1971-06-04

PRESENCE IN SPEAKER'S GALLERY OF PROVINCIAL SPEAKERS ATTENDING CANADIAN AREA COUNCIL MEETING OF COMMONWEALTH PARLIAMENTARY ASSOCIATION

Mr. Speaker:: I am delighted to bring to the attention of hon. members the presence in the Speaker's Gallery of a group of delegates attending the annual meeting of the Canadian Area Council of the Commonwealth Parliamentary Association.
At this moment in the gallery there are seven provincial Speakers. Later during the day it is expected that all of Canada's provincial Speakers will be in attendance, representing all of our Canadian Legislative Assemblies. On behalf of hon. members I extend to them a hearty welcome to the mother of Canadian Parliaments.


Some hon. Members:: Hear, hear!



ROUTINE PROCEEDINGS


[Stage Direction]
TRANSPORT AND COMMUNICATIONS [Translation]
Sixth report of Standing Committee on Transport and Communications, in the two official languages-Mr. Les-sard (LaSalle).

[Stage Direction]
Second report of the Special Committee on Election Expenses-Mr. Chappell.

[Stage Direction]
Third report of Standing Committee on External Affairs and National Defence, in the two official languages.-Mr. Lachance.
[Editor's Note: For text of above reports, see today's Votes and Proceedings.]


Hon. Ron Basford (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I have the honour to present the Prices and Incomes Commission report on the prices of oil refinery products, in the two official languages.



AUDITOR GENERAL


Mr. P. M. Mahoney (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I would like to table today, on behalf of the Minister of Finance, copies in both official languages of the report of the Auditor General to the House of Commons for the fiscal year ended March 31, 1970. The Financial Administration Act requires this report to be laid before the House on or before December 31 or, if Parliament is not then in session, within 15 days after the commencement of the next ensuing session. The Auditor General has asked that his apologies be extended to the House for the lateness of this report which was caused by circumstances beyond his control.



ANNOUNCEMENT OF SALE OF WHEAT TO SOVIET UNION

Hon. Olio E. Lang (Minister of Manpower and Immigration):: Mr. Speaker, I should like to report to the House upon an event which occurred about an hour ago and was witnessed by my colleague the Minister of Industry, Trade and Commerce (Mr. Pepin) and myself along with Mr. M. R. Kuzmin, First Deputy Minister of the Ministry of Foreign Trade of the Union of Soviet Socialist Republics. This was the signing of a contract between the Canadian Wheat Board and V/O Exportkhleb, the Soviet grain trading agency, for the sale of wheat to the Soviet Union totalling approximately 130 million bushels and valued at approximately $235 million. Delivery of the wheat will begin this month and continue throughout 1971 and 1972.
The sale involves two separate contracts. The first is for approximately 38.4 million bushels to be shipped during 1971, completing the outstanding portions of the agreement which was signed by the Canadian Wheat Board and V/O Exportkhleb on June 14, 1966. The second contract covers an additional sale of 2,220,000 metric tons, of which 970,000 metric tons will be shipped this year and the balance in 1972. Of the total quantity, 350,000 metric tons will be shipped in the form of flour.
In addition to this the buyer has the option to purchase a further 250,000 metric tons for shipment during the period May-July, 1972.
Shipment of the wheat will be made from both Pacific and eastern Canadian ports, with the buyer having the option to ship a portion from Churchill during the 1971 navigation season. Grades to be delivered during 1971 are Nos. 2, 3 and 4 Manitoba Northern and No. 1 Canada

June 4, 1971
Wheat Sale to Soviet Union Western Red Spring Wheat-13 per cent protein. The buyer also has the option of taking No. 3 and/or No. 4 Canada Western Amber Durum Wheat as part of the over-all purchase contract. This contract, of course, in taking up the balance of the outstanding contract and a new portion, carries out the comments made by Mr. Gromyko to the Minister of Industry, Trade and Commerce and myself a year ago and most recently repeated in the Soviet Union to the Prime Minister (Mr. Trudeau) that the Soviet Union would turn to Canada when they next needed wheat.


Mr. F. J. Bigg (Pembina):: Mr. Speaker, no news could be more welcome to Canada than news of the sale of wheat. I must say that there has been a big change since a sign, 12 feet long and eight feet high, was erected by the Liberal party in my district on the only occasion when any Prime Minister-I refer to Mr. Diefenbaker- has. ever visited the town of Westlock, saying that his major crime was the sale of wheat to Communist China. I am delighted that at last the present administration, whether it is on the road to Damascus or the road to Russia, is making sure that any breakthrough in international relations is followed up on each and every occasion.


Mr. David Lewis (York South):: Mr. Speaker, the same challenge which caused the Premier of Saskatchewan to ask for a postponement of the constitutional conference has robbed me this morning of all the wheat experts in my party in this House. I am therefore glad to rise as leader of this party to congratulate the Wheat Board on this sale and to express our pleasure, without any reservations, that it has taken place. I notice that no credit was given to the Prime Minister (Mr. Trudeau) for the sale as a result of his visit to Russia, perhaps in order to be consistent with the statement he made some time ago that it was not his business to sell wheat, and it was important not to break that record.
We are glad that this sale has taken place. I would merely add that there are other countries in the world which need Canadian wheat. The proposal we have made many times should be given consideration by the government, namely, that we should provide the developing countries that require wheat, flour and bread, and whose people are hungry with the necessary long-term credit so that they may buy our wheat, and thus improve the situation of Canadian farmers as well as feed the hungry people of the world.


Mr. Real Caoueiie (Temiscamingue):: Mr. Speaker, in my turn I wish to say that I am satisfied with that transaction which will certainly please the western wheat producers who will benefit from it. I think that similar transactions should be made with other countries which, as stated earlier by the hon. member for York South (Mr. Lewis), would need Canadian wheat.
This sale is made up of two separate contracts; one for the balance of 9 million tons of wheat which the Soviet Union had undertaken to buy in 1966 and the other for a new sale.
In addition, in his statement the minister pointed out and I quote:
As in previous contracts with the U.S.S.R., the terms of the sale call for payment in cash at the time of delivery.
Mr. Speaker, Russia will not pay us in Canadian dollars or rubles, but in gold ingots at world market prices of $35 an ounce, when it costs $16 an ounce to produce. It means that the price paid will in fact be half of what the farmers expect to get.
I wanted to point that out to the government and at the same time to congratulate it on this successful deal.



ORAL QUESTION PERIOD


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Prime Minister. In consideration of the statement made yesterday by Prime Minister Davis of Ontario that he intends to bring forcefully to the attention of the federal government at the Victoria constitutional conference his province's concern over federal policies which create economic hardship, can the Prime Minister now tell the House if Mr. Davis has indicated the specific economic areas he would like to discuss? If so, what are they?


Right Hon. P. E. Trudeau (Prime Minister):: No, Mr. Speaker. I must confess I am not aware of what Mr. Davis had in mind. The House will recall that he requested some time ago that an additional day be added to the constitutional conference to discuss economic matters. However, since the federal budget and tax reform will be brought down after the conference, it is my understanding that he has now suggested that this additional day be not added to the conference and that economic matters, particularly those relating to the budget, be discussed some time later, presumably at a finance ministers meeting in the month of July.


William Gordon Ritchie: A supplementary question, Mr. Speaker. As the Quebec Minister of Welfare, Mr. Castonguay, has suggested that Ottawa's policies are the cause of Quebec's poverty, has that province indicated to the Prime Minister the areas of economic policy which it wishes to be discussed at Victoria?


Pierre Elliott Trudeau: No, Mr. Speaker. That seems like a very general statement, such as the opposition often makes.



CONSULTATION WITH PROVINCES ON PENDING TAX CHANGES

William Gordon Ritchie: Mr. Speaker, have the provinces indicated to the federal government that they

June 4, 1971

are satisfied with the consultations that have taken place up to the present time on the pending tax changes?


Pierre Elliott Trudeau: Mr. Speaker, the provinces do not know any more than the opposition knows about what the tax changes will be which are to be announced in the budget and therefore the provinces cannot fairly comment on something they do not know about. They are being asked to comment at the meeting of finance ministers later.



INDUSTRY


David Lewis: I have a question for the Prime Minister. Will the Prime Minister inform the House whether the provincial government of Ontario has asked the federal government to give some assistance, together with the province of Ontario, to the publishing house of McClelland and Stewart and has the federal government refused to participate in such assistance, as I am informed the premier of Ontario announced in the legislature this morning?


Pierre Elliott Trudeau: I did not
see that announcement, Mr. Speaker, and I am not in a position to contradict it. I know the Secretary of State brought the matter to the federal cabinet some time ago and that we discussed it and a decision was taken. This decision was to be communicated to the Ontario authorities by the Secretary of State. I would prefer to have the Secretary of State say exactly what he communicated to them rather than comment on it myself.


David Lewis: A supplementary question. In view of the fact that the Prime Minister has informed the House that the matter was brought to cabinet and that a decision was taken by the government, surely as Prime Minister he is able to inform the House. Will he be good enough to say whether the decision of the federal government was to participate in assistance to McClelland and Stewart or not?


Pierre Elliott Trudeau: The decision was that the Secretary of State should communicate some information to the Ontario cabinet.


David Lewis: On a point of order, Mr. Speaker, if the Prime Minister had made no answer to my question that, of course, would be his right. However, I suggest that when the Prime Minister says the government has taken a position on the matter and as the matter was discussed and I have brought it to his attention, surely it is his duty to inform the House what the decision was of sloughing off the question.


Mr. Speaker:: Order, please. I suggest to the hon. member that is hardly a point of order. It is debate
Inquiries of the Ministry
between the right hon. gentlemen and the member for York South.


David Lewis: May I rise on-


Mr. Speaker:: Does the hon. member wish to rephrase the question?


David Lewis: I want to ask the Prime Minister whether the following statement which is reported to have been made by the Secretary of State some time ago was government policy, namely, that publishers in need of working capital should be able to borrow under special terms and conditions and that it is the role of the provincial and federal governments to assist such industries which are essential for the country and which cannot survive on their own resources. I ask the Prime Minister whether this statement by the Secretary of State was government policy and, if so, did the government agree to participate in assistance to McClelland and Stewart as a result of that policy?


Pierre Elliott Trudeau: Mr. Speaker, I was trying to be helpful to the member and forthcoming to the House in saying it had been discussed in cabinet, but I see it would have been simpler to have just taken notice of the question and said that the Secretary of State will answer the question when he is present.



ACTION TO INCREASE SALE OF MANUFACTURED PRODUCTS TO JAPAN-SURVEY OF POTENTIAL MARKETS

['In view of increased reports of shortages of medical supplies needed to combat epidemics rampant among the East Pakistan refugees, I should like to ask the Acting Secretary of State for External Affairs whether Canada has received a request from any country or international relief agency for emergency supplies? If not, has Canada offered such assistance to this unfortunate part of the Commonwealth?']
Hon. George Hees (Prince Edward-Hasiings):: I have a question for the Minister of Industry, Trade and Commerce. In view of the statement yesterday in Vancouver by the chairman of Mitsubishi Corporation, Japan's largest trading company, that Canadian businessmen have not been aggressive enough in trying to sell in Japan and if they would expend just a little more effort they would probably be amazed at the results, will the minister take the first opportunity on motions to outline to the House what steps his department is willing to take in the immediate future to send additional trade missions of Canadian businessmen to the Japanese market, over and above anything that has been done in the past or is being done now, so that we may take full advantage of opportunities to sell, in particular, labour-intensive manufactured products in that market?
Hon. Jean-Luc Pepin (Minister of Industry, Trade and
Commerce): Hon. members will observe, Mr. Speaker, that the remark was made about Canadian businessmen, not about the Canadian government. If I were to deliver a statement each time my friend asked me for one, I would be on my feet almost every day. I will gladly write to the hon. member to give him a better idea than he already has of the efforts made by the Canadian government to develop trade with Japan.

June 4, 1971
Inquiries of the Ministry
Mr. Heesr When the minister is making the statement in the House I have asked him to make for the information of all hon. members, will he also outline the steps he is willing to take to arrange for an immediate survey by his department of all traditional and potential markets throughout the world to make sure we are not missing out on important potential sales in other parts of the world as we are obviously missing out in Japan?


Mr. Pepin:: There was a good example this morning of the sales the Canadian government has encouraged and is making. I believe that a growth factor of 13 per cent last year on exports is a good indication of the efforts that are being made.
This point raised by that Japanese businessman about the activities of Canadian businessmen in Japan is debatable. If you look at the increase in exports to Japan in the last year-


Mr. Speaker:: Order, please. I regret to interrupt the minister but I suggest we are now embarking upon a debate between the minister and the hon. member. Perhaps we might return to the hon. member for Prince Edward-Hastings in a short while if he wishes to pursue the matter further. In the meantime, the Chair will recognize the hon. member for Hillsborough.



Mr. Heath Macquarrie (Hillsborough):: I have a question for the Minister of National Defence. Noting that the United States is sending four large military transports to assist in the movement of refugees from Pakistan, now in India, could the minister tell us whether any request for similar assistance has come to the government of Canada and whether the government is looking with favour upon the granting of such aid?
Hon. Donald S. Macdonald (Minister of National
Defence): I would have to confirm this, but at the moment I do not believe we have received a specific request for material assistance such as could be provided by Air Transport Command. As the hon. member will recall, the command was of some assistance in East Pakistan earlier this year, and of course we stand ready to provide as much assistance as we can should there be such a request made.


Heath Nelson Macquarrie: I direct this question to the Prime Minister. Noting, also, that the United States is increasing substantially its financial aid in connection with these refugees, may I ask whether the government of Canada is giving consideration to granting more assistance to these suffering people?


Pierre Elliott Trudeau: The matter will be discussed when the Secretary of State for External Affairs comes back from his conference in Europe.


Mr. Stanley Haidasz (Parkdale):: In view of increased reports of shortages of medical supplies needed to combat epidemics rampant among the East Pakistan refugees, I should like to ask the Acting Secretary of State for External Affairs whether Canada has received a request from any country or international relief agency for emergency supplies? If not, has Canada offered such assistance to this unfortunate part of the Commonwealth?



URBAN AFFAIRS


Mr. Andrew Brewin (Greenwood):: I address my question to the Minister without Portfolio responsible for urban affairs. I should like to ask whether, in light of the historic decision of the government of Ontario to transfer its financial support to public transportation from the building of expressways, the government of Canada will review its policies in the field of urban transportation and undertake to give financial support for the building of rapid transport facilities in lieu of expressways and thus encourage a form of transportation more sensitive to the real needs of the people living in urban areas?


Mr. Speaker:: I suggest to the hon. member that the question is perhaps more than that. It seems to me it is a suggestion or proposal he is making to the government. However, the minister responsible for this part of the administration might like to reply.


Hon. Robert K. Andras (Minister without Portfolio):: think I have answered similar questions before. I shall simply say I will give every consideration to the hon. member's representation.



RESEARCH


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a related question to the President of the Treasury Board in his capacity as minister responsible for science matters. In light of the historic announcement from Queen's Park yesterday, can the minister say whether the federal government has considered appropriating sufficient funds for massive research into the possibility of getting rid of internal combustion engines on our highways before they get rid of us?


Hon. C. M. Drury (President of the Treasury Board):: There is already a considerable effort going into seeking satisfactory alternatives to the present gasoline-powered internal combustion engine, either by using other sources of energy than gasoline or by not using an internal combustion engine at all. This question is being dealt with by a number of departments but there will, of course, be a special interest shown by the new department of the environment.

June 4, 1971



PRINTING OF WARNING OF DANGER TO HEALTH ON CIGARETTE PACKAGES

Mr. Oza Tetraull (Villeneuve):: Mr. Speaker, I would have addressed my question to the Minister of National Health and Welfare but in his absence I direct it to his parliamentary secretary. Following government pressure in Great Britain, tobacco manufacturers agreed to print "Smoking can damage your health" warnings on cigarette packages. Can the minister say if Canadian manufacturers were approached to have a warning printed on each package of cigarettes sold in Canada?


Patrick Morgan Mahoney: Mr. Speaker, I will take notice of the question on behalf of the minister.



URBAN AFFAIRS


Hon. J. A. MacLean (Malpeque):: Mr. Speaker, I should like to ask the President of the Treasury Board a question which is supplementary to the one to which he has just replied. Have there been any discussions between the federal government and the provinces, or any requests made by the provinces, regarding research into a logical way of controlling and planning city growth so that commuting by automobile on costly highways to and from suburbs will not be necessary in the future?


Charles Mills (Bud) Drury: Mr. Speaker, this is perhaps a special part of the consideration of the whole environmental problem being given by the minister responsible for urban affairs and Central Mortgage and Housing Corporation. This is a field of sociological research into which considerably more effort has been put in recent years than in the past, but I think we are still some distance from finding the answers.



INQUIRY OF THE MINISTRY

Mr. Craig Stewart (Marquette):: Mr. Speaker, I should like to direct my question to the Prime Minister. Following the speech in Alberta yesterday by the Minister of Energy, Mines and Resources, has the Prime Minister issued a directive that all speeches of cabinet ministers be submitted to his office so as to make sure there is nothing anti-American or anti-Russian in their content?


Mr. Speaker:: Order, please. The hon. member will realize that the question asked in those terms is not in order.
Inquiries of the Ministry



FEDERAL-PROVINCIAL CONFERENCE TRANSFER TO PROVINCES OF JURISDICTION OVER SOCIAL SECURITY-REQUEST FOR STATEMENT BY PRIME MINISTER

Mr. Roch La Salle (Jolielle):: Mr. Speaker, I would like to ask the Prime Minister a question.
Regarding a question I asked yesterday, would the Prime Minister make a statement on motions before the Victoria Conference about the suggestions of the Caston-guay report on the distribution of powers over social security?


Pierre Elliott Trudeau: No, Mr. Speaker.


Mr. Thomas M. Bell (Saint John-Lancasler):: Mr. Speaker, I have a supplementary question regarding the conference. Will the Prime Minister be making an effort to talk to Premier Davis before the conference in the same way as he talked to Premier Bourassa so as to try to get some of Ontario's ideas ironed out?


Pierre Elliott Trudeau: Mr. Speaker, I will do my best to iron out any Tory ideas in Ontario, but it is very difficult.



POLLUTION


Mr. Louis-Roland Comeau (South Western Nova):: Mr. Speaker, on Tuesday I asked a question of the Minister of Transport, which was taken as notice, with regard to the motor vessel Trans Pacific which was aground off St. Pierre Island and was posing a threat to our shores. I am wondering what action the department has taken in regard to preventing any threat to our shores from oil pollution?


Mr. Gerard Duquet (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, the latest information on the status of the Trans Pacific is that there is no longer any pollution threat because the cargo was salvaged a number_of days ago.



PENITENTIARIES


Mr. Arnold Peters (Timiskaming):: Mr. Speaker, 1 should like to ask the Solicitor General whether he has a report to make on the riot that is reported to have taken place in Collins Bay penitentiary on Monday of this week. May I also ask the minister whether it is now the intention of the department to use the Ontario Provincial Police or the provincial police in other provinces every time there is a disturbance at a federal penitentiary?

June 4, 1971
Inquiries of the Ministry


Hon. Jean-Pierre Goyer (Solicitor General):: Mr. Speaker, a convict at Collins Bay has actually hit a guard. Since that constitutes an assault, we have asked the Ontario Provincial Police to investigate. I think that the best way to discover the truth is to use inside penitentiaries those agencies which make investigations outside them.



THE CANADIAN ECONOMY


David Réal Caouette: Mr. Speaker, I would like to put a question to the Prime Minister.
The former Minister of Communications stated in St. Johns, Newfoundland, I believe it was yesterday, that there would be a resurgence of inflation in 1973-74. Was the former minister, who is still a Liberal member, then reflecting the government's opinion?


Mr. Speaker:: Order, please. The hon. member knows that this question is out of order. The statement was made by a former minister, and not by a current minister. This is why the question cannot be asked in the terms used by the hon. member for Temiscamingue.


David Réal Caouette: With your permission, Mr. Speaker, I would like to ask the government and not the former minister a supplementary question which is quite relevant.
Is the Prime Minister considering calling a general election before inflation recurs?


Pierre Elliott Trudeau: This would be quite a good idea, Mr. Speaker.



INFORMATION CANADA


Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Minister of Consumer and Corporate Affairs and arises from an answer given by the Prime Minister to a question asked yesterday by the hon. member for Red Deer. In view of the fact that the Prime Minister stated that no comprehensive security report was prepared for cabinet use on the director of Information Canada, in order to clarify some correspondence received from the minister's office, especially in view of his penchant for credibility in advertising and many other things, could the minister explain to which comprehensive report he was referring in letters dealing with this matter to constituents in his riding?


Stanley Ronald Basford: Mr. Speaker, the letter to which I think the hon. member refers was intended to indicate that security
procedures had been followed in this case, which is the information that the Prime Minister gave the House over a year ago.


Mr, Nowlan:: Is it fair to assume from the minister's answer that the specific statement in the letter that "a comprehensive report was drawn up for the use of cabinet only" is incorrect?


Stanley Ronald Basford: No, Mr. Speaker.


Mr. Speaker:: Order, please.



NATIONAL DEFENCE


Mr. Jack Marshall (Humber-St. George's-Sl. Barbe):: Mr. Speaker, my question is for the Minister of National Defence. Can the minister advise the House whether the quotas under the student militia training program have now been reached?


Hon. Donald S. Macdonald (Minister of National Defence):: I will take that question as notice, Mr. Speaker.


Jack Marshall: A supplementary question, Mr. Speaker. As the minister is taking notice of the question, would he investigate the reason why, despite an expansion of the program from 5,000 to 8,000, some provinces' quotas have been seriously reduced, and would the minister also investigate why some courses have been cut out or cancelled at armouries where applications had already been made?



FISHERIES


Mr. Thomas S. Barneif (Comox-Alberni):: Mr. Speaker, I wonder whether the Prime Minister might be able to give me an answer today to the question I asked him on June 1 arising from the refusal of the United States coastguard to admit Canadian fishing vessels to ports in the state of Washington, and what action the government might take in light of this situation?


Pierre Elliott Trudeau: Mr. Speaker, I remember referring this question to, I believe, the Secretary of State for External Affairs. This is not a day on which the department is answering in the House, but I understand that there is a minister to my left who is able to supply an answer to this question.
Hon. Jean-Luc Pepin (Minisler of Industry, Trade and
Commerce): Mr. Speaker, I understand that an investigation is being carried out into that subject. The Secretary of State for External Affairs wants to remark, however, that there is no contractual obligation with respect to this situation, that the whole matter is dealt with under cus-

June 4, 1971

tomary international law, not written law. If there are reasons to believe that injury was done to international law in this case, the Secretary of State for External Affairs is willing to discuss the matter with the United States government.



POLLUTION


Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I
have a question for the Minister of Fisheries and Forestry but in his absence I will direct it to the right hon. Prime Minister. In view of the concern over pollution, will Parliament be given an opportunity to debate proposals concerning a possible Canada-United States clean-up agreement for the lower section of the Great Lakes?


Pierre Elliott Trudeau: Mr. Speaker, I believe there is a meeting on the tenth of this month which will be attended by a Canadian minister. When he returns I will consult with him on the opportunity of making a statement to the House.


George Harris Hees: Mr. Speaker, I have a supplementary question. May I ask the Prime Minister whether he has looked out of his bedroom window since he got back and noticed the massive pollution in the Ottawa River-


Mr. Speaker:: Order, please.


George Harris Hees: -as an example of the fact that the government is doing nothing across the country to deal with pollution?


Mr. Speaker:: Order, please. I am sure the hon. member has seen the light and will recognize that he is out of order.



CANADIAN NATIONAL RAILWAYS


Mr. Albert Bechard (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, my question was for the Minister of Transport but, in his absence, I will direct it to his Parliamentary Secretary. In view of the fact that our seats are not very far apart, I dare hope that my question will reach the minister very quickly.
Is it the intention of the Minister of Transport to urge the Canadian National Railways authorities to stop making things difficult for the public and to give up the idea of closing their office at 70 Sparks Street whose services are absolutely necessary?


Mr. Speaker:: The hon. member has put his question. He is making a suggestion or representations to his colleague and obviously, the Parliamentary Secretary's colleague has taken note of them.

Inquiries of the Ministry CONSUMER AFFAIRS



OIL COMPANY PRICE INCREASES-ACTION RESPECTING ALLEGED EXCESS PROFITS

Mr. Max Saltsman (Waterloo):: Mr. Speaker, I should like to direct my question to the Minister of Consumer and Corporate Affairs. It is in connection with the report he tabled today from the Prices and Incomes Commission which indicates that Imperial Oil, Shell Canada, Texaco and Sun Oil increased their prices in a manner which resulted in revenues increasing to a greater extent than costs, and that the commission has met with these companies in an attempt to convince them to take remedial action but has not been successful and has therefore brought this matter to the minister's attention. May I ask the minister what action he intends to take in the face of this excessive profit-taking by the oil companies?


Stanley Ronald Basford: As indicated in the report, the amounts involved were generally small in relation to the total revenue. Nevertheless, I certainly regret that the companies were unwilling, apparently, to take any sort of compensatory action. As a result we are examining a number of alternatives that arise from the report and which will be announced in due course.


Max Saltsman: Can the minister say whether one of the things he is examining is the report of the Alberta government made to the minister in 1969 which recommended that the government intervene in order to restore freedom of enterprise to service station operators? Is he considering taking action as recommended by Alberta?


Stanley Ronald Basford: I have already indicated that that report and a similar one from British Columbia and also one from Nova Scotia are being considered by me in terms of revising the Combines Investigation Act.



STEEL PRICE INCREASES-INVESTIGATION BY PRICES AND INCOMES COMMISSION

[Stage Direction]
Mrs. Grace Maclnnis (Vancouver-Kingsway)r I have a supplementary question for the Minister of Consumer and Corporate Affairs. In view of the fact that Dofasco estimates that its latest price increases will add about $10.50 to the steel cost of a family car, 62 cents to the steel cost of a refrigerator and 64 cents to the cost of a stove, has the minister asked the Prices and Incomes Commission to investigate this inflationary price rise, or could he tell the House what effective action he plans to take to deal with it?
Hon. Ron Basford (Minister of Consumer and Corporate
Affairs): The effective action is the first course of action the hon. member suggested.

Mr. James A. McGrath (St. John's East):: Mr. Speaker, perhaps my question is more of a related question. Will the Minister of Consumer and Corporate Affairs under-

June 4, 1971
Inquiries of the Ministry
take to refer to the Prices and Incomes Commission the extravagant increases in fares imposed by Canadian National on the gulf ferries between Newfoundland and Nova Scotia?


Stanley Ronald Basford: That question has already been asked of my colleague, the Minister of Transport, and has been dealt with in the House.


James Aloysius McGrath: May I point out with great respect that the question was not put to the minister. I again ask the Minister of Consumer and Corporate Affairs, who is responsible for the Prices and Incomes Commission, if he will refer the extravagant increases by the CNR which average about 80 per cent on the gulf ferries between Newfoundland and Nova Scotia to the Prices and Incomes Commission?


Stanley Ronald Basford: I believe that the Prices and Incomes Commission is examining these fare increases but I believe, although I may be wrong, that these questions were also asked of the Minister of Transport who reports to the House for the CNR relative to fare increases and that answers were given at that time.


James Aloysius McGrath: I rise on a point of order, Mr. Speaker.


Mr. Speaker:: The hon. member rises on a point of order. We will have to go on to another question after the hon. member has indicated what his point of order is.


James Aloysius McGrath: My point of order is to set the record straight. The Minister of Transport left on an official trip to Europe the day before the increases were announced by the CNR.


Gérard Duquet: I also rise on a point of order, Mr. Speaker. I answered that question last Wednesday.


An hon. Member:: What did you say?



INDUSTRY


Mr. Edward Broadbent (Oshawa-Whitby):: I have a question for the Minister of Industry, Trade and Commerce concerning the auto pact. Assuming that the minister has read the auto pact since the bizarre answer he gave the hon. member for Windsor-Walkerville the other day, can the minister inform the House whether or not the government has in recent months approached the United States government and the automotive companies with a view to improving the conditions for Canadians which currently exist in the auto agreements between Canada and the United States?


Jean-Luc Pepin: There has been a constant flow of conversations between the-I see by the face of the hon. member

or by the noise made by him that he does not agree with what I am about to say. I wonder why he does not agree.


George Harris Hees: Just give the answer.


Jean-Luc Pepin: I repeat then that there has been a constant-


James Aloysius McGrath: You are not supposed to lip read.


Jean-Luc Pepin: I was saying very politely that there has been a constant flow of conversation between the governments of Canada and the United States on the subject of the auto pact in the last months, and the industry has been made aware of those conversations by myself.


John Edward Broadbent: I do not doubt that there has been a constant flow of conversation. What I am interested in is whether there have been any results that the minister can report to the House.


Jean-Luc Pepin: When results are reached I will communicate them to the House in a very polite way.



FINANCE


Mr.  R. Gordon L. Fairwealher@Fundy-Royal: I have a polite question for the Prime Minister. In view of the concern, referred to in the New York Times this week, of the international development section of the World Bank about soft loan pledges for third world countries, will the Prime Minister reassure us that Canada's pledge of $50 million is unaffected by the hold-up of the foreign aid bill in the United States? Second, to prevent a supplementary question, would the Prime Minister ask the Minister of Finance if he would be agreeable to making a statement on motions on this whole matter which is of some concern to the countries involved?


Pierre Elliott Trudeau: I think this is the type of polite question which the Minister of Finance would be able to answer it asked of him. I am not aware of any change in the government's plans as a general proposition, but I must say that the fact that a bill might be held up in Congress does not seem to me to be a sufficient reason for Canada to change its aid plans.



FORECAST OF TOTAL WHEAT SALES THIS YEAR

Mr. Jack Murla (Lisgar):: My question is directed to the minister responsible for the Wheat Board. In view of his announcement this morning of the sale to Russia, which is the first announcement of a wheat sale of any consequence for a considerable period of time, I should like to ask him whether other wheat sales are being contemplat-
June 4, 1971

ed to bring the total of wheat export sales this year up to the 500 million bushel figure that he has been quoted as expecting?


Otto Emil Lang: Mr. Speaker, there have been constant reports of sales of wheat, for instance, not long ago to Brazil, and so on, and there is every prospect still that our exports for this year will hit record levels. Of course the sale announced this morning, like some of the other sales, relates particularly to the next crop year and so begins to lay the foundation for a very rapid movement of grain into the next crop year as well.


Jack Burnett Murta: Can the minister inform the House what total wheat sales are up to this point for this crop year?


Otto Emil Lang: Mr. Speaker, it is not customary to be too precise about the sales figures, but I did indicate in answer to a question this morning that the likely total export sale of wheat for the 1970-71 crop year, which ends on July 31, will be within the range of 430 million bushels to 470 million bushels.



APPROXIMATE PRICE OF WHEAT SOLD TO RUSSIA

Mr. R. R. Southam (Qu'Appelle-Moose Mountain):: Mr. Speaker, I wish to direct a supplementary question to the minister responsible for the Canadian Wheat Board. It refers to his statement earlier this morning with respect to the large sale of wheat to Russia. Can the minister indicate what the approximate price in this sale was, and if the wheat was in fact sold at a price per bushel that would compensate the Canadian wheat producer?


Otto Emil Lang: Well, Mr. Speaker, the exact selling price is also confidential information between buyer and seller. However, recent Wheat Board listed prices have been in ranges which have been approximately at the minimums under the International Grains Arrangement.



STATISTICAL BREAKDOWN OF PRODUCTS EXPORTED- REASON FOR DELAY IN PRODUCTION OF REPORT

Jean-Luc Pepin: Mr. Speaker, I was asked a question yesterday by the very energetic and distinguished member for Prince Edward-Hastings-


Some hon. Members:: Oh, oh!


George Harris Hees: I cannot help but agree with that.


Jean-Luc Pepin: -about the monthly breakdown of exports, and the information it usually provides on the degree of fabrication of exports. I have inquired, and I presume that a number of people in DBS have stayed up overnight. The explanation is that computer programming is encountering scheduling difficulties, for the first time in recent history of this set of statistics.
Inquiries of the Ministry


Some hon. Members:: Oh, oh!


Jean-Luc Pepin: However, DBS officials having worked overnight I have some preliminary statistics, subject to further auditing and possible revision.


George Harris Hees: Which I am sure they will get.


Jean-Luc Pepin: These statistics, which I am very keen to show to the hon. member, show that preliminary tabulations of the data indicate that the proportion of end products to total domestic exports was higher in April, 1971 than in April, 1970, and the same is true for the first quarter of 1971 compared with the first quarter of 1970. So I know the hon. member will be delighted to receive this information.



INDUSTRY


Jean-Luc Pepin: I also want to reply to the hon. member for Saint-Hyacinthe who inquired from me yesterday about Bruck Mills Limited, in Montreal, which would be on the eve of shutting down their plant.
He is right about the main point only. One hundred and thirty-five employees and not 250 are involved. Some of them will be hired by a research and development laboratory which is being built by the company in Montreal. Others will obtain employment in the same sector-knitting-in the Montreal area and the company points out that it will hire another 250 employees in the Sherbrooke area.


Mr. Speaker:: The hon. member for Gander-Twillin-gate.


George Harris Hees: On a supplementary-


Mr. Speaker:: Order. We are running short of time. 1 would suggest that the matter might be pursued at the next sitting of the House. For the moment the Chair has recognized the hon. member for Gander-Twillingate.



PRICES AND INCOMES COMMISSION


Mr. John Lundrigan (Gander-Twillingale):: Mr. Speaker, I would not object to the hon. member responding to that statement on motions, but in any event I have a question for the Minister of Consumer and Corporate Affairs. I would like to know if there has been a special meeting recently between himself and the chairman of the Prices and Incomes Commission, and if the discussion involved the continuation beyond December, 1971, of the legislative position of the Prices and Incomes Commission?

June 4, 1971
Inquiries of the Ministry


Stanley Ronald Basford: Mr. Speaker, I am not sure what the hon. member means by a special meeting. We talk about matters quite regularly and constantly, and there is no such thing as a special meeting.


John Howard Lundrigan: Mr. Speaker, may I have an answer to this question-


George Harris Hees: On a point of order-


Mr. Speaker:: The hon. member rises on a point of order.


George Harris Hees: Mr. Speaker, you have pointed out quite rightly to the members of the House how a great deal of time is wasted in dissertations between ministers and members, just as we have had this morning, but may I point out that this is because the Minister of Consumer and Corporate Affairs and many others simply refuse to give straight answers and we have to keep pounding at them in order to try to get some kind of answer out of them.


Mr. Speaker:: 

POLLUTION


Mr. Robert C. Coates (Cumberland-Colchester North):: Mr. Speaker, I wish to direct a question to the Minister of Energy, Mines and Resources. Is he in a position to report to the House on what progress is being made in extinguishing the mine dump fire at Springhill, Nova Scotia, following his meeting with the Minister of Mines from Nova Scotia regarding this matter?


Hon. J. J. Greene (Minister of Energy, Mines and Resources):: Mr. Speaker, I have not been brought up to date in the last day or two on this question, but I will be glad to take it as notice and report to the hon. member.


Mr. Speaker:: I believe the hon. member for Marquette has a supplementary to a previous question, and he will be recognized now.



WHEAT-ASSURANCE THAT PRICE IN SALE TO RUSSIA NOT BELOW COST OF PRODUCTION

Donald Craig Stewart: Mr. speaker, my question is directed to the minister who reports for the Canadian Wheat Board. Can the minister assure the House that the wheat sale to Russia was not made at below production costs to western farmers, as has been the case with barley sales recently?


Otto Emil Lang: Mr. Speaker, I take issue with the hon. member's statement that barley sales recently have been made below the cost of production. In answer to a question a moment ago I said that the actual prices are not revealed but that the most recent prices being quoted by the Wheat Board are public knowledge, and the hon. member can draw his own conclusions.
4s *	*



HOUSING


Mr. John Gilbert (Broadview):: Mr. Speaker, I wish to direct a question to the minister in charge of housing. When will he be meeting with his provincial counterparts to discuss the implementation of the public housing guidelines which were issued by him about a year ago?


Robert Knight Andras: Mr. Speaker, there have been several meetings since that public housing guidelines statement was issued. There has been considerable progress toward implementing many of the suggestions we made at the federal level. Some have not been accepted by the provincial governments. This is a matter of constant discussion between the provincial housing authorities and CMHC.



TRANSPORT


Jack Marshall: Mr. Speaker, I wish to direct a question to the Parliamentary Secretary to the Minister of Transport. In view of the serious cost to the economy of the Atlantic provinces as a result of the increased CNR ferry rates, would the parliamentary secretary bring all the grievances and protestations already made to the minister's attention and ask him to make a statement on motions when he returns to the House?


Gérard Duquet: Mr. Speaker, I would again like to repeat that the increase in ferry rates does not contravene the terms of union with the province of Newfoundland which refer to the movement of freight. The increase was made after a very close study of the matter. Further, the minister will be in the House on Tuesday and he will certainly be glad to answer any questions put by hon. members.


Jack Marshall: On a point of order, Mr. Speaker, the parliamentary secretary has not answered the question. It has nothing to do with rail freight rates. It has to do with ferry rate increases between the provinces of Nova Scotia and Newfoundland.

June 4, 1971



INDUSTRY


Max Saltsman: Mr. Speaker, I would like to direct a question to the Minister of Consumer and Corporate Affairs. It is in connection with the letter sent to the minister from Micro Drug Company. Was that request for assistance met by his department, and what was the conclusion of his department's investigation into the situation of Micro Drug?


Stanley Ronald Basford: Mr. Speaker, I am not sure to which letter the hon. member refers. If it was a request by Micro Chemicals because of certain difficulties they were having, that letter has been responded to and the matter of financing Micro under the PIDA program was referred to my colleague, the Minister of Industry, Trade and Commerce, who has been answering questions on the subject in the House. He and his officials are examining whether Micro Chemicals would be eligible for a loan under the PIDA program.


Mr. Speaker:: Orders of the day.


James Aloysius McGrath: On a question of privilege, Mr. Speaker, the Parliamentary Secretary to the Minister of Transport interjected on a point of order during the question I directed to the Minister of Consumer and Corporate Affairs to say he had already responded or replied to my question, which was to ask the Minister of Consumer and Corporate Affairs to refer to the Prices and Incomes Commission the inflationary and extravagant increases by CNR in the ferry rates. Upon examination of Hansard I find that the parliamentary secretary did not respond to this question, and I suggest to the hon. member that he should get his facts straight before he interjects in that way.
noon)



GOVERNMENT ORDERS


[Stage Direction]
The House proceeded to the consideration of Bill C-219, to establish the Canada Development Corporation, as reported (with amendments) from the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Speaker:: Order, please. Before the motions are called in connection with the consideration of Bill C-219, an act to establish the Canada Development Corporation, the Chair might be allowed to make some suggestions about the way in which these motions might be considered.
The first suggestion I should like to make is that motions Nos. 1 and 2 be proposed together to the House,
Canada Development Corporation that they be debated as a single question and that if there is a negative vote on motion No. 1, that vote will also dispose of motion No. 2; second, that motions Nos. 3. 4 and 5 might be grouped for the purpose of debate and should there be a negative vote on motion No. 3, that vote will also dispose of motions Nos. 4 and 5; third, motions Nos. 6 and 7 could be grouped for joint consideration and here again a negative vote on motion No. 6 would dispose of motion No. 7; fourth, motion No. 8 might be considered and disposed of separately. Motions Nos. 9 and 10 could be grouped for the purposes of debate but a negative vote on motion No. 9 should dispose also of motion No. 10.
I suggest to the House that motion No. 11 might well be defective in that it would appear to go outside the scope of Bill C-219 in attempting to amend the Senate and House of Commons Act. This motion is submitted to the consideration of the House by the hon. member for Cochrane (Mr. Stewart). However, before making a decision in that regard the Chair is prepared to hear argument when the motion is called for consideration in due course. Lastly, it is suggested that motion No. 12 be considered and disposed of separately.
If the suggestions of the Chair are acceptable to hon. members, the Chair is prepared at this time to put mot'on No. 1 and motion No. 2 to the House. Before doing so I should be pleased to hear the suggestions, comments or advice of hon. members.


Mr. Lambert (Edmonton West):: Mr. Speaker, I was looking at the grouping proposed by Your Honour and I find some difficulty in establishing the relationship between motions Nos. 9 and 10. Motion No. 10, relating to clause 39, deals with the acquisition of shares, in whole or in part, of certain Crown corporations whereas motion No. 9 deals with an entirely different clause and an entirely different matter. I find it somewhat difficult to see-


Mr. Speaker:: Order, please. The hon. member does not have to argue the matter too strenuously. As I indicated I am quite prepared to make changes. It is sometimes not too easy for the Chair to interpret some of the motions proposed by hon. members. When an argument as logical as the one just made by the hon. member for Edmonton West (Mr. Lambert) is submitted for the consideration of the Chair, I have no hesitation in accepting the suggestion and motions Nos. 9 and 10 will be considered separately.
Hon. members know that suggestions made by the Chair are just for the convenience of the House. If hon. members take exception to the situation for serious reasons, there is no difficulty in agreeing with hon. members who make such suggestions. I would, therefore, agree that motions Nos. 9 and 10 be considered separately.


Stanley Howard Knowles: Mr. Speaker, if I may comment on the ruling you have made with respect to the 11 motions that have been submitted by members of this group, I may say that the suggestions you have made, taking into account the amendment pro-

June 4, 1971
Canada Development Corporation
posed by the hon. member for Edmonton West (Mr. Lambert), are quite agreeable to us. In other words, there will be seven different proposals, seven different debates and perhaps seven different votes. The only comment I would like to add is that in those cases where Your Honour said if there was a negative vote it would take care of other motions, I suppose it follows that if there is an affirmative vote in some of these cases then we will reassess the situation.


Mr. Speaker:: The hon. member's suggestion is hypothetical, but it would be considered if there were an affirmative vote. I note the hon. member's suggestion that a negative vote indicating that certa n matters would be done is equally hypothetical. I had in the back of my mind that perhaps one was just a little more hypothetical than the other.


Patrick Morgan Mahoney: Mr. Speaker, I certainly agree with the suggestion of the hon. member for Edmonton West (Mr. Lambert) that Nos. 9 and 10 be separated. However, it seems to me that amendment No. 9 is consistent with Nos. 1 and 2 in that it is basically directed at making the Canada Development Corporation a Crown corporation and taking it out of the private sector. Some consideration could properly be given to including motion No. 9 with Nos. 1 and 2.


Mr. Speaker:: That might be complicated. I suggest to hon. members that if we try to change this grouping too much we will be here for two days trying to make new groupings and new regroupings. I am not suggesting that the proposal made by the hon. parliamentary secretary is not logical, but in view of the fact that the suggestion has been made now that Nos. 1 and 2 be considered together and that we are prepared to proceed with them, I suggest we do this unless there is unanimous agreement that No. 9 be taken with Nos. 1 and 2.


Stanley Howard Knowles: No.


Mr. Speaker:: There is obviously no such agreement. I would hope that hon. members would agree with the suggestions made by the Chair at this time. We will now call motions Nos. 1 and 2.


Some hon. Members:: Agreed.


Max Saltsman: I move:
That BiH C-219, an act to establish the Canada Development Corporation, be amended by deleting from clause 2 all the words following "corporations" in lines 9 to 12 on page 1.
That Bill C-219, an act to establish the Canada Development Corporation, be amended by deleting from clause 4 the words "together with such persons as are shareholders of the company from time to time" in lines 34 to 36 on page 2.
In proposing motion No. 1, I should like to point out that as the clause now stands it is misleading and perhaps unintentionally dishonest, but nevertheless dishonest, by virtue of the language used. Line 11 indicates that the establishment of a corporation will provide "greater opportunities to invest and participate in the economic development of Canada". We have to realize that in some ways this corporation will provide less opportunity rather

than greater opportunity. One of the proposals in this legislation is that more wholly owned Crown corporations and one partially owned Crown corporation be put into the hopper, which means in fact that the four corporations now owned by all Canadians are going to be put into one corporation that will be owned only by some Canadians. This seems a very regressive step, so it seems to be enormously misleading and dishonest to say we are providing opportunities to invest and participate in the economic development of Canada.
The greatest opportunity to invest and participate in the economic development of Canada is provided by doing what we have done in the past, by establishing wholly owned Crown corporations in which every Canadian can participate. To take away these Crown corporations that have been built up for good reasons over a number of years and to turn them over to a limited number of stockholders, is to sell out the interests of the vast majority of the Canadian public.
In September, 1968, a study was carried out by Professor G. R. Conway, of the faculty of administrative studies of York University, Toronto. It was commissioned by the Toronto Stock Exchange and called, "The supply of and demand for Canadian equities". The study comes to a number of conclusions and gives some interesting facts. I should like to read briefly from page 8. There is a reference to the number of Canadians owning shares. Right now, every Canadian is a shareholder in a Crown corporation but not every Canadian will be a shareholder in CDC, considering the provisions under which that corporation is being incorporated. It is interesting to discover who the new shareholders will be and what percentage of Canadians they will represent. We may gain some insight into this by examining the number of Canadians who now own shares and the number of Canadians who are in a position to own shares.
Let us be clear, Mr. Speaker. Most Canadians would like to own shares. If you ask any Canadian whether he would like to own shares he would say, "Of course, I should like to own shares in a company." To buy shares in a company you need surplus purchasing power, and that surplus purchasing power is not available to all Canadians, especially since almost a quarter of our population is living at or below the poverty level. When we talk about opportunities for buying shares, we are talking about a very limited portion of the Canadian population. The report I am about to refer to mentions that limited portion. May I now quote from the report, under the heading, "Number of Canadians Owning Shares":
The proportion of Canadian taxpayers receiving dividends has been increasing, from 5.3% in 1955 to over 7% in 1965-up about 30%. This increase is relatively more significant than it appears as 13% more of the population filed tax returns in 1965 than in 1955. In the United States the percentage of taxpayers receiving dividends in 1965 was 17%, reflecting the higher average incomes in that country.
If it can be assumed that tax returns filed are a reasonable indication of the proportion of the population over age 21 that receive dividends, then the proportion of all Canadians receiving dividends has increased from 2.7% in 1955 to 4.2% in 1964- an increase of about 55%. Projecting the figures to 1965 would
June 4, 1971

mean an increase from something under 300,000 adult equity holders in Canada in 1955 to well over 500,000 adult equity holders in 1965.
There has been an increase in the number of Canadians holding equities and in a position to buy equities. Yet the absolute number or percentage of such Canadians is very, very small. In a country with a population of slightly over 21 million, slightly more than half a million adults are in a position to buy equities, or roughly 7 per cent. Let us assume that the advent of $5 shares in Canada Development Corporation will open up more opportunities for equity investment; that is to say, that the corporat-on will be able to attract a larger number of Canadian investors than has been the case previously. Even assuming that this corporation takes over corporations like Polymer and Eldorado, the equities of which are 100 per cent owned by the Canadian people, and that 7 per cent or 9 per cent or 10 per cent or even 15 per cent of the people-which is double the present number-are able to hold equities in the corporation, that does not mean, as clause 2 suggests, that there will be greater opportunities for investment, because actual opportunities to invest are being withdrawn from the vast majority of Canadians.
I might say, Mr. Speaker, that the examination in committee of the Canada Development Corporation was not the finest hour of the Standing Committee on Finance, Trade and Economic Affairs. My criticism does not arise as a result of any change in the membership of the committee, and I am not suggesting that the committee did not work hard enough. I would not wish to leave that impression, because I have a high regard for the members of the committee and for the committee chairman. The point is that the government has so confused and befuddled the issue of Canada Development Corporation that no one, including the witnesses, knew what the heck the whole thing was about. Almost no intelligent criticism was possible with respect to this amorphous kind of thing that the government has produced.
I ask, why was this exercise necessary? Why did the government bring in Canada Development Corporation or an entity that looks like a Canada Development Corporation? It really is a big "nothing". It does not satisfy those who feel that there should be greater emphasis on government participation in the economy-we see the necessity for government participation in the economy-and who feel that our economy has gone so badly down the drain because of the failure of private entrepreneurship in Canada that the only real solution lies in greater public participation and public enterprise. This does not satisfy us at all. The corporation is to make profits. Its objectives are not compatible with national objectives and national purposes. Tne government is hamstringing the corporation from the beginning. It is hoped to interest investors by offer.ng shares at $5; yet, after all, a man invests because he wants a return. If he does not get a return he will sell his stock. The objectives of the corporation cannot be reconciled with the national interest. Nobody can understand this measure. That was obvious in the committee hearings. The witnesses before the committee said, "If the bill means this, then we should do that; on the other
Canada Development Corporation
hand, if it means something else, then we should be doing the other thing."
No enthusiasm has been displayed for Canada Development Corporation; certainly, there has not been the kind of enthusiasm that a good Canadian development corporation ought to deserve. After all, we have been waiting for this sort of corporation for seven or eight years. We have wanted a Canada Development Corporation. We have waited with great expectation and hope for the establishment of such a corporation. Yet the government has brought in this "fizzle", this great nothing, and does not seem to know what it wants to do. It is significant that one of the most telling criticisms of the government proposal has come in a brief submitted by the policy committee of the Toronto and District Liberal Association.


Some hon. Members:: Hear, hear.


Max Saltsman: It is all very well for members opposite to say hear, hear. I want to see whether hon. members opposite will support the ideas of this brief. Are they going to say to those who submitted the brief, "You are nice boys, now go away; we are not paying any attention to you." A lot of intelligent thought has gone into this brief. It was brought to my attention by the hon. member for Don Valley (Mr. Kaplan). I read it with great pleasure. I will not say that the Liberals have stolen our ideas. I do not care where the ideas came from; that is not important. It does not matter whether we originated the ideas or whether they did. The point is that this group makes sense in a way that the government does not.
The government does not listen to us. They have a hangup about taking ideas from other people, unless absolutely compelled to do so. Why do they not adopt some ideas from their so-called grass roots? There is a good deal of talk these days in the Liberal party about new policy objectives, about how that party is making its conventions more democratic and about how the party is asking for inputs from around the country. Once in a while the party talks about participatory democracy. Where is it, I ask? Certainly, no attention was paid to this brief from the Toronto and District Liberal Association. I shall read from the brief, which is already on the committee on record, and the points it makes are very good. With reference to the subject of the amendment that stands in my name, page 3 of the brief reads:
The question should be asked whether a small group of investors who happen to have some surplus cash should profit from this government action, while the vast majority of Canadians would not profit.
There is a great deal more in this brief, but I just wanted to quote that part. They also say in their brief, and I quote:
We believe that CDC must not sell shares to Canadian public. We are at fundamental disagreement with the objective to sell shares in CDC to the Canadian public. We do not see the role of CDC as a sort of publicly sponsored private investment company.
6378

June 4, 1971
Canada Development Corporation
One has to ask why the government brought in this strange kind of animal, the Canada Development Corporation. Perhaps the government is thinking of an election this fall and has to offer something more than the sorry performance we have seen in the past three years. They may need something glamorous so that they can go to the people and say that we now have a Canada Development Corporation. Perhaps the government does not want to do anything, and this is the way to take the heat off what is obviously a growing concern in this country about foreign ownership. This concern was expressed in the brief from the Liberal association and has been expressed by almost everyone in Canada except the members of the stock exchanges. This provides a clue.
In the study to which I referred earlier, "The Supply of and Demand for Canadian Equities", one of the conclusions reached is that there is a great need for publicly traded stocks in Canada. In other words, there is not a shortage of investment money in Canada. There is a great deal of investment money in Canada, but it is not being invested in this country because the stocks are not available. I think the figure used is that there is twice as much money available as there are stocks. I quote from page 40 of the brief:
If their present rates of asset growth continue, and if the proportion of their total assets invested in equities increases, then the three major financial institutions-pension funds, life insurance companies and mutual funds-could be looking to invest over the next few years, an average, about $1 billion a year in equities.
This estimate of potential demand excludes any net new purchases by other Canadian financial institutions, by Canadian corporations, or by Canadian individuals. It also excludes any consideration of net changes in the portfolio position of nonresident direct or portfolio investors.
If the equity holdings of Canadian individuals increased at half of the rate of growth of gross national product, if other financial institutions just increase their Canadian equity portfolios at an annual rate of 3J% (approximately the average annual rate of growth in real terms of gross national product over recent years) and if there is no net change in the holdings of non-residents, then there would be an additional demand for an average of $300 million a year in equities. Again this figure includes possible demands for all equities, Canadian and foreign, and is based on constant dollars.
The total average annual demand for equities in Canada would, therefore, be in the order of $1,300 million a year over the next few years. This projection may well be assuming too high a rate of growth-*
It is obvious that the investment people need a place to put their money. The government is very conveniently taking away the investments of the people of Canada in their Crown corporations and, in many cases, people are embarrassed by a surplus of investment funds. This is very nice for the life insurance companies, banks and trust companies. It may even be nice for a few Canadian investors, but is not going to be good for the people of this country. It is going to be a wide step backward instead of forward. The Canada Development Corporation we had hoped to see is going to be used as an instrument for wrecking some of the proud corporations we have been able to build up over the years.
During the course of the committee hearings, the minister appeared as a witness. We asked him on what basis
this form of privately oriented corporation had been developed, if other development corporations around the world had been studied by him and his committee, what they learned from those studies and whether papers had been prepared to back up their reasons for developing this kind of corporation. The answers were always vague. When the minister felt terribly accommodating, he would smile between puffs on his pipe and say "you believe one thing and I believe another", or words to that effect-In other words, we have ideological differences. At no time was there an adequate explanation of why this corporation was set up with so-called public shareholder partici-pat on as against a wholly owned corporation responsible to the people of Canada. The reply was based on ideological grounds. The minister felt that our position was ideologically oriented. Hon. members are far too concerned about the Canada Development Corporation to go to the wire over what form it is going to take. We are prepared to examine many different kinds of forms, but we want to be assured that the form in which it is developed will enable it to do the job it is supposed to do.
After asking questions about what corporations had been examined and the experience in other countries with development corporations, we were supplied with a 20 page summary of other development banks studied in connection with the Canada Development Corporation bill. I am grateful for this, although it is not research or a study in depth, but at least it is a study. The table of contents lists the various corporations studied. They are as follows, General Investment Corporation of Quebec, the Development Corporation Act (Manitoba), Australian Industry Development Corporation, Industrial Development Corporation of South Africa, Industrial Reorganization Corporation (Britain), Institute of Industrial Development (France), Nacional Financiera (Mexico), Institute for Industrial Reconstruction (Italy) and the Japan Development Bank.
With the exception of the General Investment Corporation of Quebec, none of these corporations in countries as diverse as South Africa, Italy, Mexico and Japan, have public participation. There is no prototype. There is no experience in developing this kind of corporation. On the contrary, all the experience that exists indicates that if you try to include the small investor in the picture with the national interest, as the government claims it is trying to do, it does not work.
The one example we have, the General Investment Corporation of Quebec, started out to do a job which was much needed in Quebec. In many ways, it has been a failure. This is the one example where an attempt has been made to sell shares to the public and match the national interest as well. It has been a failure. The price of the shares has consistently dropped because there has been no public demand for them. The corporation has tended to be immobilized because it does not know which master to serve, the stock market and the shares or the public interest of Quebec. It cannot do both. It is asking too much of a corporation to give it terms of reference of that kind. Maybe in the case of the General Investment

June 4, 1971

June 4, 1971
Canada Development Corporation changed very substantially before any benefit will come to the Canadian public.
For these reasons, Mr. Speaker, I hope hon. members will consider some of the arguments I have placed before them in favour of amending this legislation so as to make sure that this corporation becomes the property and ultimately the pride of the Canadian people, rather than the special hunting ground of a relatively few affluent citizens.


Mr. Depuly Speaker:: The Chair sees the hon. member for Edmonton West hurrying to his seat. Now he is there I will recognize the hon. member for Edmonton West.


Marcel Joseph Aimé Lambert: Mr. Speaker, I apologize to the House but the hon. member for Waterloo (Mr. Saltsman) did not flash the "minute signal" and I was expecting the parliamentary secretary to reply to the amendment moved by the hon. member. This is an amendment that was moved either by the hon. member or one of his colleagues in committee, and following a good deal of discussion of it the amendment was turned down.
Personally, I am opposed to the amendment; not that I have any favour at all for this bill. We intend to propose no amendments, to support no amendments and to support nothing in the bill. I feel this bill is such a bad job that there is no way we can try to flush out a cadaver. To use another simile, I have said many times that I believe the Canada Development Corporation is strictly a non-starter; that there is no way this particular form of corporation as proposed in the bill can be improved so as to make it a viable proposition. One would have to start again from the ground up, and given the shape of the bill it is impossible to do that.
However, the amendment of the hon. member for Waterloo does give the House an opportunity to discuss some of the principles of the bill. We referred to them in the second reading debate. I have before me Hansards for last January when the bill was debated on the first instance on second reading, and a goodly number of members participated in the debate from time to time. There is no question that the original debate displayed a certain flavour of concern about foreign ownership and so on; but as hon. members gradually realized that there was no question at all that in this or any other form the Canada Development Corporation would affect the nature of foreign or Canadian ownership of companies, the debate came back to a discussion of the particular form of corporation that was proposed.
Your Honour will remember that initially there was considerable debate about whether the government had brought in the bill in the right way. A procedural question was raised and a ruling was made. Although I have some reservations about the reasoning behind the ruling, the ruling is there and one must abide by it. Nevertheless, I hope the officers advising the Chair would review the material on which they based their decision, because as x Say-and I say this respectfully-some of the reasons for the decision are somewhat suspect on a logical basis. I
admit this is a new form of corporation and a breaking of fresh ground, but I do have some reservation about that particular decision.
In any event, the amendment moved to this clause by the hon. member for Waterloo reveals the difficulty that was expressed in the majority of briefs that were presented to the committee, even the brief presented by the Liberal Association from the Toronto area. They called into question the sort of paradox that exists in this particular bill. This was illustrated as well by the minister and his parliamentary secretary, in what has been interpreted as the widespread demand on the part of the Canadian public for participation by the more modest investor in a corporation that would assist in the development of Canadian industry and business and the maintenance of Canadian control, when both the minister and the parliamentary secretary said that it would be five years-in reply to a question at one time it was said that it might even be ten years-before the corporation had established what was called a track record in regard to earnings that would justify the government in deciding that the shares of the corporation should be offered to the public.
We are being asked to buy a real pig in a poke so far as response to public demand is concerned. We know it is there. The public is exercised about the degree of participation by Canadian investors in Canadian corporations and Canadian industrial and resource development. But the answer of the government has been to erect a twoheaded monster, each of the heads opposed to the other in principle. First of all, the white paper on taxation made such investment more difficult and discouraged Canadians from owning and participating in Canadian business, particularly in competition with United States and foreign neighbours. It was not a case of Canadians being placed in an equal or more favourable position; the white paper, with its chaotic idea of equity among taxpayers, made investment even more difficult. I must say in parenthesis that I am absolutely astounded at the theories put forward by the hon. member for Duvernay (Mr. Kierans), formerly a cabinet minister, who wants to give strength to what I consider one of the two heads of this monster.
The second head was the Canada Development Corporation in which no opportunity will be given for public ownership and public participation for at least five or ten years, after being used as a sort of closed-end mutual fund and having established a kind of track record. This operation was to be based on four government Crown corporations and was to be established, on the one hand, with a view to public ownership. On the other hand, clause 6(1) provides that the corporation-
-shall be carried out in anticipation of profit and in the best interests of the shareholders as a whole.
Where does one reconcile public interest with the interests of the shareholders as a whole? What a classic example of the dilemma that is faced by a corporation such as this that is charged with acting in the public interest. There is nothing wrong with charging a corporation to operate in the public interest. Certainly, if it is
IMr. Saltsman.]
June 4, 1971

the public interest the Canada Development Corporation must serve then, to turn around and say that "there shall be carried out in anticipation of profit and in the best interests of the shareholders as a whole", is to negate the public interest in many instances.
Let us look at a smaller version of the Canada Development Corporation. Its shareholding structure is different but its purpose is the same. I refer to La Soeiete Generale de Financement of the province of Quebec and its recent experience with the lumber and plywood operations up at Maniwaki in the organization known as SOGEFOR. Initially, La Soeiete Generale de Financement bought two or three lumber or woodwork operations that were going concerns which were making a profit. This is the sort of thing that the Canada Development Corporation should get into, something that has a potential for Growth, some experience, and is in the public interest. But there was a changing situation; the market was not as good either for lumber or plywood. There were changes in the lumber permit, and this made it much more difficult to assure these woodworking operations of a steady supply of suitable wood. We found then SOGEFOR facing an entirely different situation of rather astounding losses.
But the town and district of Maniwaki were entirely dependent upon these industries. It was in the public interest to maintain regular employment for the bulk of the population. It was not in the public interest to let these men out and to place them on welfare. There is no other industry around, but la Soeiete Generale de Financement, whose shares would be from $10 to $103 if they are ever quoted on the market, could not possibly absorb these continuing losses. So the company went to the market; the SOGEFOR operations were to be sold either to Canadians or to Americans. We saw there a classic example. La Soeiete Generale de Financement, a company set up for the advancement and development of Quebec industry and Quebec control of industry, when the operations were losing money, was quite prepared to sell out to a New Jersey concern in order to get out of the situation.
Fortunately, that aspect is now academic and after some sort of almost Gilbert and Sullivan operation the Montreal syndicate that bought the concern have taken it over. Employment is much reduced, but the operation is continued. This is a very sad spectacle all around, and I have gone into this in detail to point out the immediate problem that would be faced by the Canada Development Corporation if it invested in any Canadian concern where the total of its participation and that of the others exceeded $1 million and it turned sour. The directions are that they shall be operated on the basis of profit and in the interest of the shareholders as a whole, but what about the public interest? Are the people who are working for this particular concern to be thrown out, put on the dole and the operation dismantled, or is it to be sold to the highest bidder who may be an outsider who can provide more capital and perhaps more expert management? Is that to be the role of the Canada Development
Canada Development Corporation
Corporation? Nonsense, that is not what the operation will do. At that point we have departed from the principal idea of a true Canadian development corporation.
My party, after examining the proposals contained in the legislation, and without going into the details of the bill, finds it somewhat difficult to see how the government is going to get competent, interested people who will be able to take over this corporation and breathe life into the legislative bones that will be created through the adoption of this bill. I find this exceedingly difficult to believe. I find it exceedingly difficult to consider what would be the situation if Polymer or Eldorado or the Eldorado subsidiary, the Northern Transportation, but to a lesser degree, or Panarctic, should fall upon difficult days when the operations are not profitable. There might be a requirement, in the public interest, for the provision of further capital, the building up of reserves or that it should not declare dividends. In other words, there might be a requirement that it not be operated for the benefit of shareholders, notwithstanding the fact that this bill has the gall to say that the shareholders of the Canada Development Corporation will be those able to qualify under investments or insurance companies or trust and loan companies. That to me is the height of-


Mr. Deputy Speaker:: Order, please. It being one
o'clock, I do leave the Chair.
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
Marcel Joseph Aimé Lambert: Mr. Speaker, there is very little of my allotted time left, and I would just like to indicate that my comments up to this point have been concentrated on what appears to be the paradox in the directions given by the government to the corporation through this legislation, that it should have some public interest but that its primary interest shall be for the benefit of the shareholders, and that it shall be based upon the profit motive.
I reiterate for the benefit of hon. members that they should refer to the evidence given before the Standing Committee on Finance, Trade and Economic Affairs, to the briefs that were presented by the Canadian Chamber of Commerce, the Canadian Bar, and other bodies and private individuals, although I must say not by a great number of people. In the light of what we had been given to understand was great public interest in having a Canada Development Corporation, and notwithstanding the wide advertising by the chairman of the committee about the reception of briefs and the possibility of presenting personal testimony, I was surprised that in large part the response by the public was a big yawn. To me this indicates a complete lack of concern about this particular type of corporation.
In conclusion, Mr. Speaker, I wish to say that we will not accept these NDP amendments because they are

June 4, 1971
Canada Development Corporation trying to impose upon the corporation a much too narrow type of operation. If the amendments were adopted it would become a sort of public finance operation. This whole series of amendments is designed to make the Canada Development Corporation merely a government investment corporation, with no private interest in it. In other words, the members of the NDP disregard entirely any interest that the public might have as individuals in participating in the corporation. I think there is a role for the private individual in a development corporation, but it should have an entirely different structure from this. We will go into that on some other occasion. For the present, I say that we cannot support the amendments, and we certainly cannot support the bill.


William Gordon Ritchie: Mr. Speaker, on rising to speak on this amendment standing in the name of the hon. member for Waterloo (Mr. Saltsman), I would say that he has drawn attention to the dichotomy of this bill, and while I cannot support his amendment I think he has pinpointed what is wrong with the bill. In my opinion, the Canada Development Corporation is destined to be another of the government's great failures. I have observed the results of other endeavours which have been poorly conceived, and I think the Canada Development Corporation bill falls in that category. There are at least three conceptual errors in the proposed structure and mandate of the corporation, any one of which in itself would be sufficient to preclude the realization of its presently envisioned aims.
The corporation's orientation is clearly nationalistic, as set out in clause 6(l)(d) of the bill. The adoption of this amendment would make it even more so. We come, therefore, to the philosophical enigma of what constitutes our national interest. I think we have only to examine the present scene to see the lack of unity amongst Canadians as to what is in the national interest. As a western Canadian, I note part cularly that many Canadians in the two central metropolises, Toronto and Montreal, are com ng more and more to be exponents of the view that foreign investment in Canada is no longer as essential to our economic well being as formerly, but rather now constitutes a serious threat to our sovereignty. In contrast, we in western Canada, and I am sure the same is true for people in the north, see foreign investment capital as the only hope of developing our great natural resources, and relieving our dependency on eastern banks and financial institutions to provide us with the development capital without which the northern and western regions of our country can never reach economic maturity and diversity.
For my part, Mr. Speaker, I believe that where there is a broad consensus throughout our country that a certain industry or segment of our economy should remain under Canadian control, this consensus can best be served through the formation of government owned organizations of the kind represented by the Polymer Corporation. Moreover, I do not believe that such organizations when formed should seek financial participation from the
IMr. Lambert (Edmonton West).]
public sector as the Canada Development Corporation proposes to do. I think there are a number of excellent reasons for separating private and public ownership. I believe that combinations of these have too many inherent difficulties which inhib t the resolving of disputes involving conflict between the profit motive, which is of necessity such a dominant concern in the private investment sector of our economy, and the concept of the public good or national interest wh ch government agencies are expected to use as their principal guidelines in making management decisions in the running of public utilities or other holdings.
Moreover, Mr. Speaker, it is not sufficient for Canada to become increasingly preoccupied with what the board of directors of the Canada Development Corporation mieht define as our national interests when we are so vitally dependent upon global interest for our economic survival. Let us for a moment examine the concept of national interest in reverse and suppose that the United States government decided for certain reasons that it was in their national interest to repatriate American owned automobile plants and related subsidiaries of them in Canada. What would happen to the industrial heartland of Ontario in such a situation? Conversely, is there not the very real danger that the existence of the Canada Development Corporation will dampen, or deter external participation in our economy because potential investors from abroad may fear they will be subject to take-overs or other hazardous action from the Canada Development Corporation at any time when the corporation's board of directors deems it to be in the national interest to move in on them?
The belief that the Canada Development Corporation will be a vehicle to enable the small Canadian investor to participate in the financial benefits of ownership in important and profitable Canadian companies is, at best, a spurious assumption. No evidence has been presented to show that there is a significant body of small investors in Canada who cannot find satisfactory or attractive opportunities under existing conditions.
I share fully the views expressed by the Canadian Chamber of Commerce during committee study of this bill. They were entirely dubious of any extensive participation in the Canada Development Corporation by the small investor. This amendment would indicate that this would be the result. Surely, Canadians with modest resources have no interest investing their few dollars in iron ore projects in Ungava or some other endeavour with benefits that are likely to be far too distant to appeal to them. Moreover, inflation, increasing levels of taxation and the creation of the welfare state are factors which all contrive to discourage people with limited means from saving. For them, the world of today and the satisfaction of today's desires are of much more interest than participation in ventures whose concepts and relevance to our national development are matters beyond their understanding or interest. The idea of the five dollar investor being one of the mainstays in the public offerings of the Canada Development Corporation is not, I suggest, something which
June 4, 1971

should be taken seriously. This, then, leaves the question of who will find investment in the corporation attractive.
It seems to me to leave two potential groups, aside from the government itself which will be under strong pressures of self-justification to participate in the corporation. In listening to testimony in committee on this bill by individuals knowledgeable about the investment habits and patterns of medium sized investors and the large institutional investor, I was not at all convinced, nor were many of these witnesses, that such investors would regard the Canada Development Corporation as the type of highly sophisticated, strongly profit oriented, conglomerate which could best serve their needs.
The principal reason for this reservation appears to be the spectre of governmental control which will always lurk over the management of the corporation. Investors will rightly wonder about the basis on which large financial commitments are to be made. Let us take the case of a province which is urgently in need of several hundred million dollars to develop a natural resource industry or a hydroelectric project and which is encountering difficulty in raising the money on the open market because of interest rates or exchange difficulties. It is not difficult in this situation to imagine the pressure which a province could bring on the federal government to have the Canada Development Corporation provide the needed capital through the purchase of provincial debentures, although such an investment might not be in the best interests of the shareholder of the corporation.
It is all very well for the Minister of Finance (Mr. Benson) to cite the provisions of this bill which enable the government to dispose of up to 90 per cent of the shares in the corporation, thereby reducing its participation to as little as 10 per cent. The fact of the matter is that this situation will be a long time coming, if ever. Even if it should come about, the government has provided further against its loss of effective control over the corporation by limiting the ownership of any other investor to 3 per cent of the share capital of the company, which at its maximum capitalization of $2 billion, represents an upper limit of $60 million of participation by any single company or individual.
In a normal public company, a shareholder who is dissatisfied with the management of the company is free to seek voting support for his position amongst other shareholders, but this will not be the case for an investor in Canada Development Corporation. Shareholders are specifically forbidden to vote in concert to express their disapproval with the corporation's policies or management. I cannot imagine why a sophisticated, large investor, of the type which the corporation will need to attract if it is to operate as envisaged by the government, would ever consent to placing his interests in such an unfavourable position when there are so many other excellent and truly democratic companies in which he can place his assets. I submit that the government has simply failed to look at this aspect of the Canada Development Corporation's operations realistically. While I can understand some of the reasoning behind the government's position on this particular question, I believe it merely serves to
Canada Development Corporation
confirm the inherent difficulties of attempting to set up a huge conglomerate that will be responsible at the one and same time to political interests represented by governmental participation in it and private interests seeking the maximum return on their investment regardless of whether this comes from ventures with a high content of national interest.
Having seen and studied various socialistic economies, I remain an adherent of the free enterprise system. When a government enters a major area of economic activity, it seems always to do so on a far more costly basis than when the matter is left to private enterprise.
Let us consider the costs and quality of medical care in Canada, particularly since the introduction of a national medicare system. Can anyone really state seriously that the quality of medical care has risen proportionately-


Mr. Deputy Speaker:: Order, please. I have been following the hon. member's remarks very carefully. He is making an important contribution to the debate, but I suggest with respect that he may be ranging a bit wide of the subject. The House has before it for consideration the first group of motions. It seems to me that the question with which these motions deal is the question of public corporations, such as Crown corporations, and corporations in which there would be private investment. With respect, I think the hon. member should not range into medicare and other matters.


William Gordon Ritchie: I just wanted to point out that the high cost of medicare is an example of the cost of the type of large bureaucracy which this bill could well set up, Mr. Speaker. On the subject of administrative costs, I think we can easily imagine the size and type of administrative empire that will quickly spring from the existence of the Canada Development Corporation. If this amendment is passed, it will make this a completely government dominated corporation. It will be the largest single conglomerate in Canada, even before it becomes fully capitalized. When one sees the size of departments of government in Ottawa which operate on much smaller budgets, one cannot but shudder to think of the army of economists, research assistants, investment advisers and portfolio managers, policy developers, department heads, secretaries, typists, clerks and others who will be assembled to operate the levers and wheels of such a behemoth.
The Canada Development Corporation, Mr. Speaker, represents to me the continuance of the pattern of the present government of extending its powers further and further into the private economic sector of our society. The present bill is its boldest approach yet in this direction, and many important members of the private sector are understandably alarmed over its implications. There are, in my view, other places than the bedrooms of this country where the state does not belong. The free enterprise system is one of the most important ones.
I believe it is the duty of the government to provide a fiscal and monetary climate which enables and encour-

Canada Development Corporation
ages orderly and vigorous growth in our society. I do not believe that the government, including its agents, has any role to perform in the day-to-day management or operation of the private sector of the economy. Such a path is the path to state ownership of the means of production and distribution, and that concept of government is not acceptable to the Canadian people. I will vote against this amendment and I also intend to vote against this till at third reading.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: The question is on motion No. 1 in the name of the hon. member for Waterloo (Mr. Salts-man). As hon. members will recall, it was agreed earlier today that the question will be put on the first motion. The Chair will put the question only on that motion at this time pursuant to that order. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Deputy Speaker:: All those in favour of the motion will please say, yea.


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion the nays have it.
And more than five members having risen:


Mr. Deputy Speaker:: Pursuant to Standing Order 75(11) the recorded division on the proposed motion stands deferred.
In accordance with the order made earlier today the Chair will now put motions 3, 4 and 5. First, we shall take motion No. 3.
The hon. member for Waterloo (Mr. Saltsman) moves:
That Bill C-219, An Act to establish the Canada Development Corporation, be amended by deleting from Clause 6 lines 34 to 36 and substituting the following:
"and shall be carried out in the best interests of the people of Canada."
Next we will take motion No. 4. The hon. member for Regina East (Mr. Burton) moves:
That Bill C-219. An Act to establish the Canada Development Corporation, be amended by deleting paragraph (b) of subclause 2 of Clause 6.
Lastly, we shall take motion No. 5. The hon. member for Waterloo (Mr. Saltsman) moves:
That Bill C-219, An Act to establish the Canada Development Corporation, be amended by substituting in Clause 7(1) paragraphs (d), (e) and (f) the words "Canadian nation" for the word "company" in lines 9, 19 and 23 on page 5.
If hon. members are in agreement, it seems to the Chair that the three motions ought to be amended. I think the record ought to show that Motion No. 3 was moved by the hon. member for York South (Mr. Lewis), for the hon. member for Waterloo (Mr. Saltsman), and seconded by the hon. member for Winnipeg North Centre (Mr. Knowles). With respect to Motion No. 4, the record should be amended to show that the hon. member for York South moved the motion for the hon. member for Regina East (Mr. Burton) and that it was seconded by the hon. member for Winnipeg North Centre. With respect to Motion No. 5, the record should show that the motion was moved by the hon. member for York South for the hon. member for Waterloo and that it was seconded by the hon. member for Winnipeg North Centre.


David Lewis: Mr. Speaker, I am very pleased to move these motions on behalf of the hon. members whose names are on the order paper, partly because I was unable to participate in the debate on the second reading of the bill and partly because we, in our party, consider the issue now before the House as of extreme importance. This bill might have been one of the most important bills that this House has considered in over 100 years. Instead, in our view we have been presented with a bill which is a shameful distortion of an important and imaginative idea.


Some hon. Members:: Oh, oh.


David Lewis: It is a further sellout to private enterprise in this country and will destroy the possibility of control of the Canadian economy being regained not only by Canadian investors but by the Canadian people. My party made the suggestion for a Canada Development Fund. The idea was later developed into the Canada Development Corporation. The suggestion was first made and included in our first program at our founding in 1961. We made the suggestion because we felt that Canada was faced with four fateful and related problems. We were faced, first, with overwhelming foreign ownership and control of our economy, a problem that had to be solved. We were faced, second, with an unequal development of our economy across the country. We knew that there were areas in Canada which did not keep economic pace with the average development in this country. They were areas such as the Atlantic provinces, major sections of Quebec, parts of Ontario and, indeed, parts of other regions in this country. In a very real sense, in a sense that is true for countries in Africa and elsewhere, regions of this country are underdeveloped in relation to the rest of this country, with very serious consequences for the standard of living and well-being of people living in the Atlantic provinces, in parts of Quebec and in other underdeveloped parts of Canada.
We were faced, thirdly, with an economic problem in this country arising out of the fact that the foreign ownership of our manufacturing industry produced in Canada a branch plant manufacturing industry which was relatively inefficient, which produced duplication and

June 4, 1971

which was not specialized, as a manufacturing industry ought to be in a relatively small country like ours.
We were faced in this country, fourth, with the fact that Canada was almost entirely dependent on multinational corporations for its research and development, the result being that the development in our own country of technology could not take place without reliance on General Electric or General Motors or any of the dozens of large, multi-national corporations that now control this country's economy. We faced these four major problems among many others. They were to do with the foreign ownership of our economy, the unequal development of the economy in Canada, the inefficient branch plant manufacturing industry and the lack of research and development in this country. We therefore faced the economic and, eventually, the political dependence of Canada on countries like the United States and, eventually perhaps, even Japan, those being the countries from which these multi-national corporations came. We are faced at this time in western social history with a new phenomenon, Mr. Speaker, that of the multi-national corporation which straddles the world, which literally straddles the globe and which has developed new techniques.
The multi-national corporation does not use methods as crude as were used by the old style imperialism, under which you took over a country physically and militarily. They take over a country now in a much more efficient and refined way. They do not bother taking over a nation physically; they merely take over the means by which the nation lives, knowing perfectly well that if you take over the means by which a nation lives you exercise effective control over the life of that nation. This is what the multi-national corporation means in the 1970's as it meant in the 1960's. It is a dangerous thing for the fate of freedom and the world.
I recently visited the city of Helsinski, Finland, where I attended the conference of the Council of the Socialist International, in which the NDP is represented. One major matter concerned the leaders present, including the chancellor of Germany, the chancellor of Austria, the prime minister of Sweden, the prime minister of Norway, the prime min ster of Israel and men and women who were either in government, had just been in government or expected to be in government in a very short time. The major concern of these men and women from Europe, Asia and Africa was the evil result of increasing control of the world economy by multi-national corporations, centred mainly in the United States, but also centred in Japan, West Germany and in other highly developed industrial countries.
Canada, which is right beside the powerful United States of America and whose economy is to a large extent controlled by that economic giant, has a very serious problem to overcome. It must reduce and, if possible, eliminate or at least control foreign ownership and foreign domination of the economy of this country. This was one of the major purposes we saw in the Canada Development Corporation. We believe very
Canada Development Corporation
strongly that the time is very short for Canada to become independent economically and, therefore, fully independent politically. No Canadian, regardless of what party he belongs to, can help but be seriously distressed at the attitude of this government and the ministers of this government if his mind, eyes and ears are open.
It is sometimes said that the Americans have taken over Canada. I have stated across this country and I want it on record in Hansard that I do not blame the Americans. For a century, Canadian business and political leaders have gone to the United States and begged the Americans to come into Canada and take over our resources. They pleaded with them to come and build manufacturing plants in our country. They told them, with that lack of self-respect and self-reliance which is typical of the continentalists and disastrous for this country, that we not only want and need them, but they are indispensible to us. This is what was said to the Americans. Because the governments of this country were not willing to make profits for the Canadian people, nor did the business men in this country have that objective, we were taken over in very large measure.
We said in 1961, and we have stated ever since, that there is only one way of making certain that we gain more control of the economic destiny of this country; that is to set up a mammoth, massive development fund under the control and management of government and Parliament. The funds would come from the undistributed profits and retained earnings of all financial and other large corporations in this country. By law, they would be required to invest a large proportion of their undistributed profits, retained earnings and reserves in this Canadian development entity for the development of this country. Instead government has produced this puny bill which we are now discussing and which is a distortion of a good idea. It has produced this abortion after seven years of gestation. I remind hon. members that Walter Gordon promised us the Canada Development Corporation in 1963. After seven years, this government has produced this stillborn, meaningless, mindless kind of legislation 1hat has no place in our society, cannot accomplish anything.
What is it expected to do? It is to be a private corporation, not a Crown corporation or a public corporation. It is to have exactly the same objectives as any other private enterprise, namely making of profits. This will be its major consideration and motivation. It is to have exactly the same objective as every other private corporation in Canada with respect to a return to its shareholders. Only 7 per cent of Canadians have any money to invest in a corporation. The other 93 per cent are not investors. This is another bill which serves the interests of the private corporation and the interests of, at most, 7 per cent of Canadians who have enough money to make an investment.
What is the purpose of this bill? It is not going to repatriate any part of our economy. It is not going to deal with investment in the undeveloped parts of this country. It will not deal with rationalizing, specializing of manufacturing industries so that we can become a much great-

June 4, 1971
Canada Development Corporation
er force in the markets of the world than at the present time. It is not going to make funds available for research and development. Why in heavens name is it on the order paper except for the government to seek to fool the Canadian people into thinking that the government is doing something about Canadian ownership which, in fact, it is not doing? There is no other explanation for this deformed, mental aberration which the Minister of Finance (Mr. Benson) has produced on behalf of this government. It will do nothing except create another agency to help the private corporations which, God knows, need no help from this government or, if they do, receive enough help.
Some time ago I calculated the grants that are made to the private corporations of Canada out of the public treasury through the various programs. Most of these corporations are foreign owned. I calculated that over $1 billion a year of Canadian taxpayers money is paid to these large, poverty stricken corporations which we constantly help with incentive grants, capital grants, research grants, development grants and every other kind of grant imaginable. The government is putting $250 million into this agency for the purpose of giving more assistance to the large corporations, most of them foreign owned, which already control and in most cases choke the independence of Canada on the economic front.


Mr. Boulanger:: What did they do for the country?


David Lewis: They do not do anything that the country could not have done for itself.


Some hon. Members:: Hear, hear.


David Lewis: There is a myth which the Liberals and Conservative accept, that is that Canada needs foreign investment. The hon. member who made the interjection has not made a statistical computation. If the Minister of Finance, who knows better, were honest with Parliament and the people of Canada, he would tell us the truth. In the past few years, we have had a net loss as a result of foreign investment in this country. We shipped out of this country in profits, interest, management fees and licence fees more than is invested in direct investment from outside of this country. It is true that the foreign owned corporations are able to expand their control and they do, but they do that with Canadian money, not foreign money.
Recently, the Ryerson Press was taken over by an American firm. We lost it. Where did the capital come from to take over this Canadian company? It was not from New York or Chicago, but the money markets of Canada. Every dollar borrowed was borrowed on the Canadian money market to enable Ryerson to become a publishing house controlled by a large United States publishing firm. This is what has been happening in Canada. This nonsense about our needing foreign investment is a myth, a story which is told across this country by people who know better and which is innocently spread by people in this country who ought to
know better. We do not need foreign investment any more. We generate the largest proportions of savings of any other western industrial nation. If those savings, and the investments which could be made with them, were channelled in the right direction and used in accordance with a public plan for the welfare of the Canadian people this terrible dominance of foreign capital would disappear in the course of a very few years. If at any time we were to require additional money from outside we should pass laws insisting that this money come in as loan capital, not as equity capital.
I would remind members of this House that Canada is the only western nation which has permitted foreign investment without limit, without rules, without permit. Every country in Europe, and even countries in Asia like Japan, have established rules with regard to foreign investment which require the investor to obtain a licence or a permit. We have instituted some rules in the fields of banking and communications but, generally speaking, we have permitted foreign investment to go on in the absence of any rules or permit requirement. The amendments I have the honour to move on behalf of my hon. friends from Waterloo and Regina East go to the heart of this legislation. We are, basically, advancing a proposition that this bill, poor though it is, that this corporation, amorphous though it is, be made to serve the interests of the Canadian people and not the interests of the shareholders and the profit-makers of this country. This, in essence, is what these amendments propose. I suppose the plea which we are making will go unheeded but I warn the government that recent events, electoral if you like, in Brant and elsewhere, recent indications in Gallup polls, show that a much greater awareness exists on the part of the Canadian people as to the economic situation of this country and a much greater determination to take control of our economic destiny.
I say to hon. members of the Conservative party from the west that there is no part of this country, west, east or centre, in which there are not thousands of Canadians growing daily more distressed by the continuing exploitation of this country by foreign-controlled interests. This is the first issue which the CDC should have been able to confront. But it will have no power to do anything with regard to repatriating any part of Canada's economy. The natural resources of this country will continue to be owned by foreign corporations, and those resources will continue to be shipped out in a raw or semi-raw state; and with that kind of export we export jobs, leaving the Atlantic provinces and parts of the west and northern Ontario with communities which are not viable, which cannot thrive. And when the non-renewable resources have been exhausted, when they have been taken out of the ground and shipped all over the world, the communities concerned become ghost towns. I have seen such places all over the eastern provinces and elsewhere in my travels across the country.
What will this corporation do to lessen the economic inequality in this country? Again, nothing. One of the reasons we proposed a Canada development fund in 1961 was our conviction, and it has proven more accurate every day, that the under-developed parts of Canada will

June 4, 1971

not witness the economic development they require on a basis which will serve the interests of the communities affected except the federal government be ready to invest directly in those areas and build industries which will be related to the lives of those communities, to the skills possessed by the people of those communities, to the welfare of those communities generally rather than, primarily, to making profits for shareholders. We have not done that for more than a hundred years. For over 100 years, and in 1971, we have been trying to attract private corporations, most of them foreign, to these under-developed areas by handing out carrots in the form of tax incentives, incentive grants, job grants, capital grants and so on. I repeat what I have said on the floor of the House on previous occasions: five, ten or twenty years from now we shall see a Canada just as unequal as it is today; we shall find the Atlantic provinces and parts of Quebec and Ontario and the West just as poverty-stricken as they are now, their citizens living in conditions as unfair as they are today, unless during the next decade or so we have the imagination and the courage to stop this candy-giving to private corporations, to stop this carrot-attraction of private corporations who in any case, will not stay unless they can make profits. Instead, there must be a plan for the development of the Atlantic provinces in particular, as well as of other parts of Canada, based on funds made available through public investment and subject to public control.
It was our notion that the Canada Development Corporation would join private enterprise, not replace it, in developing industries in the Atlantic provinces and other parts of the country; that it would be empowered to make direct investment in those areas and bring about a real change in the lives of the people in the Atlantic provinces and elsewhere. But this bill will do nothing to make such things possible. The corporation is not equipped to do anything about them. It is not intended to do anything about them.
The third objective we had in suggesting a development fund was to provide a means of assisting manufacturing industries to introduce specialization so that we could really become an effective country in certain areas in the export world. No power is given to the corporation under this b 11 to do anything to help bring about the necessary rationalization. There is no intention to give it such power. If we are to rationalize the manufacturing industry, someone must have the power to step on the toes of foreign-owned corporations, the power to say some plain words to private enterprise, the power, the authority and the w 11 to act on behalf of the people of Canada without kow-towing every day of the year to the corporate elite.
No modern economy can develop satisfactorily an area such as Northern Ontario, for example, along the lines with which we have become familiar in the past.
To use Northern Ontario as an example, large deposits of natural resources have been found there and still others w.ll be found in the future. The mining, the extraction, ought to be the least of the activities. One contemplates at once the development of smelting and refining of the ores, and then comes the development of
24107-54^
Canada Development Corporation manufacturing industries based on the natural resources of the locality. No country can develop that kind of community unless it has control of research and development within its borders and the kind of technological know-how and potential that Canada does not have except in the hands of the multinational corporations that control our economy. We will never be able to deal with these communities in Canada in a way that will make them viable communities, or be able to build secondary or even tertiary industry and develop the tourist industry in the Atlantic provinces, in Ontario, in eastern and northern Quebec and right across the country, unless this know-how is under our control instead of the control of foreign corporations.
This bill enables the Canada Development Corporation to do absolutely nothing in th's field. As the hon. member for Waterloo and other members who have taken part in the debate on this bill have indicated, we do not understand why the minister has brought the bill forward. 1 have often said, and I repeat, that the most important characterist'c of the Trudeau government is a kind of technocratic neatness. Since this measure was mentioned in the throne speech in 1963 and has been repeated in every succeeding throne speech, this is why the government felt obliged to bring in a measure of some sort so as to make sure that the graph on the wall could show an x against this item indicating it had been been dealt with.
What other explanation is there for this misadventure entered into by the Minister of Finance and which this Parliament and the people of Canada are contemplating at this time? In all fairness, I see not one single objective that this bill can fulfil that private enterprise has not fulfilled, and has fulfilled well from its point of view but fulfilled badly from the point of view of the welfare of Canadians. This corporation will do exactly the same thing that private enterprise in this country has done for over 100 years. As I said earlier, the government is fooling the Canadian people into believing it is doing something to enable it to take control of Canada's economy.
The parliamentary secretary has been extremely kind to and co-operative with me this afternoon. May I return the kindness and co-operation by telling him before he speaks in the debate that if he repeats what the Minister of Finance said, that this bill would enable us to control our own economy, then he will be just as misleading and his argument will be just as fallacious as was the minister's. Because the corporation created by this bill will do nothing of the sort. It will not take us one single, solitary step toward controlling our own economy. This bill is an attempt to fool the Canadian people into believing that something is being done about foreign control of the Canadian economy, and this is a shameful thing to do with what might have been an important instrument of government and national policy.
The only other reason I can think of for this bill being brought forward is that the government is determined

June 4^ 1971
Canada Development Corporation that if there are areas where private enterprise might not be as ready to enter because profits will not be large enough, the taxpayers of Canada will make enough funds available so as to guarantee profits for those private enterprises which this corporation will assist. This is a shameful betrayal of the interests of the Canadian taxpayer.
I suggest to the members of this House, without making any apology for doing so, that it is this kind of legislation that shows the real difference between our party and other parties in this House. To people who shout at me: "You want a socialist Canada", my answer is that indeed I do; I want a democratic socialist Canada. If they think that by saying that to me I am going to be frightened and run away, let me say that the only reason for the existence of the New Democratic Party is that it is trying to persuade the Canadian people-and more and more is doing so-that they cannot have the kind of humane and decent society to which they are entitled to or make the kind of humane and decent contributions to the welfare of hungry peoples in the world that a rich country like Canada ought to make, unless our economy is based on foundations different from the present ones.
Our economy must be planned in the interests of the welfare of all Canadians, indeed the welfare of the whole world. We must realize that the natural resources that we are fortunate enough to have in such abundance in this country belong not only to one province but to the people of Canada; indeed, they belong not only to Canada but in some respects belong to the people of the world, and will enable us to build a peace based on genuine economic co-operation and social progress.
I make no apology for saying that we saw an instrument such as this as a Canada development fund into which large amounts of money were put by the requirement of law by large corporations out of their reserves. We saw an instrument such as this controlled and managed by Parliament through its necessary agencies. We saw an instrument such as this as an essential part of the planning machinery of this country, as an essential part of repatriating our economy, as an essential part of developing the underdeveloped areas of Canada. We are heartbroken and angry beyond words with this government for the shameful way it has done everything domestically since the Prime Minister (Mr. Trudeau) came to power. It has again destroyed an instrument that might have been of immense good to the people of this country and has again shown its complete reliance on a partnership with the most selfish interests that exist in Canada, indeed in the world.


Mr. Alexandre Cyr (Gaspe):: Mr. Speaker, would the hon. member for York South (Mr. Lewis) allow me to ask him a question?


David Lewis: Of course.


Alexandre Cyr: Mr. Speaker, the hon. member just stated that he wished a socialist democratic Canada, for the well-being of the people. Would he say if he would invest
part of his savings in the Canada Development Corporation in order to insure the well-being of Canadians?


David Lewis: Mr. Speaker, I did not understand everything the hon. member said.


Alexandre Cyr: Mr. Speaker, I asked if the hon. member would invest part of his savings in the Canada Development Corporation in order to insure the well-being of Canadians?


Prosper Boulanger: Why don't you put in
some of your own money?


David Lewis: Yes, yes, I understand
Mr. Speaker, the answer is simple. If the investments of either a corporation or an individual have made profit their sole objective, then such investments will not be in the interest of the Canadian population.
Any investment that is aimed at assuring the welfare of the Canadian people is the kind of investment that has as its objective the production of consumer goods required by the people, such as housing units, for instance, where profit could be one but not the prime objective.
That is my answer. I see no use in investing money as the hon. member has suggested, merely because we know it is private economy, as we have known for years, that has caused and is still causing unemployment, housing shortage, poverty and disparities all over Canada, and I do not want this type of society in my country.


Mr. Henry Latulippe (Compton):: Mr. Speaker, I shall say a few words about the motion brought forward by New Democratic Party members and also about the projected corporation. We have a great deal to say in this respect, Mr. Speaker.
I believe myself duty bound, before broaching the matter, to say that the corporation will not perform the services anticipated. Canadian citizens do not need such a corporation for the development of their economy.
The aid of the corporation, Mr. Speaker, is to increase production, to organize major industries for the purpose of constantly increasing production. We are now witnessing the effects of (he problem. We have no production problem and the Canada Development Corporation will assist only companies having no financial problems or able to find elsewhere the capital they require. In fact, the government will assist firmly established and viable companies, or it will create new corporations with an enormous amount of capital which will be supplied by Canadian people who are already in need of it.
Earlier, the leader of the New Democratic Party (Mr. Lewis) said that only 20 per cent of the people could save money. If we are to establish this big corporation, we are going to take the savings of those who were able to put money aside, and we will take money from small industries which need it. In fact, this will be the end of small firms, because big concerns are going to control everything. They will be involved in every aspect of production because of their huge amount of capital and they will destroy small and average concerns.

June 4, 1971

Mr. Speaker, we are now witnessing the collapse of the small and the medium-sized companies. Among the latter, some are no longer able to survive, because they have too many debts, they are over-taxed and they are not allowed to sell shares to finance themselves. They must borrow needed capital and those loans must be paid back, at which time they are said to be profits. So, they have to pay taxes on reimbursements, contrary to the big corporation which never has any reimbursements to make. The big corporation will win out in competition with the small company because it will have every facility to obtain capital, by taking it away from the small companies already in need of it.
I am not dead against the establishment by the government of this corporation which should be an agency with new capital to be used only for new ventures. For the good of the people these new investments should be made available to institutions at administrative costs. This would bring prices down and we would have corporations able to produce and compete with any other country in the world. However, these big corporations should only produce goods that small companies cannot produce, because it is too hard for them. There would then be one or more different corporations, and all current capital or savings would be left to the small and medium enterprises.
The federal and provincial governments, or at least several of them, have set up similar corporations that wheedle what little savings there are, thus depriving those who need that money. That is why we are witnessing the disappearance of small and medium industries: they cannot find the capital they need.
Mr. Speaker, the citizens prefer buying shares in government organizations rather than private industry, because they have more guarantees. Indeed, the state centralizes, takes over control, and causes the small industry to disappear, although it too has the right to exist.
Since the corporation will be used to draw all existing capital and take it away from small concerns, we will have to vote against the creation of that huge state corporation which w.ll gain control, even if it is said that it will finance private enterprise or help firms already in existence. However, the companies which the government wishes to assist have the means to find capital through the issuance of shares and bonds, while small concerns are unable to get listed on the Stock Exchange.
In the province of Quebec for instance, since the Bombardier Company has become powerful enough to become a member of the Stock Exchange, its problems are over as it can do anything. No company of that kind experiences financial problems. Therefore why set up corporations to finance such businesses that have no financial problems? People who really want to help others help those who are in need not those who are well off.
Small businesses are the ones in need. To be logical, they are the ones the government should help. It should guarantee to those businesses the purchase or sale of their production. If the government did that, we would get all
Canada Development Corporation the necessary production out of the small and mediumsized businesses.
Now there is a lack of balance, jugglings, bankruptcies of all kinds, small and medium-sized businesses are vanishing because they have to deal with the victims of a systeb they are unable to pay.
A good number of citizens are unable to pay. So they buy without paying and they go bankrupt. Therefore industry has to put up with all those losses. It is a victim of the system.
The government must give industrialists the guarantee that there will not be any more victims of that kind, it must guarantee the pay the same way it guarantees exports, which would enable the industries to operate. Should production be needed, the only thing to do would be to specify the kind of products we want as the industry is organized.
We have all the technology we need to enable those businesses to operate and the state is there also to provide that technology. If we have too little of it in Canada, we have as neighbours the Un.ted States, which have at their disposal numerous technical resources on which we can rely at any time.
If we are short of it, we can import technical capital from the United States, to help us develop our industries. But we are not short of it, for we have at hand all the products we need in Canada. We have all the engineers, technological data, labour force and means of transportation that we need. We are only short of capital funds and we should avoid making them available to large centralized industries.
Such centralization leads to socialism and to the elimination of small businesses. None of our large state undertakings are able to produce at the same cost as private enterprise. Experience teaches us that public enterprise costs much more than private enterprise, since people do not assume the same responsibilities in one or the other.
In private enterprise, people take their responsibilities more seriously, whereas, in public enterprise, they could not care less. And when repairs call for shut-downs, the doors are simply shut down until completion, which means that production suffers and the cost of the products increases. I do not believe that the minister can convince us that public enterprise is in a position to manufacture products at a cost as low as that achieved by private enterprise.
The large private firm can do better than its public counterpart. There are small and large private firms and we should-and this must be sacred-first, help the small firm by all means available. If the funds available for the establishment of large corporations designed to increase production were allocated to the private sector, the results would be ten times better. It has been said that this will not be a state enterprise but a private firm; we shall begin by helping corporations which can fend for themselves and which need no help to prosper. After that, we will look after state enterprises because, owing to taxes and levies, no private firm can succeed in reim-

June 4, 1971
Canada Development Corporation
bursing the taxed capital and paying for the fringe benefits which it must provide to its employees.
The small enterprise, the small manufacturer is facing all the conomical problems. It has to finance all the plans and programs which the government is forever coming up with.
I am pleading in the name of the small enterprise which has a right to exist. It should enjoy all possible consideration from the state before it can mesh with larger socialist organizations and large centralized enterprises. We must decentralize and guarantee to the small firm the outlets and the capital required. We will thus get better results than these giant corporations which will finally eat up the small ones.


Patrick Morgan Mahoney: Mr. Speaker, the Canada Development Corporation has received considerable public attention over the years and particularly concentrated attention in recent months. The government has listened closely to the discussion and has prepared a bill which reflects this informed deliberation.
The concept of the bill was discussed informally as long ago as 1963. The bill before us received first reading in this House on January 25 and second reading on March 3 after a very thorough and comprehensive debate. The public was then invited to submit briefs to the Standing Committee on Finance, Trade and Economic Affairs. The committee received numerous briefs and letters and heard a number of witnesses including the Minister of Finance (Mr. Benson) and representatives of the Investment Dealers' Association of Canada, the Canada Chamber of Commerce and the Canadian Bar Association, as well as several private individuals.
There is no question that there is broad public support for the Canada Development Corporation. Equally, there is no question that almost everyone has his own personal vision of the Canada Development Corporation. As the amendments before us and the speeches supporting them from the NDP indicate, that party has quite a different vision of the Canada Development Corporation from that of the government. I might say that the official opposition appears to have no vision of it at all, the Social Credit party, with its own firm belief in certain cures for all economic ills, has a view of its functions that do not accord with those of the government.
Constructive suggestions were received in the briefs and made by the witnesses appearing before the committee, and further comments were received directly by the minister. Government officials have discussed the bill with concerned persons including representatives of the stock exchanges. The government was able to take all these views into account in supporting amendments made at the committee stage. I shall return to these in a few moments. Notwithstanding all the public discussion there are still some widely held misconceptions about the CDC, misconceptions obviously shared by hon. members opposite. I would like to restate briefly the government's
position on a few of the major issues in the hope of clearing up some of these m sconceptions.
It has been suggested that the objects of the corporation are too vague and that its board of directors will lack direction. Hon. members will appreciate that the CDC as proposed in the bill will be a statutory corporation and that its objects can be changed only by act of Parliament. The CDC will operate, with few and necessary exceptions, under the Canada Corporations Act and will be competing With other corporations in the private sector. The objects of the CDC are deliberately broad. Restrictive terms would hamper the CDC's mandate to fulfil its purpose as set out in the bill. The directors must be free to establish new policies to meet new situations. In this respect the CDC will be on all fours with other successful Canadian corporations.
Some critics of the bill question its timing. They say the CDC should operate within a framework of defined government policies on industrial development and foreign ownership, and should not be created until such policies are defined. The government is not presently planning to make an over-all, embracing statement on industrial policy.
Existing government programs establish the government's interest in developing, among other things, a strong manufacturing sector, a distinct Canadian communications industry, and in encouraging resource development, particularly in remote regions of Canada. These programs provide ample definition of our industrial policy. I expect that the government's statement on foreign ownership will be issued before the CDC is operational. However, the CDC's Canadian orientation is quite clear from the bill itself.
The primary role of the corporation will be to help shape and secure the future rather than to recover the past. In the words of the bill, the corporation will "help develop and maintain strong Canadian controlled and managed corporations in the private sector..." The corporation will take into account this objective in considering its various investment opportunities. Whatever our foreign ownership policy may be, the CDC will not be a buyer of last resort. The CDC is a positive step in promoting a greater Canadian presence in industry by pooling capital and entrepreneurial skill, and by encouraging the rationalization of Canadian industry.
Much has been said in and out of Parliament about the danger of conflicts between the national interest and profitability. Others seem to feel that the two are irreconcilable. The government rejects that contention. It is said that the board will tend to be influenced by the former at the expense of the latter, by national interest at the expense of profitability. As a statutory corporation, the directors of the CDC are obliged to pursue the objects of the corporation which, as the bill states, "shall be carried out in anticipation of profit and in the best interests of the shareholders as a whole."
A dynamic private sector in which there is a greater Canadian participation is clearly in the national interest.
[Mr. Latulippe.1
June 4, 1971

Through the CDC, Canadian entrepreneurs, investors and managers may significantly influence the future development of Canada for their benefit and the benefit of all Canadians. I was indeed gratified to have the confirmation of the hon. member for Waterloo (Mr. Saltsman) that in fact a great deal of Canadian capital exists and is waiting for good investment opportunities. The CDC will surely be one of those.
Some critics of the CDC concept believe that any government participation in the corporation will be synonymous with interference in its operation. The best protection against such interference is a strong and independent board of directors chosen from the private sector. The bill explicitly contemplates their independence. I am confident that as soon as the CDC is incorporated a strong board will be readily formed and will assert its independence.
Initially, Mr. Speaker, the government will be the sole shareholder, and it will always be the largest single shareholder. Because of the significant role that the corporation has been given by its purposes and objects, the government will want to show a continuing interest in it and it is expected that the government will always want to hold at least 10 per cent of the voting shares. It is also likely that the government will always have some elected or appointed directors on the board. Thus, it will always be in a position to exercise the degree of influence on the over-all policies of the corporat.on appropriate to its shareholding. However, to underscore the importance that the government attaches to achieving the maximum possible degree of ownership of the CDC by the Canadian public, the corporation will have the right to reduce the government's holding of voting shares down to 10 per cent.
As I mentioned previously, the government recognized the merit of suggestions brought forward at the committee hearings and through other channels and certain amendments were introduced during the committee's clause by clause study of the bill. For example, clause 16 of the bill, which deals with eligibility and declaration requirements of shareholders to ensure that voting shares would be held only by Canadian citizens or residents and that the shares would be widely distributed, was amended to privide greater ease of sale and transfer of shares among the public. The Canadian Chamber of Commerce and the Investment Dealers' Association of Canada in their briefs called attention to the need to ensure that these shares would be readily traded.
Legislation now before the House in Bill C-193, an act to amend the Northern Canada Power Commission Act, proposes that the commission's rate structure should only produce a revenue which is sufficient to meet expenses and maintain a contingency reserve fund. The commission will, therefore, not have a profit orientation and will not be a suitable investment for the CDC. Reference to the Northern Canada Power Commission has therefore been deleted from clause 39 of the bill.
Paragraph 2 of schedule II of the bill was revised to provide for quarterly net asset valuation rather than
Canada Development Corporation
daily valuation as originally proposed. It had been pointed out that daily asset valuation would be an unnecessarily onerous task for the corporation. On the other hand, quarterly valuation of the corporation's assets is in keeping with good disclosure practice. Other amendments moved in committee tidied up clauses to help ensure their clarity, and yet others take into account amendments to the Canada Corporations Act which came into effect on March 31. The government appreciates the effort and concern that went into the preparation of the briefs submitted to the committee, as well as the contribution of the committee members in improving the bill.
Reference was made in the debate today to institutions in other countries which some hon. members deem to be parallel to the CDC. Just as every Canadian and certainly every Canadian political party has its own vision or lack of vision, as the case may be, in respect of the CDC, so every country has its own particular needs in its own financial institutions. One that was mentioned was the Italian body, the Institute for Industrial Reconstruction. That was a body created to restore bank liquidity. Italian industry had been heavily financed by bank loans, and when the industrial recession of the mid-1920s hit Europe bank liquidity was badly impaired and accordingly the Italian government constituted the Institute for Industrial Reconstruction, which really performed the functions of long-term lending institutions that were lacking in Italy and that had hitherto been performed by the commercial banks.
Similarly, in Japan the origin of the Japan Development Bank lies in the reconstruction period immediately after the last war when long-term credit was needed to rebuild heavy industry in that country. Today, the Japanese Development Bank still concentrates in the area of heavy industrial development and does not perform a function parallel to that conceived for the CDC. Another one mentioned in the debate was the Australian Industrial Development Corporation. Again, the need for that institution was peculiar to Australia. There was no longterm debt money available in Australia commensurate with the needs of Australian industry and the institution was created specifically to go out of Australia, with government credit, and borrow money that might be available for investment in Australian industry. Foreign debt capital just was not coming into Australia, again not comparable with the Canadian situation.
In the case of the General Investment Corporation of Quebec, which has been cited by members of the official opposition as an example of why the CDC should not be proceeded with, and on the other hand the objectives of which have been cited by members of the Social Credit party as those which the CDC should pursue, we had a situation where investments were made by that corporation for what were regarded as national or social priorities in the province of Quebec. The experience of that institution is one of the reasons why the Canada Development Corporation will be placed in the hands of a very independent board of directors, because when social or political objectives intervene in business decisions, business judgment suffers.

June 4, 1971
Canada Development Corporation
Mr. Speaker, the Canada Development Corporation will provide a unique, important, major new financial institution in Canada. The need for it is recognized by most Canadians, the government is confident that the concept is right and that the kind of people necessary to make it work will be very readily available just as soon as Parliament creates the corporation.


Max Saltsman: Mr. Speaker, I listened with considerable interest to the parliamentary secretary as he spoke about development organizations in other countries. There is one point on which I agree with the parliamentary secretary, that every country has unique problems and therefore tends to develop corporations to take those problems into account. No one suggests for a moment that the problems of Australia, South Africa or Mexico are the problems of Canada. If we look at other development corporations we find that in some ways they were organized to deal effectively with the problems in their particular countries.
Our criticism of this legislation is that the Canada Development Corporation is not designed to take into account the problems of Canada. We are not saying that the CDC should be organized like the others; we are saying that in fact it will not deal adequately with the problems which exist in Canada. The only problem it would seem to deal with-the parliamentary secretary referred to this-relates to the fact that savings will be available for investment opportunities and the government will satisfy the desire of Canadian investors to have a place in which to put their money. It would seem that the government is going to take the corporations which are now Crown corporations, owned by the people of Canada, and give them to the CDC to satisfy this investment urge. This is a pretty shoddy kind of objective for a development corporation. One would think that is the only problem facing Canada. If it were, perhaps the CDC would make some sense.
The greatest problem facing this country, as far as investment and development are concerned, is the high proportion of foreign ownership. Yet the terms of reference of the CDC say it is not there to buy back control of Canadian companies or to deal with the problems of foreign ownership which the government says it will try to deal with in some other way. So it would appear that the CDC is not set up to deal with the problems we face.
Another problem is that of industrial inefficiency. I see the Minister of Industry, Trade and Commerce (Mr. Pepin) turning a rather baleful but, as always, friendly eye in my direction as if he wonders what I am going to say next. The minister knows as well as I do that we have one of the most inefficient industrial structures in the world. We have infinitely more capital at the disposal of our workers, but we are 30 per cent less efficient than the United States. The inefficiency arises, not because Canadians do not work as hard or because there are not enough brains here but from what is essentially a bad industrial structure through less specialized plants. The branch plant approach of the Canadian economy, with tariffs and the desire of American international corporations to locate here, has forced upon us an industrial structure that is not suitable to our economy nor our population.
In many speeches both inside and outside this House the Minister of Industry, Trade and Commerce has pointed out the difficulties facing Canada in terms of rationalization of the chemical industry, the rubber industry, the white goods industry and many others. These are industries with heavy investment from foreign corporations; almost every one is characterized by foreign ownership. That is one of the great problems that we have in Canada.


Jean-Luc Pepin: Not necessarily.


Max Saltsman: No, not necessarily; but I will come to that later. The point is that with the exception of the resource-based industries-which is a horse of another colour-most of the industries characterized by this inefficiency are essentially foreign-owned. If we believe that this is a problem, and I think the minister admits that it is, how are we to correct it?
One statement made in connection with the CDC is that when it is set up it will be in the business of forming new companies either through mergers of existing ones or starting from scratch. One of the few successes in this approach has been the British approach to rationalization because it has not attempted to get public investment participation. In order to accomplish such mergers you must have a very free hand, enormous flexibility, and not have to answer to the stock market or the investors in the corporation. If you have to answer to the profit motive, you cannot carry out your purpose.
This is an area that is crying for attention in Canada, an area which is acknowledged to be difficult by the Minister of Finance (Mr. Benson) and others. Yet the corporation set up to tackle this problem will not be able to do it unless the national interest and the profit interest coincide. There may be a situation where a merger could be put through to provide the kind of profitability called for by this bill, but it is not possible in the majority of cases. To limit the activities of the Canada Development Corporation in such a critical area is foolhardy and is an enormous disadvantage to this country.
The hon. member for Mercier (Mr. Boulanger) interjected earlier in this debate. He is not in the House now. I wish he were because I have something to say to him. I have known him for a long time and I am very fond of him. We served together on the Standing Committee on Transportation and Communications and in the course of its hearings we toured western Canada together. I have a great deal of respect for him, taut he interjected in the most inane way in this debate when he asked, "What will we do without foreign ownership?" Mr. Speaker, that is typical of the thinking of people on fhe other side of the House-reasonable, intelligent people in some cases and I think even reasonably well-intentioned people. They have been brainwashed by their own silly philosophy and actually believe that we cannot exist without foreign capital, despite all the evidence to the contrary.
On one occasion when making a speech out west even the former Prime Minister, Mr. Pearson, said that if

June 4, 1971

Canada tried to do without foreign capital, the price would be a 25 per cent to 30 per cent lower standard of living. That was absolute nonsense, but it has been adopted by the other side of the House. Where is the evidence to suggest that we cannot manage without foreign capital? The suggestion from the other side of the House that some countries which have done much better than Canada, in terms of economic growth and development, have done so with foreign capital is not true. The countries that push us into third place in terms of standard of living are characterized by an absence of foreign capital. Those countries are Sweden and Switzerland. If foreign capital is so vital to development, surely there should be evidence that large amounts of foreign capital were poured into Sweden and Switzerland in order to improve their economies. No such evidence exists.


An hon. Member:: Remember, those two countries did not suffer because of the last two wars.


Max Saltsman: As I say, no such evidence exists. And remember, Mr. Speaker, that both those countries have far less in the way of natural resources, far less in the way of power potential and far fewer natural advantages compared with other countries.


An hon. Member:: Those countries did not suffer in World War I or World War II.


Max Saltsman: Let us consider a country that was involved in World War I and World War II. It was certainly involved in World War II. I am speaking of Japan. Japan has fostered a most successful rise in the development of its economy by deliberately excluding foreign development.


Marcel Joseph Aimé Lambert: And by excluding foreign products.


Max Saltsman: And by excluding foreign products, perhaps. Development in that country is far in excess of development in this country.
What are the really efficient industries in Canada? Of which industries are we most proud? Which industries require the least amount of tariff protection? Leaving aside the resource industries for a moment, you will find that the most efficient industries in Canada are those developed either by private or by public Canadian entrepreneurship. The steel industry, which is largely Canadian-owned and remains in Canadian hands, is among the most efficient industries in the world. Our beer industry, which has remained in Canadian hands, is among the most efficient of its kind in the world.


Mr. Francis:: Mr. Speaker, may I ask the hon. member a question? The hon. member has referred in praiseworthy terms to the Japanese example. Does he feel that the kind of labour movement that has existed in Japan since the last world war is one that he is prepared to commend to Canadians and to those who support his party?
Canada Development Corporation


Max Saltsman: I do not understand the point of that question. The hon. member seemed to draw the inference that the Japanese are in some way oppressed. The Japanese economy is badly misunderstood. The level of wages in Japan is not so low when you take into account all the fringe benefits that are given to their workers. Japan has not prospered through paying its workers low wages. It may be true to say that wages in Hong Kong are low. To imply that Japan's success rests on low wages is nonsense.
The Japanese rise has come from technical excellence. They have developed some of the most efficient industrial structures in the world. They do not depend on cheap labour; that is not the basis for their growth. I am not suggesting that we adopt Sweden, Switzerland, Japan or any other country as a model. I say that you cannot automatically equate foreign investment with growth. That is what the Liberal party has tended to do. I am merely saying there is no evidence to support that argument. On the contrary, foreign investment has probably reduced our standard of living. I see hon. members shaking their heads. They are victims of the kind of mythology that is espoused by the Liberal party.


Some hon. Members:: Oh oh!


Max Saltsman: They find it impossible to have confidence in the Canadian people. They do not think that we can develop this country unless foreign investors do it for us. We are one of the richest countries in the world, and in a most shameful way hon. members suggest that we should say to foreign investors, "We cannot develop our industries and the resources that nature gave us. Would you please tell us how it should be done?" That is ridiculous. There never was any need for it. Perhaps some of our industries have got off the ground a little faster through being helped by foreign investment. Nevertheless, in the long run the intrusion of foreign investment in Canada has lowered our standard of living. It will destroy our economy unless we do something about it. That is what we ought to be concerned about.
Let us consider what we do well in Canada. First of all, many efficient industries in Canada are under public ownership. Let us compare these industries in Canada with their counterparts in the United States. Compare our medical services and their availability in Canada with those in the United States. There is no comparison because we are so far ahead. In hospital services we are far ahead of the United States. Provinces which have introduced no-fault insurance or publicly-owned insurance schemes are the envy of people in the United States; Americans come here and tell us that.
Let us consider the CBC. Although we criticize the CBC-and it is far from perfect-the United States wishes to set up a similar body. They are talking about a similar kind of broadcasting system because they are dissatisfied with the crassness of their commercial system. They know that the CBC is good. Look at Polymer Corporation. That is an ideal model of a Crown corporation. Originally begun in wartime to satisfy a specific need, it went on to stand on its own feet and justify its existence.

June 4, 1971
Canada Development Corporation
Another company that may be taken over by the CDC is the Northern Transportation company, another model of its kind. It has not raised rates for years; it provides substantial profits to the treasury and gives good service in the northern areas, service that could not be provided by others. Look at our transportation system. One of the built-in difficulties in this country stems from a relatively small population spread over vast distances. I have criticized our railways; I think a great deal is wrong with them. But when you compare our railways with those in the United States you will see there is no comparison. Ours do a better job. This applies particularly to the publicly-owned railway. Despite our criticisms, it has operated in the public interest to a far greater extent than has the CPR, and certainly to a far greater extent than have the American railways.
Air Canada is another example of which we can be proud. We took over this airline because private industry did not want it, although once we proved that a national airline could be profitable, private industry began clamouring for a piece of the cake. We do not require Canadian Pacific Airlines. There is no need for it. Air Canada is one of the finest airlines in the world. It has an outstanding record. Although this year, after a long time, it has shown a loss, the loss is insignificant compared with losses being shown by United States airlines which are in serious trouble under private ownership.
I am trying to show that many of the most efficient industries in Canada are under public ownership and those areas of endeavour have remained to a large extent under Canadian ownership. Somebody said what we need today is a C. D. Howe rather than a CDC.


Some hon. Members:: Hear, hear!


Max Saltsman: Some of the efficiency of the steel industry can be attributed directly to C. D. Howe's insistence on its expanding and developing. Polymer Corporation stands as a tribute to his foresight and imagination. We need more of that today. I regret to say that foresight and imagination are qualities seriously lacking on the government benches. Those attributes were seen briefly in some on the government benches but are seen no longer. The hon. member for Duvernay (Mr. Kierans) had to resign from the cabinet in order to speak of some of the truths that he saw.
Earlier in the debate the hon. member for Gaspe (Mr. Cyr) asked my leader whether he would invest in the CDC. He put the question in a way which implied that Canadians were breathlessly waiting to invest their $5 in a corporation such as the CDC and that was the only opportunity they would have for investing. I find it difficult to understand why an intelligent man would assume that. What does he think we have been doing for 100 years? We have all been investing in Canada. Everyone of us who pays taxes invests in Canada. The corporations I described earlier are all investments in which I and millions of Canadians have participated.
It is a great joy to me, and I am sure this is true of other hon. members, to welcome students and others from my riding to this beautiful building, this magnificent House of Commons of which we are all so proud,
and to say, "This is your building; it belongs to you. All these carvings belong to you. All this represents the investment of my generation and of previous generations, and your generation will continue the investment in these things." All who pay taxes and contribute through productive work make an investment in this country. We do not have to wait for the Canada Development Corporation, with its five bucks, to be reminded that there are investment opportunities in Canada. Rather than trying to distort a development corporation, we should try to induce people to invest in the most unselfish of all motives, and at least give the Canadian investor the opportunity to invest as in the past, although there has not been as much investment as I would like to have seen.
The way to do this is to ensure that the Canada Development Corporation is a Crown corporation which is answerable to Parliament and is owned by all the people of Canada. In this way, the chances we take with the Canada Development Corporation and the benefits which accrue therefrom will be for all Canadians and not just a small group.


The Acting Speaker (Mr. Laniel):: Order, please. I regret to interrupt the hon. member, but his time has expired.


Marcel Joseph Aimé Lambert: Mr. Speaker, this afternoon we have had the delightful experience of listening to the hon. member for Waterloo (Mr. Salts-man). Based on the last few minutes, this could be called an interlude of fairy tales on a Friday afternoon by Max Saltsman. We have heard unsubstantiated observations with regard to the performance of the Canadian economy. The hon. member for Waterloo made such statements in committee, but when we start pinning him down the statements become unglued, we do not see the same assurance and bravado.
The amendments are with regard to the objects of the corporation. The first amendment suggests the elimination of any question of "profits and in the best interest of the shareholders as a whole." I shall not try to get into the laboured reasoning of the parliamentary secretary when putting forward the view of Department of Finance officials. He said that if we are working in the best interests of the shareholders, we are working in the best interests of the nation. That is really stretching it. What we are looking for in this clause is what this company will be able to do. Its purpose is to assist in the creation of the development of business, resources, property and industries in Canada. This is a litany of pious hopes of what it might be able to do.
It reminds me of the objects of a company in a memorandum of agreement or letters of incorporation. They sound very nice. They go far beyond the operations of the particular little company that is being established. When looking at the objects of the average small corporation you think you are looking at a corporation such as MacMillan Bloedel which is one of Canada's most successful operations. As the hon. member stated, one thinks

June 4, 1971

it is a corporation like the Steel Company of Canada. Many large companies have the same objects as small companies.
In this clause we have the same grandiose language. It is true that these provisions must be expressed in broad terms in order to permit the company to function in a certain way, but the operative part of clause 6 is what the hon. member for Waterloo seeks to amend. The operative part of the clause reads:
-and shall be carried out in anticipation of profit and in the best interests of the shareholders as a whole.
The hon. member seeks to eliminate that part. By its elimination one would suppose that the hon. member's argument is that it should not be run for profit, or that it could be run for a loss. This amendment suggests that "in the national interest" has the same meaning as "anticipation of profit and in the best interests of the shareholders as a whole." If I had authorship of such an act I would lay out the objects in much the same way as at present, tout with some variations. I would place greater emphasis on the national interest and use the method of operation in the way that the Alberta Gas Pipeline was spawned and started. That is the sort of operation in which a development corporation should be able to participate, not in this way, having it the sole source of money. There is no public participation at the beginning. The public is not invited to come in at the appropriate stage.


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


Marcel Joseph Aimé Lambert: I will terminate my remarks, Mr. Speaker. I will not be here next week; I will be out of town with the constitution on committee. I wish to reiterate the opposition's dislike of the amendment. We will not support it and we will not support the bill.


The Acting Speaker (Mr. Laniel):: Order, please. It is
the understanding of the Chair that there is general agreement to allow the Minister of Consumer and Corporate Affairs (Mr. Basford) to move the second reading of and concurrence in the amendments made by the Senate to Bill C-180. Is this agreed?


Some hon. Members:: Agreed.



CONSUMER PACKAGING AND LABELLING ACT


Stanley Ronald Basford: the second reading of and concurrence in amendments made by the Senate to Bill C-180, respecting the packaging, labelling, sale, importation and advertising of prepackaged and certain other products.
He said: Mr. Speaker, there has been consultation in the usual way with the hon. members for St. John's East (Mr. McGrath), Vancouver-Kingsway (Mrs. Maclnnis) and Compton (Mr. Latulippe) to call the Senate amendments .to the packaging and labelling act and deal with them at
Senate Reform
this time. I appreciate their courtesy in allowing this matter to come forward.


The Acting Speaker (Mr. Laniel):: Order, please. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Stanley Ronald Basford: I am not sure whether hon. members want an explanation. There are two amendments, one to clause 3, to make it read very simply that subject-


Stanley Howard Knowles: Carried.


Stanley Ronald Basford: I take it that hon. members do not want an explanation and I thank them very much.


The Acting Speaker (Mr. Laniel):: Is the House ready for the question?


James Aloysius McGrath: It would be helpful if a short explanation of the two amendments were on record. I think the minister should be allowed to finish.


Stanley Ronald Basford: It will take just 60 seconds to explain them. Clause 3, which was of concern to hon. members, will now read:
Subject to subsection (2) and any regulations made under section 18, the provisions of this act which are applicable to any product apply notwithstanding any other act of the Parliament of Canada.
Clause 11 was amended to make it mandatory, as was my intention anyway, to seek the advice of at least one organization of consumers and one organization of dealers in relation to the preparat'on of any regulations to standardize the shapes or sizes of containers of prepackaged goods. These are the two points which concerned the committee. We have been able to propose wording which I believe deals with the objections which were raised.


[Stage Direction]
Motion agreed to, amendments read the second time and concurred in.
The Acting Speaker (Mr. Laniel):: It being four o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions, public bills and private bills.



PRIVATE MEMBERS' MOTIONS


Mr. David Orlikow (Winnipeg North) moved:: That, In the opinion of this House, the government should give consideration to the appointment of a special committee of this House which shall have the power to hold hearings in

June 4, 1971
Senate Reform
various parts of Canada, take testimony and hire experts, with the following terms of reference: That it shall examine the role of the Senate within Parliament and in its general constitutional functions and report with recommendations on whether the Senate should continue as it has been and is, or whether it should be abolished (and if so, by what means) or whether some form of reformed Senate is worthwhile (and if so, what reforms).
He said: Mr. Speaker, it will come as no surprise to hon. members that I am personally of the view that the Senate plays no useful role in the political life of Canada and that it ought, therefore, to be abolished. However, in light of experience, in light of the attitude taken by both the Liberal and the Conservative parties, I recognize the complete futility of proposing a resolution or putting forward a bill which would simply call for the abolition of the Senate. It is for this reason I am proposing the establishment of a committee to look into the role of the Senate, to study what part it plays in the political life of Canada and try to arrive at conclusions. If the evidence showed that the Senate presently plays no really useful part in the life'of Canada, the committee might recommend ways in which it could be changed or reformed so that it could play a useful role.
I do not believe that a committee which looked at the question objectively could reach the conclusion that the Senate as presently constituted serves a useful purpose in Canadian life. I am so convinced that the Senate ought to be abolished that I believe a step in the right direction would be the establishment of a committee to study the question.
One of the leading experts on the constitution of Canada, one of the leading students of the place of the Senate in the last 25 or 30 years, is Professor Eugene Forsey. In a memorandum which he prepared in the late fifties when he was research director of the Canadian Congress of Labour, Mr. Forsey had some interesting observations to make on the role of the Senate. I should like to place some of these observations on record and discuss some of the conclusions reached. Professor Forsey said in his memorandum:
The Canadian Senate is one of the most thoroughly undemocratic bodies in the world, and has far larger powers than many Canadians suppose.
Senators are appointed, not elected. They hold office for life. They cannot be removed, except by the Senate itself.
The Senate can amend any bill whatsoever, including a money bill, and go on throwing it out, as often as it likes; ten, twenty, fifty, a hundred, a thousand times. There is nothing in Canada corresponding to the Parliament Act in Great Britain.
He then drew attention to some of the limitations which have been placed under the British Parliamentary system on the power of the House of Lords, the chamber under the British system which is analogous to our Senate-limitations which make it impossible for the House of Lords to prevent bills passed by the Commons becoming law. Since Professor Forsey prepared his memorandum further limitations have been placed on the power of the House of Lords under the British parliamentary system, but no such limitations apply to the Senate of Canada. The Senate has virtually equal power with the House of Commons in the enactment of legislation. Aside from the limitations which have been expressed in the law of Britain curtailing the power of the House of Lords, Prime Ministers of Britain have for many years enjoyed the right to recommend the creation of as many members of the House of Lords as they felt desirable.
Sixty years ago a Liberal government in which Lloyd George, later Prime Minister of Great Britain, was a leading cabinet minister proposed sweeping social changes. When it appeared that the House of Lords would prevent the legislation from passing into law, the government made a public declaration that if the House of Lords were to prevent the passage of legislation implementing promises on the basis of which the government had been elected, the Pr.ma Minister would recommend the appointment of sufficient members to the House of Lords to ensure that the legislation was enacted and that the will of the people was implemented.
This could not happen constitutionally in Canada because in this country the Senate has the absolute right to veto any legislation proposed by the Commons. True, it has not happened very often. It is possible that a government elected by the people of Canada on a program much more radical than we have had up till now would be blocked by the Senate. It is for that reason that Professor Forsey in the late 1950s proposed that the Senate be abolished.
In abolishing the Senate we would be following the process of democratization that has taken place in many countries. At the time of confederation five or six provinces of Canada had a second chamber, the members of which were appointed in much the same way as Senators are appointed at the present time. Since confederation, all the second chambers in Canada's provinces have been abolished. I think the provinces learned from experience that the second chamber played no useful role, and it was for that reason that Professor Forsey was so strong in his support of the proposal that the Senate be abolished.
It has been argued that the Senate can and does play a useful role. In the last half dozen years in particular a number of quite young people in their thirties and forties have been appointed to the Senate, instead of those in their s xties and seventies who had been appointed for many years in the past. A number of Senate committees have undertaken some quite important studies into matters of policy that are of tremendous importance to Canadian citizens. Let me mention a few of them. There was the committee headed by Senator Croll which studied in depth the problem of the aged in Canada and made a report that had considerable merit. In their report they made a number of very useful proposals as to what should and could be done to improve the lot of the aged in this country.
The committee headed by Senator Davey studied in depth the condition and role of the media-the press, magazines, radio and television-in this country. I think it did an excellent piece of work. A large number of

June 4, 1971

recommendations made by the Davey committee are useful and are ones that I think the people of Canada could support. A Senate committee headed by Senator Lamontagne looked into science policy and carried out the most in-depth survey of scientific research ever undertaken in th's country. A tremendous amount of useful information was gathered by that committee. Their first report is interesting and contains a number of valuable suggestions.
We now have the Senate finance committee, which is headed by Senator Everett, one of the younger Senators from my own province, looking into the state of Canada's economy. I notice the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) is in his seat. I wish he would read the testimony that is being given to that Senate committee. I have not been keeping an exact scorecard but I am willing to bet the parliamentary secretary a dinner in the parliamentary restaurant that 90 per cent of the economists who have been appearing before the committee are opposed to the economic policies of the federal government. I think Senator Everett's committee is doing an excellent job.


Patrick Morgan Mahoney: I rise on a point of order, Mr. Speaker.


Mr. Speaker:: Order. The parliamentary secretary is rising on a point of order.


Patrick Morgan Mahoney: Mr. Speaker, if the hon. member would take time out from reading the Senate reports in order to read the speech I gave yesterday in the House, he would find not only have I read that evidence but that I quoted from it.


David Orlikow: Unfortunately, Mr. Speaker, I not only read the parliamentary secretary's speech, I heard it, and a more selective choosing of so-called evidence I have yet to hear. The only quotations he made were of the one or two economists who happened to agree with government policy. There was not a word about what Professor Barber or Harry Johnson said, or what was said by the vast majority of those who disagree with the government.
So as I say, Senate committees have been doing a very useful job. But, Mr. Speaker, what happens to the recommendations that are made? Have any of the recommendations made by Senator Croll's committee on rhe aged been implemented into legislation? Of course not! What has happened to the recommendations made by Senator Davey's committee on the mass media? Have any of these been implemented? If they have, then I do not know about it. What about Senator Lamontagne's committee's recommendation on science policy? They are gathering dust, like the thousands of pages of evidence given to that committee.
We know from the speech made by the parliamentary secretary yesterday and also the speech made yesterday by the Minister of Manpower and Immigration (Mr. Lang) how much attention they are going to pay to the evidence given before the Senate committee headed by Senator Everett. Perhaps the government will be rescued from its own folly by the Senate committee, in that the
Senate Reform
Senate committee will ignore all the evidence given by the experts they have heard and will endorse the economic policies of the government in its report. But if the committee does this it can only do so by ignoring the evidence of the experts that the committee itself chose to testify before it.
I say quite seriously that these kinds of studies could be much better done by parliamentary committees, task forces and royal commissions. No government, not even this government, could ignore reports and recommendations made by task forces and royal commissions appointed by it, or the recommendations of parliamentary committees staffed by members the majority of whom came from government benches, as completely as the present government has ignored the recommendations of the Senate committees I have just mentioned.
Other suggestions in regard to the Senate have been made, such as that the Senate's composition ought to be changed, that there ought to be Senators appointed on the recommendations of the provinces. Personally, I cannot think of a better way to hamstring the running of this country than to give the provinces what is virtually a veto power over what is done by a Senate which, as I have already said, has power equal to that of the House of Commons.
Some have suggested that Senators should be replaced by representatives of various occupational groups. Again, I do not know who would decide which occupational group should be represented or in what proportion the representation should be. One thing that could be said of that kind of Senate is that it could not possibly have more representatives of business than the present Senate. Neither could it possibly have more representatives from one political party than the present Senate. But in my opinion such a Senate could create just as many difficulties and problems as the Senate we now have.
As I said when I rose to introduce this resolution, knowing as I do that there is such hostility on the part of government members and most, if not all, of the members of the official opposition to a proposal to abolish the Senate, I feel that we should either abolish the Senate or give the Senate a useful role to perform. I also make the moderate suggestion that we should appoint a parliamentary committee with power to employ staff and adjourn from place to place to hear witnesses and evidence and decide whether there is a useful role for the Senate.
There has been some indication as a result of hearings over the years that the overwhelming majority of Canadians believe the Senate plays no useful role and should be abolished. I do not think members of this Chamber are prepared to take such a position. I am sure members realize there would be difficulty if such a change were made, particularly in respect of the British North America Act.
At this time, the role of the government and the Senate is becoming increasingly difficult. As the situation changes in the world, the role of the government in this House and in the other place becomes very difficult. In

June 4, 1971
Senate Reform
closing I should like to state that the Senate should be considered from a democratic point of view. Can it be designed to properly perform a purposeful function? For that reason I have proposed the establishment of a committee to consider its function and responsibility.


Mr. Deachman:: Mr. Speaker, would the hon. member be willing to answer a question?


David Orlikow: Yes.


Grant Deachman: Mr. Speaker, would the hon. gentleman be willing to add to his motion a request that the committee determine whether the House of Commons is worthy of retention?


David Orlikow: Mr. Speaker, I do not know whether the hon. member for Vancouver Quadra (Mr. Deachman) is serious, but I suggest to him there is no comparison between the Senate and the House of Commons. Every member here, including the hon. member for Vancouver Quadra, is expected by the general public to be doing the kind of job hon. members ought to be doing.


An hon. Member:: He is the best member from British Columbia.


David Orlikow: He may be the best member from British Columbia, but that is a sad commentary on the people of British Columbia. I do not accept that. We only have to look at the results of the elections since 1957 to realize that most of the members who sit in this place have not been here very long. I do not think we need worry about the people of Canada deciding who should sit in this place and what should be done with the Liberal government. I suggest no one could look after the functions of the Senate better than the hon. member for Vancouver Quadra. Perhaps he is looking for a call to that place, but most people appointed to the Senate are not there for very long.


An hon. Member:: Until they are 75.


David Orlikow: Senators are appointed for life and can elect to retire at 75.


Mr. Speaker:: Order please. I must interrupt the hon. member because his time has expired.


Mr. Hubert Badanai (Fort William):: Mr. Speaker, I commend the hon. member for Winnipeg North (Mr. Orlikow); not so much for his view of the upper chamber but for giving members of this House the opportunity to speak about the Senate and what it means to Canada. I am happy to take part in this debate for the opposite reason which the mover of this motion has in mind. He wants a committee to study the value of the Senate, favouring its abolition. I want to strengthen the Senate.
Under the present Constitution of Canada, Parliament consists of the Queen, represented by the Governor General, the Senate and the House of Commons. Whatever arguments may be advanced against this parliamentary structure, aga.nst the monarchy or against the Senate in its present form, the fact remains that this is the existing
system and, therefore, the point from which we are obliged to start. It follows that in any consideration of the future role and composition of the Senate, or of the question of its abolition, the Senate itself should have a vo ce. There is some force to the argument that it would be constitutionally improper for one House of Parliament to consider the compositnn, functions and future of the other place without any reference to that chamber.
The Senate is part of the Canadian structure of government, whether one likes it or not, and therefore has a right to be consulted on any matter of direct concern to it. If the Senate had a record of irresponsible or obstructive behav our, if it could be demonstrated that it was a totally useless body, if it had been a consistent hindrance to progress, then perhaps one could make out a case in favour of the objective contained in the motion under discussion. Since nobody could claim, however, that the Senate poses a threat to Canadian democracy or that it had never done anything useful, it would be difficult to just fy an investigation of the Senate from which the Senate itself was excluded.
It is quite possible that among those best qualified to>
advise on the future role of the Senate are Senators themselves. They are the people with direct, practical experience of the work of the Senate. They are presumably as much aware of the strengths and weaknesses of the Senate as anybody and are certainly well placed to measure its success or lack of it. It is not inconceivable that they might have some good ideas as to how it could be improved. Before any final decisions are taken it would surely be only just and reasonable to hear what the Senators themselves have to say.
Another argument against the motion is that Senate reform is only one aspect of constitutional reform, and constitutional reform as a whole is a subject which is currently engaging the attention of the federal-provincial constitutional conference. The consideration of the future role of the Senate and one of the pros and cons in respect of its abolition should only be made in conjunction with other constitutional considerations. Piecemeal reform of a constitution can lead to dangers and inconsistencies.
The future role of the Senate is hkely to be cruc'ally influenced by other constitutional decisions which will have to be taken. While the federal-provincial constitutional conference will be devoting its attention to the entire quest on of const tutional reform, it would seem quite inappropriate at this stage to appoint a committee charged solely with making recommendations in relation to the Senate without any regard to the constitutional conference which is scheduled for the fourteenth of this month.
The conclusions of the third working session of the constitutional conference of February 8 and 9, 1971, give an important indication of the conference's current thinking. These conclusions registered agreement in principle on a number of important issues, including patriation of the constitution, a formula for constitutional amendment,.
[Mr. Orlikow.)
June 4, 1971

federal and provincial constitutions, fundamental rights and language rights. In any one of these areas it is important to recognize that the Senate could well play a very active and crucial role. Moreover, the constitutional conference envisages that the Senate would be involved at the very outset of the constitutional reform process.
Reference to the Senate by members of the NDP as an old-age home for the party faithful is a cynical statement which reflects the negative attitude of the hon. member's party in general toward an institution which is part and parcel of the government of Canada and performs a very useful duty. The hon. member who proposed the motion asks in effect: Why a second chamber? I wish to point out to the hon. member and to those, who think like him that the second chamber relieves the pressure of work on the House of Commons which, in these days of intense governmental activity, becomes overburdened. As everyone knows, it acts as a reviewer of legislation, providing a brake on rasty or ill-considered legislation.
Hon. members who were here in March of 1961 will remember that the government of the day imposed legislation giving the Minister of National Revenue the final decision with respect to tariff changes, without right of appeal. The resolutions read:
That goods be deemed to be of a class or kind not made or produced in Canada where similar goods made or produced in Canada are not offered for sale to the ordinary agencies of wholesale or retail distribution or are not offered to all purchasers on equal terms under like conditions-
In other words, the minister was to assume the dictatorial power to impose tariffs at his discretion, without giving the importer a chance to state his case. The then Minister of Finance suggested that it was a small resolution, but in reality it was one with big implications extending to the fundamental principle of parliamentary control over taxation, giving the Minister of National Revenue the power to decide, without any review or appeal. Needless to say we, the Liberal opposition at that time, fought tooth and nail against the measure in an effort to get the government to amend the resolution to provide reasonable protection against any arbitrary action by the minister. In summing up the case for the official opposition, Right Hon. Lester B. Pearson said:
We claim that the rule of law is involved in this resolution as an issue. It is not simply a matter of the preservation of the substance of parliamentary authority and rule. We will have nothing to do with the granting of powers vastly in excess of need. Supreme over any all powerful executive, in our view, must stand the authority of a free, sovereign and independent Parliament.
After days of debate the resolution came to a vote and the government, having 208 members against the Liberal is 49 and the CCF's-forerunner of the NDP-eight members, it carried the day in the House, but not in the Senate where Liberals were in the majority. That body refused to approve the legislation and thus saved Canada from one of the crudest autocratic pieces of legislation ever put forward by a Canadian government.


Some hon. Members:: Hear, hear!
Senate Reform


Hubert Badanai: Had we not had an upper chamber an unpopular and undemocratic piece of legislation would have been written into our statute books. This is just an example that the Senate can check any tendency on the part of the House of Commons to abuse its power. It also safeguards the interests of the provinces, which was envisaged at the time of confederation.
The idea that the upper house is trying to take away the power of the Commons is absurb. As the load on Parliament grows to enormous proportions and the House of Commons can no longer cope with the demands on members, the Senate moves in to shoulder more of the burden. The investigation of such broad and urgent problems as those of the aged, poverty, science policy and the mass media are important examples of the work which the Senate has been able to perform through its committees' system. To abolish the Senate would remove a considerable potential for Parliament, all the more so in view of the pressures imposed upon the standing committees of the House of Commons.
Senator A. W. Roebuck, one of the brilliant minds of our upper House, once said:
In my opinion the strength of the Senate lies in the independence of its members. In our modern form of cabinet government, the Prime Minister and his ministerial colleagues have absorbed, first, the powers of the Crown, and second, many of the former functions of parliament. Parliament is still boss whenever it assumes that role, but ordinarily, and in the course of the multifarious details of government, the House of Commons is the pliant creature of the cabinet. So too the cabinet is the boss of the civil service, but more and more as the detail and complexity of government grows and multiplies, the cabinet becomes the instrument of the civil service.
But not so the Senate. The members of the upper chamber are not dependent on either the government or the civil service. Senators are not seeking promotion or anything else. They have nothing to hope for and nothing to fear. They are as secure in their positions as judges on the bench. The ever-increasing responsibilities of modern government, extending as they do into almost every sphere of public activity, serve as a good reminder of the need of a second chamber.
The House of Commons is always overburdened because of the vast amount of government business with which it has to deal. The criticism is sometimes heard that many matters of national importance receive scant attention. Without a Senate to relieve the pressure, many matters would receive even less attention, perhaps none at all. There is no doubt that the second chamber, properly utilized-and I am convinced that such is the case-helps to relieve the burden of work in this House.
As to the suggestion that the Senate should be an elected body, this view is not generally accepted. The Lord Chancellor of Great Britain, addressing the Commonwealth Speakers' Conference on September 9, 1969, said the following about this question:
The members of the elected house have a certain moral and political authority by reason of the very fact that they have

June 4, 1971
Senate Reform
been elected. If the members of the upper House are also elected, they thereby acquire a measure of moral and political authority which could prompt them to challenge the authority of the lower House and thus make a conflict between the two Houses more likely. Moreover, the upper House needs to be something different in kind from the lower House, and not a pale reflection of it.
I am sure that most Canadians will agree with this assessment of the value of an elected upper chamber equal in power to and which would become a rival of the House of Commons. Fundamental to this discussion is the question: What should an upper House do? Since this matter is being discussed in relation to Canada it will be assumed that it would not be desirable to set up a body equal in power to and which would become a rival of the House of Commons.
Theoretically, the Canadian Senate shares equal power with the House of Commons except in respect of financial legislation, since these powers have never been curtailed by statute as have those of the British House of Lords. The relatively passive role which the Senate plays in the legislative process today has resulted from its own prudence and its acceptance of the fact that power should lie with those who have been directly elected by the people. Former Senator Ross MacDonald, presently holding the position of Lieutenant Governor of Ontario, speaking at the time of the change of government in 1957 when he was leader of the opposition in the Senate, said:
The overriding responsibility of the Senate is to make the constitution work-The Canadian constitution, like all constitutions based on the British tradition of parliamentary government, is a finely-tuned and delicately-balanced instrument. Accordingly, we do not propose to assert our legal rights and prerogatives to the prejudice of common sense or reason, or to the sacrifice of the proper functioning of our constitutional machinery-The Senate was expected by the Fathers of Confederation to act responsibly at all times, and I am confident that it will continue to do so in the new Parliament. We should not- automatically resist every government measure which comes before us. To do so purely out of party considerations would be to hamper any effective government of our nation.


Mr. Speaker:: Order, please. I regret very much to interrupt the hon. member for Fort William (Mr. Bada-nai), but his time has expired.


Some hon. Members:: Continue.


Mr. Speaker:: Has the hon. member leave to continue his remarks for a few moments?


Some hon. Members:: Agreed.


Hubert Badanai: I thank hon. members for their indulgence. I shall shorten my speech and take only a few more minutes. The thought to bear in mind is that the abolition of the Senate would not strengthen the House of Commons. On the contrary, it would tend to add to the authority of the establishment, the cabinet and the top officials of the civil service. Thus, the abolition of the Senate would end by losing the scrutiny of the parliamentary system as we know it. In the Senate today sits a man who at one time was leader of the CCF, forerunner of the NDP, whom I heard speak in this chamber on more than one occasion in favour of the abolition of the
Senate but who, speaking in the other place, as reported in the Senate proceedings of March 17, 1970, said:
Although a committee of the House of Commons in 1969 recommended a Commons Committee on statutory instruments, the motion before the Senate seems to be the government's response to the important recommendations of that committee. The honourable leader-hon. Mr. Martin-was careful to point out that he was not making that assertion. However, it would seem to be quite logical that his action should flow from the recommendation of the House of Commons committee. The Senate will be undertaking the very important work of this committee.
The government leader presented this motion to the Senate in a very eloquent manner, and I think once again he has demonstrated, in his capacity as leader of the government in the Senate, that he is determined to give the kind of leadership that will result in important activity being undertaken at all times by this chamber. With this kind of leadership the Senate will make a valuable contribution and will be an enduring part of the Canadian Parliament.
This member, far from being opposed to the value of the Senate has become one of its champions. It is worth noting that most of the countries of the world which one would regard as democratic have two chambers. In the Commonwealth these include Canada, Great Britain, Australia, India, Ceylon, Malaysia, Jamaica, Trinidad and Tobago, Barbados, Bahamas, British Honduras and Bermuda. Outside the Commonwealth they include the United States of America, France, Western Germany, Italy, Belgium, Holland, Switzerland, Norway, Iceland, the Irish Republic and Japan.
Mr. Speaker, I submit that a second chamber can relieve the pressure of work on the lower House, which in these days of intense governmental activity easily tends to become overburdened. It can act as a house of review and thus provide a brake on hasty or ill-considered legislation. It can secure for the country the services of men and women who may be unable or unwilling to engage in the political campaign necessitated by an election. It can check any tendency on the part of the lower House to abuse its power. It can represent interests not otherwise represented in the lower House. In short, in a federal state it can safeguard the interests of the component parts of the federation.


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have just a few remarks to make on this motion. My colleague from St. John's East (Mr. McGrath) also intends to make a few remarks in view of the fact that for some time he was employed in the Senate. But neither of us will make a long speech.
I feel it is something of an insult to the Senate that a committee of the House of Commons should be set up to investigate its activities and usefulness. If there has to be a committee at all, I think it would be much more reasonable if we were to propose the setting up of a joint committee. The two Houses are part of the legislative process of Parliament. In spite of the fact that we occupy different parts of the building, we do work in concert on many joint committees which points up the fact that there is a mutuality of interest.
I am quite sure that members of the other place are well aware of the shortcomings within the Senate and
[Mr. Badanai./
June 4, 1971

of the improvements that could be made in appointments, operation and so forth. I do not believe that they are lacking objectivity and could not look at this auestion fairly and come to a conclusion. I am quite sure they know where improvements can be made in the operation of the Senate. For that reason I think the hon. member's motion should have been to set up a joint committee and to take care of the House of Commons portion of it so that there would be a joint effort to look at the legislative processes of Parliament. We cannot separate them because at the moment and from time to time during the session there are bills which go from this House to the Senate. Sometimes they are amended, as one was today, and come back to this House for reconsideration.


James Aloysius McGrath: That was a good amendment today.


Gordon Harvey Aiken: As my friend from St. John's East says, it was a good amendment to the legislation. For this reason I think we should work together and look at the joint legislative process rather than using this motion to beat the other House once again for its shortcomings. We have a few ourselves. We often pass bills here after days or weeks of consideration and anguished debate and send them to the other place, expecting them to deal with the matter in an afternoon-and some of it is very important legislation. I think members of the Senate have cause for complaint about the way we treat them.
As has been pointed out, very effective work is being done in the other place both in originating legislation and in financial affairs. As generally happens, the hon. member from the New Democratic Party who introduced this motion took the opportunity to whack at the Senators for financial and business interests which might be inconsistent with their legislative capacity and for the fact that the Senate is sometimes considered a retirement house for old politicians. I do not think we can be too critical in these respects. I believe some benefit derives from the Senate. We must remember that the effective power in Parliament is in this House and not in the Senate, by reason of the presence of the cabinet within this House and the fact that we are an elected body. We cannot say that the power of legislation rests equally with the Senate and the House of Commons.
The fact that some Senators had or have business interests and connections is not a bad thing. Sometimes it is of benefit to have knowledge of what you are talking about. Many of the things that the other House considers effectively pertain to business, financial and economic matters. They make good amendments and have worthwhile discussions. As far as the question of retired politicians is concerned, a quick look at the membership of the Senate, particularly those who are doing good work, will show that most of them have some political background.
Senate Reform
Of course, some improvements could be made to the Senate. The point was raised by the hon. member for Winnipeg North (Mr. Orlikow) that there should be a limit on the length of time the Senate can delay legislation. I agree with that; there should be no right in the other place to hold up legislation indefinitely. This is one of the weaknesses which should be corrected and in this case we have been delinquent.
There are many other things I should like to say, Mr. Speaker, but time is running out. I merely wish to express my reservations on the motion, first because there should be a joint committee of both Houses and, second, because I could not agree to the abolition of the Senate. For these reasons I cannot support the motion in its present form.


Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, I do not intend to talk out this motion but I want to make one comment. In my opinion it is a very immoral thing indeed to have a law-making body in a country that calls itself democratic if part of that lawmaking body is not subject to election and recall at the proper time by the electorate. That is all I want to say.


Mr. Murray McBride (Lanark-Renfrew-Carlelon):: Mr. Speaker, it is a delight to have an opportunity to say at least a few words on the motion before us in the name of the hon. member for Winnipeg North Centre (Mr. Orlikow). It is my conviction that the Senate suffers from not reflecting very accurately what the electors might expect. We are all aware that bills may originate in either House and that they must pass both Houses and receive royal assent before they become law.
By means of the ballot box, the House of Commons, hopefully, does reflect the will and wish of the public. I think it might be accurate to say that we have "do it yourself" government in this country where no person or persons govern by any divine or preordained right or privilege. This means that we are here because the people of the country want us to be here and we function as the people want us to function. It therefore seems to me that the upper House, which is appointed, cannot really be justified today when we have a very highly-educated populace and people want to participate more fully in the decision-making process. I count myself amongst those who believe very strongly-


Mr. Speaker:: Order, please. The hour assigned for consideration of private members' business has expired. It being five o'clock, this House stands adjourned until eleven o'clock Monday morning, pursuant to special order of the House made earlier this week.
At five o'clock the House adjourned, without question put, pursuant to special order.

Monday, June 7, 1971