as a supplementary source of income to the fishermen in the Atlantic provinces.
The minister referred to the fact that the herd this year is very seriously depleted. I believe he mentioned the herd was down to
250,000	from 700,000. This is a real cause for concern, Mr. Speaker; but the minister omitted to mention the fact that Canada is now a member of ICNAF, the International Convention of the North Atlantic Fisheries. I believe this matter has been under the jurisdiction of ICNAF since 1966. Steps should be taken in ICNAF to ensure proper methods of conservation of the herd off the front. I believe that proper conservation methods must be taken with the main herd off the coast of Labrador. We can talk all we want about a sanctuary in the Gulf of St. Lawrence, but it is all to no avail unless the main herd is protected.
I am sure hon. members are glad to hear that the minister at last has his facts correct regarding the infringement of our Territorial waters that took place last weekend, and is still taking place, by Norwegian vessels. I brought this to the attention of the minister and his parliamentary secretary gave a reply on Monday. The reply by the minister on Tuesday indicated there was no evidence that

seals were being taken by the Norwegians. This was totally at variance with the reply given by his parliamentary secretary the previous Monday. We now find there is evidence the Norwegians were hunting seals within the three mile limit, and the department has had to request a coast-guard vessel to be dispatched from St. John's, several hundred miles distant. This highlights the inadequacy of the fleet of fisheries patrol vessels to enforce Canadian jurisdiction and conservation in our territorial waters, particularly in so far as fisheries and the seal herd are concerned.
The fleet of the Department of Fisheries patrol vessels must be substantially increased so the department can enforce our territorial jurisdiction. The seal fishery has been a subject of debate in this house for a number of years, more particularly since films produced in 1964 were shown around the world, and as a consequence of which Canada's reputation has suffered.
Canadians have been portrayed abroad as being a bunch of sadistic, barbarous people skinning baby seals alive, whereas in actual fact seals are humanely killed. The minister has in fact announced from first hand evidence that seals are humanely killed. I think he would be the first to admit that the killing of these animals is a necessary supplementary source of income for the fishermen of the Atlantic region. A request has been made in the house, and in writing to the Standing Committee on Fisheries and Forestry, to have the whole matter aired before the committee, in order that the facts may be ascertained once and for all.


Mr. Arnold Pelers (Timiskaming):: Mr. Speaker, I was pleased to hear the announcement of the minister and to learn that the very unfortunate circumstances with regard to the seal herd in the Gulf of St. Lawrence had decreased as rapidly as they have. I had the opportunity of visiting that area with the minister. The area of ice off Prince Edward Island was very small in size and I think an accurate count was fairly easy to take. If there are only 6,000 pups left in the area, I think the minister is to be congratulated for terminating the seal hunt. The prime interest in this matter, leaving aside the ballyhoo and all the other propaganda in which certain people have been interested, should be the conservation of the sealing industry. The fact that an accurate count could be made indicates that something happened in the last
March 21, 1969

year, not only because of weather and fisheries conditions but with the seals themselves, because only a quarter of a million seals came into the gulf when normally there have been a million in the area.
We must make some arrangements through ICNAF or perhaps under a bilateral agreement with Norway as to the taking of seals on the front, because this year seals, rather than coming into the gulf, stayed on the front. The loss of three-quarters of a million seals is a very serious blow to the industry and will be a serious loss if it continues in the future.
I am surprised at the comments of some hon. members who have argued the matter on economic grounds. We are concerned here with an industry and the fact that conservation is more important than this year's catch. If those involved in the industry are in difficulty, and difficulty to our economy has developed1, the situation should be handled as an emergency and the government should provide financial assistance to the people involved. But we should not forfeit our right to carry on a reasonable conservation program. Ouir prime interest should be to maintain- the seal herd at a level which will allow harvesting for years to come. The minister will have serious difficulty, and this has been pointed out by other members of the house, with regard to the 12-mile limit and the headland to headland system. There will be difficulty in drawing our boundaries in this respect. Our discussions with Norway in this regard should not only be with the fishermen in the area but at government level in order that we can arrive at a bilateral agreement and conserve seals on the front as well as in the gulf.


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I shall be brief in my comments on the minister's statement.
We share his views regarding seal conservation measures.
On the other hand, we find it difficult to understand the insistence of the Minister of Fisheries and Forestry (Mr. Davis) to put an end to what is practically a slaughter of baby seals, a matter much talked about in the house these last few weeks. We do not hold it against him but we are surprised that his colleague, the Minister of Justice (Mr. Turner) does not have in his omnibus bill the same pity for human babies.
Business of the House [DOT] (11:20 a.m.)


Mr. David MacDonald (Egmont):: Mr. Speaker, I rise on a question of privilege. In the minister's statement on motions he referred to comments of mine with respect to the size of the herd north of Prince Edward Island. Inasmuch as there might be some confusion, which there seems to be in some of the responses in the house, in the statements both by the fisheries people and the fishermen-the fishermen apparently have estimated from the air on two occasions this week that the seal herd was from 50,000 to 80,000- could the minister arrange for fishermen and officials of the department to get together and look at the herds so that they could clear up this misunderstanding?


Mr. Speaker:: Order, please. I suggest that is not a question of privilege.
Does the hon. member for Winnipeg North Centre wish to take part in the question of privilege?


Mr. Stanley Knowles (Winnipeg North Centre):: No, Mr. Speaker, I have another
question.



BUSINESS OF THE HOUSE

Stanley Howard Knowles: Mr. Speaker, before we leave motions, I wonder if we could have an understanding about the business of the house for today. I have in mind in particular the desire of the government to get a certain amount of business through, and I wonder if there could be an understanding at this point that the private members hour today will be suspended so that we could use that time for government business.


Hon. Donald S. Macdonald (President of the Privy Council):: Mr. Speaker, perhaps, if the house is agreeable, we could make an order right now that the private members hour today be suspended.


Mr. Speaker:: Is that agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: It is so ordered.


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have a supplementary question on the matter that has just been raised. Does the minister intend to proceed in the same manner as was outlined last night by

March 21, 1969
Inquiries of the Ministry the President of the Treasury Board (Mr. Drury) on the business for today, or does he propose to bring in the superannuation bill first?


Donald Stovel Macdonald: The intention is to proceed with the government reorganization bill, in the expectation that by the early afternoon at the latest it would be disposed of. From there we could go on to the superannuation bill, and in the time remaining to the Financial Administration Act.



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I should like to direct to the Minister of Transport a question in connection with housing. It arises out of the statement made this week by the Premier of Ontario, that the Minister of Transport has held up approval of public housing projects in Ontario and specifically in the Ottawa area. Will the minister say how soon the country may expect a clarification of the federal government's housing policy and an end to the freeze in effect since last November?


Hon. Paul Hellyer (Minister of Transport):: This has already been done to a very large extent. Had the Premier of Ontario consulted his minister in charge of housing he would have found out that I recently indicated to him, in reply to a telegram, that most of the applications which had been pending have been approved. I think there are only two or three which are still the subject of further examination, and in addition one or two with design problems and where the normal criteria had not been met were sent back for clarification of these points. To a large extent all the outstanding applications have been dealt with and we are up to date, with the exception of two or three of the very large projects which do not provide the kind of family accommodation that was considered advisable by the task force and by other people who have studied this subject.


Robert Lorne Stanfield: I have a supplementary question, Mr. Speaker. I should like to ask the minister a question specifically relating to Ottawa, where the fear has been expressed that the city may be left holding the bag with regard to a program involving 1,000 families.

Has this situation been clarified and, if not, will the minister undertake to hold an early meeting with officials in Ottawa to ensure that the policy of the government is clear with respect to this project and to enable the city to proceed?


Paul Theodore Hellyer: I will give the same answer. Some of the projects were approved. One or two others where the design was inadequate were referred back to the officials responsible for design improvement. Two large projects which have not been put forward firmly but which are pending are under consideration. These had not reached the stage where a decision had to be taken. I think the statement I made that everything is current applies to Ottawa as well as to the rest of the province and the country.


Robert Lorne Stanfield: A supplementary question, Mr. Speaker. Does the minister say that the officials concerned with this matter in the city of Ottawa have been given an answer regarding this project, that they know exactly where things fit and that the ball is now in their court?


Paul Theodore Hellyer: I could not answer that question, Mr. Speaker, because I am not sure of the channels of communication. I think they have to go back from Central Mortgage and Housing Corporation to the Ontario Housing Corporation, from the Ontario Housing Corporation to the city of Ottawa, and from the city of Ottawa to the public. If that has not happened then it is merely because of communications.


Robert Lorne Stanfield: With respect, Mr. Speaker, I am beginning to wonder whether we are involved here in a housing program or a merry-go-round.


Mr. David Orlikow (Winnipeg North):: supplementary question. May I ask the minister in charge of housing whether he told representatives at the Canadian Conference of Mayors and Municipalities that there would be substantially less money for public housing during the next few years?


Paul Theodore Hellyer: No, Mr. Speaker, I did not indicate that. I indicated that there would be considerable experimentation in this field that is designed to seek better ways of meeting the needs of Canadians in all income brackets, particularly those of limited income, and that we would not close our minds to any suggestion that would improve either the quantity or the quality of accommodation available for people who need it.
March 21, 1969


David Orlikow: A further supplementary
question, Mr. Speaker. Keeping in mind this experimentation, will the minister tell the house whether there will be as much or more money for public housing this year than there was last year?


Paul Theodore Hellyer: Mr. Speaker, I do not wish to give specific figures, but if my hon. friend includes the whole range of options and policies that might be tried in order to provide accommodation for people of limited income, then I think he would be pleased to know that there will be a sizeable amount available for housing, probably as much or more than was spent last year.


Hon. Marcel Lambert (Edmonton West):: supplementary question, Mr. Speaker. I wonder whether the minister would get his communications speeded up so that officials both in the city of Ottawa and in the city of Edmonton could be given a clear picture as to where they stand, in view of the fact that they have proceeded bona fide with their programs and now feel they are left holding the bag, unable to tell anything to the people concerned.



MORTGAGE RATE IN LIGHT OF INCREASED PRIME LENDING RATE

Mr. John Gilbert (Broadview):: Mr. Speaker, may I address a supplementary question to the Minister of Transport who is responsible for housing. Considering that the prime lending rate has been increased from 7 per cent to 7 s per cent and considering the high yield of Government of Canada bonds, does he anticipate that the N.H.A. mortgage rate as of April 1 will be 10 per cent or more?


Paul Theodore Hellyer: Mr. Speaker, I am advised that it will not be that high.


An hon. Member:: It will be 9| per cent instead.


Paul Theodore Hellyer: I hope that interest rates will soon begin to decline.


Some hon. Members:: Oh, oh.


Mr. Diefenbaker:: Which year?


Paul Theodore Hellyer: I hope my hon. friends will exercise the restraint required of all levels of government and of all citizens, if this is to come about.
Inquiries of the Ministry FINANCE



RAISING OF PRIME LENDING RATE BY CHARTERED BANKS

Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, may I direct a question to the Minister of Finance in regard to the announcement by several chartered banks that they are now raising the prime lending rate to 7J per cent. In view of the fact that this will increase the cost of doing business, and consequently increase prices, may I ask the minister whether he intends to use his very considerable powers of moral persuasion with the chartered banks and ask them to exercise some restraint in the matter of increasing the prime lending rate?


Hon. E. J. Benson (Minister of Finance):: Mr. Speaker, I believe the reasoning behind the banks raising the prime rate is that the prime rate in the United States has gone up to 7i per cent. Since there are the two alternative places for borrowing, bank rates in Canada have to be pretty much in line.


Thomas Clement (Tommy) Douglas: A supplementary question. In view of the fact that the profits of the chartered banks increased sharply for 1968 and for the first quarter of 1969, will the minister initiate an investigation into the activities of the chartered banks with a view to seeing whether or not parliament should consider reimposing some ceiling on the interest rates the banks may charge?


Edgar John Benson: Mr. Speaker, as my hon. friend knows, the activities of the banks are examined on a regular basis by the inspector general of banks.


Mr. Max Salfsman (Waterloo):: A supplementary question, Mr. Speaker. Since the interest rate is not responding as it was anticipated it would when the committee examined banking legislation, will the minister consider referring the Bank Act back to the committee for a complete evaluation and examination of its effects?


Edgar John Benson: Not at this point, Mr. Speaker,


Max Saltsman: A further supplementary question, Mr. Speaker. Since the banks have raised their rate by half of 1 per cent to their prime borrowers but have only increased the interest rate to depositors by a quarter of 1 per cent, will the minister examine the wide discrepancy the banks have introduced and imposed on the financial system?

March 21, 1969
Inquiries of the Ministry


Edgar John Benson: 
Some hon. Members:: Oh, oh.


Thomas Clement (Tommy) Douglas: 
Mr. Speaker:: Order, please. I suggest to hon. members and the minister that we are now entering the realm of debate and should turn to another subject. I see the hon. member for Broadview rising on a supplementary. I shall recognize him later.


Gilbert F. Rondeau: Mr. Speaker, I wish to speak about a fairly well-known matter. I would have liked to ask the minister a supplementary question. So, I rely on your indulgence, for which I thank you in advance.
I have a question for the Minister of Finance, with regard to this last increase. Does he intend to recommend that the chartered banks stop increasing their interest rate, considering the cost of living and the very high rate of municipal, provincial and federal bonds?



WHEAT-REPRESENTATIONS FROM SASKATCHEWAN AS TO PRICING

John George Diefenbaker: Mr. Speaker, my question is directed to the Minister of Industry, Trade and Commerce. What was his response to the telegram from the government of the province of Saskatchewan supporting a floor price of $1.95i for wheat, and a two price system under which the price of No. 1 at the Lake-head until the establishment of the two price system would be $2.12?


Jean-Luc Pepin: Mr. Speaker, I have already answered that question,


John George Diefenbaker: No, you have not.


Jean-Luc Pepin: Mr. Speaker, similar telegrams were sent to the Prime Minister, to me and to
[Mr. Saltsman.l
other ministers by other groups too. An answer is being prepared and will be sent out soon.


John George Diefenbaker: Will the minister say whether the answer will soon be available to the Liberal government in Saskatchewan. If not, does he not think that the large delegation of 1,000 farmers which will come here may convince him of the catastrophic position of western agriculture and of the necessity for action?


Jean-Luc Pepin: Mr. Speaker, I am sure when the right hon. gentleman was prime minister of this country that once in a while he had to think for a while when similar requests were made of him.


John George Diefenbaker: Is this a case, Mr. Speaker, where the matter will be considered once in a while? Our western farmers have had no consideration from this government.


Some hon. Members:: Hear, hear.


Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I have a supplementary question to direct to the Acting Minister of Energy, Mines and Resources. Will he provide his cabinet colleagues with a copy of the speech he delivered to the Hamilton East Liberal Association in which he is reported to have said that there is a feeling of isolation in western Canada. Will he support a two price system for wheat, which has been advocated, to reverse the current trend in western Canada?



OUT-OF-CONDITION GRAIN ON HAND

Mr. Ed Schreyer (Selkirk):: Mr. Speaker, my question is directed to the Minister of Industry, Trade and Commerce. In order that hon. members may determine whether the matter of out of condition grain remains a national problem that must be dealt with during the next few weeks, will the minister undertake to make a full report on the volume of out of condition grain still remaining. Will he do that before the Easter recess?


Jean-Luc Pepin: Mr. Speaker, I think the Minister of Agriculture is willing to answer that.


Hon. H. A. Olson (Minister of Agriculture):: Mr. Speaker, we have been attempting to obtain accurate figures about the volume of such grain and I must advise my hon. friend that there are wide variations in the estimates. We do not know how much has been
March 21, 1969

fed to livestock during the months since harvest and how much has been dryed on farms. The estimates we have been receiving are widely varied.


Edward Richard Schreyer: A supplementary question, Mr. Speaker. Before parliament adjourns for the Easter recess will the minister undertake to make as accurate a report as possible on this matter?


Horace Andrew (Bud) Olson: Mr. Speaker, during most of next week the Agricultural Congress will be held ini Ottawa and I suggest to the hon. member that a large number of knowledgeable people from western Canada will attend and give us their opinions on this matter, which will be publicized.


Edward Richard Schreyer: A further supplementary question, Mr. Speaker. I was asking for statistical information and not for policy information.



SHIPPING


Mr. Thomas A. Bell (Saint John-Lancasler):: Mr. Speaker, I have an interesting policy question for the Minister of Transport. Has the government changed its policy with respect to icebreaking in the St. Lawrence, as seems to be indicated by a statement made in Montreal yesterday? If it has changed its policy, in what respect has it done so?


Paul Theodore Hellyer: Mr. Speaker, we have tried to do this as effectively as we can. We are making substantial progress, as technology improves.


Thomas Miller Bell: A supplementary question, Mr. Speaker. Am I do understand from the minister that ice breaking policy as announced by this government and the previous government is exactly as it was before, and that there is to be no artificial assistance to breaking up the ice?


Paul Theodore Hellyer: Mr. Speaker, we have to keep the channel open to prevent flooding, and more and more ships are using the channel for navigation. There is no sense in sparring around on this question.


Mr. Fairweather:: Do not talk about flooding, then.


Paul Theodore Hellyer: The fact that the channel has been kept open has aided navigation. I have no doubt it wiE be used to a considerable extent in the years ahead.
Inquiries of the Ministry


Thomas Miller Bell: A supplementary question, Mr. Speaker. Since there evidently is some sparring around on this question, will the minister make a full, straightforward and honest statement in this house on any change in policy?


Mr. Robert McCleave (Halifax-East Hants):: A supplementary question, Mr. Speaker. I ask the Minister of Transport whether consideration is being given to recovering costs of present operations from those shipping companies which are benefiting from this new policy?


Some hon. Members:: Answer.



AGRICULTURE


Mr. Andre Fortin (Lotbiniere):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture.
Could he tell us whether his department intends to review the policy of the Dairy Commission and to increase quotas in order to allow farmers in eastern Canada to have a progressive production?


Horace Andrew (Bud) Olson: Mr. Speaker, I do not know whether we can call it a complete revision. There will probably be some adjustments in the new policy, beginning on April 1. I hope we will be able to announce that before April 1.



AIR TRANSPORT


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, my question is directed to the Minister of Transport. Is it the intention of the government to reorganize the regional air carriers into one common carrier?


Paul Theodore Hellyer: No, Mr. Speaker. The government has no such intention.


Edward Richard Schreyer: Mr. Speaker, I wish to direct a supplementary question to the Minister. Since the United States Civil Aeronautics Board is showing determination in standing up to IATA on the question of air fares, can the minister assure the house that the Canadian government will show similar backbone?


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

March 21. 1969
Inquiries of the Ministry COMPANY OF YOUNG CANADIANS



ALLEGATIONS BY MR. LUCIEN SAULNIER

Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I wish to direct a question to the Acting Prime Minister or the government house leader. Will either minister give an assurance that the estimates of the Company of Young Canadians will be brought before the broadcasting committee to investigate the allegations of Lucien Saulnier, Montreal executive officer, that the C.Y.C. involves a red guard type of operation?


Donald Stovel Macdonald: Mr. Speaker, I would point out to the hon. member that these estimates are already before the broadcasting committee. If he would like to discuss the timetable of the committee, he could make representations to the chairman or to other members of the committee.



CANADIAN ECONOMY


Hon. George Hees (Prince Edward-Has-tings):: Mr. Speaker, I wish to direct a question to the Minister of Finance. As the new wage guideline of 9 per cent increase a year, which was established yesterday by the government when it announced its agreement with the C.B.C., will create a great additional inflationary pressure on the economy, does the government intend to take any steps to counteract this upward pressure on prices?


Edgar John Benson: Mr. Speaker, it was not a settlement of the government; it was a settlement between a Crown corporation and its employees.


John George Diefenbaker: With the Minister of
Labour engaged in it.


Edgar John Benson: The Department of Labour acted as a mediator in this particular dispute, the same as it does in many disputes coming under federal jurisdiction, and I can assure my hon, friend that we have no idea of increasing inflation by increasing his salary.


George Harris Hees: Mr. Speaker, as the Minister of Labour very proudly announced this as a government achievement yesterday, and1 as we know perfectly well he had a lot to do with setting this 9 per cent increase guideline, would the Minister of Finance give consideration to giving more sensible answers in the house, rather than the broken record he often substitutes for common sense?


Mr. Speaker:: Order, please.
IMr. Speaker.]



THE BUDGET


Hon. J. W. Monieiih (Perth):: Mr. Speaker, I wish to direct a supplementary question to the Minister of Finance. Can he definitely announce whether he is going to bring down a budget in April or May, or some other time, in an effort to try to combat the continuing inflation so seriously pointed out yesterday in the report of the Governor of the Bank of Canada?


Edgar John Benson: Mr. Speaker, I have indicated that a budgetary statement, or a statement on our economic and financial position, will be made some time in May or June.



NATIONAL PARKS


Mr. Guy LeBlanc (Rimouski):: Mr. Speaker, I wish to direct a question to the Minister of Forestry and Rural Development.
The establishment of a national park at Pointe Forillon, in the Gaspe peninsula, was provided for in the federal-provincial agreement on the development of the Gaspe peninsula. Could the minister tell us whether there has been some development in the last few days with respect to the implementation of that plan?
Could he also tell us whether we should believe the report that from now on planning will be the responsibility of the premier of Quebec?


Mr. Speaker:: Order. The hon. member
knows that he cannot ask a minister to confirm or to deny a rumour or a report, if there is any urgency as far as the first question is concerned, the hon. member could give notice to have it debated on adjournment.



CONSUMER AFFAIRS


Mr. A. D. Hales (Wellington):: Mr. Speaker, I would like to direct a question to the Minister of Transport, who is responsible for housing. In view of the great increase in the price of lumber in the last little while, as much as $15 per thousand board feet in the last six weeks, which has had very serious repercussions on the cost of building homes,
March 21. 1969

would the minister consider setting up a task force to investigate this increase, and would he also contact the Minister of Consumer and Corporate Affairs and ask him to make a study of the matter?


Mr. Speaker:: Order, please. It seems to me that the question asked by the hon. member for Wellington has been asked within the last few days; and so far as the second part of the question is concerned, he is making a suggestion to the minister, and he has to assume that his submission will be taken into account.



HOUSING


Mr. Robert Simpson (Churchill):: Mr. Speaker, I wish to direct a supplementary question to the Minister of Transport. Some days ago he mentioned that it was his intention to make C.M.H.C. mortgage money available in the field of high rise apartment construction in Thompson, Manitoba. May I ask him whether this has now been accomplished, and whether the regional office in Winnipeg has been so advised?


Paul Theodore Hellyer: I cannot, Mr. Speaker. There is some reluctance toward making loans for high rise apartment construction, but this is a matter which will be discussed between myself and the corporation in an attempt to achieve the ends desired by the hon. member and myself.


Robert Simpson: Can the minister say what are the grounds for the reluctance to make these loans?


Mr. Speaker:: Order, please. The hon. member for Regina East.



NATIONAL DEFENCE


Mr. John Burton (Regina East):: Mr. Speaker, I wish to direct a question to the Acting Prime Minister. In view of the Prime Minister's forthcoming visit to Washington and the discussions he will be engaged in there, would he undertake to draw to the attention of the Prime Minister the views of a former Minister of Finance, Walter Gordon, that Canada should renounce the use or possession of nuclear weapons?
Inquiries of the Ministry A.B.M. PROGRAM-COMMUNICATION BETWEEN U.S. AND CANADA


John George Diefenbaker: Mr. Speaker, my question is directed to the Acting Prime Minister. Yesterday the Secretary of Defence in the United States is reported to have given evidence before a Senate committee that Canada was1 fully advised and informed regarding the new A.B.M. plan of the Nixon administration over a period of days. Will the minister look into this question so that this house may have the truth as to what actually took place, because ministers in the government here said they had no knowledge until the day of the speech by the President of the United States? This is a very serious matter in our relations with the United States.


Paul Theodore Hellyer: Mr. Speaker, I think the Prime Minister indicated there had been discussions going on back and forth over many months, or even years, and if my right hon. friend has some question beyond that I will be glad to refer it to the attention of the Prime Minister.


John George Diefenbaker: I am not talking about the discussions about the Sentinel plan. I am referring to the new plan that has just been brought into being, or at least promised to be brought into being by the President-not the old plan that was going on for months. Was this new plan brought to the attention of the Government of Canada on several occasions prior to the President's announcement? I want to find out who is actually giving the true facts. Is the Secretary of Defence of the United States, doing so, or is the Government of Canada concealing the facts?



TELEVISION


Mr. Donald Maclnnis (Cape Brefon-East Richmond):: Mr. Speaker, I wish to direct a question to the Acting Prime Minister. Is he aware that recent press reports from Toronto have indicated a great concern about the ethics of the transaction between the Minister of Transport and Geoffrey Stirling?


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


Malcolm MacInnis: Mr. Speaker-


Mr. Speaker:: Order, please. The Chair has recognized the hon. member for Egmont.

March 21, 1969
Inquiries of the Ministry
AGRICULTURE	AIR CANADA



POTATOES-PROGRAM FOR ASSISTANCE OF GROWERS

David Samuel Horne MacDonald: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. Can he indicate whether or not the Agricultural Stabilization Board has taken a decision with regard to assisting potato growers, particularly in eastern Canada where they have had a very difficult year with low prices?


Horace Andrew (Bud) Olson: Mr. Speaker, an announcement was made last night that we are going to undertake a diversion program to starch to try to take some of the potatoes out of inventory and strengthen the market.



WHEAT-REQUEST THAT INTERNATIONAL COUNCIL BE RECONVENED

Mr. R. R. Soulham (Qu'Appelle-Moose Mountain):: Mr. Speaker, I wish to direct a question to the Minister of Industry, Trade and Commerce. In light of reports that the two day meeting held earlier in London, England, by representatives of major wheat exporting and importing countries on the subject of the threatening price war has not come to any conclusive determination, will the minister do all within his power to encourage the reconvening of the International Wheat Council early in April, as was suggested at the London meeting in order finally to settle this serious problem?


Jean-Luc Pepin: Mr. Speaker, the price committee met in London and decided to reconvene immediately after the meeting of exporters, which is to take place very early in April.


Richard Russell Southam: As a supplementary question: If it is possible would the minister accompany the Prime Minister to Washington next week, and take his colleague the Minister of Agriculture with him, so that they could discuss this serious situation with their American counterparts.


Jean-Luc Pepin: I am not going but the subject will be on the agenda.



EFFECT ON ROUTES OF REGIONAL CARRIERS REORGANIZATION

Stanley Howard Knowles: Mr. Speaker, may I direct this question to the Minister of Transport. In view of the answer he gave a few minutes ago to the hon. member for Dauphin with regard to air carrier policy, may I ask the minister whether there is any explanation for the lengthy report in the press today attributed to a highly placed source in the Department of Transport that there is to be a change in the regional air carrier policy which may affect the routes assigned to Air Canada.


Mr. Speaker:: I suggest the question asked is partly in order. I think the question might be asked directly by the hon. member, but that he should not ask the minister to comment on some aspect of a news report.


Stanley Howard Knowles: am prepared to ask the question directly, but I also feel I have a question of privilege in that we are given statements on the floor of the house, brief though they may be, which do not jibe with statements given outside the house by people in the Department of Transport. This goes on all the time. I still think parliament is supreme.


Some hon. Members:: Hear, hear.


Stanley Howard Knowles: ask the Minister of Transport directly whether the government is considering a change of regional air policy, as a result of which five regional lines would be made a national line and given some of the routes of Air Canada.


Paul Theodore Hellyer: First of all, Mr. Speaker, I do not think there is any conflict whatsoever between what I said and any newspaper story. If I understood the question correctly, it was whether it was the policy of the government to have one regional air carrier for Canada, and I said no. That is quite correct.
In so far as the newspaper story is concerned, I have no idea what the source of it was. The policy of the government in respect of regional air carrier service is still as it was when announced two or three years ago by the former minister. That policy is in the process of being implemented now. Some routes which have been operated by the main line carriers are being given to regional carriers, and beyond that there is some change and extension of the pattern of regional services.
March 21, 1969

There is no change in policy at this time. I think the question raised in the article-and I have no idea of the source-was more of a speculative kind, relating to a much longer term, and one in respect of which not only is there no policy, but no serious policy consideration.


Mr. Speaker:: Order, please.


Stanley Howard Knowles: May
I ask a supplementary question, Mr. Speaker. In view of the uncertainty raised by this article, and in view of the confusion still in our minds about the structure of Air Canada visa-vis Canadian Pacific Airlines, will the minister at an early date make one of those straightforward and honest statements about the government's whole air policy.


Paul Theodore Hellyer: I think that is quite unnecessary. I just said the policy is as announced two years ago and is in the process of being implemented. If and when there is any change in that policy it will be announced in the house.


Thomas Miller Bell: Will the minister give assurance to the house at this time that the Minister without Portfolio and no other member of the cabinet has the matter under study at the moment.


Paul Theodore Hellyer: It has already been announced that the future air policy is a matter of the continuing concern of the Minister without Portfolio. This study will take a considerable period of time and will involve a great deal of consideration on the part of the department, the Canadian Transport Commission and the carriers. No change of any substantial nature is envisaged in the immediate future.



AIR TRANSPORT


Edward Richard Schreyer: Mr. Speaker, my supplementary is not intended to be bantering. However, I should like to ask the Minister of Transport if he can say whether his department is making a systematic effort to work in concert with the United States aviation agencies in order to deal with the problem of IATA air schedules, in view of the United States agencies concerted attempt to deal with this problem.


Paul Theodore Hellyer: Both the department and the Canadian Transport Commission are interested in opening up new avenues of opportunity for Canadian air
Inquiries of the Ministry carriers. To this end every effort will be made to make any changes in the rules necessary to provide those opportunities, when this can be done.



ONIONS-SHIPMENT TO U.K. FROM MONTREAL

Mr. H. W. Danforth (Kent-Essex):: Mr. Speaker, may I be permitted to direct a question to the Minister of Transport. I wonder whether the minister would give me an undertaking that he will investigate and report to the house with regard to what I consider to be very serious allegations made by the Ontario Onion Marketing Board that several thousand bags of Ontario onions were recently left on the wharves at an east coast port due to a transport problem. It is alleged that, even though the onions were at the port, two ships sailed without them because they could not be made available for loading.


Paul Theodore Hellyer: If the hon. member will give me the details of this allegation I will of course have it investigated.



FROZEN GROUNDFISH-SITUATION IN U.S. MARKET

James Aloysius McGrath: Mr. Speaker, since this has become a traditional fish day in the house, I wonder whether I might be permitted to direct a question to the Minister of Industry, Trade and Commerce. In view of the critical situation that did exist on the U.S. market vis-a-vis Canadian frozen groundfish, can the minister bring the house up to date on the situation today?


Jean-Luc Pepin: I understand that the prices have firmed up substantially. The last time I looked they were up to 26 cents from a low of 21 cents, as a result of the policies applied by the Minister of Fisheries.


Jean-Luc Pepin: Mr. Speaker, I have a supplementary answer. I was very kind to the Minister of Fisheries. I think I should be kind to my own department too. The efforts which have been made at the international level I think have been very useful also.


James Aloysius McGrath: I have a supplementary, Mr. Speaker. Would the minister also be kind to members of this house who have helped him in this regard?

March 21, 1969
Inquiries of the Ministry FISHERIES



SALT COD-REQUEST FOR STATEMENT ON FEDERAL PROGRAM

Mr. John Lundrigan (Gander-Twillingale):: Mr. Speaker, I should like to direct a supplementary question to the Minister of Fisheries. Is the minister in a position to announce to the house the nature of the new federal government program in aid of the sagging salt cod industry?


John (Jack) Davis: am holding discussions with the industry next week and I hope to be in a position to make an announcement shortly.


Mr. Jack Marshall (Humber-St. George's-Sl. Barbe):: Mr. Speaker, I have a supplementary question for the Minister of Fisheries. Will consideration also be given to the salt cod prices to inshore fishermen for 1968?


Mr. Speaker:: I submit that the question the hon. member is asking is similar in nature to questions asked by other hon. members and will be taken into account by the minister.



AGRICULTURE


Stanley James Korchinski: Mr. Speaker, this question is for the Minister of Agriculture. I should like to ask the minister whether the small producers of milk and but-terfat who cannot qualify under the present policy, which is favourable to the large producers, may expect a policy announcement from the government, the result of which might mean a boost in their income position since they cannot qualify for subsidies while the larger producers can.


Mr. Speaker:: Order. The question is in order only to the extent that the hon. member is asking whether a statement will be made.


Horace Andrew (Bud) Olson: I repeat that a statement will be made before the first of April.


Stanley James Korchinski: Will it affect the people I have mentioned?



REQUEST FOR STATEMENT ON DRYING OPERATION

Mr. A. P. Gleave (Saskaloon-Biggar):: Mr. Speaker, this question is directed to the Minister of Agriculture as a follow-up of an 
earlier question asked today. On February 24 I asked the minister if he could provide the house with information as to the amount of grain to be dried on prairie farms at that time. He informed the house that a survey was being made and that he would be in a position to provide the information. I should like to ask him now whether he can provide this information and whether he will do so before the house recesses for Easter.


Horace Andrew (Bud) Olson: Mr. Speaker, I can give the house some indication of the estimates that have been made, but I would caution my hon. friend that these are estimates. It is very difficult to make an estimate of this kind with accuracy, because there is a considerable number of places where this grain has been stored, and indeed where it has been dried.


Alfred Pullen Gleave: Mr. Speaker, my question was whether the minister would provide the information.


Horace Andrew (Bud) Olson: I would be very happy to send my hon. friend the estimates we have now, and he can sort them out in his own mind and decide which ones are accurate.


Mr. Speaker:: Is the hon. member rising on a point of order?


Alfred Pullen Gleave: It is on a point of order or a point of privilege.


Some hon. Members:: Hear, hear.


Alfred Pullen Gleave: Mr. Speaker, I am not averse to providing the house with some humour, but I am asking the minister for information. I am quite able to sort out in my mind the situation in western Canada at any time, but I am asking the minister for the result of the survey which he said was being made and the progress that is being made in this regard, because this is an urgent matter.


Mr. Speaker:: Order, please. It is hardly a point of order.


John George Diefenbaker: A supplementary, Mr. Speaker. In order to help out the minister, are there 83,287,262 bushels in the province of Saskatchewan as yet undried?


Mr. Speaker:: Order, please.


Thomas Clement (Tommy) Douglas: On a point of order, Mr. Speaker; surely the minister, who has intimated to the
March 21, 1969	COMMONS
house that a survey is being made and that he will give the information to the house, should not be allowed now merely to tell a member that he will send him some information and he can sort it out. Surely the house is entitled to the information which the minister has collected. If the minister wants to add an addendum to the effect that the figures are only estimates and he cannot guarantee their accuracy-that is done with most government statistics and is taken for granted-all right, but surely the minister has a right to say he will make a statement on motions and tell the house when he proposes to give this information.


Horace Andrew (Bud) Olson: Mr. Speaker, the Minister of Industry, Trade and Commerce and I will attempt to put these estimates together and make a statement within the next few days which will be as helpful as possible.


John Stratford Burton: A further supplementary question, Mr. Speaker. Since the James Richardson Newsletter has provided a fairly complete summary of the situation would he consult with his colleague the Minister without Portfolio from Winnipeg South?


Mr. Speaker:: Order, please.


Mr. Roland Godin (Portneuf):: Mr. Speaker, I wish to direct a supplementary question to the Minister of Industry, Trade and Commerce.
Could the Minister of Industry, Trade and Commerce tell us if the fact of reminding the house too often and of telling the Canadian public that we have bad wheat, mouldy wheat, proves an obstacle when the time comes to sell wheat abroad?



GOVERNMENT ORDERS


[Stage Direction]
The house resumed from Thursday, March 20, consideration in committee of Bill C-173, respecting the organization of the government of Canada and matters relating or incidental thereto-Mr. Trudeau-Mr. Faulkner in the chair.
29180-441J
DEBATES	6953
Government Organization
The Chairman:: When the committee rose on Thursday, March 20, clause 20 was under consideration.
On Clause 20-Definitions.


Mr. Harding:: Mr. Chairman, I have
enjoyed the interesting debate on the setting up of the new Department of Regional Economic Expansion. Before commenting on the department I should like to spend a few minutes outlining some great economic problems facing Canada today.
We in this great country are fortunate to be living at peace with our neighbours and the world. Canada is a very rich nation and our standard of living is one of the highest in the world. Despite our great wealth, abundant resources and high standard of living, there are still many serious social problems which we have not solved. We have in our country widespread poverty, great regional disparities and a disgraceful unemployment rate. A brief outline of these problems might serve as a background for the need to set up the new department.
These problems will not all be solved by the measures contemplated in this bill to reorganize the departments of government. There is widespread poverty in Canada. The fifth annual review of the Economic Council of Canada outlines it very clearly. In fact, it clearly sets out the picture in a 37-page review of the problem. The leading paragraph on this subject reads as follows:
Poverty in Canada is real. Its numbers are not in the thousands, but the millions. There is more of it than our society can tolerate, more than our economy can afford, and far more than existing measures and efforts can cope with. Its persistence, at a time when the bulk of Canadians enjoy one of the highest standards of living in the world, is a disgrace.
I would like to give a few facts on the extent of poverty in our nation. The lowest 20 per cent of non-farm families received an average annual income in 1965 of $2,263, representing 6.7 per cent of the total income for that year. The average should have been 20 per cent. The next 20 per cent received an average income of $4,542, or 13.4 per cent of the total income.
An answer to a question in the house not too long ago indicated there had been a very recent survey by the Dominion Bureau of Statistics which indicated that 2,753,000 wage earners earn less than $3,000 per year. In reply to the same question the information was given that 997,000 wage earners in Canada have annual incomes between $3,000
March 21, 1969

Government Organization and $4,000. These figures indicate that 3,750,000 wage earners, 55 per cent of the total, earn less than $4,000 per year. I agree that income statistics do not give us the entire picture, but they are a very good criterion as to how widespread the problem of poverty is.
There are interesting facts on the problem of regional disparity, the solving of which is one of the main objectives in the new legislation. The latest records for which we have adequate statistics set out quite clearly the terrible difference which exists between various regions in- Canada. This is a good time to put the figures on the record again.
In the most recent period for which statistics are available, 1962-64, personal income per capita was $2,025 in Ontario, $1,521 in Quebec, $1,302 in Nova Scotia, $1,167 in New Brunswick, $1,115 in Prince Edward Island, and $1,007 in Newfoundland. This clearly indicates the need for action on the problem of regional disparity. The people of the province with the lowest income receive less than half the per capita income of the people of the province with the best income.
The next point I would like to raise in connection with the subject of poverty is unemployment. As other speakers have pointed out, we have been made aware of this by the Economic Council of Canada. On numerous occasions the council has urged the government to set a maximum limit of not more than 3 per cent. Currently more than 6 per cent of our working force is unemployed. In areas such as the Atlantic provinces the figure is over 10 per cent. In the province of Quebec it is over 8 per cent. In my own province of British Columbia it is well over 6 per cent. This, again, is a tragedy so far as Canada is concerned.
[DOT] (12:10 p.m.)
We have three problems in this respect, over-all poverty, the extreme disparity between regions, and unemployment, upon which we are all trying to focus attention. Having briefly outlined these problems I should like to discuss one or two aspects of setting up the new Department of Regional Economic Expansion. Again, Mr. Chairman, I point out to hon. members and the minister in particular that just changing the name of the department will not bring success. We must be prepared to make major changes in our approach to these problems. We must make major changes in a variety of fields.

This department could play a major role in solving many of the economic problems facing us at the present time, especially those involving regional disparity in- areas where sufficient economic expansion has not taken place. I say again that unless the government is prepared to make drastic changes in- its former plans and policies the new department will fall far short of the goals which everyone would like to see achieved.
In 1963 the government carried out a reorganization of departments. The results were not very beneficial, and now another reshuffle is to take place. For example, Bill C-173 brings industry, trade and commerce together in one department. They should never have been separated in the first instance. However, I hope that the reorganization of a number of government departments will result in more co-ordination and efficiency than we have experienced in the past.
The idea of one department being responsible for attempting to eliminate regional economic disparities is a sound one. Our party has been urging it for years. It could at least prevent the costly duplication of attempted services by a number of different agencies. The minister himself showed how costly the lack of co-ordinated action has been so far as the Canadian taxpayers are concerned. The minister pointed out that since 1963 we have spent over $1 billion on various programs, and he estimated we have wasted about half this amount.
As I said before, for years our party has called for over-all direction, -co-ordination and planning in every government program so as to make them fully effective. There has never been such co-ordination, as the minister frankly admits. The federal government has never allocated sufficient financial resources to really come -to grips with the problem of regional disparity. Now that one department will be in charge of and responsible for such programs, I have no hesitation in endorsing -the legislation setting up the department.
The increase in departmental expenditures of approximately $37 million this year means -there will not be too great a departure from past policies and programs which have attempted to deal with regional disparities. This must be -apparent to everyone, because if more regions are to be brought under the plan the budget should be sharply increased in order to meet the correspondingly greater need.
March 21, 1969	COMMONS
I would like now to speak very generally about the new Department of Regional Economic Expansion. The department is to take over the designated area program and several other federal programs such as ARDA, the Atlantic Development Board, etc. We find that the total budget for 1969-70 is almost $192 million which represents an increase of $37 million over last year when we add the amounts which were allocated to the various programs being brought under the plan.
We find that under the designated area program established under the old legislation benefits were available for secondary processing or manufacturing industries but not for primary industries. Benefits under the designated area program, which I understand will be in effect for some time even under the new legislation, included capital costs amounting to one-third of those under $250,000, one-quarter of those under $1 million, and one-fifth of those over $1 million to a maximum of $5 million. They also included depreciation allowance.
Under the designated area program there was no assistance for the tourist industry. I understand this is being considered under the new legislation. I am convinced that the tourist industry should be included in any new plan because it has tremendous potential in many areas which are currently classed as regions of disparity. I urge that it be included in the regulations which will be set up under the new department.
For the new department to be successful it must avoid the obvious mistakes made in the past because of the lack of a planned and co-ordinated policy. For the new department to be successful there must be full co-ordination at three levels of government. There must be full co-ordination at the federal level. In my opinion, this entails three distinct steps. First, I believe there should be a formulation and consideration of consistent programs as they affect or are directed toward regionally balanced growth. Second, there must be communication and delegation of authority to federal regional departments. This is essential in a country as vast as ours and it will cut the red tape often found in a central office. If we do not have communication and delegation of authority to federal regional departments, we will find that the program will not be as effective as it should be.
[DOT] (12:20 p.m.)
The third point is that there must be a meshing together of specific operations by federal departments and agencies within a
DEBATES	6955
Government Organization region. Again I repeat that this is absolutely essential for full results. Let me give one example. It does not apply to the new department which has not yet been set up. I have been dealing with a problem in the Creston area where three federal government departments were doing various jobs. On checking with the departments I found that each of them does not know what the others have been doing or what their object is in spending money in a certain area. To me this is nonsense and is one of the reasons that many of our programs have failed miserably in the past.
The second area of co-operation must be at the provincial level, and again I contend that this is another necessary ingredient for the success of the program. I feel it is absolutely essential. If there is a failure to co-ordinate the provincial and federal roles in the setting up of projects and the carrying out of programs, we will find that the result will be little short of disastrous. I suggest also that provincial agencies, especially in the regional areas affected, must also be delegated sufficient authority to deal quickly and adequately with most problems. In my view this is a lesser problem at the provincial than at the federal level.
The third area where there must be full co-operation is at the regional and municipal level. Again, to be successful the programs must have the co-operation and the backing of the various municipal and regional groups in the entire area. This includes, of course, the various organizations in these designated areas. In addition to having the support of the organizations they must have the backing of the general public.
I should like to make it clear that I feel the inescapable alternative to effective consultation and co-ordination among the federal, provincial and municipal levels is conflict, confusion, waste, frustration and the ultimate failure of the policy. There must be continous and effective liaison between the federal and provincial levels if the program outlined by the minister is to be fully successful. There are a number of other problems which I would like to raise in connection with regional development. I do not think you can just outline a series of programs unless you are prepared to take other steps. Canada needs a great deal of capital to help finance some of these projects. This is where the need for a Canada Development Corporation arises. The corporation could make sure that funds were
March 21, 1969

Government Organization available to help supply the needs of the various industries which may be set up in some of these areas. I am thinking particularly of some of the new growth areas which we will have to study closely.


James Hugh Faulkner: I regret to interrupt the hon. member but the time allotted to him has expired. Is there agreement to allow the hon. member to carry on?


Some hon. Members:: Agreed.


Randolph Harding: I had some other material but I would appreciate another minute or two to complete my remarks. I was going to speak about the Canadian Council on Rural Development but I will let that go until another time. However, I would like to say a word or two about the problem in my own area of Kootenay West. Officials from that area have approached the minister and his department asking that the area be brought under the plan. Currently the area is not classed as one that needs assistance under the area incentive program. But today there is a great need for assistance and direction.
I should like to point out to the minister that it is a good growth potential area. Groups are already working in the Nelson, Trail, Creston and Castlegar areas with the hope that some assistance and direction will be given by the department. The municipalities are keenly interested in the problem. Two regional districts have been set up for several years. The have already done some surveys and planning, and I feel it is essential that the new department assist these areas in the job of planning and bringing in new industries. If this is not done, we will find that in a few years there will be other slow growth regions. This is something that we can and should avoid, and this is why I stress above all things the absolute need for complete co-operation and co-ordination among all levels of government but most of all among the various agencies of the federal government. If the program fails, it could well founder on the lack of a properly coordinated policy within the framework of the federal government.
I suggest to the minister that his department give utmost priority to this consideration. If we are to get a full return for the dollars spent, this is one aspect which must certainly be considered. Thank you, Mr. Chairman and members of the committee, for allowing me these extra few minutes.


Mr. Muir (Cape Breion-The Sydneys):: Mr. Chairman, I am very pleased to be able to say a few words in this debate.
I was very glad that the previous speaker was given a few extra minutes because it indicates that the house is in a rather genial mood today, as it was all day yesterday when the majority of speakers from all parties were allowed a few minutes beyond their allotted time. I think this is a good thing because the legislation before us is most important.
Before proceeding with my remarks I would like to say to the minister that some weeks ago when we were discussing other legislation in the house which the minister was piloting the minister, as the result of some unkind words I said regarding his activities in connection with that legislation, became rather disturbed and irked and his blood pressure went up, as does the blood pressure of most of us at such times. However, today he looks calm and collected and does not appear to be upset. In fact he is genial and serene, and I hope he will not take anything I say too much to heart.
I do not intend to go into great detail on this legislation dealing with the new Department of Regional Economic Expansion other than to point out that if the elimination of economic disparities is desirable it is equally desirable that all the tools for that purpose be placed in the same hands. So far as the minister is concerned, this bill places the tools in his hands. It remains to be seen whether he can finish the job. Even if he only starts it, that will be something.
[DOT] (12:30 p.m.)
The bill is a perfect example of the way in which government action leads to an increasing commitment of public funds with no appreciable increase in benefits. However, no one objects to a commitment of public funds as long as we get results. The department, as would appear from the estimates for 1969-70, seems to include what formerly came under ARDA and P.F.R.A., plus a few other scattered programs, with the National Capital Commission thrown in as political makeweight, the Cape Breton Development Corporation, some remnants of the Department of Labour not quite defunct, and various powers and authorities formerly under the Department of Industry. It will also include the Atlantic Development Board which now finds itself reduced to being a mere sounding
March 21, 1969

board. In pursuance of this reorganization the new department will, we are told:
1.	Encourage economic expansion in regions where growth is lagging.
2.	Prepare development plans and programs.
3.	Recommend special areas for action to improve economic growth.
4.	Enter into agreements with the provinces to provide for economic expansion.
5.	Build up the economic infrastructure of areas.
6.	Provide special incentives to commercial undertakings.
These various programs will cost Canadian taxpayers approximately $150 million this year-evidence of a fairly dramatic expansion. Under this government we have seen the inauguration of direct grants to industries through the area development incentives program, and in 1967 the ceiling was raised to $200 million.
The hon. member for Halton yesterday spoke about the migration of young people from the Atlantic provinces. I shall have something to say about that, but before doing so may I comment that the present government spawns new departments like mushrooms in a damp basement. Problems cannot be solved simply by changing nameplates on doors. Nothing has been done for our young people. There has been no leadership, no policy. We see a generation of young people whom we have allowed to be assaulted by narcotics, bombarded by propaganda, overcome by violence, intimidated by mobs. And we think we have done right by them. Meanwhile, the government goes on walking in its sleep.
In spite of constant reorganization and reshuffling, no attention has been paid to the challenge of youth, none to the demands for the expansion and development of natural resources. The most serious situation in this country today is that created by the lack of challenge for young people. This bill does not deal with the problem. It adds nothing new. It takes existing divisions and sections and rearranges them. This is the third or fourth government reorganization since 1963. We have seen reorganization piled upon reorganization, reshuffling on top of reshuffling. The Department of Industry came on the scene with a great fanfare of trumpets. It has apparently been a colossal failure and is to be buried within the Department of Trade and
Government Organization Commerce. Now we are setting up a department which is to carry on the policy of making grants to industries to enable them to establish themselves in certain areas or to stay in areas where they are already established. The news handout from the minister's office puts it this way:
The area development incentives program is to continue, but additional assistance will be available if special circumstances make it necessary to help a commercial undertaking establish, expand, or modernize in a special area. Such additional assistance will be available only if it is essential to the implementation of a development plan.
This seems to imply that there are some reservations. The suggestion is that the area development program will go on and that grants will be made to industry though perhaps under more restrictions than formerly. In the case of a department which will be spending large amounts of public money it is well not to begin operations under reservations or without a clear idea of what is entailed, what the purposes are, and what methods are to be followed. After all, the policy behind this department is one of direct intervention in and interference with the economy. There is nothing new in this. It is being done in the form of incentives rather than by way of compulsion. If it were being done by compulsion, it would amount to straight regimentation. Instead, it may represent a kind of fiscal regimentation. Whatever the philosophy behind it is, we should be clear about the likely effects of what is proposed. This is one of the problems raised by the bill before us; there is no clear indication of how effective the procedure is likely to prove.
Let us face the fact that under the area development incentives programs brought in by the government 18 months ago the procedure proved ineffective. We know it has been ineffective because the minister said so himself. Yet this same procedure is now to be employed by the new department. The area development incentives program is to be carried on, according to the statement from the minister's office, and direct grants are to be made to industrial organizations to persuade them to do what the government thinks they should be doing. This is a situation calculated to cause some misgiving in the light of the minister's statement during the federal-provincial constitutional conference. I draw attention to the following report which appeared in the Globe and Mail of February 13, not long ago:
The Area Development Act provides for grants to industries which establish in sections designated by the federal government as slow growth areas.
March 21, 1969

Government Organization
Mr. Marchand said the legislation had not worked as expected. Some industries which had benefited from the incentives would have moved to the area without them. Others had overexpanded as a result of the incentives.
The minister will no doubt remember -those remarks and certainly those who witnessed' his appearance on television will recall them. I continue to quote from this account in order to refresh his memory:
Mr. Marchand said the federal government's future regional development programs would concentrate on identifying regional growth centres and stress development in them.
He said the policy would mean that other small centres in the same region could not expect the same assistance and called on the provincial premiers to help him sell the program to the people.
Further, the article states-this is very interesting and I am reading it because of its importance:
We need political strength to resist pressure. All the villages, all the small towns in Canada want to have industries, want us to spend money for infrastructure, and so forth-
Previous federal efforts in regional development had often spread money too thinly and tried to cover too large a territory. It was necessary to take into account natural economic forces and concentrate efforts in a few natural growth centres.
This gives an idea of the approach being taken by the minister and his department. It is an interesting and significant one and it is of great relevance to the -consideration of this -bill. For two years, according to -the minister, we have been- following an- accelerated program of handing out money to industry for the purpose of stimulating expansion in slow growth areas. The program has not worked because industries are in many cases more interested in suiting their own requirements than in participating in government economic plans. This is not entirely unexpected. In effect, the minister is saying that despite the fact his policy -and programs did not achieve the desired result they are to be repeated on an even bigger scale. At least, this is what it sounds like. I hope this is not really what the minister is saying because I have too much respect for the hon. gentleman as a man of constructive ideas, and as a trade unionist, to want to see him led down the garden path.
Surely we should be able to get a clearer picture from the minister and the department. We have been told, in effect, that to a large extent industry will go its own way regardless of government incentives which may be offered. Today, it appears that the government, or its experts, or the brains behind the minister, have decided that because of the

difficulties attached to getting industry to conform to patterns laid down in Ottawa, the department is to select certain areas where growth is already manifesting itself and move in there. This looks to me like following the path of least resistance. Surely it ought not -to take a whole new department and the expenditure of hundreds of millions of dollars to decide we should go into natural growth areas, areas in which I presume growth is already taking place, to spend money.
The minister asked the premiers to help him sell the program to the people. I am asking the minister to sell the program to this house, to dispel some of the doubts engendered by his own statements and by statements emanating from his department.
[DOT] (12:40 p.m.)
I would also like -to hear what -the minister means by economic infrastructure. That phrase appears in his statement and in the statement issued by his department and, like charity, it seems to cover a multitude of sins. It is important that we should all be talking about the same things. I would like to know, in addition to the grants to industry, grants to provinces and arrangements with provinces, what additional undertakings are implied by the word "infrastructure". How far is the government going under this legislation? What kind of economic infrastructure is envisaged? Are we talking about facilities, transport, roads, railways? I think we should be very clear on what we -are discussing, and I would ask the minister to deal with some of these points when he -replies.
What we should have is a very clear picture of how these powers will be applied and how these functions will be exercised. We were able to spend very large -sums in the last few years without securing the desired results, but let us not repeat that process. If we are going to simply fallow -the line of least resistance and go where growth already exists and industries are already established, then where is the case for this new department?
One of the dangerous and negative developments in this government has been to allow nature to take its course and simply speed up the process. That is not policy; it is simply greasing the skids, as the government is doing in the case of the eastern Canada farmer.
This is another area where the government has fallen down completely. Again we have organization and reorganization. We have had
March 21. 1969	COMMONS
enough paper programs to ensure the prosperity of the paper industry for many years . to come, but little assistance for the farmer. The way in which farmers in Ontario, Quebec and the Atlantic provinces have been written off under this government's policies is an utter scandal. In pursuit of the policy of creating an urban proletariat the government has given the eastern farmer the choice between starving or lining up in city welfare offices. We now have the most recent study of the Atlantic Development Board forecasting further declines in agriculture in the Atlantic provinces. We did not need a special study to tell us what everybody knew. This government is now specializing in the obvious. It is all right to produce study upon study, report upon report, task force after task force, reorganization after reorganization, but when are we going to have some solutions? Farming in the Atlantic provinces has been reduced by half the number of farms since 1961. Is this a record of which the government can be proud? Their whole policy is negative and destructive. It does not require genius and the expenditure of millions to tell the farmers to get off the farm. The government should be producing policies to help the farmer stay on the farm, such as the establishment of agricultural institutions and vocational training schools in rural areas, building better roads, giving assistance in marketing products and so on.
No one can tell me that a farm family is better off on welfare, adding to the total of urban poor, than on their own land. Yet the policies of this government have followed the incredibly fatuous course of thinking that the farm problem can be solved by adding to the urban poor. They have now decided that the problem of the urban poor can be solved by wiping out government housing projects. They have decided the problem of slow growth can be solved by concentrating on the fast growth areas.
This government produces high-sounding policies and programs, the net result of which is to aid and abet the destruction of our society. The government has done absolutely nothing about the rural poor, the urban poor, the homeless, the farmer on his land a prey to the high-tax, high-spending inflation spawned by a government incredibly mediocre in performance and execution. Canada cannot long stand being saddled with policies having as their aim the destruction of a whole class of people, the self-employed in this nation.
DEBATES	6959
Government Organization
When one considers that, according to the Atlantic Development Board, the total number of maritime farms decreased from 52,600 to 24,700 in the ten years prior to 1966, then one has an idea of the scope of the problem. We have had huge, pretentious, expensive programs aimed at the eastern Canada farmer, programs that remained largely paper programs, and the best thing the government hs has been able to do is to tell the farmer to get off the farm and line up in a welfare office in the city. The same course is being followed in the Atlantic provinces with regard to the fishing industry.
It does not take massive programs and huge commitments of funds simply to follow the current; we have got to have development programs. What we need is a department and a minister to push such programs, particularly in the Atlantic provinces and Quebec.
Achievement will not result from simply following the line of least resistance. I say to the minister that success in this field will not come instantly. It will be a long and perhaps painful process. It can be achieved only by orienting in one administrative capacity the various authorities required to bring about profound economic transformation. The minister is being given the power; I know he will do everything he can to use it constructively and wisely.
By this bill, as I understand it, the minister is given authority over agricultural development through ARDA, P.F.R.A., Maritime marshland rehabilitation, the Atlantic Provinces Power Development Act, and so on. He will thus be responsible for rural development and will have the legislative power and authority to produce effective programs. He will have the power to encourage industry to go into areas where it is needed to provide employment. He will have the facilities to bring about widespread economic rehabilitation of lagging areas.
In the exercise of those powers, in the eradication of rural blight and the stimulation of economic expansion, the minister can count on the sympathy and understanding of every member of this house, particularly those from the Atlantic provinces where unfortunately regional disparity has its home. In that respect I must express my regret at the downgrading of the Atlantic Development Board and its demotion to an advisory body. I hope the minister will see fit to give every encouragement to this body to examine into and recommend solutions to the economic problems of the maritime and Atlantic region.
March 21, 1969

Government Organization I should like to say to the minister, through you, Mr. Chairman, that I was most pleased to hear of his appointment of Professor Smith as chairman of the new board.
We have seen what can be done in the example of the way Sysco has been functioning under provincial management. To the uninitiated, Sysco is the Sydney Steel Corporation, a crown corporation set up by the Nova Scotia provincial government. If we had half a dozen Syscos in Nova Scotia and Cape Breton, our economic problems would be infinitely less serious. Unfortunately, we have not. Perhaps with the full power of this legislation behind him the minister can take steps to bring that about.
At this time I should like publicly to go on record as lauding the accomplishments and being very enthused about the efforts of the steelworkers at the steel plant in Sydney, as well as the union and management. The fine work they have done since taking over and operating the steel mill at Sydney has made it, through co-operation, the success it has been.


Some hon. Members:: Hear, hear.


Robert Muir: We
know what eastern Canada and other parts of Canada went through under Dosco, the Dominion Steel and Coal Company. It nauseates me even to mention Dosco so I will say no more about it at this point.
[DOT] (12:50 p.m.)
In conclusion I should like to say to the minister that once the department is launched and commences operation I hope he and the department will not embark upon a great series of studies, because it is doubtful whether any area of the earth's surface has been studied as much as have the maritime provinces by successive federal governments. There have been studies on every aspect of flora and fauna of the Atlantic and maritime provinces. There have been oyster studies, shrimp studies, frozen groundfish studies, bloater studies, studies on coal, on the tourist industry, on family formation, on agriculture, on every aspect of social and economic life in those historic provinces. We have been practically studied to death. As a newsman stated the other day when writing about these studies, the poor lobster has been studied so many times by successive governments that this has caused the lobster when mobile to move in reverse.

It would not be accurate to say that the studies have produced nothing. They have produced mountains of paper. The maritimes would have benefited more from government action if the government had decided to bring about even a 20 per cent reduction in freight rates. We did not need all these studies. According to a return tabled the other day in answer to a question by the tireless hon. member for Cumberland-Colchester North on the subject of studies, hundreds of economic and social studies have been undertaken since confederation. In the field of agriculture there have been 54, in fisheries, 38, in rural development and forestry, 22, and in trade and commerce, 4. Two transportation studies have been undertaken and we have had 13 royal commissions and other commissions. Altogether there have been 133 studies, reports, commissions and investigations of one kind or another in the Atlantic region since confederation.
Before I resume my seat may I say to the minister: for heaven's sake, do not begin another series of studies and task forces. Surely the government has enough information to be able to act. We want the minister and his new department to bring about a rejuvenation of the Atlantic provinces, and our people will assist him in his task. We want industry and we want assistance, but do not think of us as poor cousins who want to cry on the shoulders of the rest of Canada. The Atlantic provinces have contributed to confederation in a great many ways. I wish the Minister every success in his endeavours with his new department and look forward to his co-operation.


Jack Marshall: Could Your Honour call it one o'clock?


James Hugh Faulkner: Is that agreed?


Robert Jardine McCleave: Mr. Chairman, I only wish to speak for about five minutes and if the committee would consent to my speaking at this time I could be out of the way, so to speak.


Stanley Howard Knowles: We
would not want that to happen.


Robert Jardine McCleave: I thank the hon. member for his interjection and hope it is recorded in Hansard.
The point I wish to raise concerns the continuing smooth flow of certain operations which may be interrupted as a result of the demise of the Atlantic Development Board
March 21, 19G9	COMMONS
and the setting up of the new department. I raised this matter the other day during the oral question period and I wish to reinforce my argument at this time. It is important for the provinces to know exactly what sort of assistance is to be provided under programs that the Atlantic Development Board has carried on in the past. For example, federal sharing in the cost of highway construction has brought tremendous advantages to Nova Scotia and to other provinces as well, no doubt. The minister ought to answer immediately whether past programs are to be continued, because plans for highway construction are usually well under way by this time of year and the actual work is carried out mainly in the summer and fall.
I hope the minister will listen to the good words of advice in the swan song of the Atlantic Development Board to the effect that programs should not be allowed to grind, to a halt and that there should be a quick transition in responsibilities so that the new department may carry on the work of the Atlantic Development Board. We hope that the minister will reply to this question today. Will he also indicate whether another important recommendation of the Atlantic Development Board dealing with the metropolitan water supply for Halifax and Dartmouth will be proceeded with, as the board suggested during its last meeting it ought to be? Of course, the board has made other recommendations to the government about various projects, some of which have still not been acted on. I urge the minister to say today whether those programs, carried out by the Atlantic Development Board, which have been of great assistance to Atlantic Canada are to be continued.


James Hugh Faulkner: Order, please. The time being one o'clock I do now leave the chair until two o'clock.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2 p.m.
Mr. Reid:: Mr. Chairman, I want to say a few words about this bill and to commend the government for having introduced it. I think I should first state that I am quite happy to see the very wide powers which are being given to the minister. I am glad this legislation does not tie him down too much as
DEBATES	6961
Government Organization previous legislation tied down ministers responsible for regional development.
Before getting into the burden of my remarks I would like to say a few words about the former area development agency and to indicate some of the difficulties associated with it, particularly as they affected my constituency and the region from which I come. My first criticism is that it was far too inflexible a piece of legislation. Boundaries were set by the Canada Manpower agency boundaries, and often these had little or nothing to do with the economic regions around them. Consequently a variety of situations arose in which bordering areas lost employment and manpower to areas which, through a quirk of fate, came under the area development agency.
In addition, the former A.D.A. did not take into consideration the local resources which were available in the various regions. It was a universal program. It was not really designed to seek out areas which had something to offer if only they could get a spark of help. It was reasonably successful in rural areas which happened to be designated in isolation and had no competing areas near them.
My third criticism of this program is that it was directed almost wholly to urban and industrial areas and did not really take into consideration the difficulties which rural communities have in attempting to attract some form of development to them. It is a fact that the program was most successful in those areas which were close to urban communities that had a substantial urban industrial base.
I know that when the minister took office in his new portfolio the first thing he did was to amend the A.D.A. legislation in such a way as to permit growth centres within regions to participate in the area development program. I think it is a legitimate criticism of the former program that where you had a growth centre in a particular region it was excluded from the benefits available under the area development agency. This situation has now been corrected. Now that growth centres seem to be the latest economic panacea we will see if this idea works as well as its professorial theorists seem to think it will.
I understand that new legislation will be brought down, hopefully by the end of June, to redesign the area development agency program. I hope that when this legislation does appear it will be far more flexible than the former legislation. The reason for this is simply that all parts of Canada are not equal. In
March 21, 1969

Government Organization the regional distinctions which must be made, or in the provincial distinctions, there are a variety of conditions with which the legislation must deal. I think one example will suffice to show this. That example would be the situation in the maritime provinces, say, Nova Scotia, where almost all of Nova Scotia with the exception of Halifax was designated under the former legislation. Now that Halifax has been included, I think the program has a chance of being some good to Nova Scotia.
[DOT] (2:10 p.m.)
But in the area of northwestern Ontario, which is part of a very large province, there was no designation at all, and because great areas in Manitoba were designated industry which might have been attracted to our area flowed to Manitoba. In addition, the province of Manitoba at that time had a particularly vigorous development fund which worked against what we considered to be our interests.
The problem in one case was that the whole province of Nova Scotia was committed to a program of regional or provincial development, whereas in the case of large provinces like Ontario and Quebec large areas were ignored, sometimes because of internal problems within the provinces. When this new legislation is brought down I hope it will have sufficient flexibility to recognize these very real problems and distinctions that are found in the various parts of our country.
In returning to the legislation before us I should like to say that I am quite pleased with the powers given the minister under clauses 25 and 26. In particular, under clause 25, subclause 2, I am happy to see that the minister not only is given permission to cooperate with the provinces but also the clause provides for the participation of persons, voluntary groups, agencies and bodies within these regions. I say that because recently in the province of Ontario the government tabled a series of 13 regional development programs. One of these programs concerns the area of northwestern Ontario. It is entitled "A Five-Year Development Program For Northwestern Ontario", and was produced by the Northwestern Ontario Development Council.
Basically the primary recommendation of this study is that there be a public corporation strongly financed by the province to spearhead a massive effort to expand the region's economy and population. This corporation, modelled somewhat, I believe, along 
the lines of the Atlantic Development Board, would have the power to designate growth areas, general use areas, highways and roads and would have power to provide incentives for industrial expansion. It would promote a regional consciousness and spirit and encompass other activities related to the betterment of the northwestern part of Ontario. It was suggested that the executive or board of directors would be appointed half by northwestern Ontario municipalities and half by the provincial government, with capital provided, of course, by the provincial authority and/or, I would add, the federal authority because I believe it is quite clear the federal government will have to participate in this project if it goes ahead.
In our area we are also awaiting the report of an ARDA study which was commenced about two years ago under the federal-provincial ARDA agreement. When this project is completed, we hope some time in September, we expect we will have for northwestern Ontario a basis on which we can develop a sensible regional and economic development plan. I would be the first to admit that this will not solve all our problems. Indeed, I think there must be a considerable restructuring of local government into a regional form. There must be some power which has authority to control land use and bring about proper development patterns. Something must be done about the increasing multitude of municipalities with which we have to deal and which I think tend to weaken us economically, socially and politically.
In retracing my steps a little, Mr. Chairman, I should like to read to you the goals set up for the Northwestern Ontario Development Study:
1.	Northwestern Ontario should seek to increase its population as rapidly as possible.
2.	This population should be concentrated as nearly as is socially and economically possible, given the requirements for new economic activity, in as few urban centres as is possible.
3.	The region should achieve a level of socioeconomic excellence second to none.
I might say that these goals were not created by the consulting Arm which did the study but instead were the result of a series of teach-ins, if I might use that term, at the Quetico training centre and in the various communities which make up northwestern Ontario. I think these are goals to which all the people of northwestern Ontario subscribe.
I believe also that the concept of a public development corporation is accepted by the people of northwestern Ontario.
March 21, 1969

It is quite clear to me that the provincial and the federal governments have not enjoyed the very close co-operation one might expect in the growth of a new and developing economic structure in a region such as northwestern Ontario. In Ontario, at the present time, we have reached the point of absurdity in that we have the federal government's area development program operating under certain guidelines, but since this program was not accepted by the people of Ontario the provincial government was constrained 'to bring forward its program for equal opportunity. The result is that the provincial government and the federal government are both providing subsidies to industries locating all over Ontario with the exception, I believe, of within a 50-mile radius of metropolitan Toronto. Here we have the two governments not acting in concert but operating on a different basis with the consequence that neither program really has produced the results we had hoped for.
If the northwestern Ontario five-year development program is accepted by the province, it would seem to me that there would have to be very close co-ordination between the provincial and federal governments. I hope the minister will not take the attitude that was outlined in respect of ARDA. I believe one of the great defects of the ARDA program was that the areas which needed help were those which suffered most from depopulation or which suffered from an outflow of population. To some extent these areas lack the ability to self-start by producing the kind of pressure on governments which cannot easily be ignored. In addition, the problem is intensified by the great political divisions which exist within these regions. It is impossible for members of parliament and provincial members to properly represent all aspects of the areas simply because of the built-in conflicts in the size of the ridings.
I hope the minister will be much more aggressive than his predecessor. I hope he will seek out areas which require assistance and see that they are given assistance so that this development program may help them grow and make a contribution to the whole of Canada. Up until this time this has not been the case.
I do not like to be parochial in a debate of this kind. Nevertheless there is one other aspect of this matter which I should like to bring to the attention of the minister. I feel that the hon. member for Hull will agree with me that this is a problem in his area also. I

Government Organization want to speak about the situation in Kenora-Rainy River because of its location on the periphery of Ontario. We are closer in some aspects to the province of Manitoba than we are to the province of Ontario. Our economic and social connections are with Manitoba but our political connections are with the province of Ontario. To some extent this is a condition which will not be solved easily. Nevertheless it is a real factor in respect of our existence in northwestern Ontario.


An hon. Member:: Separate.


John Mercer Reid: I will get to that later. For example, it is easier to get to my riding from Winnipeg than it is from the Lakehead. In many ways we feel cut off and isolated. We have the feeling that it is impossible for us to do what we want to do for ourselves. When the minister is involved in developing these regional programs I hope that he, the officials of his department and the provinces concerned will look into this problem very seriously when formulating policies. One very serious defect in the Northwestern Ontario Development Council's study is that it does not take into consideration this very real fact of life in Kenora-Rainy River. It completely ignores it. This is not a reflection on the consultants who did the study; it must be pointed out that it was not part of their terms of reference and consequently they did not consider it.
One other aspect with which I should like to deal concerns the question of regional communications. It seems to me that before one can develop an economic plan for a region or even reorganize on a regional basis there must be some form of regional communication. In the case of northwestern Ontario as a whole there are none. There is not one radio link which covers all of northwestern Ontario. There is not one television link which covers all of northwestern Ontario. There is not one paper which covers all of northwestern Ontario as a basis for the people to obtain their regional information.
[DOT] (2:20 p.m.)
It seems to me that if the minister is serious about regional economic problems, he will also have to take a hand in fashioning regional development communications. I know this is an area in which the C.B.C. could play a role and in which the minister could use his good offices, if I may use that expression, to encourage regional link-ups so that communication can flow throughout the
March 21, 1969

Government Organization various regions. There is no sense trying to do this type of programming in a vacuum. There must be communication between all areas so that they know what is going on. If you can communicate from one area to another, you can very often break down the local parochialism which very often slows down development programs, no matter how carefully worked out. I regard this as a great priority in northwestern Ontario.
In conclusion, Mr. Chairman, I want to say I am quite pleased with this bill. I am delighted with the way it has been prepared in that it has a minimum of restriction on the minister and gives him the maximum of opportunity to refashion many of our rural areas. I am delighted with the prospect of new legislation with regard to the area development program. This legislation should be flexible, taking into account the regional difficulties in this country. The minister must pursue his objectives with vigour. His programs should always work in concert with provincial ones.
If this type of regional program is successful, I am quite certain it will not be necessary for northwestern Ontario or Kenora-Rainy River to separate from the province of Ontario and establish a new province or join with Manitoba. We will be able to do the job we want to do, provided the two senior levels of government, federal and provincial, give us the tools we require.


Jack Marshall: Mr. Chairman, I welcome the opportunity to speak today and offer my comments on that portion of Bill C-173 dealing with the new Department of Regional Economic Expansion. It is not my intention to criticize the intent of the government in creating this new department. The idea is good. I have said so time and again when speaking to my constituents, but I am getting very impatient with the tardiness of the government in implementing some of the programs which they keep preaching about and the words of wisdom they expound which they say will cure the ills of regional disparity. The programs they are introducing are good. They were good programs under the Department of Forestry and Rural Development and the mere changing of the name is not suddenly, as if with a magic wand, going to accomplish the aims and objectives of these programs.
I have tried to take a serious interest in all phases of the government's policies with regard to rural development since coming to parliament because it was my sincere opinion

and belief that the incentive programs under the act were of real value to the provinces in the Atlantic region, especially to the province of Newfoundland where incentive programs to lift the economy are so critically required. In the six or seven months that I have been here I have tried to gather together as much information as possible with regard to the Department of Forestry and Rural Development to determine the application of its benefits to those areas of Canada where these programs are best suited.
In the past six months I have obtained considerable information in the form of pamphlets, booklets, studies and reports, each one of them compiled or written by the supposedly greatest brains in the country, stating how to overcome regional disparity and how to develop natural resources. Almost daily I receive notices of experts, professors' and scientists being brought in by the government to solve all of our problems. Mr. Chairman, the mandarins are coming! The government is stealing industrial experts from firms across the country to advise the government. Almost daily I receive copies of speeches made across the country by the Prime Minister, the minister of the department and also by those ministers who try to get into the act at every opportunity. If I quoted from all of them it would take me all day. I will quote from just a few recent ones. At the federal-provincial conference the Prime Minister stated:
A new constitution for Canada should start by stating objectives ... and one of them should be to promote equality of opportunity for all Canadians in whatever region they may live-
Yesterday the minister amplified that statement when he said that everyone should be able to earn a living comparable in standard from sea to sea. When speaking about this new department the Prime Minister also stated:
This will mean establishment of a department charged with the objectives of ensuring that people in all areas and regions of our country have as equal access as possible to the opportunities of Canada's economic development.
They have all the answers, Mr. Chairman. They have been preaching words of wisdom for many years. I have all the answers in my office, but they are only on paper. They are in beautifully bound pamphets which are written in the most glowing terms. I have pamphlets on regional planning for depressed areas, establishing new regional organizations, stimulants to social development in
March 21, 1969

slow growth regions, the Canada land inventory, water development, the role of education in rural development, the ARDA program in relation to recreation and tourism, views on rural development in Canada special study 1, special 2 and all the numbers, the second report on regional development and many more.
I have most of the incentive programs, such as incentives for industrial location, the Canada development agency, municipal development loan boards, the Atlantic Development Board, the Industrial Development Bank, and small business loans. They also have the answers on productivity in agriculture, farming and fishing. They are all on paper, Mr. Chairman. The government has its new programs and also M.M.R.A., P.F.R.A., ARDA, ADA and FRED. They have the whole family, Mr. Chairman, all on paper and maps.
Surely by now these programs have had their day in court. Royal commissions have finished their work, task forces have covered all the ground, and this is the time for action. But the government is again changing names, dialoguing the studying. Now there is a new word. The government is now interrogating.
Before doing anything about our own regions the government has gone looking for new ones. They found one in Latin America. They have gone junketing off to look at and solve the problems of other countries, but they have not solved their own. They are going to attempt to solve the problems of Venezuela, Peru, Colombia, Chile, Argentina and Brazil. But in their own backyard they are going to conduct more studies and more reviews. The government keeps insisting there is no money available to develop the poor provinces, but they have the money for foreign countries. They have money for the needs of Latin America for telecommunications, airport construction, mining, forestry and fishing equipment, hydroelectric equipment, grain storage facilities, pulp machinery, specialized aircraft, nuclear reactors, road and railway equipment and educational equipment. The government has found $75 million for a subway in Caracas, Venezuela, but they cannot afford a causeway for Prince Edward Island. They can find money for telecommunications in Latin America when communities in Newfoundland do not even have a telephone in this day and age of satellites. They keep closing down post offices in isolated communities even through they are the only source of communication. This is done to save money.
Government Organization
They can find money for the government of Paraguay to finance highway feasibility studies, to lend to the government of El Salvador for the construction of major ports. They can even find money to lend to the Central American Bank for Economic Integration to finance projects in Central America for highways, industrial parks and other things.
[DOT] (2:30 p.m.)
Two hundred and eight and a half million dollars have gone to countries in foreign aid. It is referred to as the flow of financial resources to less developed countries. I wish I could find the river they are talking about so I could change the current.
I like the terms the government of the day use when they speak of involvement. I refer again to the Prime Minister's speech. He said that any plan will not work without the close involvement of the people on the spot-the minister called it participation of local areas-and that the department in Ottawa needs the full involvement of local people just as much as they need the federal government's help. These are empty words.
Where is the $305 million FRED program promised for western Newfoundland? It was supposed to start last fall, according to the premier of that province. Then it was supposed to start this spring, and then it was to be delayed because of the pending change of the name of the department. Now I find that the new department will have to look at a new plan for Newfoundland. But where is the report that was presented by the province of Newfoundland to the federal government? How can the people get involved when they do not know the first thing about the projects that are contemplated? How can they participate when no one has asked them to do so? Why the secrecy in respect of the report? Let the people know so they can become involved, if that is the advice of the minister.
So far as Newfoundland is concerned, FRED is dead. The people of Newfoundland have suffered another disappointment. I understand that the Prime Minister will be in the province in the near future. I hope he will give them the reasons for cancelling the FRED program. I am sure that he will tell them about their human rights, that they should have the same opportunities as everyone from sea to sea. He will dialogue, he will tell them to get involved, he will probe and he will interrogate. I hope they listen, because they are just a little fed up with promises.
March 21, 1969

Government Organization
It is not my inclination to be so critical, but the people of Newfoundland are becoming impatient. I apologize for being parochial but I just have to be. I accept the principles of this new department and suggest to the minister that in the riding of Humber-St. George's-St. Barbe there is a development potential which is tailor-made for his programs. I wish to emphasize that it has resources that will not mean handing out dollars with no return. I ask the minister to take a good, hard look at the natural resources of the province and make an investment which will return a hundredfold.
The west coast of the province of Newfoundland has resources which are not realized. It has a potential that, if exploited sensibly, could revitalize the economy of that province in all phases of development. But I hope the studies have all been done; I hope all the research is completed. We have had enough procrastination. What we need now in implementing regional economic expansion is action.


Edward Richard Schreyer: Mr. Chairman, I want to say at the outset that many members on this side of the house have immense respect for the Minister of Regional Economic Expansion. I am certainly one of those. Even that great character analyst, Judy LaMarsh, has had favourable words to say about the Minister of Forestry and Rural Development, the new Minister of Regional Economic Expansion, and if she had something favourable to say about him I suppose that in itself is an indication of something important. However, the fact that I have admiration, and respect for and confidence in the minister does not mean that I do not have some rather harsh and critical things to say to him.
In the first place, I take exception to the statement the minister made yesterday during the introduction of this part of the bill. The minister said that the introduction of this legislation to form the new department was a very important occasion for Canadians. I think the bill in itself means absolutely nothing. What will become important are the policies and actual work carried out by the government in the course of the next few years with respect to the problem of regional disparities, particularly in income.
There is no point in saying that the organization of the new department is important when we know full well, as the previous speaker has just said, that in the past few years we have had rather impressive-looking legislation on the books which has not been

translated into anything particularly effective. This has happened since 1964 or 1965. We know too, that the minister's predecessor in office, Maurice Sauve, seemed to show a great amount of enthusiasm and idealism for the task he had of implementing the provisions of ARDA and FRED in order to halt the decline and stagnation of many rural areas of the country. But nothing substantial ever occurred; there can be no mistake about that.
The minister is as determined as his predecessor to deal with the problem of regional disparities, and I hope he is prepared to take a new approach. It seems to me that the new approach should include the following. First of all, when speaking to the legislation the minister said that the concept of the new department is one of global planning. In so far as rural areas are concerned, one assumes and hopes this will1 include the problem of agricultural policy in Canada.
I have said on previous occasions, and I say again with all the emphasis I can muster, that nothing effective will be done in the realm of rural development and the elimination of regional disparities until the government is prepared to come forward with a meaningful agricultural income policy. Such a policy is almost completely lacking. It is true that with regard to the dairy industry there is an income policy of sorts, but with respect to western grain production there is no income stabilization policy worthy of the name. Therefore there are in western Canada many areas, districts and even regions which are suffering from low incomes. This situation has resulted from the fact that there is no agricultural income policy in Canada.
For the entire post-war period there has been one extreme in the United States, that of agricultural commodities price support without limit. In Canada there has been another extreme, that of no agricultural commodities price support. Surely between the two extremes there is a median that an enlightened government would want to endorse and implement. No matter how many programs the government implements, no matter how often it changes the name of a department or how many civil servants it hires, nothing meaningful will be done by the government to cope with rural poverty as long as farm income remains a problem. Only when the problem of low farm income is dealt with can the residue of the problem be dealt with through FRED or ARDA. Let there be no mistake about that.
March 21, 1969

I sometimes have the sinking feeling that the government-I am sure this will not be true of the minister-over the past few years has, in the introduction of new legislation setting up a department, fund or agency under a new name, sought to buy time. Civil servants are dispatched to different parts of the country to conduct surveys and studies, and when that is not enough outside consultants are hired for the same purpose. Months and years go by, and when there is no hope of any continued stalling, lo and behold a new bill appears under a new name and they start off tabula rasa. In the meantime, the people living in these areas continue to live in the same economic circumstance from which we had hoped to elevate them eight years ago.
[DOT] (2:40 p.m.)
I hope the minister will see fit to make a concerted effort to allow less money to be diverted into studies, many of which have been meaningless in every respect, and to use the money saved from these studies for projects and programs that seek tangible and concrete improvements in local districts in these special designated areas. I tried to bring to the attention of the minister's predecessor the fact that under the ARDA and FRED programs as they operate in the Interlake district of Manitoba, part of which I represent, there had been a plethora of studies. I recall one study in particular on the fertility rates among different cohorts of mothers. This study cost a few thousand dollars and resulted in the finding that the fertility ratio among mothers in the Interlake district happened to be .3 of 1 per cent higher than in the rest of the province. A big deal that was! The $6,000 or $7,000 spent on that kind of study plus equal amounts of money spent on equally useless studies could have been saved and put to use in drainage improvements and road improvements, or added to the amount of money available for technical school construction or for manpower training in rural areas. This money could have been of immediate and direct benefit to the people in the area.
There is another point which I should like to bring to the attention of the minister. I find there is something inherently contradictory in the efforts of the government to deal with the problem of rural poverty and regional disparities. I refer to their attitude to the role that can be played by existing Crown corporations and government agencies. Until now the pattern followed by the government has been to do something in the less advantaged

Government Organization regions where it is hoped that the attraction of industry would have beneficial effects. The government, through its old ADA program as well as through ARDA and FRED, has made capital grants available to any private entrepreneur and to any industry wanting to locate in a given region or district. I suppose that in many cases this has had limited success. But we do know that there are also Crown corporations in this country that, as a matter of internal management decision, have decided to pull out of a given region. Often this has had dire consequences for that region.
The prospect which faces the government, and in particular the Department of Regional Economic Expansion, when a Crown corporation leaves a region is the provision of massive amounts of capital by way of grants to attract new industry. In either case the cost to the Canadian taxpayer is not substantially different. In fact, it can be argued that a saving might result to the taxpayer if the existing operation were maintained, even if it required a subsidy.
Let us consider two specific instances, one being Air Canada's operation in Winnipeg and the other the Canadian Forces base at Rivers, Manitoba. Neither of these two places are in my constituency so I am not speaking from a local or parochial point of view. The fact remains that if it is the intention of the Department of National Defence, as was announced, to discontinue the Canadian Forces base operations at Rivers, it will mean the wiping out of 1,100 jobs for the people of that essentially rural area of Manitoba. The prospect of losing 1,100 jobs will mean, if not death, at least a high degree of economic stagnation for that part of the country. In turn, it will mean that if the new department is to live up to its name it will have to inject massive amounts of capital by way of grants to try to attract alternative industry.
I should like to ask the minister whether the thinking of the government is sufficiently crystallized to enable him to say whether, in the case where a government department or Crown agency or corporation decides to take a step which will have an immediate and direct bearing on the economic life of a region, it is envisaged that his department will have a considerable say on whether or not the other department or agency will be allowed to take such a step. I think this is a crucial factor and an important question on which the minister should try to elaborate at the first opportunity.
March 21, 1969

Government Organization [DOT] (2:50 p.m.)
There is another criticism which I should like to direct to the minister's attention. When the local representatives on the board of directors of a local co-operative, which is usually a small local industrial undertaking such as a creamery or cheese plant, decide that a particular kind of industry can operate successfully in that district-here I am speaking of areas which have been acknowledged as having less economic opportunity than designated areas in the rest of the country-I hope there will be a greater sense of urgency on the part of the officials of the new department and of the minister than was the case under the ADA program, for example. I speak from direct experience in this regard. In my area a local co-operative creamery decided that because of the changing nature of the dairy industry in Canada and in the west it would be desirable to supplement the local creamery operation with a cheese plant. After a number of local meetings in which many of the local residents involved themselves-and this type of involvement is supposed to be the essence of the whole approach-a decision was reached to go ahead with the construction of a cheese plant. It was found possible to raise between $30,000 and $40,000 locally, but a matching grant from the Department of Industry under the area incentives legislation was needed. After two years these people are still waiting for financial assistance.
I wish to emphasize that in many rural districts which are impoverished and face prospects of further decline, it takes hard thinking to come up with proposals for concrete action. It is not easy to decide what kind of industrial possibility will be feasible. But here we see an instance of local people led by their local co-operative board of directors, many of whom have a good deal of experience in business affairs. They agree on a concrete proposal involving the raising of between $30,000 and $40,000 locally and they make arrangements to provide this sum. But, when they ask the department to make use of its much publicized area incentive legislation to the extent of making a grant of a similar amount, the department refuses. One can only come away, in such a situation, with a pretty sour impression of the way in which the department handles these matters.
Only a few miles away from this community one of the largest corporations in the country has built a distillery costing about $10 million. The corporation is not impoverished,
[Mr. Schreyer.J
but in order to attract it to locate in this designated area capital grants of the order of 30 per cent of construction costs were made to it. The distillery gives work to upward of 100 people in the community, and that is fine. But in addition to outright capital grants provision is made for an accelerated capital cost allowance. Altogether, the amount of transfer capital from the taxpayers of Canada to this corporation comes to several million dollars. Yet when a band of local dairy producers wants to get $40,000 out of the government they meet with two years of stalling.
It cannot be said that the project was not feasible, that it was rash. I defy anyone to show me a group of people more cautious and prudent than local businessmen or directors of local -co-operative boards. The department has made a gracious offer. It has said that in a year or 18 months it will reconsider the application and maybe grant moneys retroactively. Bearing in mind the kind of harvest in western Canada last year, bearing in mind the decline in farming in 1968, I believe the time for action is now, not next year after what one hopes will be a fruitful harvest.
There -are many instances which one could cite without being unfair in the slightest way to show that there is something incredible about the operations of the various agencies which have been established to deal with the problem of inter-regional disparities, low rural income, and so on. When the department is presented with opportunities of concrete action in respect of concrete projects it responds by procrastination and delay.
In conclusion, I should like to say the time has come to speak with more candour than in -the past about the problem of rich and poor regions. I feel that unless the government is prepared to make greater use of existing and new Crown corporations nothing substantial will be done. There are certain approaches open to it. There is something illogical -about a situation where at a time of slow growth and high unemployment in certain regions the central government is pursuing a blanket policy of tight money and high interest rates. In some -areas this might be logical but in others it is the height of folly. I conclude by saying -there is ample opportunity for effective action by the government. I wanted to make a point about the role of fiscal and-monetary policy. It would not take too long.


The Acting Chairman (Mr. Richard):: Order. I am afraid the hon. member's time expired two minutes ago and unless the committee is disposed to grant him more time, he cannot
March 21, 1969	COMMONS
continue. I could not care less personally who is speaking provided the committee wishes to listen, but I understand there are a number of other speakers who wish to take part in the debate.


Edward Richard Schreyer: I really require only another minute, Mr. Chairman.


Mr. Drury:: I think the committee would be quite agreeable to allowing another minute.


Edward Richard Schreyer: 
Roland Godin: Mr. Chairman, I was very pleased to hear that under Bill C-173 which is now under study, a greater part of Quebec would be able to benefit from various types of assistance. If that is true, the Montreal area which has always attracted manufacturers and tradesmen will be advantaged more than some other areas of the province of Quebec where the exploitation of natural resources brought about the establishment of some big industries while the industrial development of the rest of the provinces slackened.
Therefore, we from the eastern area of Trois-Rivieres get the feeling that we are advantaged since clause 23 gives us great hopes. In fact, under that clause the functions and powers of the minister entend to and include all matters relating to economic expansion and social adjustments in areas requiring special measures to improve opportunities for productive employment and access to those opportunities.
DEBATES	6969
Government Organization
I presume that the minister will not overlook anything and will back the provinces concerned, as to the implementation of a real policy for industrial decentralization.
Yesterday afternoon in his statement the minister pointed out to us that the department will urge that loans and advances be granted to provinces. In our opinion, that is another piece of news that is welcome since the minister will do his best, I trust, to carry out fully the programs that have been jointly studied and approved. And in order to do so, I am convinced that he will not hesitate, once the time has come, to call on the Bank of Canada.
The Canadian public has not always been aware of all that happens in the administration of the country. There is a public administration and a semi-public administration. As far as foreign investments are concerned, some facts are ignored and banking transactions which eventually benefit those foreign countries are not always disclosed. However, I learned from reliable sources that upon his arrival here in Ottawa in the fall of 1965, the minister, requested an explanation of how the funds loaned to foreign countries were set up and finally-I could give the name of the member of this house who explained that to him, as well as the name of one witness to confirm this-he came to the conclusion that these credits for foreign countries were merely social credit provided to them.
Now that he knows how it is done, I am inclined to believe that he will make a statement in the near future, to tell us that what is good enough for foreigners is good for Canadians.


Some hon. Members:: Hear, hear.


Roland Godin: Mr. Chairman, I am convinced that when the Minister of Forestry and Rural Development (Mr. Marchand) makes that statement, he will get the approval of every honest cabinet minister. I also hope that to ensure the success of those projects the Minister of Forestry and Rural Development will demand the co-operation of the Minister of Industry, Trade and Commerce (Mr. Pepin), since only he can evaluate at this time the damage caused to Canadian businesses by excessive imports. It is useless to think of establishing or expanding plants to produce goods to fill the needs of the Canadian family if the government does not reduce those imports. Already, the electrical appliances, clothing, and shoe industries of Canada have
March 21, 1969

Government Organization been greatly affected, in Ontario and particularly in Quebec, where plants established for 50 to 75 years have recently disappeared as a result of increased imports. That means we cannot think of creating employment without taking the consumers into consideration.
It must not be forgotten that Canadian consumers will purchase only in case of need, and if they have the necessary purchasing power. Now, many unemployed who have been retrained are coming on the labour market to offer their services, and thousands of youngsters are also hoping to get jobs.
In the Ottawa area alone, 50,000 students are seeking summer jobs and according to the Manpower Centre, only 3,000 to 5,000 jobs are available, which means that 40,000 students will be unemployed during the summer.
That proves, Mr. Chairman, that skilled manpower is numerous enough in the country now to meet the demand of manufacturers.
Let us be careful not to import indiscriminately. We should not forget that no country buys from Canada to do us a favour or out of gratefulness. Events of the past are a proof of it and it is quite normal that a country buys what it needs at home and only calls upon foreign countries when it lacks some product.
Mr. Chairman, another aspect of the vocational training policy should be, in my opinion, to help farmers. Indeed, one of the main tasks of government as far as designated areas are concerned is to allow access to vocational training to farmers whether or not they are fated to remain on the farm.
If a farmer must stay on the farm, he must have the technical knowledge necessary to face the problems of managing a modem farm. On the other hand, if he must leave the farm, he should not go to the city as a castaway but he should have the necessary knowledge to practice a trade.
I trust that the rules enacted under this bill will enable the greatest number of farmers to attend the schools during the coming months.
As far as the riding of Portneuf is concerned, only 40 p. 100 of the farmers interested in further training have been allowed in recent years to attend classes that are now offered to them.
In order to control the market for their products, the farmers, through proper organizations, have tried to follow up as far as they could the movement of their products. They have also tried to organize for their benefit the sale of their products, natural or processed.

We have seen well organized co-operatives with a good system for the production, the preserving and the sale of fruits and vegetables. I have in mind particularly several areas of the province of Quebec, such as Riviere-du-Loup, Orleans Island, Quebec-Montmoren-cy, Portneuf and Saint-Jerome.
We also have cold storage facilities that were built thanks to grants from the provincial and federal governments. They were filled with potatoes and strawberries for which there were no buyers and we had to empty them by burying those products in the ground, since our markets had been flooded by imports.
The same situation prevails also in the dairy field, and so much so that last year our country was importing butter from New Zealand and Australia, and this to the prejudice of the Canadian producers.
Section 28(1) (a), (b) and (c) of the bill states clearly that money will be provided to industries as capital or interests, or simply as grants, to help them defray part of the capital cost needed for the establishment, expansion, modernization or operation of the undertaking.
Such a procedure is most commendable, and I know that many businessmen are waiting for the opportunity to put their names on the long list of applications already in the minister's hands.
But whatever the projects under study, capital is needed to carry them out. We must not think, however, that this bill will regard all problems as pertaining to the so-called special areas.
Let us remember for example, the investments of some $15 million in Arvida, by the Aluminium Company. That company invested $15 million, the federal grant was $5 million, which makes a total investment of $20 millions and the creation of 100 jobs. Therefore, it is an investment of $200,000 per job.
If ALCAN keeps for itself 9 to 10 per cent of the profits, which is the average profits of Canadian companies as capital gain and which is quite normal, if the capital was borrowed at 7 per cent, ALCAN would make a profit of some $20,000,000 for each job. Those huges investments create very few jobs, but large profits and as automation gains ground,
I think that the distribution should be automatic.
Automation and machinery are social capital. The yield of that capital should be distributed by means of the social dividend suggested by the Creditistes. This would help the people to purchase good and services and it
March 21, 1969

would promote the growth of present business concerns and the creation of new ones.
Mr. Chairman, I conclude by pointing out to the minister that we have only two choices: either we find ourselves buried under our present production, because we do not have enough purchasing power, or we get ready for another war, which, by the way, would help us get rid of our surpluses.


Some hon. Members:: Hear, hear!
[DOT] (3:10 p.m.)


Mr. Clermont:: Mr. Chairman, I would like to make a correction to Hansard for March 20, 1969. At page 6907, third paragraph, left column, my words are reported as follows:
Those areas have tremendous potential for the tourist industry; they have natural and extremely varied attractions. Tourist centres, camping sites and a provincial park have already been developed. In 1966, with the co-operation of the federal government and the province of Quebec, eight provincial parks were developed in that province; lifts were installed for the skiers as well as facilities for the skidoos, a sport that is very fashionable these days.
Here is what I said, I think:
Those areas have tremendous potential for the tourist industry; they have extremely varied natural attractions. Tourist centres and relays, camping sites, ski-lifts and snowmobile centres, which is a very popular sport nowadays and a provincial park have already been developed. In 1966 with the co-operation of the federal government and the province of Quebec, eight provincial parks were developed in that province.


William Gordon Ritchie: Mr. Chairman, in speaking on this government reorganization bill I shall be concerned with one area only, and that is P.F.R.A. I support the general tone of the bill and its endeavour to foster better economic growth as well as to correct regional disparities. I caution, however, that although it may be easy to set up the new department, it will not be easy for this department to deal with regional disparities. After all, regional disparities exist in any economy, be it socialist, a so called free economy or a regimented economy as they have in Russia.
It has become difficult in many highly developed countries to take care of that segment of the population that has not found security within the economy of the nation. In this country, with our huge underdeveloped natural resources, we ought to be much more successful in tackling this problem and in reaching an original solution.
Government Organization
May I now speak of the matter of P.F.R.A. I believe this has been one of the more rewarding government ventures and has made possible constructive developments in the rural economy of Canada. As Canadians, we owe a debt to this vehicle which has been so useful. I am sure it has contributed much to the productive capacity of our farming community. The pattern this venture has laid down ought to be followed and built on. It has created large cadres of skilled engineers and others who are able to pass judgment, based on their experience and know-how, on programs that have been undertaken. The most visible evidence of P.F.R.A. in western Canada is the larger dams that have been constructed such as the Shellmouth Dam on the Assiniboine River in my constituency. This dam is now nearing completion and will be very useful. In addition, P.F.R.A. has been involved in many similar projects to do with water; I refer to projects such as dugouts, small run-off dams and other programs that have increased the livestock carrying possibilities of our economy.
Although most of the larger P.F.R.A. projects in western Canada have been completed, many projects in other parts of Canada remain to be undertaken. I am concerned about the fact that responsibility for implementing programs under this legislation is to be transferred to the new Department of Regional Economic Expansion. I believe that much of the effort of the new department will be expended east of Montreal and in the Maritime provinces. I approve of that, since in those areas we seem to find the greatest economic disparities.
I now wish to add a word of warning about the relation of agriculture to P.F.R.A. The government has sent out numerous task forces that are involving themselves in various programs in this country. The task force on agriculture suggested that wheat acreage should be cut by 10 million bushels and that no dairy herd of less than 30 cows should be allowed to be operated. I do not quite agree with wholesale changes such as these that the task force recommends. I wonder if many of the premises on which these surveys were conducted were not, to some extent, falacious.
It seems to me that many rural people eventually will have to leave their farms and seek their livelihood in cities. This factor, I presume, is behind the idea of establishing central areas of regional economic focus where industries could be assembled to provide jobs for displaced people. Yet much
March 21, 1969

Government Organization remains to be done for those who remain on the farms. Perhaps many will not have to leave the area in which they are living; many may change their occupation from one involving farming to one involving employment in some service industry and so continue living in rural or semi-rural surroundings. By this I mean that these people could easily involve themselves in recreational industries and other services that inhabitants of larger centres would use. There is great potential for establishing recreational industries or services in rural areas, in addition to secondary industries.
I believe that P.F.R.A. has a much greater role to play now than it ever had before; in future, it will enter more fully into the economic life of our community than it has in the past. It will work more closely with provincial governments; throughout all Western Canada and other areas of Canada, therefore, a survey into the condition of land and land use should be carried out. Although much has been done, much more remains to be done. We have been profligate with natural resources such as water, land and forest. Erosion has hurt our country considerably and will hurt it more in the future unless steps are taken to correct erosion. The work of preserving our natural topography has only just begun and we ought to press forward with this work with all reasonable speed. The preservation of wet lands has become a problem in North America and a particular problem on the prairies. Preserving this land will help us to preserve a better balance of nature. If man is to remain on this continent with any degree of success, he will have to be more careful about preserving his natural surroundings.
There is a great future for P.F.R.A. in this field, Mr. Chairman. Although the new minister will be engrossed in problems of regional economic expansion, I hope he will not lose sight of the productive potential of P.F.R.A. I should like to see the aims of this legislation increased. Although it does not deal directly with the welfare of the people, in the long run it is a very productive tool of government and will contribute much to the agricultural community. With these few remarks, Mr. Chairman, I conclude.


Gordon Harvey Aiken: Mr. Chairman', there seems to be a general idea that Ontario is a prosperous province and needs no help from area development programs. In a general sense, Ontario is a prosperous province. A large proportion of the national income derives from the province of Ontario and much of

our industry is established in Ontario. In that general sense, Ontario is prosperous. Nevertheless, there are underdeveloped areas of the province which do not share in the total provincial prosperity. I want to point out that fact this afternoon.
I represent an area in the Georgian Bay region of Ontario in which, as a general rule, the inhabitants* have a reasonable standard of living. The people there are reasonably happy. All the same, there are several important areas with underdeveloped economies that I do not wish to be overlooked. It should not be thought that Ontario does not suffer from any problems connected with underdeveloped regions and that there are no provincial areas needing help.
[DOT] (3:20 p.m.)
In that connection, a report was prepared recently by the Georgian Bay Regional Development Council, and I would like to read part of that report as it appears in the Globe and Mail of Friday, March 7 under the headline, "Prosperity Gap Greatest in Georgian Bay region". It reads:
The Georgian Bay area is in trouble, faced with a prosperity gap greater than any of the nine other provincial regions.
Over-government, collapsing industries and disappearing communities in some areas, outmoded highways and irrational development policies are its major problems, according to the report of the Georgian Bay Regional Development Council.
To remove and stabilize the 11,500 square mile area the report recommends an integrated federal-provincial development plan, a drastic reduction in the number of municipalities, a new highway development plan and the designation of urban areas as growth points

To support the claim, it publishes statistics showing that Georgian Bay is at, or next to, the bottom in comparisons of income, market ratings, industry ratings, retail sales, ten year growth rates and population growth.
Collingwood and Parry Sound are in Slow decline-
Further, on its states:
The region is perhaps a more difficult challenge than any of the problem areas of Ontario for it is not poor enough to be called an economic disaster area and, unfortunately, it is not yet in a stage of sustained, self-generating growth.
I think that fairly describes the area that I represent. It is not in any sense of the word a disaster area. In general, it has a good tourist industry. There are a number of other industries established there, yet on the west side of the district of Parry Sound, in the Georgian Bay area, there has been no benefit from the incentives that have been offered by the government in past years.
March 21, 1969

We are a designated area and the incentives that have been granted under the Area Development Agency have been used for several industries. We have been very fortunate, at least on the east side of Parry Sound and Muskoka, in establishing better economic development. However, on the west side, on the coast of the Georgian Bay, in the parts around the town of Parry Sound and north from there some 80 to 100 miles, development has fallen far behind what it ought to be.
Highly improved educational facilities and a good vocational school have been constructed in Parry Sound. In the village of Britt, which is just north of there, an excellent public school has been constructed. There has been an upgrading of the attempt to get some further economic value from the communities, but there is as yet nothing on which the young people can use their improved knowledge and special skills. The result is that those who stay there are very little better off than were their parents or grandparents. Those who leave merely increase the problems of the urban areas in housing, employment and transportation.
In most cases the offering of incentives is not sufficient in itself. There has to be an over-all joint program to meet the needs of an area. For example, several industries have given serious consideration to establishing plants in the West Parry Sound area. I would like to tell the minister, who has just come into the chamber, that I am speaking of the Georgian Bay area of Ontario.
But there are other problems which must be solved at the same time in order to bring in two or three of these industries. Natural gas is a first requirement for some industries, yet the natural gas lines were built some 40 miles further east. There is no use building the plants until the gas supply problem is met, and there is no use putting in the gas until the industries are there. This is the type of situation where a combined federal-provincial program is necessary, and I am trying to impress upon the minister that this should be a special area under the new procedures that he is going to use.
I think that the province of Ontario, which recognizes the difficulties, will be most happy to co-operate in setting up a special area in this Georgian Bay region. An expression of interest in a region by the government is a tremendous force for the better. Industry

Government Organization which has knowledge of sympathetic government support is usually willing to take a reasonable chance. Certainly designation as a special area of development would help.
I am glad that the minister is in the chamber so that once again I can tell him that the great need is to get started in this area, to get one major industry in there, and then the rest will come. Once we have got that incentive into the west Parry Sound area, I am sure that area will develop because it has a tremendous advantage in harbours. It is on the St. Lawrence-Great Lakes seaway. It has manpower advantages. It has advantages in living conditions. It has the fundamentals for everything that a regional economic development plan is intended to do, and I hope that the minister will consider this area seriously.


William Arnold Peters: Mr. Chairman, other speakers have mentioned the influence that a particular minister can have on a particular department. A few weeks ago, shortly after the reorganization bill was introduced, I had an opportunity of discussing this subject with the parliamentary secretary, the hon. member for Northumberland-Durham. I made the point that I was very unhappy that this particular minister had been chosen for this particular position, because if any department should have a broad federal outlook it should be this one dealing with regional problems. The department should not consider provincial boundaries, but should tackle problems on a national basis. I discussed my reasons for not wanting this particular minister to be the head of this department.
[DOT] (3:30 p.m.)
I pointed out it was my opinion that as the minister responsible for manpower he had adopted a very provincialistic attitude by placing manpower retraining in the provincial field again when it had been in the federal field. This involves similar problems, because a person trained as a plumber in British Columbia should be able to do a job as a plumber in Newfoundland under the federal manpower placement agencies. This is not possible now; there is no universality. My feeling is there would be the same problem in respect of a regional program. Since that discussion, I have had an opportunity to look at several speeches made by the minister. I listened the other evening to the remarks made by the hon. member for Huron and I am prepared to agree that if the speeches this minister has been making are representative
March 21, 1969

Government Organization of his opinions, perhaps this program will be a success.
I should like to mention some of the programs we have had. I know they have been gone into in detail. However, in most cases in respect of ARDA and the area development agency, we have had very competent people in those departments. Considerable leadership has been provided both in the agricultural and industrial field. Yet, there has been a very small degree of success. It is true that in some areas there has been more development than in others. The situation in Brantford is a good example. This area asked to be undesignated because there were too many industries. I should have liked to see a similar situation in respect of most of the other designated areas, but this result was not accomplished. I believe this mainly resulted from the fact both the provincial and federal governments jealously guard their own areas. Therefore, the type of co-operation provided was not very great and was provided too slowly.
In respect of one program with which I have been concerned, I phoned the official directly in charge who advised me that they had not been able to get the project through the counterpart provincial agency. After months and months, when the people who had been interested in the project were no longer interested in it, finally agreement was reached. It is my opinion that the development areas of Canada will be broken down into three particular regions. One region will be the area north of the St. Lawrence region. It is the area we call the Golden Horseshoe and stretches from Quebec and Montreal through to Windsor. This area is not likely to need a great deal of assistance in developing industry. This is an area where, in my opinion, more difficulty will be experienced because of industry than because of the lack of industry.
There is another area, which I believe is the one we are considering, which stretches from the Atlantic provinces through to the west coast. It might be called a mid-Canada area. In my part of the country, it is the area beginning about 50 miles north of Toronto and stretching to the tree line. If the information I have from other countries is correct, for a considerable period of time the tree line probably will mark the end of the area in which there can be secondary industrial development. There will, of course, be primary development beyond that. I think the area we are talking about is what one might call a

resource base area rather than an industrial area. This is an area which to some extent is industrialized now because of the various natural resources in the area. This is true in my part of the country. It has also affected the main centres in the south part of the area. They seem to be in a fairly viable position. In fact, the two major centres of Sault Ste. Marie and Sudbury have the highest income level in that whole area, and probably in Canada.
In these places, the secondary development has been related to the natural resources. They have been very successful in this field. Farther north, however, this has not been possible. There, there is a lack of transportation and communication facilities. The fact is that my area is 400 miles north of Toronto and it takes five days for a letter to get to Toronto. This can be very disturbing to a businessman. A doctor told me that out of 20 or 25 samples he sent to a laboratory in Toronto in his professional capacity, 15 samples were frozen and returned as unacceptable for laboratory work. This is an indication of how poor communications are.
If this reorganization is to be successful, it will be successful because the minister believes in the program. If the minister does not really believe he, as a federal member of parliament and as a federal cabinet minister, is responsible for the regional development of all Canada, then this program will not work. The program did not work in respect of ARDA, FRED and AIDA. The main reason it has not worked is that there has been a patronage arrangement either by the federal government or the provincial government. Personally, I would like to see one of the two get out of some of these fields.
The previous speaker, the hon. member who comes from Parry Sound-I doubt whether that is in northern Ontario but it is close by-made representations in respect of the tourist industry. In my area, the tourist industry has been assisted by the federal government through the area development incentive program. However, the tourist industry would seem to be much more in the provincial field since parks, reforestation, and the maintenance of stocks of fish and game are under provincial jurisdiction. Licensing also falls within the jurisdiction of the province.
I should like to see the provincial government take over the development of the tourist industry. I have no objection to the federal government providing some money in this regard, but I believe it is rather ludicrous for
March 21, 1969	COMMONS
both governments to be vying for the opportunity to help in this regard.
One concept of ARDA was that little groups would get together and choose a community they would help. This might take the form of the reclamation of marshland, the draining of a swamp area or the conversion of a farming area from one kind of produce to another by the building of a facility to handle the new type of produce. This concept automatically brought to the minds of both the provincial and federal politicians that the program was within their jurisdiction. Except in respect of the two major programs we have, the provincial people and the federal people did not work in conjunction with each other. Therefore, the projects were superimposed on the communities. The communities had very little co-operation from the provincial people and none from the federal people because the negotiations and arrangements were not made at the community level. The arrangements were between governments rather than individuals.
[DOT] (3:40 p.m.)
Yesterday, the hon. member for Winnipeg North pointed out the change in attitude apparent in a number of publications and statements made by the government in recent months. There must be a change of attitude on the part of the minister. There should be assistance given to primary resource areas which are in need of assistance to become a secondary industrial area. If the minister stops at the borders, he is overlooking a number of points that should be considered. There is a very close relationship between northeastern Ontario and northwestern Quebec. The same situation is developing between Manitoba and northwestern Ontario, the area represented by the hon. member for Kenora-Rainy River. The people of northwestern Quebec talk about stretching that boundary over to Newfoundland.
These areas are not governed by provincial boundary lines. They are areas in which the primary industries are mining, forestry and subsidiary plants evolving from those primary industries. The same problem exists in the maritimes and all other areas not included in the industrial belt. People who come from the maritimes to work in northern Ontario find that they are faced with the same problems. They find that in their prime they can work in the mines for fairly good wages, but there are no jobs available for women, young people, elderly or disabled persons.
DEBATES	6975
Government Organization
The economy in that area is based entirely on the very limited strata of physically capable people working in the primary industry. They go back and forth across the provincial boundaries in that band of development. Many people have mentioned that there must be changes in the disparity of income, education, employment, job opportunities and secondary type of employment for all rather than just the most healthy male population.
The Premier of the richest province in Canada, Mr. Robarts, has demonstrated how interested provincial governments' are in money. He said this province would accept medicare because there is money in it. If this is acceptable to Ontario, then other provinces will follow. If the minister can institute programs to solve economic problems on a regional basis in northeastern Ontario, those programs will apply to northwestern Quebec. The government should no longer state that this is unconstitutional. It is not unconstitutional to provide people with the means to help themselves.
For some time I, as a pseudo-socialist, have been worried about the government developing industry in an area. I suggest to the minister it is not necessary to always follow the same pattern in achieving this development. The minister should consider projects available that will make money and provide growth centres. I suggest to the minister that he should consider the Mackenzie Delta project, an undeveloped resource area. It is difficult to say what the future will be, but no major mistakes have been made.
In considering the Mackenzie Delta and the oil that will be produced in Alaska and the Northwest Territories, the minister should consider the very large expenditure to build a 36-inch pipe line from the Mackenzie Delta to Edmonton, the heart of Canada. If this were done the United States probably would not build a pipe line from Alaska to the Pacific. There would be many advantages1 in having this commodity partly processed in Canada and the resultant industry integrated with the whole continental oil policy. No doubt the government would recover this expenditure over a period of time. Possibly shares could be sold to the general public such as was done in the Panarctic project.
There are a large number of iron deposits in northern Ontario. Iron ore is now being shipped to Hamilton and the United States. This source of iron ore will probably last the next 100 years. I suggest a steel mill should be built in northern Ontario. A secondary industry would be developed because some
March 21, 1969

Government Organization processing must be done while the steel is at a certain heat. I also ask for consideration of hydro projects. This is a very important field.
I suggest to the minister that these projects would be successful under the Canada Development Corporation. The minister may find that the Canadian public are willing to participate in a total national expansion program if given the opportunity to do so.


Mr. Maile:: Mr. Chairman, I shall try to be brief in order to give the house the opportunity to end the debate without undue delay.
That new department has raised many hopes. As a proof, I would like to quote a journalist Mr. Roger Champoux, who wrote an article in La Presse on February 19, 1969.
The article is entitled "L'operation Secours" and Mr. Champoux wrote the following:
The project is tremendous and the instrument to implement it has just been dratted. The federal government has thus taken on a tremendous task in establishing a super-department responsible for levelling the economic disparities of this country.
Actually, and I am saying this without any attempt at irony, the federal government is fulfilling an electoral promise, but above all, in so doing, it justifies at long last those reasonable people who have been calling for strong action and ingenious ventures to raise a number of Canadian areas out of their stagnation. This is an emergency and it has all the makings of a drama.
At this stage, Mr. Chairman', I would like to point out that the Creditistes are among the reasonable people the journalists are speaking of. We Creditistes, feel that the editorial writer, even if he did not intend to do so, was referring to us, for ever since the beginning of our campaign to get the government to deal with the economic depression, we have been laughed at and people have been saying: it is demagogy. The country is prosperous, all is well and therefore the Creditistes were demagogues. Today, in the very paper which was abusing us, one may read that reasonable people are those who have long been raising the alarm and pointing out, because it became more and more obvious, that there was an economic depression.
We are very happy about this government initiative and we hope that even if this the real solution, is not found even if once more we do not reach to the real causes, as the hon. member for Compton (Mr. Latulippe) pointed out yesterday, even if this is not the magic key to many of our problems, we will nevertheless not object to some improvement of the present system, which we reject.


[DOT] (3:50 p.m.)
And the editorial writer goes on to say:
We have lived for a long time with the illusion that the country was so rich that its normal growth would continue without major problems. But lo! It is not only a question of poverty, but of large areas where the economy is at a stand still and social conditions are shameful. A rich country with a precarious economy: how irrational!
One would almost swear that the editorialist has taken his inspiration from the words of leader of the Ralliement Creditiste, the hon. member for Temiscamingue (Mr. Caouette).
___The new Department is to be called "of Expansion". This phrase tells all, but the size of the problem to be encompassed.
Mr. Chairman, the situation described here is well known to the Creditistes. They denounce it, and for several years they have been trying to find the real solution.
We hope, in the meantime, that the solutions we proposed will be seriously studied. After all, we want to help in the implementation of this very vast program.
We have a few doubts however, justified by the failure of former programs which were established. I am thinking for example, of the winter works program, which was noth ng more than an outflow of money replacing the social welfare payments.
I have in mind the failure of the ARDA project, among others. The following appeared in yesterday's issue of La Presse:
Delegation to Quebec City
The ARDA project has not done anything significant: we must consider deporting the people of the Gaspe region.
Those were the words of the reeve of the county of Bonaventure, and I quote:
The project to develop the Lower Saint Lawrence region, the Gaspe peninsula and the Magdalen Islands has not really done anything significant, and that could result in the near future in the deportation of the people of the Gaspe peninsula.
That is an example, Mr. Chairman, of a wonderful program which gave birth to many hopes and which today stirs up many illusions.
Now, if we are limited to such a program, it is too bad, because it will only emphasize the poverty of the depressed areas of the country.
Here is the example of another failure. I would not want to question the ability of the future Minister of Regional Economic Expansion, but we saw during the last election campaign how he solved the problem of the dock-
March 21, 1969

yards in the Quebec region, about which questions obviously come to mind.
The famous designated areas, to be called special areas in the future, are they undergoing a simple change in name or a genuine change in organization? If this represents a real and serious change, we intend to participate.
How is it possible to ensure efficiency without, first, eliminating such a scattering of funds. If $1 million is invested in one area and $10 million in another, and there is no sound organization capable of setting up in a given period a true general plan likely to ensure the survival of the businesses, we are heading for disaster.
I have here a copy of a telegram which was sent to the minister on February 24 last and which, I think, illustrates what I call a scattering of money. I quote:
Vehement protest against use for publicity reasons of the Shur-Gain Co. for Farm Management courses subsidized in Matane area by our governments. Pierre-Paul Tardif, agronomist, responsible for such a policy, allows replacement of regular professor by those lecturers who are using panels for their benefit to spread their publicity during government paid periods. Stop. Those methods have no respect for our democracy, are unfair via the Statut Entreprises Libre, and cause me great prejudices at the present time. Stop.
I have no intention to bribe anybody to offset that. Stop. Insist that steps be taken so that competent authorities investigate charge. Stop.
That people who authorize degradation of our rights, Libres Entreprises, be deprived of office and replaced by others who can guarantee impartiality.
Such assistance is granted in order to promote the economy and to ensure the retraining of farmers. However if that money is only to benefit well-established companies, it is an astonishing, not to say scandalous, scattering of funds, which should be avoided. Of course, the efforts we will be making in order to favour companies by granting them loans which should be used to develop the area will be useless in an already underdevelopped area if those loans are made at extravagant rates of interest. Therefore our policy should be to maintain interest rates at the lowest possible level.
Moreover, as previous Creditiste speakers pointed out, in the case of a really underprivileged area, why not go further and make loans without any interests, or at least at a very low rate, just enough to meet their administrative costs?
As the hon. member for Portneuf (Mr. Godin) said earlier, what is being done for some foreign countries should be done in our own country.
6977
Government Organization
All the difficulties of the minister will stem of course from the agreements he will have to enter into with the provinces. In my opinion, the main problem he will meet and will have to solve when he works out and puts into operation the programs established under the terms of clause 5 subclause 1 is to ensure the necessary co-operation with the provinces in which special areas are located, and with the volontary groups and public authorities in those special areas.
This, Mr. Chairman, is the crux of the matter. It will be possible to develop the special areas only if there is full agreement with the provinces concerned and with the organizations in those areas.
To that end, the federal government should not stand stubbornly on its position in such a way as to force the other party, for reasons of principle, to opt out of some agreements. Therefore, a very close and cordial co-operation should be established between the Quebec Department of Industry and the Department of Regional Economic Expansion, without any ulterior motives.
[DOT] (4:00 p.m.)
The difficulties are likely to crop up because of the tremendous size of those special areas. As far as Quebec is concerned and particularly the area east of Trois-Rivieres, I can only rejoice, because I represent the first riding east of Trois-Rivieres, that is the Champlain riding.
On account of the tremendous size of those special areas, what procedure will be followed? How will the selection be made? How will priorities be determined? What will be the over-all plan?
Naturally, I am wondering about the procedure to be followed. I trust the problem will be solved in a satisfactory manner for all those concerned who are suffering now in these special areas.
In the Champlain constituency, the only fairly large city, so to speak, is La Tuque, in the northern area. It has a population of approximately 15,000. Around it revolve some centers, mainly forest centers, and it owes its existence solely to the local major industry, the paper industry.
The alarm has been sounded already in the paper industry, since, on account of the Kennedy Round trade agreements and their use of new and more expensive species, the United States are able to produce various types of paper, especially in the field of wrapping
March 21, 1969

Government Organization paper, at a cost much lower than the Canadian producers can.
Our producers get little protection against United States exports of such types of paper, and this results in a slow-down in the production of paper factories.
Of course, if United States competition in that field became stronger, almost all my constituency would find itself in a critical economic situation, since one quarter of the population in Champlain is basically dependent on the paper industry.
Therefore, a way should be found to prevent the situation from deteriorating, while it is still time to act.
The city also comprises other small plants, whose management the minister has no doubt met, and this is the announcement that was made in the matter, and I quote:
*-on February 12 last, the management of the Canadian Converters firm announced the temporary close-up of the shirt factory it has been operating in La Tuque since March 1966.
I think that the areas east of Trois-Rivieres, particularly that of Champlain County and La Tuque, should be among the first to be looked after by the new department.
It is with real optimism that we are waiting for accomplishments and even if it is our duty to look for possible defects, I would like to assure the minister of our entire co-operation and we will all be glad to cheer at the very first concrete achievements of his department.
{English]


Mr. Skoberg:: Mr. Chairman, I can assure the minister I will be very brief but I would like to add a word or two to what has been said with regard to this bill. May I remind him of a statement which he made on March 20, as recorded at page 6895 of Hansard and which reads as follows:
The first thing we have to do is establish the department before we indicate to the house exactly what we intend to do.
I admit I do not understand the minister's words. It has always been my impression that before we can ask the people of this country to expend money in establishing a department of the government, members of the house should really know what the terms of reference and intentions of that particular department are. I, therefore, ask the minister, when he rises, to answer the questions that have been asked of him and to indicate to the house exactly what his department intends to 4o in the immediate future. I realize the
IMr. Matte.]
department must be established before he can possibly speak with authority. Nevertheless, I believe members of this house are entitled to have an understanding of exactly what the department intends to do. At the same time, I believe his department faces the greatest challenge of any department that is being established under this bill. I know the minister in charge of housing has suggested that everyone in this country should have an opportunity to choose the type of home in which he would like to live. However, before this can possibly happen, the Department of Regional Economic Expansion must improve the economy of this country and make it possible for everyone to have that choice. I believe that this free choice is a great myth until disparities in different parts of Canada are corrected. We know that there is a disparity in wages throughout Canada, and this again will have to be tackled by a department of the government.
I should like to quote another portion of the minister's opening address at page 6894 of Hansard. It reads as follows:
-the department's goal will be to ensure that economic growth is dispersed widely enough across Canada to bring employment and earnings opportunities in the hitherto slow growth regions as close as possible to those in the rest of the country.
[DOT] (4:10 p.m.)
I suggest to the minister that in his attempt to bring this about he should not forget to consider the situation of areas which are steadily going down, areas which have dry rot at their roots. There are many such communities throughout Canada, and perhaps I can use Moose Jaw as an example. This is a city which has suffered severe hardship through the loss of many industries; we are close to the capital city. Even though outward appearances might indicate a prosperous community, there is a rot developing at the very core and if it is not attended to under the terms of the new legislation I can assure you, Mr. Chairman, that conditions in the area will not be pleasant in* the future. I ask the minister to pay attention not only to areas which are suffering today, but to the situation in areas which will suffer, and suffer deeply, if no consideration is given to their needs.
I notice the minister also says:
This bill provides for the establishment of special areas when employment opportunities are very limited in the region itself or in the territory of which that region is a part.
I should welcome an explanation of some of these terms, specifically a definition of "territory". Perhaps we could be given a definition
March 21, 1969	COMMONS
of what will constitute growth areas or special areas, and told how this is likely to be interpreted in the regulations. We would then be able to establish whether there is any meat in the bill, because it is these regulations which will determine whether the necessary action can be taken.
I agree with my hon. friend who spoke earlier that this should be a federal matter. If this bill is to mean anything to the Canadian people as a whole, too much reliance should not be placed on the idea of co-operation between governments at federal and provincial levels. It scarcely seems likely that the two levels of government can move quickly enough to remedy the situation which this country faces.
I ask the minister not to be too much taken up with this idea of really close co-operation in carrying out this work. Everyone agrees there must be co-operation. But if we wait for co-operation before taking any action, well laid plans can go astray, for political or other reasons. I believe the hon. member for Timis-kaming was correct when he said the federal government must itself accept responsibility for putting the provisions of this bill into effect.
I respectfully urge the minister to see that regulations are drawn up which will make this bill a meaningful part of our institutions. Everywhere in Canada people are looking to this new department trusting it will do something for their areas. I can appreciate the situation in which the minister finds himself, but if he works diligently to ensure that every part of our nation is taken into consideration, I am sure he will earn our congratulations. The special areas will, of course, have to be given special treatment. I wish the minister success in his new department and again suggest he urge his colleagues and every member of his staff to take the entire nation into consideration when laying plans and drawing up the regulations to make this legislation effective.


Donald Stovel Macdonald: I shall only take a few moments, Mr. Chairman. I wish to refer in particular to clause 20, to which we have a consequential amendment. Since it relates to a more substantial amendment a little later on when we get to the definition of a council, in particular the Atlantic Development Council, I wonder whether I could suggest the amendment now, then stand it and perhaps come back to it later on. If the government is agreeable to accepting the later amendment which we intend to propose, we
DEBATES	6979
Government Organization would move the following amendment to clause 20-that the following words should be added to paragraph (b): "and such other councils as may be created."


Mr. Marchand (Langelier):: This is to be stood until we study the operative clause?


David Samuel Horne MacDonald: Yes, Mr. Chairman.


Jean Marchand: My first words will be words of thanks to the members of the committee for their contribution to the debate. Most of the speeches were instructive. Everyone appeared conscious that this is a serious question, one with which we have had to deal as Canadians ever since confederation, and probably before.
Up to now, nobody has succeeded in solving this problem. Those who tell me that I am not likely to succeed are, of course, on safe ground. They are conservative, and I do not say they will be proved wrong, since history tells us that all those who have tried to deal with it have failed. Will it be different this time? I do not know. The only thing I can say today is that given the instruments provided by this legislation I shall try as hard as I can. After that, the house can judge whether or not I have been successful.
I thank the committee for its co-operation. As so many hon. members emphasized, this is a difficult task and it will not be accomplished overnight. I do not want those who live in underdeveloped regions to think I shall be able to perform miracles once this law is passed and that overnight they will become prosperous. I know that is not true. Many governments have been in power in Ottawa since confederation and none of them has been successful in this field. Provincially, it has been the same story. Some premiers and provincial governments have tried hard, and they have been successful to a certain extent in dealing with this problem, but it is still with us today. I know exactly what I am trying to tackle. I have no illusions, and I know the house has no illusions. But I believe that if we receive co-operation from every part of the country we can increase the pace of progress in this field and do better than in the past. If we are successful in achieving this, I shall be satisfied and could probably retire at the age of 90 or 95.
The hon. member for Egmont said he would like to know, at least in a general way, what the department intends to do. I thought this over, and found it a reasonable enough request. I shall try not to go into details of
March 21, 1969

Government Organization the program we are presently studying, because the cabinet is still at work on the first bill we intend to bring forward in connection with incentives to industries. However, I think I can say in broad terms in what direction we are moving.
[DOT] (4:20 p.m.)
Hon. members have emphasized the importance of consultation with the provinces. Certainly, we will have to consult. I respect the importance of consultation. Equally, I respect the authority of parliament. Until parliament has given me the powers requested in this bill, I do not think it would be right for me to enter into consultation with the provinces on detailed plans. On the one hand, I am asked to consult with the provinces; on the other hand, I am asked, before any consultation has taken place, to give the details of what we are going to do. Until I have consulted the provinces I am not going to talk publicly about particular plans; this would make a mockery of consultation.
However, I am happy to take this opportunity to describe to hon. members, and to the public, the broad outlines of the programs I propose to pursue. The first program is to improve opportunities for industrial employment. For that purpose, I will be introducing to the house in May, I hope, legislation on industrial incentives to replace the existing ADA legislation. The new program will be considerably different from the present one, and I believe will be much more effective in creating new, permanent and viable employment. This program will be especially important for Nova Scotia, New Brunswick and eastern Quebec, though it will be of considerable importance to slow growth areas in all provinces.
At this point, I should like to inform hon. members that in all of the programs we are studying we do not intend to deprive any region of Canada of the benefit of the law presently in force. In other words, we are not going to give less than we are giving now. Some hon. members expressed the fear that a new program might take out some regions which then would not be in as good a position as they are today as a result of the new legislation. This is not our intention; we are trying to improve what is in existence today, not destroy what is good.
Second, I will be seeking to work out with the provinces, plans for the development of the main centres within the regions where economic growth has hitherto been slow. We will be offering federal resources to help
[Mr. Marchand (Langelier) .1
these centres respond to growth opportunities. So far we have FRED plans for rural development, and this is important. I am proposing to extend that approach to plans for urban economic and social development.
Third, I will be proposing a series of plans to encourage and help the development of medium sized and small towns as trading centres and smaller industrial centres. That is especially important to the prairies, though of course it applies to eastern Canada too.
Fourth, I hope we can join with the provinces and local groups in formulating a series of plans for development and adjustment in rural areas of eastern Canada. We inherit the Gaspe plan, the plans for northeastern New Brunswick and for the Mactaquac area. They are not working perfectly. There are a lot of difficulties and we have to learn by experience. I will not be offering instant new plans. Quite a bit of time will be needed to perfect our programs. But we will be working as fast as it is possible to work effectively.
To those who raised this question, may I say we do not intend to set up royal commissions or task forces. We want to experiment with new programs and see how they work in each case.
Fifth, the P.E.I. plan, covering a whole province, is a special case. I shall be aiming to add another special case as soon as possible, because I think we need a distinctive plan for economic and social development to meet the particular needs of Newfoundland.
Some hon. members expressed the opinion a few minutes ago that there should be general plans throughout Canada. I do not think there should. Problems that are encountered in P.E.I. or Nova Scotia, in northern Quebec or northern Ontario, are not the same. If we want to make progress in this field we shall have to accept reality and plan specifically to meet the needs of the regions we want to help.
Sixth, there are the areas of Canada where Indian and Metis people are a large proportion of the population. They encounter particularly large obstacles to fully sharing in Canada's development. I propose to mount, again of course with provincial co-operation and local involvement, special plans to combat the problems of such areas.
Seventh, I referred a minute ago to a special plan for Newfoundland. In that plan, improved transportation must be an important element. For Nova Scotia and New Brunswick, we will need a long-range transportation plan that will include a program of
March 21. 1969	COMMONS
federal assistance for trunk highways as well as federal action for some major port developments.
I think one point that was raised many times during the debate was some hon. members were afraid that what we were spending now, partly through the Atlantic Development Board, on infrastructures would be eliminated in future. This is not true. I hope we will spend more than we have been spending for this purpose under A.D.B., because there is no doubt in my mind that it is useless to think of economic development for certain regions or cities if the infrastructures in those regions or cities are not built or rebuilt. Therefore, we require authority to do this. It is clear from the statute that public works and facilities are available to this end. As I say, we do not intend to do less than the A.D.B. used to do in the maritimes; I hope it will be more, much more.
Eighth, there are the programs of resource development on the prairies that we inherit through P.F.R.A. and, to a considerably lesser extent, ARDA. I intend in time to develop such programs, and to co-ordinate them with social programs such as we have in the FRED plan for the interlake area of Manitoba.
As hon. members know, this bill is not
going to put a term to P.F.R.A.; we are going to work with this program and I hope we can improve it. Perhaps later on we will think of something else, but let us wait and see how we progress with the present plan.
Ninth, we are also making through ARDA a contribution to rural resource development and rationalization in Ontario and British Columbia. We will be seeking to work with the provinces to make such programs more effective.
Finally, we will be working with the provinces in certain areas where tourism offers one of the main prospects for improved employment and earnings. Those are the then headings under which we will be developing our programs. A great deal of detailed planning has to be done, joint planning that takes time. A great deal of money will also have to be found.
I entirely agree with members opposite who (suggested that the department is, in effect, merely a framework. There is no doubt about that. This gives us a better chance to make our programs more effective. If the programs are good, then over the next few years 1hey will require increasing priority in terms of expenditure. However, I think
DEBATES	6981
Government Organization it was the hon. member for Selkirk who said that this bill may turn out to be good or bad. I agree with him, and I do not think the law itself is sufficient to correct the situations we want to correct.
[DOT] (4:30 p.m.)
One of my problems will be, of course, to find the money required. The other main problem, as several hon. members have rightly pointed out, will be to get the co-operation of other ministers and departments. There is no doubt that this will be a difficult problem, and this was underlined many times both in the committee and here in this house. While some mistakes have been made, I think some hon. members, and also some members of the public at large, have assumed I have more power than actually granted by this bill. It is underlined throughout the bill that any important program to be carried out must be approved by the Governor in Council. The minister therefore has no personal power. I say that bearing in mind the late Hon. C. D. Howe. Unquestionably he had great power. I make these remarks, not because I do not have the greatest respect for the late C. D. Howe but because we do not have the same backgrounds. Surely, he was a man who had great power; but it was personal power and not derived from law.


Robert Lorne Stanfield: Perhaps we should call the minister a Napoleon.


Jean Marchand: As I was saying, the other main problem will be for me to get the co-operation of other ministers and departments. You can't legislate that. I can assure you that within the framework the legislation provides, the minister and the department will be doing their utmost to secure necessary co-operation.
Keeping that in mind, I do not think I am authorized to give more details than I have given. That is because the cabinet itself has not made up its mind on the different programs we are proposing and because I do not think it would; be fair to the provinces we intend to consult to discuss this afternoon all the details of programs we have in mind.

Mr. Chairman, I have taken notes and I would have liked to answer every hon. member who honoured me with comments on the bill.
A number of particular cases have been raised. In view of the late hour, I would like to be permitted to consider again some
March 21, 1969

Government Organization remarks which have been recorded in Hansard and to try to give adequate answers.
For instance, the hon. member for Selkirk (Mr. Schreyer) I think, referred to the case of a dairy where a problem arose. I do not know as yet if that application was made under ARDA or the industrial incentive program, which is quite a different thing, for in the first instance the initiative must come from the province and in the second from the federal government.
Then, if I may, I will not deal with all those particular cases that I shall examine later on, and if we can do something to settle them, we will be very happy to do it.
Yet some problems were referred to, about which I would like to give some precisions. If I am allowed to, I shall start with the remarks of the hon. Leader of the Opposition (Mr. Stanfield) who in fact is very conversant with the problem of regional disparities since he experienced them probably more than I did, and since he is fully aware of this critical situation. I totally agree with him upon the proposed solutions, yet though he is probably not better than I am at working miracles, I think he is good in his part and that he brings a very valuable contribution to this debate.
He raised problems that are perhaps irrelevant, say, in a technical way, when speaking of the "causeway".
Mr. Chairman, I hope the figures on which the government based its refusal to build the causeway will be at the disposal of the house or of the committee on transport and communications, so that all those directly involved in this debate, even if they interpret those figures differently, will understand why we took a decision as important as this one.
I think that Prime Minister (Mr. Trudeau) himself said at the time that the matter could be discussed and I hope we will have the opportunity to do so. I do not think consideration of this legislation is the right time to go into a very specific debate which might be better undertaken at some other time.
One of the points raised by the Leader of the Opposition and about which I would like to make a distinction is the FRED project for Prince Edward Island. I think he knows very well that taking the total amount of each party's contribution, meaning $500 million to be provided by Prince Edward Island as against the relatively modest contribution of $225 million from the federal government, is not a very fair way to present the problem, for either one of the parties, in fact, included [Mr. Marchand (Langelier) .1
in this sum of $500 million from Prince Edward Island is a large portion of its regular budget, meaning that several things that have been included in the project are part of the normal services and activities of the province, of which we pay about 60 per cent of the budget through the tax equalization program.
And so, in any case, I do not believe it is right to consider only the two figures and to say that in a joint program with a small province, the federal government contributes only $225 million, whereas the provincial government contributes $500 million.
I think that even if the figures are correct, the facts are altogether different. I do not think that any Canadian government, even if that were his ideal, could do as much for the whole of Canada as we are doing through FRED for Prince Edward Island. In fact, our contribution is the equivalent of $2,000 per capita. If the same scale were used for the province of Qubec, can you imagine what it would give for all the other provinces?
Obviously, it may not be enough, but I believe that the program deserves to be attempted honestly. However, to present the problem as it was presented is not altogether fair, for I think that our contribution is much larger than the figures seem to indicate.
The question of co-operation with the provinces was also brought up. You will have noticed in the text of the legislation-to which an amendment will be proposed'

that we want co-operation. And in spite of the theories put forward by some hon. members of the New Democratic party, who want a united Canada, without taking into account jurisdictions, I maintain that it is impossible to do any economic planning in Canada without the co-operation of the provinces and that of the communities, through the provinces, or even without the co-operation of private enterprise and voluntary organizations.
It is being too optimistic to think that the federal government can, by itself, do economic planning when its spending power throughout Canada is now lower than that of the provinces and municipalities.
Therefore, it is obvious that if we work to develop an area, while the province works in an opposite direction, the results will cancel one another, because co-operation is imperative and should not remain a dead letter. I think that we all agree on that point.
Now, the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall) said, I think, that no consideration is given in the
March 21, 1969

legislation before as to the human factor. He evidently wanted to condemn big cities, in favour of small towns or rural areas. I will not go into that, but he should consider evolution-


John Howard Lundrigan: It is not fair.


Jean Marchand: I think the hon. member meant that under this program, we will do nothing for the big cities but that we will take care of smaller population centres and rural regions. That is not the point I am trying to make. The point is that the law must be concerned about human beings, and this we understand very well. We are talking about social adjustments, and we have those adjustments very much in mind. We are thinking of the social impact of regional economic expansion. We know that if we move people we must house them, find jobs for them, sometimes retrain them, pay for their transportation and take care of their families. All this is included in what we call social adjustment. It is important for us to take all those factors into consideration and it is therefore not fair to say that this law does not take into account human problems.

Now for several reasons, I should like to speak French. The hon. member for Winnipeg North (Mr. Orlikow) made a long speech on education. It is true that I was very pleased-


The Deputy Chairman:: Order. I regret to interrupt the hon. minister, but the time allotted to him has expired. Unless the Committee gives unanimous consent, he cannot carry on. Is it agreed?


Some hon. Members:: Agreed.


Jean Marchand: I shall be brief. All I want to say is that I shall never hire him as my legal adviser on constitutional law. He mentioned the intervention of the federal government in the field of education and alluded to the Prince Edward Island, Lower St. Lawrence and Interlake programs. Those programmes have been set up jointly with the provinces which have jurisdiction in this field. The intervention of the government in the field of education could give rise to a debate a little too technical. However, I found it very funny, because the hon. member really thought that he had found a point which could not only destroy the Prime Minister 29180-443
Government Organization and myself but also put us at variance. In any event, we shall have other opportunities to debate this matter. Let us confine ourselves to regional development.
[DOT] (4:40 p.m.)


William Arnold Peters: We thought it was a very favourable change.


Jean Marchand: There was no change, fortunately for us, but I think the hon. member for Winnipeg North does not see our point of view, because this concerns joint programs. It does not concern only education. For example, there are programs for sewage and for water supplies, which are municipal and provincial matters, but because they are joint programs we can participate. We are not involving ourself in provincial jurisdiction, and this is a distinction the hon. member has not made.

Well, Mr. Chairman, it is getting rather late. I was afraid when I saw that the debate was dragging on that my chances for carrying the bill through today were dwindling. Therefore, I am not going to extend the debate and kill my own bill because I should like to have it passed today.
I shall, no doubt, have the opportunity to comment on the other subjects that have been mentioned. Once again, I thank all those who have taken part in the debate and as far as knowing exactly what will be the impact of this legislation, only the future will tell. Only experience will show if we have given ourselves the proper instruments and if, later, we have had the courage to seriously tackle the problems we wish to solve.


Edward Richard Schreyer: I would like to ask the minister a question.


Albert Béchard: I wish to remind the hon. member that the minister's time has expired, so he needs the unanimous consent of the committee. Is this agreed?


Some hon. Members:: Agreed.


Stanley Howard Knowles: On
a point of order, Mr. Chairman, we are in committee and the minister can speak as often as he wants.


Edward Richard Schreyer: When a federal government department, or agency, or Crown corporation makes a decision to remove an operation from a region of the country that is already
6984	COMMONS
Government Organization in economic difficulty, under the new legislation- will the minister be in a position to exercise a countervailing decision-making power vis-a-vis that particular department or agency? Will he have a direct say?


Jean Marchand: I think that the answer is yes. That does not mean that I, alone, can decide not to close a base if the government decides to close it, but before the decision is made this department will be involved. We will discuss it, and we will try to protect the interests of the region.


John Howard Lundrigan: Mr. Chairman, I was very impressed with the minister until his last statement, which left me almost speechless. I am not sure whether he was clear in his statement about his attitude toward human resource development, or education, if one wants to be Joe Blunt about it. He left the impression that his department has no intention of getting involved in human resource development. I am aware of the constitutional problem, and I am also aware that the minister's colleague, the Secretary of State, has taken certain actions which are moving in the direction of involvement in human resource development.
I have recently completed reading studies by a lot of top economists, some Canadian and some United States economists, and next year the Economic Council will be saying that one of the keys to the solution of economic disparities is human resource development. For these reasons, I think the record should be set straight with respect to the minister's attitude toward human resource development.


Jean Marchand: Mr. Chairman,
I think that we have a few instruments to combat regional disparities. One will be industrial incentives, and I do not think this relates directly to human problems. It is related, but not directly. After that, we have plans which we will negotiate with the provinces, and there is no problem of provincial jurisdiction because when we negotiate with a province both of us have global jurisdiction. The province has its own jurisdiction, we have ours, and the result is that there is no field with which we cannot deal. I think the provinces are deeply interested in these problems and we are ready to make joint agreements covering those subjects.


John Howard Lundrigan: I will take the example of a province about which I know something. Let us say that Alberta wants to negotiate with

DEBATES	March 21. 1989
the minister's department for federal-provincial involvement so far as education is concerned. If there were some basis of agreement whereby the federal government and that provincial government could get involved with primary, elementary and secondary education, would this be a possible area of development within the terms of this legislation and within the terms of the minister's recent statement?


Jean Marchand: It is very difficult to answer such a question. I think if you read the P.E.I. agreement, you will see what we have done and to what extent we can go. I do not believe that we can make an agreement with Alberta dealing solely with education, but if we have a comprehensive plan those subjects could be dealt with in the agreement. We would have no objection to that.


Mr. Yewchuk:: Since Alberta has been mentioned, I did not hear the minister make any comments pertaining to northern Alberta. Questions have been asked about the redistribution of the boundaries of designated areas. Is this too specific for the minister to deal with at this time?


Jean Marchand: I think it is a little too specific, Mr. Chairman. We intend that this program should extend to the whole of Canada, and that we should take care of all depressed areas including those in Alberta. However, I think it is a little too soon to indicate how it is going to be done.


André-Gilles Fortin: Mr. Chairman, may I ask the hon. minister, what are the repayment conditions of the loans to the provinces and the municipalities to which he referred in his preliminary remarks?


Jean Marchand: Mr. Chairman, unfortunately, I do not understand the question.


André-Gilles Fortin: In his preliminary remarks, the minister mentioned the means at his disposal to promote the development of special areas, municipalities and provinces and to check unemployment and regional disparities. He referred to loans and grants; can he now tell us about the guarantee of those loans?


Jean Marchand: Mr. Chairman, that is a matter of regulations. If the house passes the bill, we shall have the necessary powers. Thereafter, a complete set of regulations will be prepared; unfortunately, I am
March 21, 1969

not in a position to say more on the subject this afternoon.
[DOT] (4:50 p.m.)


Thomas Miller Bell: Mr. Chairman, in order to be helpful, may I give the minister notice that I want detailed information on the matter of the former designation of St. John's, Halifax and Fredericton? I refer specifically to the releases that were made on September 25 and October 7, 1968. When we come to clause 24 in respect of these special areas I hope the minister will be able to give us answers, first of all, with regard to the provisional letters of intent that are to be given to new industry and also any further details he can give in respect of the transitional arrangements. I might have some other questions in this regard. I hope the minister and his officials will be fortified with full information on these questions, because the stage has been reached in respect of these cities where one day an announcement is made that the cities are in and the next day an announcement is made that they are not. This has created a great deal of uncertainty. We appreciate to a certain extent the problems in this transitional period, but there is a great deal of uncertainty in respect of new industries knowing where they should go. I do not expect a detailed reply now, but I hope the minister will be prepared to give some information.


Jean Marchand: They are in.


James Aloysius McGrath: In his reply, the minister behaved as if he were concluding the debate. I refrained from speaking on clause 1 in the interest of getting to the clause by clause study, but I want the minister to know I intend to make my remarks on clause 29.


Albert Béchard: Shall clause 20 carry?


Donald Stovel Macdonald: Mr. Chairman, I understood that until the substantial amendment proposed in respect of a later clause has been dealt with, this clause would stand.


Albert Béchard: Is it agreed that clause 20 shall stand?


Some hon. Members:: Agreed.
Clause 20 stands.
Clauses 21, 22 and 23 inclusive agreed to.
29180-443J
Government Organization
On clause 24-Designation of special areas


Mr. Comeau:: Mr. Chairman, I wish to move an amendment to this clause. Before I do, I should like to say that the minister has supported my amendment by saying that consultation or co-operation with the provinces would be carried out. My amendment is to the effect that after the words "council may" shall be added the words "after consultation with the province or provinces". The minister has supported my argument in respect of this amendment. It is absolutely essential that the provinces be consulted so far as the Atlantic area is concerned. This may be less crucial in respect of the maritimes since the bill provides for the establishment of an Atlantic Council through which the department might carry on consultation, but in the absence of information concerning how much power this council will have I feel this amendment protects the interests of the Atlantic provinces. There are, however, other regions which are concerned such as parts of Ontario, Quebec and the western provinces. They also come under the jurisdiction of this bill.
Unless other amendments are introduced, there will be no regional councils which would be able to carry the views of these regions to Ottawa. Within these provinces there might be development plans in respect of certain areas or counties which might not be in accord with what the federal government has in mind. I suspect the provinces have priorities in respect of development. It is for this reason they must be consulted.
Therefore, I move, seconded by the hon. member for Battle River:
-that in clause 24 after the words "council may" the following words be added, "after consultation with the province or provinces".


Jean Marchand: Mr. Chairman, discussion is not easy, because, as the mover of the motion said, it is quite clear from the remarks I have made in the house that I could not oppose such consultation, since it is the very essence of the proposal now under study.
I still believe that such co-operation with the provinces is a must and that it should take place. However, Mr. Chairman, for technical reasons obvious for any person aware of the complex social and political fact in Canada, it would be inconvenient if the clause dealt with that matter.
I really feel that we would make a mistake if we failed to consult the provinces before designating any area as a special one.
6986	COMMONS
Government Organization
However, under the present circumstances, and considering that, sooner or later, we will have to consult some provinces for the purpose of designating an area, the jurisdiction of a province might possibly extend outside its limits and some of them might wish to designate one center rather than another. Consultation will then have to take place just the same. However, if the center being discussed is not chosen, all kinds of problems might arise. Although I consider consultations as essential, I believe it would be a mistake to include a clause to that effect in the legislation.


David Samuel Horne MacDonald: Mr. Chairman, I find the internal logic of the minister's statement to be somewhat weak and perhaps confusing. I believe, as he has already indicated, this will quite naturally be a function of his office while setting up the designated areas. It may be that obvious to the minister but I can assure him that it has not been that obvious to the government that has been in office for the last six years. This view is borne out by the fact that the minister has to make an announcement in September and October and the fact that we have still not resolved what has been a very serious setback in respect of the AIDA program when it would have been most effective. This amendment does not tie the hands of the minister. The word used is "consultation". I think it is a very reasonable word to be included.
It is highly important to the provinces that, in respect of the designations of the minister, nothing will be done to jeopardize other steps taken by the provinces or other governments to further the general economic condition of the area. I am sure the minister himself finds no difficulty in accepting this. There may be some difficulty in another area. Frankly, I do not see what it is. I would hope, in an attempt to take other necessary steps toward better co-operation and consultation, the minister would in fact accept this amendment.


William Arnold Peters: Mr. Chairman, the minister sure confuses me, too. I am interested in knowing what he has in mind. He indicated that he wants consultation with the provinces.
I presume he means the government, but I am not sure. If the federal government is to have a program, it will have to be able to designate areas, whether that is what the provinces want or not. The minister probably is aware of the fact that the province of

DEBATES	March 21. 1969
Ontario has designated a totally different list of places than has the federal government, and this was done with consultation. So, I am opposed to this type of consultation if it means there has to be agreement. From the minister's remarks, I would think that by consultation he really means concurrence or agreement concerning what the areas shall be.
[DOT] (5:00 p.m.)
I suggest this is the kind of philosophical difficulty we have. Those who are responsible in the federal government for designating areas should co-operate with the provinces. There must be consultation in that co-operation. The federal government sets the criterion and makes the decision about designated areas. They should have decided about Halifax. They should not have let the provincial government carry on the consultation to the stage where everyone was so confused that even the people representing that area did not know whether it was designated. What the minister decides will probably give a better indication of what he intends to do about the federal responsibility in taking the initiative on this matter. The province should know what areas are going to be designated and be in a position to make representations. If the decision is made after agreement, I am opposed to the amendment.


André-Gilles Fortin: Mr. Chairman, I cannot believe that the minister would have said that the amendment proposed by the previous speaker could be inserted elsewhere than in the place suggested since it appears that where it says in the bill, for instance:
The Governor in Council may, by order-
-that means federal government does not promise that there will necessarily be consultations with the provinces before programs are elaborated or development or special areas are designated.
As for us, we should like to be sure that the federal government will take concrete measures to reduce regional disparities in conjunction with the province. So as to be sure of it, we think it is most appropriate to add at the place suggested the following words:
*-after consultation with the province or provinces.
Besides, Mr. Chairman, that is very important. It is the very heart of the matter. The minister has said it himself and I take the liberty to recall something to him in that
March 21, 1969	COMMONS
connection. A well-known editorialist, Mr. Clement Brown, did it also in an article published in Montreal-Matin on February 19, and I quote:
It is in the delimitation of growth areas that we will find out if the federal government intends to practise with the provinces the co-operation which it considers essential.
I will refrain from reading the remainder of the sentence which is fantastic.
Mr. Chairman, in my opinion, it is quite important that the house be assured not only verbally but through deeds, as the minister said a while ago, that there will be a very close co-operation between the federal government and the provinces because, if not, one will will undo what the other has done.
Consequently, we find that amendment worthwhile and we cannot understand why the minister does not think so.


Jean Marchand: There is no one who does not understand, and rightly so, that there cannot be any objections as far as the principle is concerned. My own objections have nothing to do with the principle itself, since I agree with it.
However, if the mover was willing to drop the words "or provinces"-

We would keep the idea of consultation with the provinces. I think that legally the singular includes the plural, so you do not have to add the word "provinces". It may be confusing.


Albert Béchard: Shall the amendment carry?


Some hon. Members:: Agreed.
Amendment (Mr. Comeau) agreed to.


Albert Béchard: Shall the clause as amended carry?


Stanley Howard Knowles: On
division.
Clause as amended agreed to on division.


Albert Béchard: Shall clause 25 carry?
On clause 25-Plans for economic expansion.


David Samuel Horne MacDonald: Mr. Chairman, here we are defining the way in which the minister is going to be able to carry out his functions in terms of the plans for economic expansion in particular. One of the problems
DEBATES	6987
Government Organization which concerns members in all parts of the house is not being sure that one of the critical areas of co-ordination in fact occurs effectively.
We know in the first instance a number of departments or parts of departments and agencies have been brought under this new department, and others with respect to regional development have been created. We also recognize this has been a weakness right through the piece of legislation. If programs and plans of other departments are not effectively tailored, the benefits achieved from the actions of this particular department will be minimal to say the least. The minister indicated that he presumably will have some form of veto power, with regard to the cancellation of certain kinds of programs, such as military installations or perhaps public works projects.
What we are talking about here is something much more important to the day by day workings of government administration and particularly the on-going design of fiscal and monetary policies. Under the old FRED set-up there was established a FRED board. I think that one provision relating to the FRED board was that ten senior officials would meet. It was a fairly structured affair that had application to the design and implementation of FRED plans. That board has been shelved, of course, because the FRED legislation as such is disappearing. I think what was being attempted under that program was the whole business of effectively co-ordinating under this minister and his department, policies of the federal government that would encourage rather than discourage regional development. That is the kind of business we are about.
I shall, therefore, move an amendment to add a new subclause (c) to this clause. The subclause would spell out specifically, but not so specifically that it would limit or prevent the minister doing the kind of things necessary to achieve that end, the kind of device which I think will be useful if this department is to achieve the purposes the minister has outlined. I, therefore, move the addition of a new subclause (c) to clause 25 as follows:
(c) preside over a co-ordinating council consisting of senior officials of departments or agencies which in the opinion of the Governor in Council have responsibility for policies or programs affecting economic expansion and social adjustment. This council shall endeavour to advise and coordinate policies and programs with a view to achieving a measure of national economic and social equality.


Albert Béchard: Shall the amendment carry?
March 21. 1969

Government Organization tTranslation]


Jean Marchand: Mr. Chairman, I am firmly opposed to this amendment. I think it is really a household matter. It would be wrong, I think, to provide in such a legislation that a minister is to chair a committee composed of officials of other departments. We would then confuse things. I am sure there will be an interdepartmental committee to study these matters; so it is a matter of internal economy. To me, it would be a mistake to introduce such a provision and it would not faster the co-operation.
The government has the responsibility to set up committees, and this is essential, if the legislation is to be efficient. Therefore, I shall always be opposed to the introduction of such a provision.


Donald Stovel Macdonald: Mr. Chairman, I can accept that the minister might have some objection to this particular suggestion, but I think the level of objection he has registered is more emotional, if I may put it that way, than anything that could be considered as being in the nature of logic.
[DOT] <5:10 p.m.)
The essence of what is being attempted in this amendment is to make known that there will be some definite machinery not just the good will of the minister or the occasional urging of some of his senior officials. We have learned in the past that this has not been terribly effective. The fact that the FRED board is being abandoned indicates, I suppose, that it also has not been terribly effective, although the minister has not said this. I think a government which only a little more than two years ago instituted such a board in the legislation could not have suddenly concluded that the basic ideas it had were all bad. I think both this chamber and the people of this country have a right to know in what ways a problem will be dealt with. This is a great problem and cannot be glossed over by saying the minister would not feel very comfortable. The argument used by the minister against the institution of some form of machinery, which will undoubtedly be needed, can hardly be said to be convincing.
I do not think anyone here should underestimate the importance of having such machinery clearly spelled out, even in a statute, if we are going to convince the many little empires that we know develop in a bureaucracy as large as the one which must deal with the peoples of this country, that it would be
.[The Deputy Chairman.]
effective in overcoming a problem that is so thoroughly entrenched in our whole economic makeup. The attitude of these Empires will not in any way be altered simply because nine bits and pieces of other departments are suddenly appearing together under one department along with new bits and pieces that are being added. I think there must be, in the context of this legislation, a cleareut statement on the machinery which will be used1 in order not only that the minister and his department but that all departments know that the government is ultimately serious about dealing with the problems of regional disparity.
I think the minister's answer to me is not a sufficient one. I am prepared to present a counter suggestion which will really carry some weight, but I think it must be included in the legislation.


Thomas Miller Bell: Mr. Chairman, in rising to support the amendment put forward by the hon. member for Egmont I cannot help but go back to some previous examples. I see here the President of the Treasury Board, and I am reminded very vividly of the difficulties which we had in the designation of Saint John, Halifax and Fredericton to which I referred a minute ago. Certain criteria were set up, I understand, and it was admitted on one or two occasions that many of the officials involved were in favour of including these cities under one of the clauses, which could have been done by stretching an interpretation. I said 'this in the house, and the minister knows I stood up many times and said it. I gave him credit for being straightforward about it, but I still feel that if he had not taken a rigid position against those cities there would have been time to take some action with regard to them later when it was pointed out to him and to everyone concerned that a designation was necessary.
In my opinion, this amendment will detract from the arbitrary powers of one man who, for different reasons, may become prejudiced against an area. For that reason, I think that this amendment will enable us to avoid some mistakes of this nature that were made in the past.


Edward Richard Schreyer: The mover of this amendment will forgive me, I am sure, if I say that it is the kind of amendment with which one can sympathize and agree while at the same time being unable to work up any strong feelings about it. It seems to me that what the hon. member is proposing is logical enough,
March 21, 1969	COMMONS
but the responsibility for co-ordination, it must be understood, rests with the minister. How he achieves that co-ordination is up to him, up to his own sense of responsibility and his own ingenuity. It must be said also that what is proposed here is unorthodox in terms of the standing or traditional relationship between the minister and his advisers.
I find it difficult to conceive a situation in which a minister of one department is empowered by law to preside over a committee of officials coming from many departments of government. It would certainly not disappoint us if the minister were to accept the spirit of the amendment but, as I have said, it seems an amendment of the kind which could be put into effect without actually being on the statute books.


Charles Mills (Bud) Drury: Reference has been made to the danger of a minister acquiring a prejudice against a person, or an institution or a community. I hasten to assure the committee that I have not acquired, nor do I have, any prejudice against St. John's or Halifax. The hon. gentleman suggested that by stretching the interpretation of the law his wishes could have been granted. He criticizes me, perhaps, as being prejudiced because I did not go along with that stretching. However, possibly this is irrelevant to the subject under discussion.
As the hon. member for Selkirk has just pointed out, the notion that a minister can preside over a department made up of officials from other government departments and reach conclusions which would govern those other departments really offends the whole idea of cabinet government and the structure in which we operate. A department must be responsible to and responsive to the minister of that department. Ministers can only operate in relation to other departments through the minister, not by way of a short circuit to officials. As hon. members are aware, the current system for securing co-ordination is through operational and functional committees of the cabinet where there is co-ordination between departments conducted at ministerial level. It would be a very curious arrangement indeed were a minister to preside over a committee of officials, senior or otherwise, from a number of other government departments with a view to co-ordinating the efforts of all departments concerned. As my colleague has pointed out, we already have an apparatus which functions satisfactorily. It is sufficient, I think, to overcome prejudices which might be supposed to exist
DEBATES	6989
Government Organization in the mind of any particular minister and to achieve the co-ordination needed. I would ask the hon. member whether, in view of this, he would withdraw the amendment.


Thomas Miller Bell: Is the minister suggesting there are no examples in the civil service at present of a minister presiding over a co-ordinating committee which is substantially advisory in nature? Has this arrangement never existed in the civil service? It strikes me there must be many examples of officials of the Department of Justice, for instance, being involved in matters affecting other departments, and there must be other instances of the same sort.


Jean Marchand: I know of some committees of ministers at which officials of various departments are asked to appear, but I do not know of any committee of officials over which a minister presides.
Clause 25 of the bill reads:
-in co-operation with other departments, branches and agencies of the government of Canada (the minister shall) formulate plans for the economic expansion and social adjustment of special areas.
So, I have the authority to take the initiative.
[DOT] (5:20 p.m.)
Now, how is this decision going to be made? Will it be made by a committee composed of ministers, by ministers and officials, or by officials alone? I think this is a decision for the cabinet to make. The provision in the bill is too rigid. We may very well decide that a ministerial committee should handle this question and guarantee this co-operation; that might be preferable. I do not know why hon. members insist on having the committee they suggest, but if we do not have some kind of committee we cannot carry through with what is implied in clause 25.
For example, suppose we are interested in a particular transportation problem. I preside over the committee which has the minister or deputy minister of transport on it. The minister does not agree with a certain proposal of mine. What am I going to do in that event? I do not think the type of committee suggested will work.


Thomas Miller Bell: The minister has undoubtedly given thought to this matter and probably knows more about the details than I. Just for the record, however, I should like to say that I would sooner count on the sympathy, understanding and kindness of some civil
March 21, 1969

Government Organization servants than of some ministers I know who in the past have taken certain arbitrary action in these matters.


John Howard Lundrigan: Mr. Chairman, I am not completely familiar with every detail of the amendment proposed by the hon. member for Egmont, but undoubtedly he and other members of the committee have given it a great deal of thought. I spoke last evening on this bill, and if I said anything at all it was exactly this, that the minister will have to depend on the co-operation of other departments in dealing with problems. It is not a problem that the minister of regional economic expansion can solve himself; it is a problem for the cabinet, indeed for the whole government and the House of Commons.
Let me just give an example of what I mean. I have been pushing for the extension of runway facilities in Gander. The Minister of Transport has been hedging about this for weeks and months, which is what he wants. I have written letters both to him and to his parliamentary secretary but have received no co-operation. I have talked with the Minister of Public Works about the matter, but he does not seem to know what the problem of regional disparity is all about.
I should like to ask the minister a question. In the event that the minister is not totally in favour of this particular amendment that has been proposed, and which perhaps has not been given the required consideration, will the minister be willing to concede that some provision should be made to allow for the tying together of government departments in some co-ordinated manner in order to give the minister some leverage? If he is not willing to accept the amendment, will he agree to have it stand so that, if necessary, he can come back with an amendment basically along the same lines? This is the most important clause in the whole bill because the department will either succeed or fall on it, and it may well be where the government falls.


Jean Marchand: Mr. Chairman, I do not think I can stand the amendment. As I have said, I do not think we should have such a committee. I think we must have some kind of interdepartmental committee to work within the law. It may even be necessary to have a cabinet committee; I do not know about that. We have no experience on which to draw. But we do have the authority of the law, and the law induces us to do certain things. How we are to carry out certain programs

I do not know. We shall have to gain experience and we shall have to consider the best type of committee to set up. That would be wise. I think the law contains all the necessary provisions. It will be necessary for us to obtain co-operation. In any event, I would not wish to be bound by an inadequate law and be forced to come back to the house after a period of months and ask for an amendment. I think the provisions of the law are adequate and I do not think the amendment will do anything. I think the appropriate structures for implementing the law exist.


David Samuel Horne MacDonald: Mr. Chairman, I do not wish to delay passage of the bill but it seems to me that we are now talking about one of the gut issues of this new department, to use the vernacular. I am, therefore, amazed to find the minister opposing something which would assist him. As to the argument put forward by the President of the Treasury Board on the setting up of these committees, I say to him that if what he says is correct, how is it that there has not been greater improvement in introducing the necessary kind of co-operation we envisage under this bill. As I see it, this is a lingering problem. The minister and his officials have considered this matter for nine months and have not formulated anything more specific than the vague phrase, "co-operation with other departments". There is nothing substantial in language like that. It says nothing to agencies and other departments of government that may be involved, and does not tell them they must co-operate with the minister. At least, that is my interpretation. As time goes on, I think the minister will discover that we have tried here to grapple with one of the basic issues confronting the department in its work and that we have not been successful in instituting the right kind of machinery.


Jean Marchand: I do not think the amendment will serve any purpose.


An hon. Member:: I cannot think of a better amendment.
Another hon. Member: Five o'clock.


Malcolm MacInnis: Mr. Chairman, may I say something-


Jean Marchand: Five o'clock.


Malcolm MacInnis: Did someone on the government side call it five o'clock?
March 21, 1969	COMMONS


Jean Marchand: Yes. We did. We called it five o'clock since we will not finish this bill today.


Malcolm MacInnis: I wanted to make a few remarks, Mr. Chairman.


James Aloysius McGrath: On a point of order, Mr. Chairman. I wanted to speak for about five minutes on the potential of the committee that is to be set up. Did the minister call it five o'clock?


Jean Marchand: Yes. That is what I did.


Albert Béchard: Order, please. The time being five o'clock it is my duty to rise, report progress and request leave of the house to sit again.
Progress reported.



MESSAGE FROM THE SENATE

The Acting Speaker (Mr. Bechard):: I have the honour to inform the house that a message has been received from the Senate informing this house that the Senate have passed Bill S-23, an act to amend the Canada Shipping Act, and Bill S-29, an act respecting the production and conservation of oil and gas in the Yukon Territory and the Northwest Territories, to which concurrence of this house is desired.
DEBATES	6991
Business of the House
[DOT] (5:30 p.m.)



BUSINESS OF THE HOUSE

Stanley Howard Knowles: Has
the President of the Treasury Board any amendments to make on the order of business for Monday?


Charles Mills (Bud) Drury: Mr. Speaker, on Monday I think, not having completed this bill today on its tenth day, as I understand, we will commence with the bill relating to amendments to the Superannuation Acts, Bill C-178, to be followed by item No. 62, an act respecting maritime freight rates. Following that we will take item No. 56, an act to amend the Financial Administration Act. Thereafter, the business will be as previously outlined by the President of the Privy Council for Monday. It is to be expected that Tuesday and Wednesday would be allotted days. With respect to the program for Thursday, I think the government house leader would want to consult about that again, having regard to progress made.


The Acting Speaker (Mr. Bechard):: It being after five o'clock, this house stands adjourned until Monday at two o'clock p.m.
At 5.34 p.m. the house adjourned, without question put, pursuant to standing order.

Monday, March 24, 1969



ROUTINE PROCEEDINGS


[Stage Direction]
Fourth report of Standing Committee on Broadcasting, Films and Assistance to the Arts-Mr. Reid.
[Stage Direction]
Fourteenth report of the standing committee on Finance, Trade and Economic Affairs, in French and English-Mr. Gaston Clermont (Gatineau).
[Editor's Note: Text of foregoing reports appears in today's Votes and Proceedings.]