1971-12-20

PRIVILEGE


Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, I rise on a question of privilege concerning the manner in which we are being treated in this House by answers to questions with regard to an urgent matter.
Last Friday, in the absence of the Minister of Finance (Mr. Benson), I attempted to raise with his parliamentary secretary the serious plight of the cities of Vancouver and Victoria. Before they had submitted their applications under the special development loan fund, the entire sum available to the province of British Columbia had been allocated by the government of British Columbia, despite the fact that some 40 per cent of all those unemployed reside in those two cities. I urged that the minister consider increasing the total amount of the fund for Canada.
At this point, Mr. Speaker, you called me to order, saying that it was your impression that this question had been asked previously. You were quite correct, Mr. Speaker. Several of us had been trying to use this method to impress on the government the urgent need for help for these and other hard-pressed municipalities.
It is quite evident that up to this point the government is washing its hands of this whole matter and giving us the runaround here in the House of Commons.
I am now in receipt of further correspondence from the mayor's office, citing the Minister of Consumer and Corporate Affairs (Mr. Basford) as declaring:
... I would appreciate knowing if you have any difficulty clearing your projects through either the federal government or the provincial co-ordinator.
The mayor also encloses a copy of a letter from the Minister of Manpower and Immigration (Mr. Lang) promising that the Minister of Finance will be in touch "very soon" but declaring that "this is a matter of provincial responsibility".
In view of the way in which Canada's third largest city is being given the brush-off and its representatives are being given the runaround, I feel that this whole matter should be examined by a committee of the House. Accordingly, if you find that I have a question of privilege, Mr. Speaker, I would be prepared to move, seconded by the hon. member for Vancouver East (Mr. Winch):
That the matter of the administration of the federal-provincial employment loan program be referred to the Standing Committee on Privileges and Elections for immediate study and report.


Mr. Speaker:: The hon. member for Vancouver-Kingsway has given the Chair the required notice under Standing Order 17. I have given the matter serious consideration, and of course the Chair has listened with attention to the representations just made by the hon. member for Vancouver-Kingsway. I have to suggest to the hon. member, with respect, that her complaint should not be raised by way of a question of privilege. I fail to see how parliamentary privilege is involved in any way in the complaint she has submitted to the House for the consideration of the Chair at this time. She may have a grievance but I suggest to the hon. member, with kindness, that this should not be raised by way of a question of privilege, and I cannot put the motion to which she has referred.



ROUTINE PROCEEDINGS


Hon. E. J. Benson (Minister of Finance):: Mr. Speaker, an international monetary settlement was reached on Saturday, and I should like to report on it to the House.
With the permission of the House I will be tabling the communique issued at the end of the meeting of the Group of Ten. The principal features of the agreement may be summarized as follows:
1.	The United States agreed to propose to Congress a devaluation of the dollar in terms of gold from $35 to $38 an ounce. This is an effective change of 8.57 per cent.
2.	For the time being, Canada will maintain a floating exchange rate and will permit fundamental market forces to establish the exchange rate without intervention except as required to maintain orderly conditions.
3.	Other countries in the Group of Ten agreed on new exchange rates for their currencies, and these are being announced by the governments concerned.
4.	Countries other than those in the Group of Ten are reaching decisions with respect to their own exchange rates in consultation with the IMF.
5.	It was agreed that there should be 2-1/4 per cent margins of fluctuations above and below the new fixed exchange rates.
6.	The United States agreed to suppress immediately the 10 per cent import surcharge and the related provisions of the investment tax credit. I am informed that the White House has announced the suppression of the import surcharge with effect from midnight, Sunday, December 19.


Some hon. Members:: Hear, hear!

December 20, 1971
International Monetary Settlement


Edgar John Benson: Under the provisions of the Revenue Act of 1971, termination of the proclamation which established the surcharge automatically extends the investment credit to imported capital equipment which is ordered after the date of termination of the surcharge.
7.	The United States administration will be seeking Congressional action on the gold price as soon as the results of the negotiations now under way on short-term trade issues are available for Congressional scrutiny.
8.	Discussions will be undertaken promptly in the IMF on the reform of the international monetary system.
I should like to comment on the significance of this agreement for Canada. On the most general level it restores an orderly exchange situation on the basis of which world trade and financing can proceed with confidence. This will be of benefit to all countries, not least Canada, having in mind the vital importance of international trade to the Canadian economy.
The basis has been laid for the United States to restore its balance of payments to a sound and durable position. A serious obstacle to the expansion of the U.S. economy has been removed. When the United States prospers, Canada prospers also.
The Canadian economy has been advancing at a good pace this year. But the unsettled international situation has given rise to a sense of uncertainty in the business community. This has now been dispelled. We may therefore expect that the Canadian economy will move forward with even greater vigour.
In the field of our international relationships we also have reason to be satisfied. There have been anxieties and doubts about the direction of the United States trade and financial policies and, in particular, about the intention of the United States toward Canada. The agreement reached this weekend should help to remove these tensions. Our other partners in the Group of Ten have demonstrated a full understanding of Canada's position.
I now turn to some more particular questions relating to the consequences for Canada of this agreement.
First, the exchange rate. It will be determined by the fundamental forces in the exchange market. Our interventions will be limited to the maintenance of orderly market conditions. I might point out, Mr. Speaker, that there has been a large turnover in the foreign exchange market today, and the Canadian dollar is trading at precisely what it closed at on Friday last.


Some hon. Members:: Hear, hear!


Edgar John Benson: I do not expect that the terms of the agreement will have a marked effect on the exchange value of the Canadian dollar. I would stress that the change in the gold price in itself will have no direct effect on the relative value of the American and Canadian dollars.
There are some reasons to expect a stronger growth in our exports. These include the removal of the surcharge and the discriminatory features of the investment tax credit. The appreciation of other currencies will improve our competitive position. But we can also expect a more rapid growth in our imports as a result of the restoration of confidence and a more rapid expansion of Canadian production and investment. The growth of the Canadian
[Mr. Benson.)
economy this year has already been reflected in a more rapid growth of our imports than of our exports and a consequent decline in the trade surplus.
Our policy has been to seek to reduce our imports of capital. I have been asking Canadian borrowers to look to Canadian markets for their needs. I repeat that request today. I continue to believe that it is both practical and appropriate for us to supply more of our financial needs from our own savings.
Second, I would refer to the bilateral discussions of trade questions between Canada and the United States. The monetary agreement demonstrates that these have not been directly related to the United States import surcharge or the realignment of currencies. There are indeed matters of concern to both sides in the trade field. Progress is being made in discussions of these matters, and it is the intention of the government to proceed expeditiously toward a settlement. Canada and the United States are the world's largest trading partners. We hope to get rid of any abrasive elements in our commercial relationships. When the time is ripe, my colleague, the Minister of Industry, Trade and Commerce (Mr. Pepin), will report to the House on the outcome of these discussions.
Third, the suppression of the United States import surcharge will enable us to wind up the operations of the Employment Support Act.
Mr. Speaker, these negotiations have not been easy. Because of the inherent complexity of the subjects, there have been many meetings-bilateral and multilateral. Officials have met. There have been four meetings of the Group of Ten ministers and governors. I chaired the first two and through the rotation system the last two benefited from the energetic and determined chairmanship of Secretary Connally. Heads of government have met. There is no doubt that the meeting two weeks ago between our Prime Minister (Mr. Trudeau) and President Nixon contributed to the satisfactory outcome from the point of view of Canada.


Some hon. Members:: Hear, hear!


Edgar John Benson: Our efforts have now been rewarded with a large measure of success.


Some hon. Members:: Hear, hear!


Edgar John Benson: The agreement has been welcomed with enthusiasm throughout the world which I am sure is shared by all Canadians.


Some hon. Members:: Hear, hear!


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, like the Minister of Finance (Mr. Benson) I am pleased and I am sure we are all pleased that a general settlement of the world monetary crisis was achieved at Washington over the weekend. I am also pleased to see that other changes have been made such as the wider spread and more flexibility with regard to the fluctuation of currencies. I am also very pleased to see that the arrangements made did not involve the repegging of the Canadian dollar at a higher level, at this time at least, and, of course, that the United States surtax is going to disappear.
December 20, 1971

There are quite a few questions to be resolved, however. For example, the minister has not made entirely clear how long the Canadian dollar can float under this arrangement. Have we been committed not to intervene under any circumstances with regard to the floating of our dollar? Were any conditions at all attached to the floating of the Canadian dollar or have we acquired some kind of special status in the International Monetary Fund? These are matters on which the minister could perhaps shed some light. I assume the agreement made by this government with the United States a couple of years ago that we would maintain our United States holdings in connection with the exchange fund in non-negotiable securities stands as it was.
We now have a floating dollar, Mr. Speaker, a dollar which floated up from about 92 J cents to 98 j cents at the time President Nixon made his announcement last August with regard to his economic policies. Since mid-August it has floated up about two more cents to about half a cent above par. I would certainly agree with the Minister of Finance that moving up from 92 i cents to something above par is as much as anybody could reasonably expect the Canadian dollar to do. We are all aware, I believe, of the effect that this upward movement has had upon many of our export industries and therefore upon jobs. We must regard increasing the number of jobs in Canada as our No. 1 priority at the present time; certainly we are far from out of the woods in this regard.
One of our concerns, Sir, is whether our dollar will float higher. Will it continue to float upward in relation to the United States dollar? It has done so since August 15, during which time most other world currencies have been moving upward in relation to the United States dollar. Now we are entering a new phase of the upward movement of most currencies. Their value will increase in relation to that of the United States dollar. What assurance is there, therefore, that continued upward floating of the Canadian dollar will not take place, as has been the case since mid-August of this year? The Minister of Finance says that the value of the Canadian dollar ought not to move upward at all in relation to the value of the United States dollar. However, that has been the trend, and the United States Secretary of the Treasury seems to have said precisely the opposite to what the Minister of Finance has said. Others are expressing concern. I am concerned myself. I hope, Mr. Speaker, that this time the Minister of Finance is right.


Mr. Diefenbaker:: It will be the first time.


Robert Lorne Stanfield: I am certainly pleased, as I say, to see that the Canadian dollar has not been pegged at a higher rate, but I emphasize, of course, that the mere fact our dollar is floating will not provide for us anything like Utopia. There is a very real danger that we will get into the same fix if the dollar floats higher than we would have got into if the dollar had been pegged at a higher rate.
Again, Sir, we do not yet know the price we will have to pay for the arrangement that was worked out over the weekend. Were concessions made with regard to other irritants such as the auto pact? The Minister of Finance has said no. But the more relevant question is, will the
International Monetary Settlement
United States be particularly tough on Canada in these other areas such as the auto pact? The Minister of Finance said that what happened over the weekend shows that many of our fears regarding the United States attitude toward Canada were groundless. With great respect to the minister, I do not think we have yet got the answer to that question. Many of us will be concerned about just how tough the attitude of the United States administration will now be in areas like the auto pact.
We have not returned to the pre-August era. As I said, our dollar has risen in value by about 2 per cent since the middle of August, and there are still pressures around to push it up. The so-called DISC program is still on the books. For all we know, it will soon come into effect. The government is unable to tell us what the effect of that program will be upon Canada and what contingency plans it may announce. The government has no general development strategy. The minister spoke about this settlement increasing the confidence of the business community. If he is so concerned about confidence, he might take a look at some of the domestic policies this government is pursuing-


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: -which will have a substantial effect in diminishing the desire of people to commit money for investment.
The air of secrecy about these whole discussions is regrettable. I must say that I know more about what has been going on in the Common Market countries than about what has been going on in Canada in relation to these discussions with the United States.
Finally, without taking too much time may I say to the minister that I recognize that this must have been a time of great anxiety and pressure for him. I am pleased that a general settlement has been reached and I am pleased that he reached the objective he sought in connection with these discussions, a floating dollar. I am concerned, however, about what the achievement of this objective will mean for Canada, about what it will mean to the movement of our dollar and about what it will mean for employment in this country. I am concerned about these matters. Certainly we do not yet know what price will be exacted from this country for having been permitted to leave our dollar afloat. I can best describe my state of mind by saying that I am in a state of hopeful scepticism.


Mr. John Burton (Regina East):: Mr. Speaker, nothing could demonstrate the failure of the policies of the Canadian government in any attempts it may have made to develop a viable and independent economy in Canada more than one short paragraph in the minister's statement. I quote that paragraph:
The basis has been laid for the United States to restore its balance of payments to a sound and durable position. A serious obstacle to the expansion of the U.S. economy has been removed. When the United States prospers, Canada prospers also.
That is a damning indictment of the policies of the Canadian government as we witnessed them over the past 10 to 15 years.
It is fine for the Minister of Finance (Mr. Benson) to come before us today and say that the United States balance of payments and its economy are in a sound and

December 20, 1971
International Monetary Settlement
durable position. What we are interested in is the state of the Canadian economy. What is the situation in Canada?
The minister starts off by saying that "when the United States prospers, Canada prospers also." In the next paragraph he shows the government's compliance with that sort of point of view. He deals with the Canadian economy and, with his usual bravado, he comes forward and says: "We may therefore expect that the Canadian economy will move forward with even greater vigour." If that statement had come from any other minister on the government benches, it would have had some credibility. However, coming from the Minister of Finance, with his record regarding forecasts, this statement is not worth the paper on which it is written.
We also have to ask what deals were made behind the scene, what concessions were made and what understandings have been reached which may not yet be in writing? At one point in his statement the minister reported that progress has been made in trade talks. This can only mean that there have been some concessions. It probably means there was some horse-trading in these trade talks. Whatever concessions and adjustments have been made are of critical importance to many thousands of Canadians with regard to their everyday livelihood.
There is no doubt that to some extent the immediate impact of the announcements made today and in the last couple of days will be to relieve some stress and anxieties with regard to the economic situation, but for the long run we have no answers. I say quite frankly that none of us expects to have all of the answers now. None of us expected all of these problems to be solved by this time. But we do need to have a better idea of in what direction government policy is moving and in what direction Canada is moving.
What is the government doing to develop long-run trade policies? The minister states there are reasons to expect a stronger growth in our exports. We would like to know what exports. Is this going to be a case of continued growth in exports of our natural resources, our primary resources? The latest trade figures which have been released, for the month of November, indicate that this is the case. We are exporting more and more of our raw materials. This is becoming a greater proportion of our trade.
We also take note of the fact that talks are being held with the United States. Of critical importance to Canada, of course, is the question of our relationship with that country. This is one of the questions with which we must grapple in dealing with our long-run trade policy. Up to the present time the government has followed a policy of commiting Canada to dependency on the United States greater than many of us would like to see.
The minister reports progress in dealing with certain irritants. We would like to know which ones-the auto pact, defence sharing or some of the other irritants which have been referred to from time to time during the discussions? What options is the government exploring with respect to the future direction and thrust of trade policy? Will the government continue on the simplistic course of simply looking for global tariff reductions, desirable as these might be? Are we to strengthen our relationships

with some of the trading groups? Just where is Canada going in its trade policy? None of us can find out at the present time.
I note that the minister also commented on our international investment position. He says in his statement: "I have been asking Canadian borrowers to look to Canadian markets for their needs; I repeat that request today." The point I must make is that this is a step to curtail the wrong aspect of the flow of capital into Canada. What the minister is attempting to do is to restrict the inflow of borrowed capital into Canada rather than equity capital. I think all of us recognize that there are occasions on which some flow of capital into Canada is required. But the point must be made that to the extent that we must rely on imports of capital, that capital should be in the form of borrowed capital rather than equity capital. It is obvious that the minister is moving in the wrong direction.
The minister has told us that the surcharge has been removed, as well as the discriminatory features of the investment tax credit. We must also ask the question: What about the DISC legislation, what about the legislation concerning domestic international sales corporations? Where are we moving in this regard? Are there to be any changes in United States policy in this area?
I note the minister's comments to the effect that Canada will continue to operate a floating exchange rate. We certainly approve this decision, as we have for some time. But we are also concerned about what commitments might have been made in this respect. What concessions were made in this regard? I note one item which appeared in the Globe and Mail this morning-


Mr. Speaker:: Order, please. This might be a good moment to interrupt the hon. member if he is going to quote the Globe and Mail. I have to remind the hon. member that he should note the terms of the Standing Order, which requires the comments of hon. members on ministerial statements to be brief. I realize that when an important statement has been made members then should be allowed some latitude when making their comments. Nevertheless, heed must be taken of the Standing Order which invites members to comment briefly. The hon. member for Regina East might give this some thought as he goes on to quote the newspaper and perhaps reach a conclusion at an early moment.


John Stratford Burton: I shall certainly take your advice, Mr. Speaker. Concern has been expressed in some quarters because reference has been made to a temporary continuation of the floating exchange rate, and also that there will be only minimal concessions or interventions by Canadian authorities in the exchange market.
We also note the minister's statement that the Employment Support Act will be wound up. I hope we shall receive a report on its operations very shortly. I hope, too, that we shall also be given a report on the extent to which the agricultural stabilization fund was used to support the export situation with respect to a number of agricultural products.
Finally, the job situation will continue to be a cause of concern to the Canadian people over the winter months and next summer. To judge from the indications afforded us at the present time, and despite the cheery statement
December 20, 1971

by the Minister of Finance, I think there is a long dark winter ahead for many thousands of Canadians.


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I perused the statement of the Minister of Finance only a few minutes before the House met, when I received the English text together with a memorandum explaining why we did not get the French text. I therefore accept the minister's apologies and I am sure he did his very best.
The minister's statement is brief, and so will mine be. It shows that with some goodwill it is possible to alter the monetary system, once it has been decided to do so. We have once more the proof that it is men who control money. This is a statement to be remembered, and which the people will be able to understand.
The devaluation of the American dollar and the reevaluation of the currencies of other countries, while allowing the Canadian dollar to continue to float, show clearly that changes are necessary in the financial field in order to prevent economic disasters. The time has come for action; I hope that it is not too late and that it is still possible to repair the damage.
I am happy to learn that the American surtax will surely disappear. We will then be able to see whether this policy is liable to improve the Canadian economy so that the whole country may benefit.
However, I deplore the fact that our economy should to such an extent depend on that of the United States. I suggest that we should never let up in our efforts to establish our economy on a more solid basis, so that it be less dependent on the American economy and more on the potential of the domestic market.
We could-and such is the wish that I express for the New Year-make another reform which, further to providing Canadians with a higher minimum income, would boost their purchasing power so as to enable them to buy a greater part of Canadian production. We would thus ensure a better distribution of goods and a greater degree of independence in relation to export markets.
And were that wish to materialize, I would be able to say at the end of 1972 that it was the best year for the Canadian government and for Canadian consumers.



COMBINES


Hon. Ron Basford (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I should like to table two copies, one in each official language, of a research report entitled "Concentration in the Manufacturing Industries of Canada", carried out by the combines investigation branch of my department. The report provides previously unavailable economic information concerning the level of concentration in Canadian manufacturing industries.
The study contains comprehensive data on the industrial structure of Canada. In essence, it indicates that the level of concentration in the manufacturing sector of
Proposed Legislation
Canadian industry appears to be growing and is significantly higher than in the United States. This has implications for Canada's industrial and commercial policies and has a direct bearing on any discussion of competition policy.


Mr. Baldwin:: On a point of order, Mr. Speaker. If the minister is tabling documents under Standing Order 41(2) he has no business at all to make an accompanying statement, and he should know that.


Mr. Speaker:: My interpretation of the minister's action was that he was making a statement on motions. He has made a statement, and I see no difficulty about hearing comments from opposition members.


Gerald William Baldwin: We knew nothing about the statement being made over here.



MANPOWER


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I should like to propose a motion under the terms of Standing Order 43. The pressing and urgent circumstances relate to the evaluation report of the Canada Manpower training program, tabled in the House on December 16, 1971 by the Minister of Manpower and Immigration, which purports to contain evidence that the training program results in higher wages and higher employment rates for the graduates.
This alleged evidence is in conflict with the analysis made by the Economic Council of Canada in its Eighth Annual Review published last September. If unanimous consent is given I move, seconded by the hon. member for Saskatoon-Biggar (Mr. Gleave):
That this House, taking note of the evident contradiction about the effectiveness of the Canada Manpower training program, urges that the matter be referred to the Standing Committee on Labour, Manpower and Immigration to inquire into the appropriateness of a government department evaluating its own achievements.


Mr. Speaker:: Hon. members have heard the motion proposed under Standing Order 43. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent.



CANADA POISON PREVENTION PACKAGING BILL


Mr. Barry Mather (Surrey-White Rock) moved: for leave to introduce Bill C-274, respecting the protection of children from poisonous household substances.

December 20, 1971
Questions


Some hon. Members:: Explain.


Barry Mather: Mr. Speaker, the purpose of the bill is simply to ensure that special packaging will be provided for household substances that are likely to cause serious harm or injury especially to children, so that the occurrence of all such incidents can be eliminated or minimized.


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

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

Mr. McCleave: 1.	What does the Department of Labour consider to be the standard number of working hours in a year?
2.	What does the Department of Labour consider to be the minimum hourly wage that should be paid as a national standard?


Hon. Bryce Mackasey (Minister of Labour):: 1. The
Canada Labour Code, Part III, prescribes standard hours of eight in a day and 40 in a week, subject to averaging of hours over a period of time in certain circumstances. Over 52 weeks, standard hours would be 2,080, subject to deductions for holidays not worked and annual vacations.
2.	The Canada Labour Code, Part III, prescribes a minimum wage of $1.75 per hour for employees of the age of 17 years and over. For employees under 17 years, the minimum wage is set at $1.50 per hour by regulation.


PUBLIC SERVICE-PROFESSIONALS IN ES CATEGORIES
Mr. Saltsman: 1.	How many professionals in the ES category (Economists, Statisticians and Sociologists) are currently on the payroll of each of the federal departments and agencies?
2.	What are their classification levels and salary ranges?


Mr. J. A. Jerome (Parliamentary Secretary to President of the Privy Council):: 1.
1. Departments and agencies	Level 1	Level 2	Level 3	Level 4	Level 5	TotalAgriculture	
22	33	13	6	1	75Communications	
1	1	2	1	5Post Office	
6	1	1	1	9Consumer and Corporate Affairs	
6	4	0	2	3	21Energy, Mines and Resources	
1	21	9	1	1	33N ational Energy Board	
7	6	5	2	20Environment	
54	32	15	6	5	112External Affairs	
6	4	10Canadian International Development Agency	i	1Finance	
35	30	14	16	3	98Tariff Board	1	3	1	5Indian Affairs and Northern Development	
11	12	4	2	i	30Industry, Trade and Commerce	
16	16	10	4	4	50Statistics Canada	
208	142	86	19	25	480Labour	
4	22	8	4	38Unemployment Insurance Commission	
6	2	1	9Manpower and Immigration	
55	34	15	8	2	114National Health and Welfare	
14	19	6	6	1	46National Revenue-Taxation	
3	1	1	5Privy Council Office	2	I	1	1	5Public Works	1	1Regional Economic Expansion	
2	24	24	12	5	67Canadian Radio-Television Commission	
2	2	1	-	5Public Service Commission	1	1Solicitor General	1	1	2Correctional Services	
1	iSupply and Service	
4	2	2	-	8Ministry of Transport	
12	11	3	7	1	34Canadian Transport Commission	
22	23	4	4	2	55Treasury Board	
1	3	1	-	-	5Veterans' Affairs	-	1	-	-	-	1Public Service Staff Relations Board	-	1	-	-	1	2Science Council of Canada	-	-	1	1	1	3Economic Council of Canada	
9	12	4	4	-	29Total	
508	465	239	107	61	1,380

December 20, 1971

2.	The salary ranges for the above category are:
Salary
Level	Minimum	MaximumESI	
$ 6,960	$14,192ES 2	
15,236	20,557ES 3	
20,750	23,278ES 4	
23,220	25,785ES 5	
22,000	27,250


FEDERAL CONTRIBUTION TO NATIONAL CANCER INSTITUTE
Mr. Alexander: Has the government contributed financially to the support of the National Cancer Institute and, if so (a) what was the total amount contributed since 1947 (b) what proportion did this total constitute of the total income of the Institute during that period (c) what proportion of the total budget of the Institute for 1971-72 was contributed by the government?


Hon. John C. Munro (Minister of National Health and Welfare):: (a) More than $4,000,000 for the period 1948-49 to 1970-71. (b) The total income of the Institute for the period 1948-49 to 1970-71 is not readily available to the Department. (c) Information on the total budget of the Institute for 1971-72 is not available to the Department. However, an amount of $250,000 is being made available to the Institute for the fiscal year 1971-72.


NATIONAL PAROLE SERVICE OFFICES, BRITISH COLUMBIA
Mr. Orlikow: 1.	How many parole staff positions were there in British Columbia for the fiscal year 1970-1971?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in British Columbia during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in British Columbia during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of British Columbia had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of British Columbia for the fiscal year 1970-71?


Hon. Jean-Pierre Goyer (Solicitor General):: 1.
Twenty-five.
2.	$11,602.
3.	There are four National Parole Service Offices in British Columbia. Budgeting for National parole offices is centralized and, therefore, figures on a provincial basis are not available.
4.	7,071.
5.	856.
6.	The John Howard Society of British Columbia were paid a total of $27,480, of which, $18,330 was in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervi-
Questions
sion. (2) Part 6. The money paid to the John Howard Society of British Columbia includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of British Columbia also.


NATIONAL PAROLE SERVICE OFFICES, ALBERTA
Mr. Orlikow: 1.	How many parole staff positions were there in Alberta for the fiscal year 1970-71?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Alberta during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in Alberta during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Alberta had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Alberta for the fiscal year 1970-71?


Jean-Pierre Goyer: 1. Fourteen.
2.	$11,853.
3.	Budgeting for National Parole Offices is centralized, and therefore, figures on a provincial basis are not available.
4.	4,985.
5.	1,289.
6.	The John Howard Society of Alberta were paid a total of $30,369, of which $1,389 was in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Alberta includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Alberta also.


NATIONAL PAROLE SERVICE OFFICES, SASKATCHEWAN
Mr. Orlikow: 1.	How many parole staff positions were there in Saskatchewan for the fiscal year 1970-1971?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Saskatchewan during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in Saskatchewan during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Saskatchewan had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Saskatchewan for the fiscal year 1970-71?


Jean-Pierre Goyer: 1. Eight.
2.	$12,141,00
3.	There are three National Parole Service Offices in Saskatchewan. Budgeting for National Parole Service

December 20, 1971
Questions
Offices is centralized, and therefore, figures on a provincial basis are not available.
4.	1,612.
5.	551.
6.	The John Howard Society of Saskatchewan were paid a total of $19,170, of which, $13,925 was in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Saskatchewan includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Saskatchewan also.


NATIONAL PAROLE SERVICE OFFICES, MANITOBA
Mr. Orlikow: 1.	How many parole staff positions were there in Manitoba for the fiscal year 1970-71?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Manitoba during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in Manitoba during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Manitoba had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Manitoba for the fiscal year 1970-71?


Jean-Pierre Goyer: 1. Thirteen.
2.	$10,593.
3.	Budgeting for National Parole Service Offices is centralized, and therefore, figures on a provincial basis are not available.
4.	3,267.
5.	839.
6.	The John Howard Society of Manitoba were paid a total of $28,610, of which $9,340 was paid in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Manitoba includes $30.00 for each man-month of supervision provided by the Agency, and $40.00 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Manitoba also.


NATIONAL PAROLE SERVICE OFFICES, ONTARIO
Mr. Orlikow: 1.	How many parole staff positions were there in Ontario for the fiscal year 1970-71?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Ontario during the fiscal year 1970-71?
[Mr. Goyer.l
4.	How many cases has the parole staff had under their supervision in Ontario during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Ontario had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Ontario for the fiscal year 1970-71?


Jean-Pierre Goyer: 1. Fifty-one.
2.	$11,880.
3.	There are ten National Parole Service Offices in Ontario. Budgeting of parole offices is centralized, and therefore, figures on a provincial basis are not available.
4.	17,289.
5.	5,016.
6.	The John Howard Society of Ontario were paid $162,320, of which, $32,720 was in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Ontario includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Ontario also.


NATIONAL PAROLE SERVICES OFFICES, QUEBEC
Mr. Orlikow: 1.	How many parole staff positions were there in Quebec for the fiscal year 1970-71?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Quebec during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in Quebec during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Quebec had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Quebec for the fiscal year 1970-71?


Jean-Pierre Goyer: 1.
Forty-three.
2.	$11,809.
3.	There are seven National Parole Service Offices in Quebec. Budgeting of National Parole Service Offices is centralized, and therefore, figures on a provincial basis are not available.
4.	15,093.
5.	1,747.
6.	The John Howard Society of Quebec were paid a total of $57,040, of which, $9,635 were in the form of grants. All after-care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Quebec includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Quebec also.
December 20, 1971


NATIONAL PAROLE SERVICE OFFICES, NOVA SCOTIA
Mr. Orlikow: 1.	How many parole staff positions were there in Nova Scotia for the fiscal year 1970-71?
2.	What was the average cost of maintaining each position?
3.	What was the total budget of the two National Parole Service Offices in Nova Scotia during the fiscal year 1970-71?
4.	How many cases has the parole staff had under their supervision in Nova Scotia during the fiscal year 1970-71?
5.	How many cases has the John Howard Society of Nova Scotia had under its supervision during the fiscal year 1970-71?
6.	What was the parole grant to the John Howard Society of Nova Scotia for the fiscal year 1970-71?


Jean-Pierre Goyer: 1. Eight.
2. $11,866.
3.	There are three National Parole Service Offices in Nova Scotia. Budgeting of National Parole Service Offices is centralized, and therefore, figures on a provincial basis are not available.
4.	2,049.
5.	647.
6.	The John Howard Society of Nova Scotia were paid a total of $23,890, of which, $8,915 was in the form of grants. All after care agencies are now paid on a fee for service basis.
Notes: (1) Parts 4 and 5. Figures shown represent man-months of supervision, not individual cases of supervision. (2) Part 6. The money paid to the John Howard Society of Nova Scotia includes $30 for each man-month of supervision provided by the Agency, and $40 for each community investigation carried out by the Agency on behalf of the National Parole Service. (3) There are a number of other after-care Agencies involved in the work of supervision in the province of Nova Scotia also.


PROFESSIONAL EMIGRATION TO THE UNITED STATES
Mr. Orlikow: How many Canadian scientists, research workers, engineers, university professors and medical doctors left Canada to work in the United States in the past year?


Mr. Bruce Howard (Parliamentary Secretary to Minister oi Industry, Trade and Commerce):: Statistics Canada* reports that: The following table shows the number of people in certain occupation groups who left Canada to work in the United States. There is no classification for "research worker" in the source material.
	1969	Jan.-June 1970
Scientists'1'	102	42Engineers'2'	1,001	321Professors and Instructors'3'	161	63Physicians and Surgeons'4'	267	112
Source: United States Department of Justice, Immigration and Naturalization Service.
a>
Scientists include agricultural, biological, geologists, geophysicists, mathematicians, physicists, and miscellaneous natural scientists.
Questions
<2) Engineers, include aeronautical, chemical, civil, electrical, industrial, mechanical, metallurgical, metallurgists, mining, and sales.
<3) Professors and Instructors include college presidents and deans and professors and instructors.
<*>
Medical Doctors are described in the source material as Physicians and Surgeons.
Note: Figures for the last half of 1970 are not yet available.


PENITENTIARY INMATE POPULATION-CANADA-1970
Mr. Orlikow: 1.	How many persons were serving penitentiary sentences in each penitentiary in Canada during 1970?
2.	Of those persons serving penitentiary sentences, how many were (a) Indians within the meaning of the Indian Act (b) of Indian ancestry, in each penitentiary during 1970?


Jean-Pierre Goyer: 1.
	Inmate	2(a) and (b) Inmates of Indian
	Population	Origin
	Dec.	Oct. 25
Institution	30/70	1971H.M. Prison-Newfoundland	6	3Dorchester (Inc. Farm Annex and Blue Mountain Correctional Centre)	442	15Springhill	239	11*St-Vincent-de-Paul	481	1Federal Training Centre	276	2Leclerc	434	2Cowansville	349	3Special Correctional Unit	62	3Archambault	378	2Ste-Anne-des-Plaines	62	2St-Hubert Centre	11	0Kingston	699	7Collins Bay (Inc. Farm Annex)	440	8Beaver Creek	67	0Landry Crossing	52	1Joyceville (Inc. Farm Annex)	477	12Wark worth	271	4Montgomery Centre	6	1Prison for Women	86	10Manitoba (Inc. Farm Annex)	427	126Osborne Centre	12	3Saskatchewan (Inc. Farm Annex)	433	117Drumheller	353	100British Columbia	470	57William Head	103	24
December 20, 1971
Questions
		2(a) and (b) Inmates
	Inmate	of Indian
	Population	Origin
	Dec.	Oct. 25
Institution Matsqui (Inc. Mountain Prison and Agassiz	30/70	1971Correctional Camp)	516	46West Georgia Centre	9	i* Includes Work Annex.	7,161	561
Note: Answer 2(a) and (b) The figures given have been extracted, as of October 25, 1971, from inmate records held by each institution, and reflect as accurately as can be determined, the current Canadian Indian inmate population. Although admission forms record racial origin, many inmates of obvious Canadian Indian parentage declare themselves as Canadian. Also, many native Indian inmates, although admitting of Canadian Indian ancestry, do not divulge their status, i.e., Treaty Indian or otherwise. Accordingly, inmate records cannot accurately reflect the actual number of Canadian Indian inmates or their various categories. In addition, the time and cost factors which would be involved in searching back files to determine the approximate number of Canadian Indians in custody, as of December 1970, would be exorbitant or prohibitive.


POST OFFICE-INCREASE IN POSTAGE ON JUNK MAIL
Mr. Robinson: Will the government consider increasing the postage on "junk mail" in an effort to reduce the amount of such mail and the cost to the taxpayers in subsidy?


Hon. Jean-Pierre Cote (Postmaster General):: In replying to this question I would like to point out that there is no such class of mail as "Junk Mail".


SURVEY OF RADIOACTIVITY IN COLOUR TV SETS
Mr. Robinson: 1.	Has the government surveyed a sampling of privately owned colour TV sets to determine radioactivity and, if so, how many owners participated in the survey?
2.	What was the cost of the survey?
3.	Have the results of the survey been obtained and evaluated?
4.	According to the survey, is there any harm due to radiation from colour TV sets?
5.	Does the government propose any further experimentation in this field in the interests of safety to Canadians?


John Carr Munro: 1. In 1969, the Department of National Health and Welfare conducted a survey of about 500 privately-owned colour TV sets to determine the extent of X-ray emission.
2.	Approximately $6,000.
3.	The results of the survey were published in a scientific report available from the Department. Summary findings were disseminated to the media through news releases.
4.	About 11 per cent of the colour TV sets tested were found to emit radiation somewhat above the recommended level. In view of this, the Department, through the media, recommended to the public TV habits that would avoid any possible harm.
5.	It was determined that the excess radiation levels were largely caused by deficiencies in certain components. Subsequently, these were greatly improved by the Industry. Regulations governing design, construction and performance to ensure safety have been developed by the Department and are expected to be in force soon under the Radiation Emitting Devices Act.


POWDERED MILK
Mr. Lambert (Bellechasse): As of October 30, 1971, were there still quantities of powdered milk in storage and, if so, what were the quantities involved?


Bruce Andrew Thomas Howard: Statistics Canada reports that: The following quantities of milk were in storage as of November 1, 1971:
Whole milk powder	198,000 pounds
Skim milk powder	67,467,000 pounds

December 20, 1971


LEASING OF CROWN PROPERTIES
Mr. McCleave: Does the Crown, as represented by Her Majesty in Right of Canada, lease premises in Ottawa to the Solicitor General and, if so, for what amount and under what terms does such lease subsist?
Hon. ]ean-Pierre Goyer (Solicitor General): No.
Questions


NUMBER OF PRISON WARDENS AND POLICEMEN KILLED SINCE REVISION OF CRIMINAL CODE, 1967
Mr. Laprise: For each year since the revision of the Criminal Code in 1967, how many prison wardens and policemen have been killed and how many persons have been sentenced to capital punishment and executed following these murders?


Bruce Andrew Thomas Howard: Statistics Canada reports that: Since 1967, no prison wardens have been killed. The following table shows the number of policemen murdered or killed by criminal action, and the number of people convicted, for each year since 1967.


CONVICTIONS
[Stage Direction]
Policemen	Capital
Murdered or	Murder	DeathKilled By	Persons	Pending	Sentence	Non-capital	Man-Year	Criminal Action Convicted	Execution	Commuted	Murder	slaughter	Assault1967	
3	1	-	1	-	"	"1968	
5	6	-	-	1	4	11969	
51	7	-	2	4	1	-1970	
3	1	1	-	-	"	~
*One murder unsolved.

Mr. MacLean: 1.	Is it the intention of the government to redesign and rearrange the Green Gables Golf Course in the Prince Edward Island National Park and, if so, has any survey been carried out among persons who regularly golf on this course or among local residents as to the desirability of the proposed change and with what result?
2.	What is the necessity or rationale of the redesigning?
3.	What is the total estimated cost of the rearrangement of the golf course?
Hon. ]ean Chretien (Minister of Indian Affairs and Northern Development): 1. The National and Historic Parks Branch is presently engaged in a number of planning studies of Prince Edward Island National Park, particularly in the Cavendish area. Some of the alternative planning proposals being considered do involve modifications to the Green Gables Golf Course. However, no decision has been made as to what, if any, modifications will be necessary. Since the planning studies are still in the initial stages, surveys have not yet been carried out.
2.	In order to meet the ever increasing demand for beach facilities and to prevent further deterioration of the park resources in the Cavendish area it is necessary to modernize and expand the capacity of existing beach facilities. In order to accomplish this redevelopment proposal certain lands now occupied by the golf course may be needed. In anticipation of this need the National and Historic Parks Branch is engaged in acquiring additional land which would facilitate any modifications to the golf course should they prove necessary.
3.	Since planning studies are only in the initial stages and several alternatives are involved it is not possible at this time to make any estimation of cost related to possible golf course modifications.


CBCPERSONNEL
Mr. Rodrigue: 1. How many persons were employed by the CBC as of (a) December 1,1971 (b) March 31, 1971, 1970, 1969,1968 and 1967?

December 20, 1971
Questions
2. What amount did the CBC pay in salaries during the fiscal years 1967-68, 1968-69,1969-70 and 1970-71?


Hon. Gerard Pelletier (Secretary of State):: I am
informed by the Canadian Broadcasting Corporation as follows: 1. Number of continuing CBC employees: (a) As of December 1, 1971, 9.000. (b) As of March 31, 1971, 8,885; as of March 31, 1970, 8,951; as of March 31, 1969, 9,147; as of March 31, 1968, 9,042; as of March 31, 1967, 9,123.
2. 1967-68, $83.4 million; 1968-69, $89.8 million; 1969-70, $98.4 million; 1970-71, $104.8 million.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. McQuaid: Is the government responsible in any way for Indian Unions and, if so (a) what was the total amount for the fiscal year that was given to the Indian Unions by province (b) what are the salaries of the staffs of those working for the Indian Unions in Alberta and in the Maritime Provinces (c) how many people are employed by Indian Unions and Bands by province?
Return tabled.


PLACING OF REPORTS ON BILINGUALISM AND BICULTURALISM
Mr. Nowlan: 1.	Were any reports placed in the Archives by the Royal Commission on Bilingualism and Biculturalism and, if so (a) what were their titles (b) how much did each cost (c) who produced each study (d) when is each to be made available to the public?
2.	(a) Were there prior consultations between members of the Royal Commission with the Secretary of State or Prime Minister in arriving at a decision to place the above reports in the Archives (b) by whose authority were they placed in the Archives (c) how many copies of each report placed in the Archives had been produced (d) are the reports and all copies now in the Archives and, if not, for what reason, who has them and where are they (e) which reports were made available or distributed to all members of the Royal Commission (f) which of the reports mentioned above were made available or distributed to one or more Ministers of the Crown?
Return tabled.
FINES FOR INFRACTIONS UNDER COMBINES INVESTIGATION ACT OR CRIMINAL CODE, SECTION 411 or

Question No. 1,860-Mr. Orlikow:
In the past year, have any persons or corporations been fined for infractions of the Combines Investigation Act or Section 411 or 412 of the Criminal Code and, if so (a) what are the names of the persons or corporations so fined (b) what was the amount of the fine in each case (c) when was the fine imposed (d) what infractions occasioned the fine?
Return tabled.


PERSONNEL OF PRIME MINISTER'S OFFICE
Mr. Coates: 1. What are the name, specific responsibilities and salary of each member of the present staff of the Prime Minister's office?
(Mr. Rodrigue.]
2.	(a) What is the present staff of the Privy Council Office (b) what are the name, specific responsibilities and salary of each member?
3.	Has a request gone forward from the Prime Minister to the President of the Treasury Board to further increase his staff and, if so, by what amount and what will be the specific responsibility of the additional staff?
Return tabled.



ORAL QUESTION PERIOD


Robert Lorne Stanfield: Mr. Speaker, I have a question for the Minister of Finance about the agreement reached in Washington. Are there any restrictions, either imposed or understood, with regard to the length of time it is permissible for Canada to float its dollar?


Edgar John Benson: None whatsoever, Mr. Speaker.


Robert Lorne Stanfield: Am I to understand that the Canadian dollar has a special status now under the International Monetary Fund and that Canada will, as a member of that fund, be permitted to allow its dollar to float indefinitely?


Edgar John Benson: Mr. Speaker, perhaps the best thing is to read from the communique:
The Canadian Minister informed the Group that Canada intends to permit fundamental market forces to establish the exchange rate without intervention except as required to maintain orderly conditions.
This was agreed upon by the Group of Ten.


Robert Lorne Stanfield: May I refer the minister to page 4 of this statement where he said:
I do not expect that the terms of the agreement will have a marked effect on the exchange value of the Canadian dollar.
I wonder whether the minister would be good enough to be a little more precise as to what he means by a marked effect. Does he means that under the terms of this agreement the Canadian dollar will not move upward more than, say, a cent?


Edgar John Benson: Mr. Speaker, what I have been trying to explain to the Leader of the Opposition for some weeks now is that the market has been determining the value of the Canadian dollar vis-a-vis the United States dollar. The fact that the United States has devalued its currency in terms of gold should not in itself affect this relationship. Underlying market forces can affect this relationship, and therefore one cannot forecast from day to day what the value of the dollar will be while it is floating.


Robert Lorne Stanfield: Recognizing that there is more to this agreement than a devaluation of the U.S. dollar in terms of gold and also a revaluation of other important currencies in the world, will the minister indicate what he means
December 20, 1971

when he says that this agreement will not have a marked effect?


Edgar John Benson: Mr. Speaker, the value of the Canadian dollar in terms of the United States dollar, as I said, has been determined by its free market value. The fact that other currencies have floated upward in the period since August 15 and have now been revalued upward will, of course, react favourably with respect to Canada's dealings abroad.
Mr. ]ohn Burton (Regina East): Mr. Speaker, I have a supplementary question regarding the quotation the minister gave the Leader of the Opposition concerning Canada's situation in maintaining a floating exchange rate. Would the minister indicate whether use of the term "temporarily" has reference to a time period already established or to a particular set of circumstances? If so, could the minister elaborate on the matter for the benefit of the House?


Edgar John Benson: Mr. Speaker, "temporarily" refers to a time period which I should not like to define.



THE CANADIAN ECONOMY


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Prime Minister. In view of the close relationship between foreign investment in Canada and the exchange rate of our dollar, can the Prime Minister say whether the government will soon be announcing the screening agency to which he made reference in an interview broadcast yesterday?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I do not recall the reference to which the hon. member alludes but the government's announcement on foreign investment will be made soon.


Stanley Howard Knowles: Mr. Speaker, will that announcement include a statement as to the government's proposal for industry in Canada-in other words, its industrial strategy-so that we will know in what direction the government wants this country to go?


Pierre Elliott Trudeau: Mr. Speaker, the hon. member will have to wait until the government makes its announcement to know its content, but I dare say it will be more precise than the policy of the New Democratic Party on foreign investment.



POSSIBLE CANADIAN CONCESSIONS IN DISCUSSION OF IRRITANTS WITH UNITED STATES FOLLOWING INTERNATIONAL MONETARY SETTLEMENT

Gerald William Baldwin: Mr. Speaker, my question is supplementary to an earlier question. Can the
Inquiries of the Ministry
Minister of Finance give an assurance to the House and to the country that Canada will make no concessions in respect of the so-called trade irritants which have been under discussion?


Edgar John Benson: Mr. Speaker, in the context of the settlement reached on Saturday no concessions were made by Canada whatsoever. The matter of trade is being discussed quite separately by my colleague the Minister of Industry, Trade and Commerce. A number of trade irritants on both sides of the border are being discussed and it is hoped that this discussion will move forward toward a conclusion because one thing we need in trade with the United States is reasonable affability between the two countries in trade matters.


Gerald William Baldwin: Mr. Speaker, the minister did not answer my question. Is he able to assure the House that no substantial concessions will be made by Canada in respect of these so-called trade irritants?


Edgar John Benson: Mr. Speaker, if there are concessions made by Canada in respect of trade irritants we will expect compensating concessions from the United States. This is the reason for the negotiation that is taking place. Both sides have trade irritants and we want to get rid of them so that trade may move in larger amounts even more freely back and forth across our borders.



CRIMINAL CODE


Joseph Adrien Henri Lambert: Mr. Speaker, I would like to put a question to the hon. Minister of Justice.
In view of the increasing number of murders in Canada and the obvious concern of the population in that regard as evidenced by the letters we receive, would the hon. minister tell the House, in order to comfort the population, whether he intends to introduce in due time a bill reinstating capital punishment?


Hon. John N. Turner (Minister of Justice):: Mr. Speaker, anything relating to capital punishment should be considered by the Parliament of Canada perhaps before December 29, 1972, at which date the present legislation ceases to apply.


Mr. Gerard Laprise (Abitibi):: Mr. Speaker, I should like to put a supplementary question to the Minister of Justice.
In connection with the qualified murder of policemen or prison guards, I have just obtained an answer to the effect that since 1967, 16 policemen have been murdered and that capital punishment has not been carried out in any of those cases. Could the minister tell us under what regulation the legislation is not applied?


Mr. Speaker:: Order. The hon. member is asking the minister to give his interpretation of a statute and I do not think that question is in order.

December 20, 1971
Inquiries of the Ministry

I believe the hon. member for Saskatoon-Biggar has a supplementary to the previous question.



NEGOTIATIONS BETWEEN UNITED STATES AND COMMON


Mr. A. P. Gleave (Saskatoon-Biggar):: Thank you, Mr. Speaker. The Minister of Finance referred to further consultations on trade between the Minister of Industry, Trade and Commerce and his United States counterpart. In view of the fact that the President of the United States and the President of France in their meeting did discuss access to the Common Market for farm products from the United States, may I ask whether discussions are taking place between our Minister of Industry, Trade and Commerce and his counterpart in the United States to gain greater access for Canadian farm products?


Edgar John Benson: Mr. Speaker, this negotiation in the trade area with regard to agricultural products is to go on between the United States and the European Common Market. We have expressed our interest in any such negotiations. We will be in touch with the United States concerning the negotiations and we would expect any concessions which ultimately come out of these talks would be non-discriminatory.


Hon. Marcel Lambert (Edmonton West):: I have a supplementary, Mr. Speaker. Does the Minister of Finance say we have merely expressed an interest in such negotiations or is Canada actively participating in negotiations with regard to this particular point? Also, are there other points such as the removal of non-tariff barriers by the Common Market which was one item that was a subject of discussion earlier, and is Canada doing anything to pursue actively the removal of these non-tariff barriers?


Edgar John Benson: Mr. Speaker, first of all, these are bilateral negotiations between the United States and the European Common Market. We have been pursuing the same ends in our dealings with the European Common Market but the negotiations presently going on, as I understand it, are bilateral negotiations between the United States and Japan and between the United States and the Common Market. We, of course, have indicated our interest in them and would expect that any results would be non-discriminatory in nature. With regard to the Common Market, we have been dealing with them and expressing our opinions on various matters to them directly.



CRIMINAL CODE


John George Diefenbaker: Mr. Speaker, I have two questions to ask the Minister of Justice. The
(Mr. Speaker.]
first arises out of questions which have been asked this afternoon with regard to the abolition of the death penalty. Has consideration been given on the part of the government to meeting the serious situation created by reason of the numbers of police and custodial officers who have been murdered in the last year and a half? Has any consideration been given to changing the Criminal Code to provide that those who kill police officers or custodial officers shall serve their life sentences rather than placing them in the position of having little to lose by killing officers charged with the administration of justice?


John Napier Turner: As I said, Mr. Speaker, the whole subject of capital punishment will have to be reviewed in some way before the present law which is on a trial period of five years expires on December 29, 1972. At that time the government would make its intentions known.



SUGGESTED APPEAL AGAINST SENTENCES IMPOSED ON KINGSTON PENITENTIARY INMATES FOR MURDER DURING RIOT

John George Diefenbaker: Mr. Speaker, I have one other question. Normally I do not believe in harsh sentences, but the fact is that across this country public opinion has been aroused over the sentences imposed on certain inmates of Kingston penitentiary for murder and unspeakable cruelties. In view of the fact that there are fears in various penitentiaries across Canada that the sentences are so light as to constitute an invitation to some inmates to follow the same course taken by those at Kingston, has the government communicated with the Attorney General of Ontario to suggest that there should be appeals taken against those sentences? While I have great admiration for Mr. Justice Henderson, judges do make mistakes.


John Napier Turner: Mr. Speaker, the responsibility for instituting or not instituting any appeal in this case, as the right hon. gentleman suggested, lies with the Attorney General of Ontario. It is my understanding there was a communication between the Solicitor General of Canada and the Attorney General of Ontario but the Attorney General does not intend to appeal.


John George Diefenbaker: Mr. Speaker, this speaking appliance was not working for the latter part of the minister's statement.


John Napier Turner: I said it is my understanding that there was a communication between the Solicitor General of Canada and the Attorney General of Ontario but that the Attorney General of Ontario does not intend to appeal the sentences.



POSSIBLE AMENDMENT TO ENSURE STRICTER CONTROL OVER GUNS IN LIGHT OF MURDER INCREASE

Mr. Warren Allmand (Notre-Dame-de-Grace):: Mr. Speaker, I have a supplementary for the Minister of Justice. In view of the increasing number of murders that are taking place in which automatic weapons are used, is the minister considering making amendments to the Criminal
December 20, 1971

Code in order to have much stricter control over these weapons and other types of guns which can be used to murder people?
Hon. ]ohn N. Turner (Minister of Justice): Mr. Speaker, I will take that into consideration but of course Parliament reviewed quite thoroughly the so-called gun law in the Criminal Code review in 1968-69.



POLLUTION


Mr. H. W. Danforth (Kent-Essex):: Mr. Speaker, my question was for the Minister of the Environment but in his absence perhaps I could direct it to the acting minister or the parliamentary secretary. Since 250 employees now appear to be in danger of losing their jobs in Ontario because of an industry moving from that province to another where pollution control is less strict, is the government initiating talks with the provinces in an attempt to achieve uniform national standards to discourage actions of this type?


Mr. Eymard Corbin (Parliamentary Secretary to Minister of the Environment):: I will have to take this question as notice.



CONSUMER AFFAIRS


Mr. James A. McGrath (St. John's East):: I should like to direct a question to the Minister of Consumer and Corporate Affairs. In view of the recent takeover by an American firm of six Canadian credit companies after that firm had been served with an American federal court order forbidding the company to buy any more credit companies in the United States, can the minister tell the House whether his department is going to investigate these takeovers under the Combines Investigation Act and whether or not his department will review American controlled takeovers of Canadian data bank systems?


Stanley Ronald Basford: The Director of Investigation and Research under the Combines Investigation Act examines all takeovers to see whether there are any implications under the Combines Investigation Act, but naturally it is the practice in inquiries of this kind not to reveal the nature or details of the investigation that is in progress.


James Aloysius McGrath: I would ask the minister whether he would review this whole area of data banks, especially in light of takeovers by American companies of Canadian data banks, and would he give consideration to bringing in regulations or legislation to protect Canadians from
Inquiries of the Ministry
false and often misleading information stored in data banks either in Canada or abroad?


Stanley Ronald Basford: Some provinces have legislated with regard to credit data banks or are proposing to legislate. On the transfer of material from this country to others it is a matter of great concern and one about which my colleague, the Minister of Communications, is concerned and has already made statements.



PROPOSED JAMES BAY HYDROELECTRIC PROJECT-RELEASE OF TECHNICAL STUDIES UNDERLYING ENVIRONMENTAL REPORT

Mr. J. M. Forrestall (Dartmouth-Halifax East):: My question is for the Prime Minister. It arises out of the statement made by the Minister of the Environment that the report on the James Bay environmental situation will be released. Would the Prime Minister undertake to make sure that when this report is released the full technical studies underlying this 40-page brief will be released to the public at the same time?


Pierre Elliott Trudeau: I am not sure whether the hon. member is referring to a report made by the Quebec government or to the studies of the federal government. If it is the former-the hon. member is nodding his head-I cannot undertake anything on behalf of the province of Quebec, but I will ensure that they receive notice of the request of the hon. member.



FINANCE


Mr. Arnold Peters (Timiskaming):: My question is for the
Minister of Finance. In light of the fact that the United States has raised the price of gold to $38, is it the intention of the minister to change the regulations under the Emergency Gold Mining Assistance Act to provide the maximum benefit to those communities that are dependent on that industry?


Edgar John Benson: We will have to take a look at this matter. We have not done so yet.



GOVERNMENT ADMINISTRATION


Hon. George Hees (Prince Edward-Hastings):: I have a question for the Prime Minister. On Thursday I asked the Prime Minister whether he could bring the House up to date on the results achieved by the investigation into the leak of the Gray report. He said he would look into the matter. I wonder whether, as a result of that investigation

December 20, 1971
Inquiries of the Ministry
into the whole matter, he is now able to bring the House up to date on the results that have been achieved during the five weeks since the investigation was started?


Pierre Elliott Trudeau: Yes, Mr. Speaker. After the question was asked I did have the matter looked into and I was told the investigation is still proceeding at the departmental level.



ADMINISTRATION OF JUSTICE


Mr. Robert McCleave (Halifax-East Hants):: My question to the Minister of Justice involves the pending proclamation of the bail reform bill. First, I should like to ask the minister regarding the date of proclamation and, second, whether the hon. gentleman has worked out in co-operation with his provincial counterparts a common handbook or method of instruction to all police forces across Canada dealing with this act?


John Napier Turner: The bail reform bill will be proclaimed as a statute on January 3. Yes, I have worked out with all provincial Attorneys General at a meeting with the uniformity commissioners in August and in subsequent communications in October the use of a manual prepared by the Royal Canadian Mounted Police which has been made available to all provinces that enjoy a contractual relationship with the RCMP. As for Ontario and Quebec, we have made the manual available to those two provinces to use as they see fit.


EXTERNAL AFFAIRS
Mr. Heath Macquarrie (Hillsborough):: I should like to ask the Secretary of State for External Affairs whether he is now in a position to answer my question of a few days ago regarding the government's projected program of aid for the suffering people of the Indian subcontinent.


Hon. Mitchell Sharp (Secretary of State for External Affairs):: A series of discussions have been going on and I hope that before Parliament rises for the Christmas recess I will be able to make a report.


Heath Nelson Macquarrie: May I ask the
minister whether he intends to make or has made representations to the government of Pakistan for the return of Sheik Mujibir Rahman to the area which gave him such support not too long ago?


Mitchell William Sharp: No, Mr. Speaker. I do not think it would be appropriate or particularly useful for us to make such
(Mr. Hees.]
representations at present. I have no doubt that in Pakistan very serious consideration is being given to the best way of promoting peace in that area and this will be one of the matters which will be given most serious consideration. After all, the Canadian government was probably the first of the governments to suggest that a political settlement was needed in East Pakistan.


Mr. R. N. Thompson (Red Deer):: I wonder if the Secretary of State for External Affairs has taken any action on behalf of Canada in protesting against the cruelty and savagery that are taking place in the new country of Bangla Desh and whether or not any assurances have been received from the Indian government that atrocities will be kept under control?


Mitchell William Sharp: I have not heard any suggestions that the Indian army itself is involved in anything except trying to maintain law and order and trying to suppress these atrocities. I do not know to which authority we could make these representations at present.


Robert Norman Thompson: I have a supplementary question to one asked earlier, and it is directed to the Secretary of State for External Affairs. If the Indian government is not responsible for the maintenance of law and order in Bangla Desh, can the minister inform us whether Canada has made any decision regarding the recognition of that country as India has requested?


Mitchell William Sharp: No, Mr. Speaker, the government does not intend to recognize Bangla Desh as yet; since we are not satisfied that there is a government in that area responsible for administration. As far as I can see, the principal control now rests with the Indian army itself.



INDIAN AFFAIRS


Mr. John Gilbert (Broadview):: My question is directed to the Minister of Justice. In view of the representations by the Native Council of Canada to the Minister of Justice last Friday, and in particular the racial slur on all the Indian people in Canada made by Judge Collins in Sudbury, and in view of the statement of the Minister of Justice to the leader of our party a short time ago that he was looking into the matter, what action has the minister decided to take against Judge Collins for this slander against the native people of Canada? Does he intend to refer the matter to the Judicial Council of Canada for investigation and report?
December 20, 1971


John Napier Turner: Since I replied in the House to the hon. gentleman's leader, as he puts it, I have received a report from Chief Judge Colin Bennett of the county and district courts of Ontario, enclosing the transcript and his report on the matter. I understand that a similar document was sent to the Attorney General of Ontario. The report is being analysed and I will be consulting with the Attorney General of Ontario as to what action, if any, should be taken.



UNITED NATIONS


Mr.  R. Gordon L. Fairweather@Fundy-Royal: I have a question for the Secretary of State for External Affairs. How did Canada vote at the General Assembly on the resolution proposed by the United Arab Republic for a possible Middle East settlement, and did Canada support the amendment to that resolution proposed by several African states, including Senegal?


Mitchell William Sharp: If the hon. member and I are referring to the same resolution, as I think we are, Canada abstained along with some 36 other countries. I cannot answer specifically the second of these questions, but if the hon. gentleman will allow me to take it as notice I will find the answer.



UNEMPLOYMENT INSURANCE


Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I would like to direct a question to the Minister of Labour. I believe about a week ago he indicated to the House that a formula was being devised under which it was hoped that applications for unemployment insurance would be expedited and that an announcement to that effect would be made later. Has such a mechanism or formula been devised, and when can we expect a statement with respect to this very important and urgent matter?


Bryce Stuart Mackasey: Mr. Speaker, I will be making a statement in a matter of a few days. A program has been devised to speed up the processing of claims as of January 15 when more computer time will be available.



EFFECT OF VACATION PAY ON RIGHT OF CONSTRUCTION WORKERS TO BENEFITS

Lincoln MacCauley Alexander: I have a supplementary question, Mr. Speaker, which arises from the brief recently forwarded to the minister by the construction workers. As a result of the meeting between the
Inquiries of the Ministry
minister and the building and construction trades representatives last Friday, I believe, has the government agreed to amend the Unemployment Insurance Act and the regulations so that savings accumulated for annual vacations by construction workers will not deny or delay individual claims for unemployment insurance benefits? In other words, does the government intend to remove any reference to vacation pay denying or delaying the right of an individual to collect unemployment


Bryce Stuart Mackasey: Mr. Speaker, the underlying philosophy of the commission is that it is not a welfare program, and we are not persuaded by those people who suggest that when you are on vacation your vacation pay should be supplemented by unemployment insurance benefits.



DIFFICULTY IN PROCESSING CLAIMS IN EASTERN CANADA-POSSIBILITY OF PAYMENT BEFORE CHRISTMAS

Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, this is supplementary to the previous question asked of the Minister of Labour. I realize the minister is probably on top of this subject, and he is usually most co-operative in all these matters, but in view of the numerous telephone calls, letters and wires that we are getting from the eastern part of Canada in regard to the hold-up of payments of unemployment insurance benefits-I realize there have been difficulties in Moncton-would he make an extra special effort to see that as many cheques as possible are issued before Christmas?


Bryce Stuart Mackasey: Mr. Speaker, over the weekend we sent about 20 extra experts to the Unemployment Insurance Commission offices in the maritime area to do precisely that, to expedite distribution of cheques before Christmas.



INCOME TAX


Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I wish to direct a question to the President of the Privy Council. In view of the speed with which the Senate is processing Bill C-259, can he inform the House whether or not, when the bill was forwarded to the Senate from this chamber, a stipulated time limit for consideration of it was attached to the bill?


Hon. Allan J. MacEachen (President of the Privy Council):: No, Mr. Speaker.


Mr. Speaker:: I believe the hon. member for Oshawa-Whitby has a supplementary.


John Edward Broadbent: I wish to direct a supplementary question to the Prime Minister. In view of the Prime Minister's well known commitment to democracy, and in view of the-

December 20, 1971
Inquiries of the Ministry


Mr. Speaker:: Order, please. The hon. member is now making a speech. Certainly, I had very serious reservations about the form of his first question but I allowed it. He is now making a speech. If he has a question to ask it should be asked directly. His preface goes beyond the terms of the procedural limitations.


John Edward Broadbent: I will come quickly to the point. In view of the speed with which the Senate is processing the bill, would the Prime Minister take steps in the early future that would result in the abolition of this absurd and undemocratic institution?


Mr. Speaker:: Order, please.



AGRICULTURE


Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I have a question for the Minister of Agriculture. Since he has announced that the butterfat subsidy will be paid to cream shippers and that computers were used in tabulating this information earlier, can he give us an indication of whether there will be an increase in butterfat production as a result of this change in policy and how soon these retroactive payments will be made to those who have not been paid since 1967?


Hon. H. A. Olson (Minister of Agriculture):: Mr. Speaker, payments will be made at the end of this dairy year, that is, around April 1, and they will be retroactive for the shipments that have been made all during the 1971-72 dairy year but only up to the amount that the quota was paid before. So far as the other part of the question is concerned, I cannot estimate the amount of additional butterfat that will come forward, but presumably there will be some.



REGIONAL ECONOMIC EXPANSION


Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, I wish to direct a question to the Minister of Regional Economic Expansion. In commending him for his co-operation with the Premier of New Brunswick in analysing, identifying and alleviating the difficulties arising out of the partial closure of the Consolidated Bathurst Company operation in New Brunswick, I wish to ask him if he would advise the House whether he has had a similar meeting with the Premier of Newfoundland arising out of the difficulties surrounding partial closure of Bowaters Pulp and Paper Mill in Corner Brook?


Hon. Jean Marchand (Minister of Regional Economic Expansion):: No, Mr. Speaker.


Jack Marshall: In view of the fact that the Corner Brook mill will be closing down one machine on December 31, resulting in a crippling effect on the economy and many hundreds of citizens, would the minister initiate a meeting with the Premier of Newfoundland, to include the Minister of Manpower and Immigration, to try to alleviate this problem?


Jean Marchand: Mr. Speaker, if the Premier of Newfoundland feels it might be helpful to meet with me I will be happy to meet him.


Mr. Bell:: Who is the premier?



AID TO ACADIA FISHERIES PLANTS AT MULGRAVE AND CANSO

Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I also have a question for the Minister of Regional Economic Expansion. Several days ago I had occasion to ask the minister a question concerning possible federal aid from his department for Acadia Fisheries plants at Mulgrave and Canso. Since that time there have been certain developments. One of the plants involved has been destroyed. Can the minister bring the House up to date with respect to what change, if any, there has been in contemplated federal aid?


Jean Marchand: Mr. Speaker, I think one of the plants is likely to reopen. The other just burned down, and we have received no application for the second one.



FINANCE


Mr. David Anderson (Esquimalt-Saanich):: Mr. Speaker, pursuant to earlier questions I wonder if the Minister of Finance could comment on the substantial difference of opinion between himself and the American Secretary of the Treasury on the question of exchange rates between the Canadian and U.S. dollars?


Mr. Speaker:: Order, please. The hon. member will realize that a question asked in those terms is hardly in order. The hon. member asks the minister to comment on a difference of opinion that may exist. In those terms the question cannot be allowed. The hon. member might like to rephrase it.


David Anderson: Would the minister inform the House if he is planning further meetings with his American counterpart on this subject, and also whether he and Mr. Connally simply intend to allow events to take their course so that we will only find out from history who is right?


Edgar John Benson: Mr. Speaker, I do not think there was a joint statement issued by us in this regard. As I pointed out to the Leader of the Opposition, we are one of the few exchange markets open in the
December 20, 1971

world today, and the information I have is that the Canadian dollar is trading at its closing price on Friday last, so there has been no change so far in the price of the Canadian dollar vis-a-vis the U.S. dollar.



SPECIAL DEVELOPMENT LOAN FUND-ALLEGED INADEQUACY-REQUEST FOR ADDITIONAL AMOUNT

Winona Grace MacInnis: Mr. Speaker, I wish to direct a question to the Minister of Finance. In view of the inadequacy of the special development loan fund to handle the federal-provincial winter works program, is he considering increasing the total amount of that special development loan fund?
Hon. E. ]. Benson (Minister of Finance): No, Mr. Speaker.



FISHERIES


Mr. John Lundrigan (Gander-Twillingate):: Mr. Speaker, I wish to direct a question to the Secretary of State for External Affairs. Is the minister now in a position to table the agreement or exchange of diplomatic notes between Denmark and Canada which was brought to his attention on Thursday of last week?


Mitchell William Sharp: Mr. Speaker, the hon. gentleman asked me a question at that time which I was not in a position to reply to but I can do so now. An agreement has been reached at the official level ad referendum. I hope it will be coming before the cabinet in January.



FISHERIES AGREEMENTS WITH SPAIN, PORTUGAL, FRANCE AND UNITED KINGDOM-CONSULTATION WITH MARITIME PROVINCES BEFORE RATIFICATION

John Howard Lundrigan: As a supplementary question, in view of the fact that Canada is also negotiating treaties with France, Spain, Portugal and the United Kingdom, would the minister agree not to proceed with formal ratification of those agreements until consultation takes place with the premiers of the four Atlantic Provinces?


Mitchell William Sharp: No, Mr. Speaker.



SHARED-COST PROGRAMS-PERMISSION TO PROVINCES TO OPT OUT

Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Minister of National Health and Welfare. Following the meeting last week with the provinces on the matter of shared-cost programs, will the federal govern-24725-43
Inquiries of the Ministry
ment allow other provinces as well as Quebec to opt out, as requested by Ontario and Alberta?


John Carr Munro: No, Mr. Speaker, the conference was not on that question at all. That matter was clearly laid to rest at the first ministers' conference.


Robert Lorne Stanfield: In what way?


Robert Lorne Stanfield: have a question for the Minister of National Health and Welfare supplementary to his statement that the question of opting out by the provinces was laid to rest at the conference of first ministers. Could the minister indicate in what manner it was laid to rest?


John Carr Munro: Mr. Speaker, I meant that it was dealt with at that particular conference. The whole question of opting out did not arise at the health ministers' conference. The federal government heard proposals from the provinces and we countered with proposals of our own which they agreed to go home and consider seriously. None of these proposals included any discussion of opting out.



FAMILY INCOME SECURITY


Jack Marshall: In
view of the confidence expressed by the province of Quebec that they would be reaching agreement with the federal government with regard to the introduction of their family allowance program, is the minister now able to state whether he will be meeting the deadline of May 1 for increases in family allowance benefits?


John Carr Munro: Mr. Speaker, in view of the fact that, as I have stated, in all likelihood the legislation will not come on until the next session it would all depend on when it was passed and with what speed. It would seem rather difficult to adhere to that type of deadline.



RESUMPTION OF DISCUSSIONS WITH UNITED STATES- REQUEST FOR REPORT

Mr. Mark Rose (Fraser Valley West):: I have a question for the Minister of Industry, Trade and Commerce but in his absence perhaps I could direct it to the right hon. Prime Minister. My question refers to the Canada-United States discussions on matters of energy exports which were adjourned, I understand, during the monetary crisis. I should like to ask whether these talks have been resumed or when they will be resumed?

December 20, 1971
Inquiries of the Ministry


Pierre Elliott Trudeau: No, Mr. Speaker, I do not know when the talks will be resumed.


Mark Willson Rose: I wonder if I could ask the Prime Minister whether he is in a position to report on any developments arising from these talks so far and/or what Canada's stand is during these discussions, and can we expect a statement in the near future?


Pierre Elliott Trudeau: No, Mr. Speaker.


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


Some hon. Members:: Hear, hear!



INDIAN AFFAIRS


Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, the hon. members are applauding because there is a growing body of evidence that the number of Conservatives in this country is increasing. I am very pleased to say that my wife and I feel we are contributing our small part to this process through the birth of our new son.
I should like to direct my question to the Minister of Justice. In view of the Ontario Supreme Court ruling that certain parts of the Indian Act are contrary to the Bill of Rights, in particular the part which provides that a woman loses her Indian status when she marries an nonIndian, in the interests of justice does the minister contemplate initiating any changes in the Indian Act?


John Napier Turner: Mr. Speaker, first of all I want to congratulate the hon. member but also to assure him that all the fertility is not on his side of the House. I would suggest to him that it is certainly one way to impress upon one's constituents that one gets home from time to time.
Mr. Speaker, the Lavell case has now been appealed to the Supreme Court of Canada and I think it preferable to await that judgment before deciding what ought to be done. If any amendments are to be made to the Indian Act, they will be the responsibility of my colleague the Minister of Indian Affairs and Northern Development.



FINANCIAL ASSISTANCE IN LAVELL APPEAL TO SUPREME COURT

Paul Yewchuk: I have a supplementary question for the Prime Minister which was originally intended for the Minister of Indian Affairs and Northern Development who is absent. Will any special funds be provided to Indian persons in this case to assist them in their Supreme Court hearing?


Pierre Elliott Trudeau: Mr. Speaker, having missed the first part of the question I cannot give the answer but I shall refer the matter to the minister.


Mr. Speaker:: Orders of the day.



GOVERNMENT ORDERS


[Stage Direction]
The House proceeded to the consideration of a ways and means motion to amend the statute law relating to the Income Tax Act.
Edgar John Benson: That it is expedient to introduce a measure to amend the statute law relating to income tax and to provide among other things:
(1)	That with respect to taxable income earned after June 30, 1971, the tax payable under Part I of the said Act for the 1971 taxation year by every corporation liable to pay tax computed under section 39 or 69 of the said Act as it reads in its application to the 1971 taxation year be reduced by an amount equal to seven per cent of the tax so computed.
(2)	That the tax payable under Part I of the said Act by an individual for the 1971 taxation year be reduced by an amount equal to one and one-half per cent of the basic tax referred to in subsection 33(1) of the said Act as it reads in its application to the 1971 taxation year.
(3)	That there may be deducted in computing the income from a business of a taxpayer for a taxation year under Part I of the said Act an additional amount equal to sixty per cent of any expenses certified by the Minister of Manpower and Immigration to have been incurred by the taxpayer in the period commencing on November 1, 1971, and ending on March 31, 1974 as salary or wages of persons employed by him, under a "training on the job program" as defined in the said measure, except that where any amount has been paid or has become payable to the taxpayer under any such program providing for direct payments to the taxpayer in respect of any such expenses so certified to have been incurred by him, no deduction may be made in respect of those expenses in computing his income from the business but the amount so paid or payable to him shall be exempt from income tax.


[Stage Direction]
Motion agreed to.
Edgar John Benson: that Bill C-275, to amend the statute law relating to income tax, be read the first time and printed.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
Edgar John Benson: that Bill C-260, to amend the Excise Tax Act and the Old Age Security Act be read the second time and referred to the Committee of the Whole.


Marcel Joseph Aimé Lambert: I rise on a point of order, Mr. Speaker. I do not know just how this came about, but I would refer the hon. minister and the Chair to Bill C-260, section 3 which is not in conformity with the ways and means resolution. Paragraph 1(a) of the ways and means
December 20, 1971

resolution, which appears at page 12 of Votes and Proceeding for June 18, 1971 reads as follows:
section 5 of Schedule I thereof be repealed.
Section 3 of the act reads as follows:
Section 4 of Schedule I to the said act is repealed.
On the night of the budget debate, the minister indicated that he was removing the special excise tax as it applied to those items which appear in section 5 of schedule I to the Excise Tax Act. That is quite understandable because we know that those items related to stereophonic and electronic equipment. However, I do not think that the minister wishes to delete, coin vending machines from the tax provisions.
I have a copy of the office consolidation of the Excise Tax Act. Schedule I, paragraph 4 reads:
Coin, disc or token operated games or amusement devices of all kinds 10 per cent.
I do not think the minister meant to remove the 10 per cent excise tax on slot machines, which may be what is being done by this bill. I therefore, think that perhaps the item on the order paper should stand, in order that it may be examined with a view to seeing how the government is to get out of this little mess. I know that this is a technical matter, but the bill either conforms to the Ways and Means resolution or it does not, and this bill does not.


Edgar John Benson: Mr. Speaker, I will be pleased to look into this matter. Section 4 of Schedule I of the said act is repealed. Section 5(a), (b), (c) and (d) deal with phonograph record playing devices, television receivers, electron tubes, cathode ray tubes, and so on.


Marcel Joseph Aimé Lambert: Perhaps the copy I have is completely out of date, and perhaps these sections have been completely renumbered. If that is the case, I am prepared to accept the minister's explanation. I was not aware that we had eliminated paragraph 4 of any of the preceding paragraphs on a prior occasion. So far as I am concerned, slot machines are still covered by the excise tax. Perhaps the minister could explain this.


Edgar John Benson: Mr. Speaker, as I said, I will be pleased to look into the matter. The information I have is that section 5, Schedule I, includes items which I indicated under (a), (b), (c) and (d). If we could proceed with the bill, I will look into the matter. I am told that the bill is correct, as worded. It is correct, according to the present act.


Marcel Joseph Aimé Lambert: Then, the Ways and Means resolution must be wrong. It is either one or the other. One refers to section 5 and the other to section 4 of schedule I of the act.


Stanley Howard Knowles: That is about par for the course for this debate.


Marcel Joseph Aimé Lambert: Either the Ways and Means resolution is wrong, or the bill is wrong. I am asking the minister to let us know which one he is going to abide by.


Edgar John Benson: I will abide by the bill.
Excise Tax Act and Old Age Security Act


Marcel Joseph Aimé Lambert: We have already passed the Ways and Means resolution and we may be in the same kind of mess that we were in with regard to the tax bill.


Mr. Speaker:: I appreciate the point raised by the hon. member for Edmonton West. I certainly have no idea about the actual situation. I would have to read both the Ways and Means resolution and the statute which is to be amended by this bill in order to determine which one is right and which one is wrong. The minister appears to wish to make a further contribution to the debate.


Edgar John Benson: Perhaps I should refer to the Revised Statutes of Canada, 1971. I think the hon. member for Edmonton West (Mr. Lambert) was referring to the previous statutes, from which this wording was taken. We are dealing with the Revised Statutes, 1971, and we are amending section 4 of Schedule I of the existing act.


Mr. Speaker:: Order, please. The matter could be looked into. In the meantime, there can be consultations with the parliamentary counsel and officers at the table to see whether the matter can be cleared up in some way. If we need to make technical changes or procedural changes because an error has been made, I am sure hon. members can devise a way to achieve that end.


Marcel Joseph Aimé Lambert: Mr. Speaker, I wonder whether there will be a further statement by the minister or his parliamentary secretary in order to amplify the remarks that were made on budget night. After all, these items were not among the more important ones of the budget because Bill C-259 was, shall we say, Schedule A in the Ways and Means motion. Nevertheless, these items certainly are important. I wonder if the parliamentary secretary or the minister could deal with the problem raised by the Ways and Means resolution?


Mr. P. M. Mahoney (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I do not have a lengthy comment to make on the bill at the present time. It contains three amendments of substance to the Excise Tax Act. There are also amendments to the Old Age Security Act and to the Excise Tax Act in order to provide that the 3 percentage point of sales tax now imposed as an Old Age Security tax will, in future, be imposed under the Excise Tax Act. The amendments planned to the Excise Tax Act provide, first, that machinery and apparatus sold to or imported by manufacturers or producers for purposes of reducing pollution are made exempt from sales tax; second, margarine and similar spreads are made exempt from sales tax and, thirdly, the special excise tax of 15 per cent on radios, television sets and electron tubes, is repealed. In addition, a technical amendment to the Excise Tax Act provides that a sales tax exemption for goods described in tariff item 69520-1 will remain as it was before the wording regarding this tariff item is changed by the bill to amend the customs tarrif.
The amendment to the Old Age Security Act will repeal the 3 per cent Old Age Security tax on sales imposed under that act. However, these 3 percentage points of tax will in future be imposed under the Excise Tax Act and this change will not result in any change in the total rate of sales tax.

December 20, 1971
Excise Tax Act and Old Age Security Act


Marcel Joseph Aimé Lambert: Well, Mr. Speaker, I think we shall have a slow and desultory discussion on this particular bill. These items were introduced so long ago that I think most members of the House have forgotten that these measures actually exist. They have now come back to be considered at, shall we say, the fifty ninth minute before midnight.
The amendment is designed, first of all, to remove the excise tax on margarine. I remember thinking at the time of the budget that perhaps a freer use of margarine might make the contents of the budget and subsequent bills slide down, so to speak, a lot more easily. In any event, there will not be much saving. It is a question of whether or not savings that might have been effected by the manufacturers and retailers have been passed on to the consumer. Whether or not that saving has been passed on is a good question. We do not know whether the price of margarine reflects the exact change that was introduced in the budget. I have not canvassed the market to see whether the price of margarine is lower than it would have been if this particular provision had not been included in the budget. I thought the tax on margarine was an unsound tax and I am glad to see that it has gone. I thought it was an anachronism to have such a tax on a generally accepted foodstuff. It was imposed in the past in order to protect the dairy industry. I recall many years ago reading of the initial results of the bill that was brought in to this House from the other place and sponsored, I believe, by Senator Isnor. That bill legalized the sale of margarine in this country.
The one item I wish to talk about is the elimination of the excise tax on those items that are enumerated under paragraph 5 of the Ways and Means motion or section 4 of the bill. I believe the minister has given me a proper private explanation. The existing bill has come about as a result of the proclamation of the Revised Statutes of Canada, 1971. The ways and means motion was based on the law as it then existed. This House passed the ways and means resolution on the law as it then existed, but sometime around July 15 the Revised Statutes of Canada 1971 were proclaimed. This effected a consolidation of what had heretofore been paragraph 5 of Section 1. It is now paragraph 4 of Section 1.
I think the point of order I raised has now had sufficient explanation. The question is, did the removal of the excise tax on these particular items, phonographs, record playing devices, radio-broadcasting receiving sets and combinations of these, television receiving sets, electronic tubes and other related items, have the effect which the minister hoped? I would like to have some information on this from the parliamentary secretary. Perhaps when we are discussing this in detail he will be able to tell us what expansion there has been of the market for the sale of these particular electronic devices. Have television sets sold in greater numbers? Has the price come down to reflect the removal of the sales tax, not 15 per cent of the retail price but 15 per cent of the manufacturer's price? If there has been a reduction in price, has there been a stimulation of sales? If there has been a stimulation of sales, has this been reflected in an increase in domestic production as hoped for by the minister? It will be the

height of folly if, by the removal of this tax, all we do is stimulate the Japanese television industry. This could really be the result.
As we know, there are any number of television sets sold in this country under perfectly good Canadian names? The people believe they are made in Canada. However, they are actually made in Japan. If there has been an increase in sales as a result of the removal of the 15 per cent sales tax at the manufacturer's level, and we have seen no increase in production by Canadian manufacturers, what is the purpose of the exercise? All we have done has been to offer to the Japanese electronics industry a potentially lower market price to further penetrate the Canadian market. We need a full explanation of this.
We like to see tax reductions. True enough, people with lower incomes may benefit to the extent that small radio sets will have the 15 per cent sales tax removed from them. They benefit to that extent. I suppose many of them buy television sets, perhaps not the more expensive makes, but are they Canadian made? It was claimed that this was to be a stimulus to make Canadian industry more competitive. If the sales tax is not payable on an imported set, the actual saving on the retail price of an imported set will actually be more than the tax on the manufacturer's cost because the sales tax is on the duty paid value. There is no mention about reducing customs duty on these particular imported sets. The sales tax is actually effected at a higher level on an imported set than on a domestic set. I repeat, I would like this information from the parliamentary secretary.
There is some shifting around. Instead of the 3 per cent sales tax imposed by the Old Age Security Act and earmarked for the old age security fund, we are now getting a flat 12 per cent sales tax. The minister or the parliamentary secretary should give the House a full explanation as to how the old age security fund is to be funded from the 12 per cent put into the consolidated revenue fund or whatever it may be. After all, the old age security fund was supposed to have been contributed to by all persons. It was deemed to be a pension based on a fund that was to be contributed to by all segments of the population.
If there is a 3 per cent sales tax specifically earmarked for the old age security fund, every person who buys commodities in the Canadian market, except for most food items and until June 18, margarine, will contribute to that fund. However, unless it is specifically earmarked for the old age security fund, then individuals will feel that as far as they are concerned, it is no longer contributory. The taxpayer had certain rights at one time, but no longer. Under Bill C-259, we have a completely all encompassing provision. The funding of the old security fund will be strictly from the consolidated revenue fund. Presumably, it will be on an as needed basis.
There has been a removal or an expansion of the removal of sales tax on anti-pollution equipment. To that extent I say congratulations to the government. We can easily encourage much more anti-pollution effort by the way of incentives such as the removal of tax on certain equipment that will be used to control pollution, particularly in water and in the air. I suppose one could say that the proposals of this bill are counterproductive. They remove the sales tax on certain radios and other electronic equipment which, frankly, are among the greatest noise pollu-
December 20, 1971

tants in this modern day. As a result, we are now asked to remove sales tax from equipment which will be used to control or eliminate pollution. Noise pollution is not mentioned in this particular section, otherwise they might double the tax on certain types of transistor radios and a few other loudspeaker items, particularly on those loudspeakers which amplify so-called musical sounds and which will crack glass and split plaster.
I feel there is a great deal to be gained by extensive discussion on second reading. I have drawn attention to the areas with which I should like the parliamentary secretary to deal. Then we shall proceed, in due course, to committee of the whole.


Stanley Howard Knowles: Mr. Speaker, as the parliamentary secretary has pointed out, the substantial part of this bill is to be found in those clauses which remove the excise tax from certain indicated commodities. For the most part, we welcome these changes. But in any case the discussion of the changes with respect to the excise tax on commodities will be entered into by two or three of my colleagues. I propose to spend my time on the second reading of this bill on the part of the measure which the parliamentary secretary said involved no real change, namely, that part dealing with the amendments to the Old Age Security Act.
I think it is necessary to relate the provisions in this bill, Bill C-260, in this regard, to the provisions of Bill C-259 which also have the effect of amending the Old Age Security Act. If we put these two together, clause 3 of C-259 and clause 5 of C-260, as well as some of the other clauses in this bill, we find that a substantial change is being made with regard to the manner in which taxes are collected for old age security. Although I accept the word of the parliamentary secretary to the effect that substantial tax changes are in the other parts of this bill, I think something substantial is being done with regard to the method of financing old age security.
Whenever taxes are eliminated or reduced one is usually expected to applaud. I might go further and say that when a change is made from a regressive to a progressive form of taxation one is expected to applaud. If I thought this was all that was happening in this case I would make my applause very evident, and sit down. But I confess I am consumed with a deep suspicion as to what is happening in connection with this matter. My suspicion is heightened by the fact that the Minister of Finance (Mr. Benson) in his budget speech of June 18, did not make a single reference to this matter. He did not even say a change was being made. Only the tabling of the ways and means motion drew it to our attention. I thought the hon. gentleman presenting this bill on behalf of the government might have explained why this change in the method of taxation relating to old age security was being put into effect. But not a word was said. I did not even find anything about it in the red book containing a summary of the changes made in our tax legislation-if the hon. gentleman can tell me I have missed it, I shall be pleased to accept that advice.
Up till now, money has been obtained from the old age security fund-from which payments of old age security
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benefits are made-from three sources of taxation. There has been a 4 per cent tax on personal income with a ceiling of $240 a year as the most which can be paid. Second, there has been a 3 per cent tax on corporation income, and, third, there has been a sales tax of 3 per cent for old age security purposes. That 3 per cent has been part of the total sales tax, whether it is 11 per cent or 12 per cent, depending on what commodities are in question. In any event, the revenue from these three percentage points of sales tax has gone into the old age security fund. The Old Age Security Act has provided that in the event of there being a deficit in the old age security fund the Minister of Finance can make certain loans to the fund, and so on, but this has not happened for a long time. As a matter of fact, the fund was running with a credit balance of $687 million as of October, 1971, the last figure available to me.
I should like to make it clear that we opposed from the start the regressive nature of much of this old age security taxation. We felt it was regressive to impose a flat tax of 4 per cent-first it was 2 per cent, then it was 3 per cent, and latterly it was 4 per cent-on all income rather than impose a graduated tax. We pointed out that this had the effect of placing a disproportionate burden on those in the lower income brackets. We had no quarrel with placing a 3 per cent tax on corporations, but we did object to the sales tax being used, because, again, we felt this was taxing those in the lower income brackets to a disproportionate extent. This having been our position and since it has also been a fact of history that we have repeatedly tried to get the ceiling raised, I can understand that hon. members opposite will say: why are you now complaining when the 4 per cent tax on personal income has been removed, when the tax on corporations has been removed and when the three percentage points which were collected for old age security will no longer be collected for that purpose? The reason I am questioning all this is that I have been around here for a while and have learned to be suspicious of things that Liberals do, at least when they are in power. I find myself applauding the Liberals very strongly if they are on the opposition side of the House, but when they get over on the government side they do some strange things.
I think it is necessary that I point out that when the present Old Age Security Act was passed in 1951, and became law in 1952, it was passed on the basis of a report made by a joint committee of the Senate and House of Commons, a report on old age security tabled on June 28, 1950. I well remember the work we did in this committee. Some very distinguished people were members and I think the committee did an excellent job. It was this committee that recommended the removal of the means test from the old age pension, which was to be paid to everyone at age 70, which was the figure then, and amounted to $40 a month, as well as providing old age assistance for those between 65 and 69. I am happy to say that we have done a good deal since then in terms of improvement, such as getting the amount up and the age limit down. But the heart of our report of 1950 was its recommendation of universality.

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Excise Tax Act and Old Age Security Act
In the course of our recommendations we dealt with the question of how the new universal pension was to be financed. At page 110 of the report, paragraph 64 reads as follows:
The Committee is in favour of the contributory principle, not only because of the importance of this in raising total moneys required, but also because of the importance of establishing a close association in the mind of the individual between his contribution to the cost and the ultimate benefit he is to receive.
Although the members of the committee differed as to the rates of tax that should be imposed and that sort of thing, we were unanimous that there should be a contributory element in paying for old age security so that the Canadian people would know that they had contributed toward their pension and would be able to say the pension was theirs as a matter of right. Just interrupting my train of thought for a moment, since I am looking at this report perhaps I might also say that the committee in 1950 realized that in order to put in this kind of scheme a contributory arrangement it could well be necessary to amend the British North America Act. This was dealt with in paragraphs 71 and 72 of the report, and as a result of this recommendation an amendment to the British North America Act was passed. We now have section 94, which makes it possible for the federal Parliament, as well as the provincial legislatures, to legislate in the field of old age pensions.
The reason we made this recommendation, and that Parliament accepted it in 1951, was that we were making this change. Previous to that time old age pensions under the previous Old Age Pensions Act were simply paid out of the general revenue; there was no contributory element at all, and therefore no special authority was required. However, it was fully accepted that if we were going to establish a contributory relationship there would have to be authority for it in the British North America Act. This recommendation was made in 1950, and as I say it was accepted by Parliament in 1951.
So that from that time until the present the principle, the philosophy, the rationale, has been clear: the Canadian people make payments that are earmarked for old age security, and those payments go into the old age security fund. It is true that accounts for each individual are not kept separately, as is the case with the Canada Pension Plan, but the contributory relationship is there since all our people have made payments. Therefore, when the time comes to draw his pension each Canadian can say that this pension is his as of right, that he has paid for it not only by his contribution to the economy of the country as a whole but by the specific taxes he has paid.
I may say that this is further confirmed by a few of the statements made in the white paper entitled "Income Security for Canadians" which the Minister of National Health and Welfare (Mr. Munro) tabled in the House toward the end of 1970. At page 24 of the white paper the following statement appears:
Yet it would not be easy simply to scrap these programs.
One of the programs referred to there is old age security.
Many people have tailored their retirement incomes and made their retirement plans in the expectation that the Old Age Security pension would be paid them from age 65 on. This program has almost the nature of a separate social contract between the state

and its citizens. It has been financed in part since 1952 by a highly visible earmarked personal income tax. It provides the basis for the retirement plans of almost all Canadians regardless of income levels. Private pension arrangements, and the Canada and Quebec Pension Plans, have built benefit structures on the assumption that this payment will be made.
I realize that in that paragraph the minister was dealing with certain other arguments, but he confirmed the philosophy, the rationale, that is behind old age security, namely that there are earmarked payments going into the old age security fund, and that all our people have the benefit of a social contract. People can say, when it is time for them to go on old age pension, that the pension is theirs as a matter of right.
At page 42 of this same white paper, referring to suggestions that some people were making that the Old Age Security Act might be wiped out and replaced by something else, the white paper has this to say:
To withdraw it now would force a reconsideration of retirement benefit levels under those Plans.
The reference there is to the Canada and Quebec Pension Plans. I continue:
Many people have planned their retirement on the expectation that they will get Old Age Security at age 65, and to deny them this benefit would be extremely unfair and a breach of faith. Personal income taxes as well as other earmarked taxes have been collected from people since 1952 to finance this program, establishing an expectation and a right to the pension. Under these circumstances, action to restrict the program's universality would be difficult to justify.
In that statement the Minister of National Health and Welfare fends off any suggestion to do away with old age security for, among other reasons, the important one that it is a social contract, that there is an element of faith, that people are making earmarked payments and therefore have a complete moral right to draw their pensions, and to enjoy them, as I say, not as a form of charity but as a matter of right.
If we were dealing with the question of rates, it is quite true that I would still have something critical to say about the ungraduated nature of the tax, the regressive nature of the sales tax, and so on. However, I am dealing with the basic principle whether or not there should be a contributory relationship between the taxes people pay and the old age pension that they draw. When all the changes are made that are now in contemplation, those that are in Bill C-259 which has gone over to the other place and those in this bill now before us, there will not be any more earmarked taxes going into the old age security fund.
My friend, the hon. member for Edmonton West (Mr. Lambert) expressed the hope that someone speaking for the government would tell us what is going to happen. I had hoped that explanation would be given before we became involved in this debate. This is part of what bothers me, the silence on this issue. No one has attempted to explain it. With all respect to my good friend the parliamentary secretary who did a good job in defending the government's position on Bill C-259, this should have been a ministerial statement. The Minister of National Health and Welfare (Mr. Munro) should be here, too, because what will happen is that the entire section 24 of the Old Age Security Act will be wiped out. That is the section
December 20, 1971

which provides for the collection of the three taxes, the personal tax, the corporation tax and the sales tax.
The section that provides for an old age security fund still exists. It is there. There is still to be a fund into which certain money will go and out of which pensions will be paid. What money is to go into that fund? So far as I can ascertain, the only money to go into that fund is that which is referred to in clause 3 of Bill C-259 which says that once a year the Minister of National Revenue shall make an estimate concerning how much would have been collected in personal and corporation income taxes if the old earmarked law had been in effect. That estimate having been made, that amount of money is to be turned over by the Minister of Finance (Mr. Benson) to the old age security fund. There is one sense in which I like that and I believe I said so in respect of Bill C-259. This means that the money put into the old age security fund will be collected out of general revenue coming more along the line of ability to pay than in the other way. What bothers me, however, is that there is no money going into the old age security fund which individuals can say is money they put there. There is no earmarked contribution whatsoever.
As I say, according to clause 3 of Bill C-259 the Minister of National Revenue is required to make an estimate of how much would have been collected had the old law been in effect. But the old law in that respect is confined to the personal and corporation income tax. There is nothing anywhere which says that anything which would have been collected under the sales tax is to go into the old age security fund. So, from here on the only money going into the old age security fund will be the estimate of what would have been collected from the personal and corporation income taxes. To me there are two or three dangers about that. In the first place, there will be less money. After all, the take from only two taxes will be less than that from three taxes. Second, the earmarked situation, the clarity of relationship, will be gone. Third-and this is what I am afraid of and this is why I am suspicious-it would seem to me the government could well be laying the foundation for being able to say a few years from now, "Oh, well, old age security is just paid out of general revenue and this notion you used to have that you were entitled to it because of contributory payments is gone."
This will put the government in the position of being able to play fast and loose with the whole question of old age security and even abolish its universality. I hope I am wrong in this suspicion, but if there is good reason for all of this, if there is a philosophy behind it which can be exposed, why did the minister not say so on June 18 or when we were debating Bill C-259, because part of this is in clause 3 of that bill, or why did he not say so today and why is not the Minister of National Health and Welfare here to tell us what he thinks about this. It is only a year ago that the Minister of National Health and Welfare tabled his white paper on income security for Canadians. He accepted the fact, and in fact asserted, that one of the cardinal principles of old age security is that it is a social contract, that there is an element of faith between the people and the state and that because of that social contract and because payments are made by individuals on
Excise Tax Act and Old Age Security Act
an earmarked basis, they have the right to count on old age security always being there.
Entirely apart from arguments I might make about the desirability of increasing the basic amount of the old age security, which is presently $80,-and everybody knows where I stand on that-I think there is particular merit in the point made by the Minister of National Health and Welfare in his white paper to the effect that the Canada Pension Plan and the Quebec Pension Plan are based on old age security as a first deck. In fact, this was said at page 42 of the white paper:
It is proposed that the old age security pension continue to be payable to people who meet the residence requirements when they reach age 65.
For both the social insurance system and the guaranteed income system, the flat-rate old age security pension will continue to provide the base on which the second deck is built. In the former case the second deck is the earnings-related pension, in the latter it is the income-tested pension. But both are predicated on the continuing existence of the basic old age security payment for all who meet the residence requirements.
That is crucial and fundamental. Whatever changes we may make, whatever progress we may achieve in the field of old age security, we at least now have this basic first deck of $80 a month. Then we have the second deck, the Canada Pension Plan, and all the private pension plans and the other arrangements that people make. The Minister of National Health and Welfare was perfectly right in his white paper when he said that the people of Canada have a right to expect that first deck to remain. What was one of the main reasons he gave that we have the right to expect that first deck to remain? Because it was in the nature of a social contract and because the people are making earmarked contributory payments. To do anything to disturb that would be a breach of faith. Can you not see, Sir, that if all these earmarked taxes are removed, this philosophy begins to fade and a few years from now some government which wants to cut down on old age security, or put it on an income test, could say, "Well, it is just a payment made out of the general revenue". They would say there are no more earmarked taxes for it and so they are cutting it down. I think that before this debate is over we should have a statement on this. I would be quite happy to see my suspicions completely shot down, but they will not be shot down by silence on the government side but only by someone like the Minister of National Health and Welfare coming in and making clear that so far as he is concerned this change in the taxation basis for old age security does not have that kind of serious defect.
Back a few years, and in fact over a number of years, some of us argued that there was sufficient money in the old age security fund to pay much higher pensions under the Old Age Security Act. When we used to do that we were met with various answers. One was that the new programs that were being brought in, such as the guaranteed income supplement and so on, would soon eat up any surplus. But the figures I have on what is happening to the old age security fund show that over the past couple of years the balance at credit in that fund has not changed very much. It has gone in the last couple of years from a low of about $686 million to a high of about $730 million. But in round figures that is not much of a change, and if one looks at what happens each month, some months there is a surplus of collections over the amount paid out,

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and some months the amount paid out is in excess of the amount brought in.
In other words, I think it is correct to say that at present the taxes coming in from the three sources just about equal what is required to pay, on a month to month basis, the old age security payments and the guaranteed income supplement payments that are also paid out of that fund. We have said in the past that with the extra $687 million that was there at the last report this could be used to increase the payments. The argument that it would be eaten up by the guaranteed income supplement has not worked out, so I suppose now the government feels it is better to cut this fund down so that we will not be able to continue that argument. If you take away these three percentage points of the sales tax, it will not be long before this fund starts to go down. Then we will get some minister of finance or some minister of national health and welfare coming before us and saying that the fund is dropping, that it is just a welfare measure anyway, and we can lose what is a very important social gain, namely old age pensions on a universal basis.
As I have said, if the government can come in with a ringing speech by the Minister of National Health and Welfare or the President of the Privy Council (Mr. MacEachen) who is the one who can ring the changes and bring down the rafters, and prove to me that my suspicions are completely groundless, I would be very happy. But it will take that to do it. Silence will not convince me; in fact, it is the silence that has disturbed me. Not a word has been said about this. The parliamentary secretary rose today with a statement which I suppose was prepared for him as a departmental explanation of what this is all about. It just says that some changes are being made in the three percentage points that had been collected under the Old Age Security Act which will now be collected under the Excise Tax Act. There was no explanation or defence of it. The Minister of Finance (Mr. Benson) said nothing about it on June 18 or when he introduced Bill C-259, and we have heard nothing about it today on Bill C-260. The whole question of the future of old age security is wrapped up in this. I imagine some members are wondering how a bill having to do with the Excise Tax Act produces all this discussion on old age security, but, as Your Honour has recognized, it is in the bill and it is a very substantial change which alters the whole base.
I remind you again, Sir, of the references which I have drawn to your attention. The basic philosophy was set out in the report of the joint committee of the Senate and House of Commons on Old Age Security in 1950.1 remind you of the philosophy that was set out in the white paper tabled by the Minister of National Health and Welfare late in 1970 from which it was very clear that the reason people have the right to expect old age security to continue and the right to take these payments with a feeling of pride and honour is that, in addition to any contribution they have made to the economy as a whole, they have contributed earmarked taxes to a special fund.
I want to see some great improvements in the whole matter of old age security. I want to see the guaranteed annual income at a much higher level. I want to see it extended to certain groups, perhaps to housewives, to

veterans, and to others whom I could name. But in the meantime let us not nibble away at what we have. I am afraid that the changes involved in Bill C-259 and Bill C-260 with respect to the financing of old age security have the effect of changing it from a contributory plan which gives all the rights there are to the people to a welfare plan because it will be paid out of revenues collected in a general way rather than revenues collected on an earmarked basis.
I know I am repeating myself but I feel very strongly about this. Everybody knows now how we pay old age security, out of the 4 per cent tax on personal income with a ceiling of $240 a year, plus a 3 per cent corporation income, plus the three percentage points that are built into the sales tax. The effect of these two bills will be to do away with the 4 per cent tax. There will be no more corporation tax, no more of any part of the sales tax going into the old age security fund, and therefore the whole position of people being able to say they are contributing to this pension which is theirs as a matter of right will be vitiated.
If the removal of the three percentage points from the Excise Tax Act so far as the old age security is concerned meant a reduction of the sales tax from 12 per cent and 11 per cent down to 9 per cent and 8 per cent, perhaps there would be something to crow about on the government side, but the sales tax rates are not being changed; the 12 per cent and 11 per cent continue. It does mean that the entire take from the sales tax will now go into the general revenue and none of it will go into the old age security fund. As I said a while ago, the removal of the personal and corporation taxes is at least matched by the requirement that the Minister of National Revenue once a year estimate what the take would have been. That much money must be paid into the old age security fund. But in the case of the sales tax there is no such provision. In other words, the government will have to put all the sales tax receipts into the general fund.
In so far as there is a shift from a regressive to a progressive way of taxation, of course I welcome it, and in so far as the personal income taxes that are used for this are those out of the general structure so that those in the upper brackets pay more than those in the lower, again I welcome that. But in so far as the contributing relationship is being completely wiped out, in so far as the philosophy of 1950 right down to 1970 is being denied by this legislation, I do not like it.
In due course we shall have the committee of the whole stage when we can consider the clauses, when the government can bring its people in here to answer questions, if it will and then third reading. I will be a very happy member if I can be shown that I am wrong, that I have nothing to be afraid of, but it looks to me as though the ground is being prepared for changes in the old age security so that it can no longer be said that individual Canadians have, among other reasons, the right to their old age pensions because they have contributed to these special funds.
The hon. member for Edmonton West (Mr. Lambert) says that this will just become a transfer of payments. As I said earlier, some of my colleagues will deal with the other phases of this bill. Some of them may deal with this phase as well, and I hope they will, but they will be
December 20, 1971

dealing with the changes of tax on spreads, on radios and televisions, on anti-pollution equipment, and so on. I want to say to the parliamentary secretary and to the government that I regard these changes being made in the methods of financing old age security as very important. I am disturbed most of all by the fact that, up to the present time, not one word has been said from the government side about these changes. We have a right to know what these changes really mean.


Gérard Laprise: Mr. Speaker, I should like to take advantage of this debate to make a suggestion to the government about Bill C-260.
I should like to bring up, in particular, two points concerning clause 4 on page 2 which deals with apparatus used in the fight against air and water pollution. I feel that the government could have, at the outset, gone a bit further in that field.
I have here a news release from the Canadian Federation of Mayors and Municipalities at the time when Mayor Marcel D'Amour was president, in which it was pointed out that the municipalities too have duties with regard to the fight against pollution of all kinds, but that up to now the federal government has failed to encourage municipalities willing to fight it.
I would add that the minister said in the House on June 18 that in order to favour the purchase of equipment used against pollution, he was going to remove immediately the sales tax on it. Such new exemption would apply, according to him, to all kinds of machines which manufacturers or producers buy for use in the detection, prevention, removal or reduction of pollution, but it would reduce revenues by about $8 million a year.
Mr. Speaker, I think that the Federation of Mayors and Municipalities has a part to play in that fight and that the government should have extended the tax exemption to the equipment which municipalities must use for that purpose.
I should also like to call the attention of the minister or of his parliamentary secretary to this point. They will have to read Hansard because I notice they are both absent from the House at this time. As reported in the press, they are fighting air pollution.
We all know that in the construction area, more and more people are using electricity for home heating. In the province of Quebec, Hydro-Quebec, which supplies electricity, is doing a great deal of advertising to push the use of electricity for home heating, since it is a way of fighting air pollution.
I have here an advertisement published in almost every newspaper; it appeared in Montreal-Matin of September 22 1971.1 quote:


[Stage Direction]
Electricity means no combustion, no smoke, no soot no smell,
[Stage Direction]
Hydro-Quebec researchers are continuously improving the methods for producing, transporting and distributing electricity.
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They are looking for new ways to use it. Everywhere the future is electric. Hydro-Quebec is working for you. Electricity is clean and efficient and it can be used in many ways.
Mr. Speaker, their publicity is trying to encourage people to use electricity to heat their homes, because it does not create pollution.
I know personally several people who reacted to that appeal and who switched to an electrical heating system or who are now installing such a system in new houses.
To my knowledge it costs some $500, $600 or even $700 to set up an electrical heating system in a house. People complain about the high cost of housing and the government, through the Central Mortgate and Housing Corporation, is trying by all possible means to reduce it. The Minister of Finance (Mr. Benson) should include in that clause of Bill C-260 a provision to exempt all materials used for electric heating systems in dwellings.
The construction cost of family dwellings could thus be reduced and the new owners would pay less for a house. The monthly payments would be decreased, because for an average 2 or 3 bedroom-house the taxes on building materials would be $75 or $100 lower.
Mr. Speaker, I urge this government to further consider this suggestion and to grant an exemption concerning electrical home heating. This would benefit all homeowners, all Canadian families and, at the same time, it would be an efficient way to fight pollution.
This government, the minister and his officials should, as soon as possible, consider this proposal. I myself have considered moving an amendment to Bill C-260 to that effect. But, after study, any amendment that I might have moved on that subject would have been ruled out of order.
That is why I shall wait for another opportunity to move an amendment or a motion on this subject.
In my view, the government should immediately give consideration to that possibility and, during the study in committee of the whole, we shall see if it is possible to move an amendment with regard to this matter.
Mr. J. H. Horner (Crowfoot):: Mr. Speaker, at the outset I must say that I am slightly disappointed that many of the questions raised by the hon. member for Edmonton West (Mr. Lambert) and by the hon. member for Winnipeg North Centre (Mr. Knowles) have not been answered. Hon. members continue to wonder just what is the intention with respect to the actual application of the clauses in the bill.
Dealing first with clause 1, and the transfer of the 3 per cent from the sales tax to the excise tax, one wonders whether the suspicions of the hon. member for Winnipeg North Centre are well founded. I can recall that upon the introduction of the Canada Pension Plan there was much discussion on whether the old age security pension should be dropped since, with payment of the Canada Pension Plan benefits, it possibly could be eliminated. The Minister of National Health and Welfare (Mr. Munro) made a statement to the effect that today many old people consider that they have a contract with the state for the old age security pension and that this pension has been increased by the guaranteed income supplement. But one had to
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contribute for ten years before qualifying under the Canada Pension Plan and had to contribute a minimum of five years before receiving even a portion of the moneys so contributed.
One cannot help but agree with the hon. member for Winnipeg North Centre that perhaps the transfer of moneys places some question on the contract with the state and whether the senior citizens of this country have a right to expect that the old age security pension will continue for many years to come. The hon. member suggested that he is all in favour of a guaranteed annual income, and perhaps this is the final answer. I am also concerned with the suggestion that it would be easier to eliminate the old age security pension if it were funded by payments from the Excise Tax Act into the Consolidated Revenue fund, but I do not think that the guaranteed annual income would be sufficient for many of the senior citizens today. It would pay an equal amount of money to everybody whether or not they were able to earn money and whether or not they had contributed over a long time through sales tax, personal tax and corporation taxes. I remember very well the debate on the Canada Pension Plan. At that time many government members suggested that the old age security pension could be eliminated. I do not think so, and I am suspicious that this might be the first step along that road.
I have other suspicions when looking at this bill, Mr. Speaker. One can wonder how much of the reduction of the tax on television sets, electronic devices and margarine is reflected back to the consumer. The hon. member for Edmonton West (Mr. Lambert) dealt with this at length but did not get a satisfactory answer. Has the Minister of Consumer and Corporate Affairs (Mr. Basford) and the government looked into this question? Has the price of margarine been reduced? I am inclined to think not, and that the 15 per cent reduction in sales tax on television sets has not been passed on to the consumer. Perhaps the manufacturer in some way is able to absorb this, though I do not think it was intended for his benefit alone but rather to stimulate business through the money being in circulation in one form or another.
I am also suspicious of section 2(2) which reads:
There shall be imposed, levied and collected only six-twelfths of the tax imposed by section 27 on the sale and delivery of the articles enumerated in schedule IV.
In looking at the explanatory notes I believe, and I may be wrong, that this takes the place of the section which provides that there shall be imposed a tax of only three-ninths of the tax imposed by section 27. One does not have to be a mathematical genius to realize that three-ninths is one-third and that six-twelfths is one-half-a substantial increase in the tax levied on articles falling under section 27, schedule IV.
When one looks at schedule IV, section 27 of which deals with a host of implements and farm produce from alfalfa meal, dried or otherwise, to traction engine parts, the increase in the levy is the difference between six-twelfths and three-ninths. The section covers 25 articles. I cannot understand why there is not an explanation for the change from three-ninths to six-twelfths, and I think we must have the answer before much progress is made on

this particular section of the bill. If it is merely a change in the wording, and not in the effect, perhaps the parliamentary secretary or the Minister of National Revenue (Mr. Gray) or someone from the government could say so. The parliamentary secretary can hardly speak for the government I suppose, but he is the only one who seems to be paying any attention to what is going on here. The government wonders why its bills do not get speedy passage but they allow the parliamentary secretaries to pilot the bills through in the absence of the ministers.


An hon. Member:: Only four.


John (Jack) Henry Horner: I did not catch that remark; speak a little louder.


An hon. Member:: Only four Tories in the House.


John (Jack) Henry Horner: I didn't know the Tories were responsible for putting forward this bill, Mr. Speaker. If we were there would not be so much confusion about it. The three hon. members who spoke this afternoon were not able to get any clarification. If the Tories had introduced this bill it would have been better drafted. There seems to be some response from the government side now, even though it is a bit meaningless. Perhaps they could clear up some of the points made by me and the three previous speakers.
I hope we shall be told how much money will be lost to the treasury as a result of the reduction of the tax on margarine. Actually, that tax is to be eliminated. How much will the treasury lose as a result of the removal of the 15 per cent sales tax on electronic equipment such as television sets, phonograph playing devices and so on? Perhaps the government could also clarify something with regard to the Old Age Security Act. Is this bill the first step towards removing the payment of old age security pensions? People will have to pay for years into the Canada Pension Plan. As soon as people reach pensionable age, they are entitled to draw benefits under the Canada Pension Plan. Will there be some hocus pocus, some playing around with figures and the guaranteed annual income, which will remove benefits that are available to our senior citizens. Is any strategy afoot that will take away these pensions from people who have contributed to them? I hope not.
Remembering what went on when the Canada Pension Plan was introduced, I can only suspect that this bill is the first step towards removing the old age security pension paid to many of our people. Our senior citizens have made major contributions to their pension fund by way of the sales tax. They have contributed 4 per cent of their personal income tax and there have been contributions from corporations in the form of tax. By these means, sizeable contributions have been made to the old age security fund. Our elderly people have a right to expect that, when they reach pensionable age, they will be able to draw benefits from that fund. They expect the state to honour a contract to which it has committed itself. Therefore, any suggestion of this contract being done away with should be squelched immediately.
A long time ago the hon. member for Winnipeg North Centre dealt with this subject at length. He begged the President of the Privy Council (Mr. MacEachen) to make a
December 20, 1971

resounding speech to reassure the House that the government had no intention of doing away with the old age security pension. The President of the Privy Council, who was in the House at the time, did not rise to the occasion. I believe another minister was also present in the House at that time, and he failed to reassure the House. The parliamentary secretary to the minister did not reassure us. If the government wants to make good progress with this bill I hope, before too many hon. members have spoken on it, that answers will be forthcoming to questions hon. members on this side of the House have raised. That is what the government must do if it expects quick passage of this confusing piece of legislation.


Patrick Morgan Mahoney: On a point of order, Mr. Speaker; since I have already spoken in this stage of debate I cannot, of course, speak again, and I certainly am not in a position to answer questions at this time that may be asked by hon. members on the other side of the House. I wonder how the remarks of the hon. member relate to Schedule IV of the bill, to the Excise Tax Act and to the products and equipment mentioned there. Schedule IV of the Excise Tax Act I have in front of me refers to articles manufactured or produced by the labour of the blind, deaf and dumb. I am having difficulty relating these items to what the hon. member has been talking about.


John (Jack) Henry Horner: That is all the more reason for explaining the provisions regarding six-twelfths and three-ninths.


The Acting Speaker (Mr. Laniel):: Order, please. I understand the difficulties of the parliamentary secretary. I suggest that perhaps his colleagues could help him. However, I cannot allow him to intervene again in this way. It would be inappropriate. According to my interpretation, such intervention would be tantamount to a second participation in the debate.


Patrick Morgan Mahoney: Mr. Speaker, I was merely asking the hon. member a question, or I was trying to ask him a question. I wanted to relate what he was saying to the amendment to the Excise Tax Act.


Mr. Doug Rowland (Selkirk):: Mr. Speaker, Bill C-260, which is before us, is an attempt to put into effect the measures heralded in the mini-budget speech of June 18. That speech was made by the Minister of Finance (Mr. Benson). The bill is divided into two sections. One section deals with amendments to the Old Age Security Act and the other removes from the excise tax list certain commodities. The tax reductions indicated in this bill are, generally, welcome. I say that on behalf of members of this party. I will return to the subject in a moment.
First, I should like to spend a few minutes on the section which deals with the amendment to the Old Age Security Act and which removes the 3 per cent of sales tax which has hitherto been earmarked for the old age security fund. That 3 per cent of sales tax revenue is now to be applied to general revenues. The hon. member for Winnipeg North Centre (Mr. Knowles) dealt at some length with his suspicions regarding this particular provision. He went into detail, and I do not intend to go into the same kind of detail in my remarks. I simply want to second what he said. Until the present time, the money necessary for payments under the Old Age Security Act has been
Excise Tax Act and Old Age Security Act
collected from three sources: first, from the 4 per cent of personal income tax, the ceiling being $240, which money was paid into the old age security fund; second, from the 3 per cent levy on corporation taxes, which money was paid into the old age security fund; and third, from the 3 per cent of the sales tax levy which, again, was paid into the old age security fund.
We, of this party, have on numerous occasions opposed the regressive nature of two of the sources of income for the old age security fund, namely, the virtually flat rate levied on personal income and the 3 per cent sales tax. We have argued that these taxes were of a regressive nature. Nevertheless, we have always applauded the idea that there ought to be sources of income specially earmarked for payment into the old age security fund, so that it would be patently clear to all concerned that the old age security pension is paid to persons over 65 as of right. They have contributed to the fund during their working years in order to be assured of a pension in their retirement years. The old age security pension is theirs as of right, and the whole matter thus takes on the aspect of a social contract. We have always applauded that fact, even though we may not have approved of certain means used to raise that revenue.
Now, Bill C-259 will remove effectively the 4 per cent of personal income tax that is paid to the old age security fund. That bill will remove the 3 per cent corporation tax contribution which is paid to the same fund. Bill C-260, which we are examining this afternoon, will remove the 3 per cent of sales tax which was formerly paid into the old age security fund. The fund will now be supplied with moneys out of the general revenues, and will receive an income which will be computed on the basis of the taxes that would have been collected if provision for collecting them had still been in effect. That is how the money will be paid and, thus, the contributory nature of the old age security plan will now disappear. As I suggested earlier, the idea of a social contract as between the citizens of this country and the government will also disappear and I am worried, as is the hon. member for Winnipeg North Centre, about the implications that this move may have for the pensioner. Are we to take it, now that the money for the old age security fund is to come out of the general revenues, that at some future date the government can come to this House and say that since the old age security pension is not a contributory scheme, since it is not a matter of social contract, that it is not paid to pensioners as of right and that the government, therefore, wishes to take that pension away? May I remind the House that one year ago, I believe, the amount of the old age security pension was frozen at $80 per month. That seemed to be the first step to removing the pension entirely. This bill may be the second step. The third step may be taken I do not know when. I hope the government does not intend at some time in the future to end the old age security pension. I hope that some one will get up and tell us that the government does not so intend. The thought that universal pensions may be terminated is very disquieting, and my colleague from Winnipeg North Centre and I are afraid this might happen.
One of the outstanding benefits of the old age security pension was this: it was paid on a demogrant basis. It was paid, as of right, to the senior citizen who had attained a
24725-44!

December 20, 1971
Excise Tax Act and Old Age Security Act
certain age. The receipt of that pension was a source of pride. Previous to the Old Age Security Pension becoming universal, a person called himself a pensioner with great reluctance. A pension smacked of welfare. Once it became a demogrant and he contributed to it, it was a source of pride and dignity for the pensioner. Pensioners in this country could organize themselves to come to the government and demand the aid from their fellow citizens which they required and which was their right. They were able to do it on the basis of being pensioners. Their confidence arose from the fact the pension was paid to everyone as a right. If that is to be changed, I suggest it is a retrograde step. If it is to be changed in order to eventually remove the pension paid on a demogrant basis and if all pensioners are going to have to rely on the Canada Pension Plan, private plans and the guaranteed income supplement which is based on a needs test, we have taken a backward step. I hope someone from the government will assure this House that is not their intention and state the philosophy behind these tax changes.
I now turn to the other portion of the bill which deals with the removal of the excise tax from certain commodities. Before dealing with each of the specific items, I wish to make one general statement. In my remarks I will be repeatedly referring to the need for monitoring devices once the tax is removed. I make that demand for two reasons. First, I want to ensure that the benefits of the removal of the tax is passed on to the consumers through reduced prices of goods. The second deals with one of the major problems which every nation has had in managing its economy, that is, attempting to manage the economy through fiscal policies, the manipulation of taxes, which has been largely a by guess and by God operation. No one is ever quite certain what happens when you remove or increase a tax. Here is a real opportunity to do some monitoring and get some hard data about what actually happens when a tax is removed.
These excise taxes were removed effective June 19. We have now had almost six months to monitor the effect of the removal of the taxes to see if the removal did result in added industrial activity, added consumption of goods and more money being put into the economy thereby generating new activity. We have had that occasion presented to us. I hope the government has made use of it. I will be asking the same question again and again when I come to the individual items under these sections of the bill. It is necessary that we undertake such monitoring and collect the hard data about what happens when a tax is removed if we are to effectively use our fiscal policies in the future. I will now deal with the items.
The bill provides for the removal of the excise tax on margarine and similar products. As I indicated in my general remarks, I would like to know whether the removal of the excise tax has been passed on as a saving to the consumer. I received a letter from the Edible Oils Institute in which the Institute extended its thanks to the members of this House for removing the sales tax on edible oils. The Institute gave an undertaking that the saving would be passed on to the consumer. I have no way of knowing that has taken place except by sending my wife out periodically to see whether margarine has gone down in price.
(Mr. Rowland.]
There is available to the government an excellent way of monitoring to see if the removal of the excise tax has actually resulted in savings to the consumer. That way is through the monthly pricing surveys conducted by Statistics Canada. There are large numbers of people employed by Statistics Canada who go to the shopping centres and small grocery stores every month to see what is happening to the prices of various goods. It would take very little effort on the part of the Department of Finance to ask Statistics Canada to make a special effort to price margarine to see whether the saving resulting from the removal of the excise tax is being passed on to the consumer. They could monitor the price of margarine to discover whether the government's fiscal measures have had the desired effect. I would like to know from someone on the government side whether this was done, whether the savings anticipated have indeed been passed on to the consumer or whether they have simply been retained as increased earnings by the companies involved. I mention once again that the Edible Oils Institute assured various members of this House it was their intention to pass on the saving to the consumer. I would like to know if this has been done.
Another section of the bill provides for the removal of excise tax on machinery and products designed for, or related to, the control of pollution. This is a very welcome provision. If the removal of the excise tax does reduce the cost inherent in cleaning up our environment, it is a worthwhile step. I hope it will result in industries, municipalities, the provinces and the federal government being encouraged to purchase the devices necessary to begin cleaning up our environment. Once again, I suggest that, if it has not been done, it is necessary to monitor the effects of the removal of that tax to see that the saving to the companies involved, as the result of the tax being removed, was passed on to the consumer, whether it stimulated the production of anti-pollution devices and whether it stimulated the purchase of domestically produced anti-pollution devices and not simply the importation of anti-pollution devices designed and manufactured abroad. If it has not already been done, those three important aspects should be monitored. I ask whether this has been done and, if so, what were the results of the monitoring?
It would have been useful if the government had come up with a program of research and development in conjunction with this tax measure to ensure that Canadian companies fully benefited from the removal of the excise tax. Such a program would have been another means of ensuring that Canadian companies would undertake research and development into anti-pollution devices to enable them to produce the equipment necessary to clean up our environment and to reduce our dependence on imported goods for this purpose. Had there been a research and development program undertaken in conjunction with the removal of the excise tax, quite possibly we would have had a greater degree of stimulus to that industry than has taken place, if indeed any has taken place. Once again, we will not know precisely what has happened until we have seen the results of the monitoring of the effects of the removal of the tax and we do not know whether that monitoring has taken place.
I would also like to refer to the removal of the excise tax on the electronic equipment such as radios, phonographs
December 20, 1971

and television sets. I come back to the need for monitoring to determine whether that saving has been passed on to the consumer and, being passed on to the consumer, whether that saving has stimulated the purchase of electronic equipment. Also, have the purchases which it has stimulated been of domestic manufacture rather than foreign manufacture. We require these facts, not only to judge the validity of the measures incorporated in this bill, but also to determine the effectiveness of the use of fiscal devices in an attempt to manage our economy.
I said earlier it is largely a by guess and by God operation to attempt to manage the economy through the manipulation of taxes. Monitoring devices would remove some of the elements of doubt from that operation. This was an excellent opportunity to establish monitoring devices. They could have been used to give us some hard information which we require in order to adjust our tax system in the future. As in the case of edible oils, the monitoring in respect of electronic equipment could have been done through Statistics Canada because the pricing of electronic devices takes place monthly in its pricing surveys. A simple request from the Department of Finance could have led to the provision of this information. If such a request has not been made, I suggest the department might approach Statistics Canada and ask for such information to be compiled. It is all there. We could then find out whether the consumer has benefited as a result of these taxation measures.
I have covered, in a sketchy way, most of the subject matter included in the bill. To summarize, there are certain matters in respect to which we should like to be given further information before we vote on this tax bill. First, we should like to know whether our suspicions, as to adjustments in connection with the Old Age Security Act are justified or not. I see the Minister of National Health and Welfare (Mr. Munro) is in the House. It would be interesting to hear him confirm or deny these suspicions. Second, we should like to know whether the removal of the excise tax from certain commodities have been monitored to determine whether removal has had the results intended, in terms of money saved by consumers, the generation of increased activity in the industry concerned, and increased domestic production, rather than an increase in the importation of manufactured goods.


Mr. Ross Whicher (Bruce):: I shall be very brief, Mr. Speaker. I had no intention of entering this debate, and I would not have done so had not some of the comments and statements made by the hon. members to my left disturbed me slightly-indeed, they disturbed me a great deal. Several of them voiced a suspicion that because of a transfer of a 3 per cent tax from the Old Age Security Act to the Excise Tax Act there might be some thought in the mind of the government that at some time in the future the old age pension for senior citizens would be eliminated.
I do not know where hon. members to my left get these ideas. I know that there are about 1,700,000 old age pensioners in Canada. I realize, too, that in the future, maybe, there may be a better way of looking after our old age pensioners than the one we are now using. The fact is that old age pensions, old age security for senior citizens, who
Excise Tax Act and Old Age Security Act
have made Canada what it is, is a fact of life, and no government, no matter what government it might be, would ever think of eliminating old age pensions as we know them in Canada today. It is absolute political hypocrisy for any member of any party in opposition to suggest that this government or any other is thinking of eliminating such pensions which are involved in our way of life in this country. I can see some of the newspapers picking up those speeches by members of the opposition, and by tomorrow morning, or within the next few days, suspicion will be placed in the hearts of many of our old age pensioners that the government is going to eliminate their pensions. Nothing could be further from the truth.


William Arnold Peters: How do you know?


Ross Mackenzie Whicher: I know, absolutely.


William Arnold Peters: You are just guessing.


John Carr Munro: Don't be so cynical.


An hon. Member:: You are only in the rump.


Ross Mackenzie Whicher: The hon. member says I am only in the rump. Let me point out to him that the rump is much larger than his own party. There is a great danger that after the next election we shall have so many members we shall move right down next to him.
I have often told these people that if it comes to a battle of wits they do not stand a chance. Let them keep 'quiet. They will have a chance to speak in a few minutes. In any event, I have been asked how it is I know that old age pensions will not be eliminated. I will give an answer. There are many too many revolutions going on in the world today. There is too much fighting going on at the present time. If any future government ever thought about eliminating a basic way of life such as old age pensions in Canada, the revolution here would compare with those taking place elsewhere in the world today.


William Arnold Peters: Over 65 is not the age of revolutionaries.


Ross Mackenzie Whicher: Of course, pensions will not be eliminated. I know spokesmen for the government will stand up and say so when we get to the committee stage when members can answer questions on this bill. Of course, it will be said that old age pensions will not be eliminated. How could a government such as this eliminate old age pensions? The only thing this government has done in the last year has been to increase them. And in another four years or five years, when we are still there, we will probably increase them still further. There is no thought of eliminating these things. I suggest that hon. members who plant these seeds in the hearts of old age pensioners are not doing them any good and are not doing their own party any good.
The trouble about hon. members to my left is this. After the speech of the Minister of Finance (Mr. Benson) not only this afternoon but on television last night, and after listening to what has been said by the President of the United States and other world figures, they cannot stand prosperity. That is what they fear. It is just a little bit too much, coming after the great success the Minister of Finance had enjoyed in Washington in the past few days. I am sure someone from the government will tell these hon.

December 20, 1971
Excise Tax Act and Old Age Security Act
members shortly that there is absolutely no chance of old age pensions being eliminated.
There is something else in this bill, too. The government is proposing to reduce taxes on such things as radios and television sets. Are hon. members to my left against this? The people of Canada are getting tired of such negative talk. When they go out to buy a television set they find they can get it 15 per cent cheaper than they could 12 months ago.


Marcel Joseph Aimé Lambert: No, they don't.


Ross Mackenzie Whicher: As far as taxes are concerned, yes.


Marcel Joseph Aimé Lambert: Nonsense.


Ross Mackenzie Whicher: The tax has been eliminated and it has been eliminated, not by the financial critic of the Tory party but by the government of Canada.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: Then, too, the elimination of the tax on margarine and similar spreads may seem a small thing. A few years ago when I had the privilege of sitting in the Ontario legislature I was against the colouring of margarine in Canada. But now, new circumstances have come about. The fact is that margarine, like old age pensions, is a way of life in Canada. All this government is doing is eliminating the tax, and hon. members to my left are trying to stop it. It is high time that people knew exactly what is going on.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: This bill provides for the elimination of the tax on radios and television sets, on margarine and similar spreads and on anti-pollution equipment. Are hon. members to my left against the control of pollution in Canada? I have been listening to their speeches for the last hour and it seems to me they are not only against this bill, but they are against everything. What the government is trying to do in this bill is to cut prices, admittedly in a small area, in this instance. The people of Canada will be able to say, at least in this area, that instead of taxes being increased, they are being reduced. I hope we get in the committee of the whole soon so that the parliamentary secretary can answer some of the questions which have been raised by members of the opposition.


Some hon. Members:: Hear, hear!



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Laniel):: Order, please. It is my [DOT]duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Assiniboia (Mr. Knight)-Agriculture-Program to Assist Small Farmers-Nature of Plan-Adjustments for Simi-

lar Provincial Projects; the hon. member for Central Nova (Mr. Mackay)-Unemployment Insurance-New Procedures to Expedite Payment of Benefits; the hon. member for Notre-Dame-de-Grace (Mr. Allmand)-Criminal Code-Amendment to Ensure Stricter Control Over Firearms.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Benson that Bill C-260, to amend the Excise Tax Act and the Old Age Security Act, be read the second time and referred to the Committee of the Whole.
Mr. Cliff Downey (Battle River):: Mr. Speaker, I want to join other hon. members who have expressed their thoughts on this bill and indicated their approval of these reductions in taxes. Contrary to what the previous speaker has just said, from the speeches I have heard this afternoon hon. members are in favour of doing away with the tax on anti-pollution equipment and the removal of other taxes provided for by the bill. Knowing this bill was to be debated this afternoon, I made some telephone calls to ascertain the facts in connection with the removal of the tax on electronic and television equipment and the tax on margarine. I talked to local people in Ottawa and found, indeed, there had been some price reduction of television sets. The tax reduction has been passed on to some extent.
However, my investigations do not indicate this is the case with the tax on margarine, which I believe was 12 per cent. The same brand of margarine that sold at 59 cents last spring sells today in Ottawa for 66 cents. Even though it may be a loss leader in some stores, and in some of the large chains there may have been large stocks, there should at least have been a maintenance of the price for which it sold before removal of the 12 per cent tax. This indicates to me that the department of the government responsible for implementing the tax reductions should have checked a little more closely, because the removal of the tax has not been reflected in the price of the product. I am sure all hon. members praise the government for removing the tax on anti-pollution equipment; this is a good move. All of us are very conscious of pollution, and before some of the statements made about pollution today become too common in the press some more investigation into pollution is required.
I had an interesting trip to Washington several weeks ago to participate in talks with the United States department of agriculture and other government departments about pollution control. There had been reports in the press that fertilizer used on farmland was causing pollution, and I was interested to note an experiment that had been carried out in this regard in the city of Washington. The experiment disclosed that the major source of pollution from fertilizer was the urban area. Some run-off tests had been made which indicated that urban dwellers, by and large, are ready users of fertilizer which is applied a
December 20, 1971

little more than is generally required on lawns. Some of the chemical is washed off the s.oil and runs down asphalt driveways and pavements into the gutters and thence into streams, and pollution was caused in this way. I think this points to the need for specific investigation as to source of pollution rather than simply referring to pollution generally.
Many speakers this afternoon have referred to the application of the 3 per cent old age security tax to other areas. I have no fear that the government will remove the old age pension, but I think it is important to earmark the tax for this purpose. People like to know where their money is going. This particular tax is earmarked for old age pensions and thus we know where the money is going. People do not mind paying it because they know exactly what it is used for. However, when money is paid into a general revenue fund, payment out of the fund introduces the concept of welfare and one can well understand some stigma may attach to it.
I think it is also important to review incomes and income guarantees of one sort or another, and to find a better way of developing sources of second incomes for Canadians. This can be done by involving Canadians in some form of participation in our industrial growth. Unless we do this, at every election time politicians will go across the land each out-promising the other, and saying he will do more if he is elected; that the people will receive additional benefits through various government channels of distribution. In this regard, we could well use at the present time something along the lines of an industrial homestead act to develop a second income plan. This would help eliminate our constant worry over how to distribute funds and what to call various taxes that are applied.
I shall not continue at length at this time, but I should like to comment on the remarks of the hon. member for Bruce (Mr. Whicher) in respect of old age pensions. I suggest that the increases the government had made in old age security payments do not warrant all the enthusiasm, wind and words he wasted on us. We all know it was an increase of 42 cents last year, and in view of the "generosity" which has been exhibited in the past we wonder what any increases might be in the future.


Winona Grace MacInnis: Mr. Speaker, lest there be any doubt in the mind of any hon. member as to where we stand on some of these matters, I should like to begin by saying we are exceedingly glad to see the repeal of the sales tax on margarine. We in the opposition for a long time have been pressing for its removal and are glad to see this brought about. We are also glad to see there is to be a removal of the tax on television sets and electronic equipment. I wish the hon. member to my extreme right had not left the chamber, but he has returned and I am glad. I would point out to him that I was saying we are very much in favour of the removal of the sales tax on margarine and the excise tax on television sets and electronic equipment, but we want to make sure that the removal of those taxes amounts to a real saving to the Canadian consumer. At the present time there is no guarantee of this.
Excise Tax Act and Old Age Security Act
As the hon. member who spoke a moment ago pointed out, the price of margarine has gone up. My colleague who spoke earlier also mentioned the need to make sure that these taxes which have been taken off result in savings to consumers. I wish to go a step further. I am sorry that at the present time only one member particularly concerned is in his seat, and indeed he is only the parliamentary secretary to the Minister of Finance (Mr. Mahoney). This matter concerns at least two other ministers, the Minister of National Health and Welfare (Mr. Munro) who was here a few moments ago, and the Minister of Consumer and Corporate Affairs (Mr. Basford). I think both these gentlemen should be here to hear the comments of members of the opposition because, after all, we hear from a good many people and reflect what they believe and say.
I shall go a step further than my colleague who thought the Department of Finance could very easily work with Statistics Canada to monitor whether or not these savings are being passed on to the public. After such monitoring I believe the job of protecting the consumers in these matters falls squarely on the shoulders of the Minister of Consumer and Corporate Affairs. He has been able to devise ways and means to protect consumers in a number of ways. I might mention inflammable materials and poisonous goods, among others. I think it is up to him, perhaps in conjunction with the Minister of Finance (Mr. Benson) and his department, to devise a method whereby the savings that are made are passed on to the consumers as would appear to be the intention of the government in making the changes in this legislation.
So I say to my friend to my right who has disappeared- he is again a little like the Cheshire cat with the grin, who appears and disappears-that because we are in favour of these changes we say to the government it is not good enough to go halfway in making them. The government must go the whole way in order to see that the provisions of the legislation are enforced so that the consumers receive the benefit. I say in this regard that the Department of Consumer and Corporate Affairs, and its minister in particuler, should have the ultimate responsibility in seeing that these amendments are enforced.
Now I want to come to the matter which has concerned many of us here more than anything else in this bill. I refer to the removal of the excise tax which had been earmarked for the old age security fund. This worries us a great deal. Anybody who thinks this is parliamentary hypocrisy or is an attempt to make political capital out of this matter has a very short memory indeed. Many memories in this House do not go back beyond personal recollection, and that is not very far in many cases. Old age pensions have never been adequate, but those of us who have worked step by step to get them and to have them increased know that there is a good deal of ground for fear, distrust and suspicion. I do not blame the parliamentary secretary, but I say he was very shortsighted if he thought there would not be this suspicion when he did not explain why the change is being made.
We want to know the reasons. There may be good reasons, but we have not been told what they are. Our suspicions will remain until such time as we are told. If we are not told during this debate, our suspicions will remain. They are not only the suspicions of the New Democratic Party or of the party to my right. They are the suspicions

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of everybody in this country who knows the history of old age pensions. In the first place they were most reluctantly given. At first we had a pension of $20 a month at age 70, with a means test. Every increase, every improvement, step by step after that had to be fought for,
There is in this House no person who has as much right as my colleague from Winnipeg North Centre (Mr. Knowles) to voice suspicion and to demand to know the reasons for this change in the legislation. Nobody in this House has been the stubborn fighter from the very beginning in respect of increasing the old age pensions that the hon. member from Winnipeg North Centre has been. I look across at my friends and say again that no member of this House has been the stubborn fighter for the rights of old age pensioners and the improvement of those rights that my colleague from Winnipeg North Centre has been.


An hon. Member:: I disagree with that.


Winona Grace MacInnis: You can disagree all you like, but what are you and I against the facts? The facts speak much louder than you do in this matter. The facts are that the hon. member for Winnipeg North Centre, along with people who are no longer in this House, carried on a stubborn fight for the old age pensioners. As I say, no one has as much right as he to demand of the parliamentary secretary the reason for these changes. The fact is that not until 1950 did we manage to get the universal old age pension. The battle had been fought step by step since 1924, and only in 1950 was it made a universal old age pension. The contributory feature in it makes it something that can be called a social contract, a contract with society, which gives it a semblance of right. The sweeping away of the contributory factor gives us every reason to feel that the right may be going with it.
It is all very well for my hon. friend sitting straight ahead of me to say that this government has no intention of removing the old age pension. Anybody who knows anything about how liberties are removed knows that very seldom are liberties taken away in a single bite. They are nibbled away. The first approach to the removal of liberty and freedom is not noticed, because it can be explained away as being a more efficient method and as being of benefit to the person who is receiving it. Step by step down the slippery road this continues to happen.
Do not think that some of us over here have forgotten what happened to the universal nature of the old age security pension, or have forgotten that by using fancy language and calling it a guaranteed income supplement the older people in this country were divided into two classes, those who are poor and those who are very poor indeed. The very poor were told that they were benefiting because those a little higher up the income scale did not get a guaranteed income supplement. We have not forgotten that, and we have not forgotten the deprivation of people being kept at a straight $80 a month no matter what happens to the cost of living. These people have no escalator clause, no collective bargaining through which to raise their income in accord with the cost of living. And they were placed in that position by this government. No wonder we are suspicious.
(Mrs. Maclnnis.]
This was done in the smoothest way. The older people were told that they would be regarded as a special category of older people who were self-supporting, and the other people were kept quiet because they were given the so-called guaranteed income supplement and allowed to keep the escalator clause. Their poverty was so desperate that my friends across the way might well have had the revolution referred to by the last government speaker had the older people not been given that kind of sop to keep them quiet.
These are our reasons for wanting an explanation. I am sorry that the minister did not give them in his opening statement because under our rules of debate he is effectively gagged from taking further part in the debate. I warn him now-he probably knows this without my warning-that when we reach the clause by clause study we will again be asking him for an explanation as to why this has been done. Either there is good reason, or there is none. If there is good reason, let him remove the suspicion from the government's shoulders by telling us about it, and if there is no good reason-


An hon. Member:: Political hypocrisy.


Winona Grace MacInnis: Let the hon. gentleman across the way keep quiet about political hypocrisy. He should know that at least the older people have some champions here who will fight for their right to exist. There are certain rights in this country. The Americans used to refer to life, liberty and the pursuit of happiness. I will add a fourth right, the right of the old to have self-respect and to be self-respecting. That is a right in this country, or it should be. If this government insists on nibbling away at it with fancy language or with silence, that right will be eroded bit by bit.
We have every right to be given an explanation because there is value in earmarking a fund for the old age security pension. If no particular amount is earmarked for this purpose, every time old age pensions are paid the government will look at the consolidated revenue fund and think that it is a big bite out of the fund and that they had better find some way of chiselling away at it, of putting old age pensioners into another category where they could be given a smaller amount.
If you have a sum of money that you have set aside for a certain purpose and you have effectively said goodbye to that money, you are not tempted to use it for something else. But if you leave that money in a common pot, in your general expense fund, every time you wish to use the money for a special purpose you are tempted to nibble it away and not rob the common pot to that extent. This is why we want a certain amount of money to be set aside by statutory means for the old age security fund, something that cannot be used for another purpose. If suddenly the government tells us that they will take away the sales tax and that it will no longer be put into the old age pension fund, then we have every right to become worried.
At present the old people in this country have been demoted, they do not count any longer. Youth is everything. Once you are over the hill, which is around the age of 30, you are regarded as being of no account. When you get to the stage of receiving the old age pension, somehow this government believes that you are well able to exist on toast and tea and that you enjoy toast and tea more than
December 20, 1971

nutritious food, that it is positively insulting to give you a full-bodied diet.
I would not trust the government round the corner unless it can give us an explanation as to why it is doing this. I say to the parliamentary secretary that I wish the minister had not muzzled himself for the rest of the debate. I appeal to him to go and find the Minister of National Health and Welfare (Mr. Munro) before supper and if he cannot do so now, after supper, and ask him to give us an explanation. Presumably there is good reason or he would not have allowed the basis of payment for the old age security pension to be changed. Let him find the minister and persuade him to take part in the debate later on, so that he can dispel our suspicions and cut short our debate. I tell the parliamentary secretary that we have no intention of letting this change go by without knowing why the government made it.


Patrick Morgan Mahoney: Let us go on to committee of the whole stage.


Winona Grace MacInnis: I would like to have an explanation now. It had better be a good explanation, because the elderly people of this country have been bitten so often that they recognize the bite when it is coming.


Ross Mackenzie Whicher: Would you be satisfied if the explanation were good?


Winona Grace MacInnis: Did I not say we were pleased to have these taxes cut? We are like Oliver Twist; we want to make absolutely sure there will be more and that not only the taxes are cut but that the consumer will obtain the benefit therefrom. We want the government to go the whole way and protect its first action by a second action. If the government has a good explanation, that is well and good; but silence is no answer. The old people of this country, and we on this side of the House, will not take silence for an answer on this very important matter.


Mr. Thomas S. Barnett (Comox-Alberni):: Mr. Speaker, my colleague, the hon. member for Vancouver-Kingsway (Mrs. Maclnnis), has suggested that the Minister of National Health and Welfare (Mr. Munro) should come to the House to tell us why this has been done. I am not sure that he is the right minister to do so, because if he must abide by the principles of cabinet solidarity I am not sure he is able to stand up and tell us why it is being done. I think it would be much more appropriate if the Minister of Finance (Mr. Benson) were to come into the House and tell us exactly why this is being done. After all, this is his bill.
Perhaps I am being a little bolder than my colleagues, the hon. member for Winnipeg North Centre (Mr. Knowles) and the hon. member for Vancouver-Kingsway. I am going to suggest that from the facts available I already know what is being done. The Minister of Finance has been talking about reducing various taxes through this bill, yet when one looks at the bill it is quite evident that he is increasing the sales tax by 3 per cent. That is exactly what it says. I quote from clause 1:
"27. (1) There shall be imposed, levied and collected a consumption or sales tax of twelve per cent on the sale price of all goods".
Excise Tax Act and Old Age Security Act The act at present in force provides:
There shall be imposed, levied and collected a consumption or sales tax of nine per cent on the sale price of all goods.
In other words, Mr. Speaker, what in my view and in the opinion of the Carter commission on taxation is a very regressive form of taxation is being increased by 3 per cent through this bill. That is what it says. There is a later clause in the bill which abolishes certain provisions of the Old Age Security Act. That, to me, is a purely incidental piece of legislation because in effect it abolishes the 3 per cent contribution to the old age security fund. But it is quite apparent, on the face of the facts of the legislation, that what is being done is to reduce the amount of money going into the old age security fund and on the other hand to permanently increase the sales tax by 3 per cent.
Hon. members may recall that the Carter commission report said if there was going to be a sales tax at all-and it said sales tax should continue-then sales tax both federal and provincial should be levied at the retail level, rather than continuing in our tax law this particularly iniquitous form of taxation that bears most heavily on the consumer and is one of the factors contributing to inflation.
If one compares this bill with Bill C-259 this was pointed out by the hon. member for Winnipeg North Centre-he will see there is no parallel provision in regard to sales tax as there is in regard to income tax. As the hon. member for Winnipeg North Centre remarked earlier, that legislation points out that an amount equal to the amount that might have been collected from income tax, under the direct 3 per cent and 4 per cent contributions from corporations and personal income tax, shall be put into the fund by the Minister of National Revenue. There is nothing in this bill which says that shall be done with the extra 3 per cent sales tax to be levied. It is quite clear to me what the government has in mind. It is going to rob the old age security fund of the 3 per cent that is now going into it and put that money into general revenues. The practical effect in the long run will be an increase of 3 per cent in this regressive form of taxation to be used for the general spending programs of the government.
The hon. member for Bruce (Mr. Whicher) said there would be a revolution if the government were to tamper with this. But some of us recall the kind of suggestions that came from government and near-government sources during the period prior to the tabling of the white paper with the blue cover, called "Income for Canadians", by the Minister of National Health and Welfare (Mr. Munro). And some of us recall the relief and surprise-certainly pleasure so far as I was concerned-that was felt when he indicated in that white paper that for the time being at least the universal old age security pension was to be continued.
As I say, there had been widespread suggestions emanating from government and near-government sources that the universal old age pension plan might be changed. Now I am beginning to feel that in the internal discussions of the government this philosophy is winning out and this bill is a symbol and a sample of it. If one couples this with the earlier action mentioned by the hon. member for Vancouver-Kingsway regarding the freezing of the old age security pension at $80, this at a time when because of cost of living increases obviously a substantial increase

December 20, 1971
Excise Tax Act and Old Age Security Act
was warranted if one were continuing to accept the principle of universality, and puts these two things together it is evident that the Minister of National Health and Welfare, if he does believe in the principle of universality of a basic old age pension, has been losing out in the arguments within government on this question.
This is what is emerging in this bill. The old age security fund is to be chopped by whatever the yield from this 3 per cent tax has been, and that presumably confirms the idea that the freeze of the pension at $80 is to continue into the indefinite future as long as this government remains in office. That is the only logical conclusion I can draw. I suggest it is the Minister of Finance, rather than the Minister of National Health and Welfare, who should come into this House and tell us whether or not that is happening with respect to the direction of government policy at this time. Some of us who have been members of a number of parliaments have seen well-meaning ministers put forward various kinds of programs, only to have them chopped out from underneath them by the real policymakers behind the scenes.


John Carr Munro: May I ask the hon. member a question?


Thomas Speakman Barnett: I think the minister has time to do so before six o'clock, and I will be glad to answer.


John Carr Munro: If the hon. member and other hon. members who have been speaking are asking for a declaration of governmental intent with respect to the old age security pension, I can say there is no intention whatsoever of the government to do away with the old age security pension. There is a question of the realignment of the tax designed to raise moneys for the government, but there is no intention at all to do away with the pension.


Thomas Speakman Barnett: I am a little uncertain as to the minister's question. Mr. Speaker, I believe it is six o'clock. I would just like to say-


The Acting Speaker (Mr. Boulanger):: Order. It being six o'clock, I do now leave the chair until eight o'clock tonight.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Thomas Speakman Barnett: Mr. Speaker, I had virtually concluded my remarks at six o'clock when I had that most interesting non-question from the Minister of National Health and Welfare who, without really attempting to ask any question that would be in order, made a short speech. However, I shall take it as a question. There is some doubt in my mind about his suggestion that I had been arguing that it was the intention of the government to do away with the old age security pension.
I should like to point out to the House, Mr. Speaker, that neither my colleagues nor I have suggested that this is implied in the legislation before us. I was pointing out that under the terms of this bill we are in effect reducing by 3 per cent the contribution from the sales tax to the old age security fund, an amount that is specifically set aside for

that purpose, and at the same time we are indirectly increasing the effective sales tax for general purposes by 3 per cent. I suggested that taken together with the recent action of freezing the old age security pension at $80, this indicated that the government was saying that the old age security pension was to be put into limbo at $80 regardless of the cost of living and that it was therefore becoming a rather peripheral and irrelevant element in terms of total government policy.
It seems to me that this is implicit in the bill and this is why my colleagues and I have raised the question. We are not suggesting that the government has any immediate intent to abolish the old age security pension by the bill but are, rather, asking whether they are moving away from the principle of universal payments to all citizens of Canada as a matter of right, through this legislation. I submit that this is a very serious question and is deserving of an answer from the spokesmen for the government. The Minister of National Health and Welfare is, of course, bound by the general policy decisions of the cabinet, so I suggest that as we are dealing with a tax bill the most appropriate spokesman would be the Minister of Finance.
Before the intervention by the minister I had mentioned that on many occasions I had seen the good intentions of various ministers and departments overridden by general government policy. This has applied in the field of pensions and certain other fields of government policy in which I have been involved. The matter is of legitimate concern to members of this party who fought for the principle of universality of pensions as a matter of right payable at a level adequate to meet the needs of retired people.
As was said by my colleague, the hon. member for Vancouver-Kingsway, this is not raised as a matter of idle politics but as a very basic question related to the wellbeing and future of the citizens of this country and, in particular, the older citizens.


Mr. John L. Skoberg (Moose Jaw):: Mr. Speaker, I shall speak briefly on Bill C-260 because I presume we would like to get it into committee of the whole and receive answers to some of the questions posed this afternoon and this evening. One hon. member opposite has suggested that we were trying to frighten the old age pensioners by some of the matters which have been raised by the hon. member for Winnipeg North Centre (Mr. Knowles). I believe it is the purpose of the opposition to endeavour to find out from the government exactly what they intend to do through any piece of legislation before the House. If they cannot explain a bill when it is introduced then, of course, we become suspicious and wonder whether we have to obtain from them in writing-in fact, maybe in blood-exactly what they are doing.
In looking at the old age security pension and the areas of concern expressed this afternoon, I think it must be said that the question posed by the Minister of National Health and Welfare (Mr. Munro) led us nowhere. It just posed another question-whether the universality of the old age security plan will be done away with. The government may be considering this, but of course they would not say so in debate in the House of Commons in the session before a federal election is called. But we need reassurance on this point, Mr. Speaker, and in committee
December 20, 1971

of the whole we should find out from the government exactly what is meant by the legislation.
I realize that the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) has muzzled himself to the point where it is difficult for him to answer questions. On September 23 a question was put to the Minister of Finance (Mr. Benson) in regard to manufacturers and producers being granted a blanket exemption from federal sales tax on anti-pollution equipment and the request from the Canadian Federation of Mayors and Municipalities that similar exemption be granted.
I realize that the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) has muzzled himself to the point where it is difficult for him to answer questions. On September 23 a question was put to the Minister of Finance (Mr. Benson) in regard to manufacturers and producers being granted a blanket exemption from federal sales tax on anti-pollution equipment and the request from the Canadian Federation of Mayors and Municipalities that similar exemption be granted.
The question is, will the Canadian Federation of Mayors and Municipalities receive the favourable consideration that is necessary in this regard? If the parliamentary secretary will indicate by nodding his head that they will receive that favourable consideration, then of course our remarks at this stage of the debate may be somewhat limited.


John (Jack) Henry Horner: Mr. Speaker, I wonder if the hon. member would permit a question.


John Leroy Skoberg: By all means, Mr. Speaker.


John (Jack) Henry Horner: Is the hon. member not aware that the parliamentary secretary cannot speak for the government? Is he also not aware that there is not a cabinet minister present in the chamber and therefore no one is present who can speak for the government, and that he ought not to proceed with this line of debate until some person with authority to answer for the government comes into the House of Commons?


Some hon. Members:: Hear, hear!


John Leroy Skoberg: Mr. Speaker, I realize that I am a pretty young buck in the House of Commons.


Stanley Howard Knowles: Here comes the President of the Privy Council (Mr. MacEachen).


Some hon. Members:: Hear, hear!


John Leroy Skoberg: At the same time, I have lots of confidence in the abilities of the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) who did a pretty good job in answering questions on the tax bill. I thought he could indicate by nodding his head whether municipalities are to be granted the same exemptions that are to be made available to manufacturers. Will the request of the municipalities receive favourable consideration? It seems strange-


Mr. Leblanc (Laurier):: On a point of order, Mr. Speaker.
Excise Tax Act and Old Age Security Act


Mr. Deputy Speaker:: The hon. member for Laurier is rising on a point of order.


Fernand-E. Leblanc: Mr. Speaker, the hon. member who has just spoken said there is not one minister in the House. The hon. President of the Privy Council (Mr. MacEachen) was in the House but his presence was required in the lobby.
On the other hand, counting the number of Progressive Conservative members, we realize there are not many, and we can say the same thing of the NDP members. Then, why pick on government members regarding attendance in the House?


William Arnold Peters: The hon. member need not worry. The House has enough business to keep him here for another hour at least.


Some hon. Members:: Oh, oh!


Mr. Deputy Speaker:: Order, please. With respect, that was not a point of order. If the hon. member for Crowfoot (Mr. Horner) is rising on another point of order, I will hear him. Otherwise, the Chair will recognize the hon. member for Moose Jaw (Mr. Skoberg).


John (Jack) Henry Horner: Mr. Speaker, I rise on a question of privilege. The hon. member who just rose questioned my word and that of my party. When I asked my original question of the hon. member who has the floor, not one minister was present who was able to speak for the government. People who are behind the curtains do not count. You know and I know, Mr. Speaker, that a member's presence behind the curtains does not constitute attendance in the House. There might be 17 members behind the curtains for all I know, but you cannot include them among those in the chamber.


Mr. Deputy Speaker:: Order, please. Although I indicated to the hon. member for Laurier (Mr. Leblanc)-


James Alexander Jerome: Look, there is a man behind the curtain. Look behind the curtain on your side.


John (Jack) Henry Horner: But he is not responsible for anything.


Mr. Deputy Speaker:: Order, please. I was about to say that it seems to the Chair that the hon. member for Crowfoot who initially raised the point of order may not have had a legitimate point of order.


John (Jack) Henry Horner: Mr. Speaker, I asked a question.


Mr. Deputy Speaker:: The hon. member asked a question. As a result, there were certain changes in attendance in the chamber. I do not think that is a matter of concern for the Chair. Whether ministers or representatives of the government are present in the chamber is not a matter for the Chair to concern itself with. I appreciate the concern of hon. members. The Chair has no control over whether members of the government are or are not present during debate. The hon. member for Moose Jaw.


John Leroy Skoberg: Sometimes it is hard to see ministers when they are not in their proper places. I see the Minister of Agriculture (Mr. Olson) occupying the seat in this House of the Prime Minister of Canada (Mr. Trudeau). Having

December 20, 1971
Excise Tax Act and Old Age Security Act
tried membership in quite a number of parties, the Minister of Agriculture now appears to be trying the Prime Minister's seat.
In all seriousness, I want to know whether representations made with regard to Bill C-260 will be given favourable consideration. Will the government give favourable consideration to the requests of the Canadian Federation of Mayors and Municipalities, the body which represents the basic foundations of democracy in this country? The members of the federation are greatly concerned about where their tax dollars are being spent. It strikes me as passing strange that the people involved have not been told what they can expect.
Let us see what the Canadian Federation of Mayors and Municipalities has said in a news release. Our search in this regard might be like a voyage of discovery because we may discover where democracy begins and ends. You see, Mr. Speaker, all sorts of concessions in the field of pollution control have been given to manufacturers but not, apparently, to municipalities. This fact has led to questions being raised in the House. The president of the Canadian Federation of Mayors and Municipalities communicated to the Minister of Finance the concern of municipalities regarding a particular aspect of the budget and tax reform proposals submitted on June 18, 1971. The Minister of Finance wrote to the federation and in an attempt to answer their concern said:
To further encourage the acquisition of anti-pollution equipment, I wish to announce the immediate withdrawal of the sales tax on such equipment used in production. This new exemption will apply to all machinery and apparatus which manufacturers or producers acquire to detect, prevent, remove or reduce pollutants of water, soil or air. The exemption will reduce revenues by about $8 million a year.
The letter, dated June 18, 1971, was sent from the House of Commons and bears the signature of the Minister of Finance. That is the type of correspondence that the federation is concerned about, because apparently little consideration is being given to extending the same advantages to municipalities as are to be extended to manufacturers. A news release dated December 17, 1971, and put out by the Department of the Environment says, in part:
Environment Canada will take the lead among federal departments in elimination of pollution by government installations across Canada.
Since departments of the federal government are prepared to take the lead in eliminating pollution, and since the Canadian Federation of Mayors and Municipalities has asked for the same privileges that are to be extended to manufacturers, I suggest that for not being prepared to assist municipalities across Canada in this regard the government stands condemned.


Lincoln MacCauley Alexander: Right.


John Leroy Skoberg: This area needs consideration. I hope the Parliamentary Secretary to the Minister of Finance is prepared to give favourable consideration to the requests of the municipalities. Perhaps the Minister of Agriculture, who should also be concerned about pollution control measures, will come to realize that the municipalities are the foundation of our society and that their needs should be considered. It is fine and dandy to say that federal

government departments will be active in the area of pollution control. The basic unit of our society is the municipality. In common with manufacturers and producers, municipalities hope that they will be given blanket exemption from federal sales tax on the purchase of antipollution equipment.
No doubt many hon. members in this House have served on municipal councils. Others who have not so served have been associated with people active in municipalities and local communities. At present it appears that the federal government is not prepared-hopefully, I am wrong-to revise its schedule of exemptions and include municipalities as entities eligible for exemptions with regard to anti-pollution equipment. One must ask, exactly what is the government trying to do to the small municipalities across this country?
We have heard many times about pollution control measures, sewage disposal plants and all the rest that will assist in controlling pollution. At the same time the government has introduced Bill C-260 which does not provide pollution control measures or the machinery connected with those measures as far as municipalities are concerned. Surely this government is not insensitive to the concern of the municipalities. They must realize that municipalities need concessions along the same lines as those which manufacturers are receiving. Surely the submission made by the Canadian Federation of Mayors and Municipalities bears considerable weight.
I look forward to questions being asked when this bill is before committee of the whole, so that we will hear the real reason for the government not including municipalities. I hope that responsible ministers of the government will be present and these questions will be answered in committee. These ministers, speaking for their departments, can tell the people of Canada that they will provide concessions along the lines to which I referred, similar to those granted manufacturers and producers.


Mr. Lloyd Francis (Parliamentary Secretary to Minister of Veterans Affairs):: Mr. Speaker, I have listened to the debate this evening. While I realize we are approaching the festive season, there is no reason why it should become a silly season. It has come close to being that. I found the speeches of members opposite almost incredible. I did not hear a word about the removal of sales tax on margarine. I wonder why. That is probably the most important feature.
Bill C-260 is a relatively insignificant bill, yet the members of the New Democratic Party are making speech after speech. I have been asking myself why they are doing this. What are they going to do? The hon. member for Winnipeg North Centre (Mr. Knowles), an experienced and able parliamentarian, spoke in the House this afternoon. He attempted to establish a link with the 1950 report of the Joint Committee of the Senate and House of Commons on Old Age Security. He waved a blue document before us. I am familiar with that report. I worked for several years as a public servant in the Department of National Health and Welfare. We used that important document.
December 20, 1971

What was the link? The link was the great virtue of having a contributory pension plan. The report of the Senate and House of Commons committee included in its recommendations a contributory pension plan, the 3-3-3 formula. It was originally 2-2-2 but was later changed to 3-3-3, corporation income, personal income and sales tax. I can understand the hon. member talking about the psychological link between the individual's contribution of income tax and pension. The continuous link, which the member spent his entire speech trying to establish, was that putting 3 per cent earmarked from the sales tax into a fund was an absolutely necessary element of a pension scheme.
I have heard ridiculous speeches, statements and propositions before but in the period in which I have been a member of this House, never anything to quite equal that. To suggest that somehow part of a sales tax, when put into a fund, makes it a little more virtuous, conspicuous and does something for the great integrity of the individual is something that I never expected to hear from a responsible member of the House of Commons, especially the hon. member for Winnipeg North Centre.
If we want to talk about contributory pensions, I can understand the point that has to be made in the proper scheme of things. But let us do it in a reasonable and sensible way. Let us not have speech after speech demanding that the minister say whether he is going to abolish the old age security program. That is complete and utter nonsense from serious members on the other side.
I keep asking myself "Why these speeches? Why this nonsense? Why this drivel?" I say it is drivel coming from members opposite who normally make good speeches. In this instance they are far wide of the mark in refusing to deal with the merits of a relatively insignificant piece of legislation. The legislation removes the sales tax on margarine, television sets and other electronic apparatus and amends the old age security financing formula to make sure that the sales tax portion is no longer labelled the way it was. It does not affect the incidence or the level of sales tax.
I suggest their purpose is to consume the time of the House to avoid a discussion on other legislation. They are wasting the time of the House. But the people of Canada, the taxpayers and the voters, have a right to recognize what hon. members opposite, those of the NDP bearing smiles on their faces, have done here this afternoon and are doing tonight.


Mr. Deputy Speaker:: The hon. member for Crowfoot (Mr. Horner) rose in his place to ask if the hon. member for Ottawa West (Mr. Francis) will permit a question.


Cyril Lloyd Francis: I will be happy to receive a question.


John (Jack) Henry Horner: My question is very simple. If what the hon. member is saying is true, why does the minister not get up and state categorically that the government has no intention now or in the future to do away with the old age security pension?


Cyril Lloyd Francis: I know that the minister is going to do so in his place. If this is the pretext on which hon. members are making their speeches, it can be quickly set to rest.
Excise Tax Act and Old Age Security Act


Stanley Howard Knowles: Will the hon. member permit a question? I wonder if the hon. member is aware of the fact that when I spoke about this matter this afternoon I related the removal of the sales tax to the concurrent removal of the personal old age security tax and the corporation old age security tax, in other words the whole package, and that under Bill C-259 we did not have a chance to discuss the matter.


Cyril Lloyd Francis: Mr. Speaker, Bill C-259 was debated in this House for over 40 days. The debate on that subject should stand on its merits. The issue before us, Bill C-260, relates to the reduction of sales tax and other matters. Surely the rule of relevance is as important in this debate as it is in any other.


William Arnold Peters: Mr. Speaker, in rising to take part in the debate on Bill C-176-


Some hon. Members:: Oh, oh!


James Alexander Jerome: Bill C-176 does not start until tomorrow.


William Arnold Peters: I know perfectly well on which bill I am speaking. The previous member was probably well aware on which bill he was speaking. I do not think there is any conflict on that matter.
Frankly, I am not one who is particularly involved in the question of sales tax. I am one who believes that a sales tax is a retrograde tax, a tax that must be paid by those who cannot really afford to do so and by those who can afford to do so, indiscriminately. Most governments have used it as an emergency measure to raise revenue but, unfortunately, it always seems to become permanent. The tax we are considering has not changed. It was levied at the rate of 11 per cent or 12 per cent, and under this bill it will continue to be 11 per cent or 12 per cent. Most people who advocate tax reform do not really approve of it as a long-term tax.
I differ from some of the statements made by the hon. member for Ottawa West (Mr. Francis), but I agree with him that this bill is concerned with only a small portion of the sales tax which has been directed to old age security. Originally, in 1952, this money was raised in three ways and a good deal of consideration was given to whether or not part of the tax should be in the form of a sales tax. At that time, personal income tax accounted for 2 per cent, corporation tax for another 2 per cent and the sales tax for a further 2 per cent. As I recall it, there was a $60 maximum on personal tax contributions. This situation changed over the years. It went to three, three and three. Then for several years the tax was 4 per cent on personal income, 3 per cent on corporation income and 3 per cent on sales tax. I do not know whether many members realize that we have eliminated the 4 per cent personal contribution and the 3 per cent collected from the corporations. The hon. member for Ottawa West may have known.
I listened to much of the debate which took place on Bill C-259. I was lucky to keep up with discussions as they were going on. I never claimed I had spent my summer reading this bill and becoming totally familiar with it. I can honestly say that I was not personally aware that the old age security fund was to be eliminated as a contributo-

December 20, 1971
Excise Tax Act and Old Age Security Act
ry fund. The Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) shakes his head. I give him credit for having studied this bill. It pays him a little money to study this bill. I will say frankly that he has earned that money. He is one of the few parliamentary secretaries who has. He has earned it because he spent all the summer and all the fall and a great deal of the time of civil servants in obtaining some knowledge of that bill. But I believe as we look around us we would see many members in this chamber who just did not know what was being done. Why were we not told we were getting rid of the old age security fund as a contributory fund?
I have always been impressed by the attitude taken by many Conservatives and, indeed, by some of the older members of the New Democratic Party as well as by some of the older Liberals; they would not accept old age security pension if they thought it was a gift from the treasury. They were always told, and they believed, that they received a pension as of right because they had contributed toward it.
Since 1952, almost 20 years ago, they have made regular contributions of between $60 and $120 to a fund from which they could draw a pension as of right because they had contributed to it. There are thousands of people in this country who will not apply for an old age supplementary benefit simply because it is a hand-out from the government, and because to receive it they must show they are destitute. I am sure not many people in this House would say they do not know many older people in their constituencies who would not accept welfare, who would not accept a dole but who would accept the old age pension. It is a dishonest government, it is a dishonest Minister of Health (Mr. Munro) and a dishonest Minister of Finance (Mr. Benson)-


Mr. Gibson:: That is a completely false statement.


William Arnold Peters: There is our friend from Hamilton-Went-worth (Mr. Gibson) again making lots of noise from his seat. He sounds better when he uses only one or two syllables at a time, because when he rises to make a contribution it really is not worth while. As long as he keeps quiet, nobody knows how stupid he is; it is only when he opens his mouth that people realize the full extent of his ignorance.


Colin David Gibson: The hon. member for Timiskaming (Mr. Peters) is overwhelmed by his own verbosity tonight.


William Arnold Peters: Congratulations to whichever member informed the hon. member for Hamilton-Wentworth of those words of wisdom. They certainly did not come from him. His own seat has not developed that kind of wisdom. I believe there is great dishonesty attached to a government which would refuse to tell Parliament what it is doing in this field. I have not said anything about closure.


Colin David Gibson: You certainly have not. We have been waiting to hear you.


William Arnold Peters: Mr. Speaker, I am pleased to get all the help I am getting from that particular direction. Closure was applied to a long and important bill. What we are seeing now is an indication of the way in which the public is not being protected. I am sure that if there had been an 
opportunity to go over the other sections of the bill, most of us would have concluded that there was to be a reduction of the personal income tax directed to the old age security pension to which we have contributed for many years.
The hon. member for Winnipeg North Centre, diligently and with a great deal of compassion and skill, was able to point out that the contributory section of the old age security legislation eliminated the last vestige of self-interest the people of Canada had in developing their own old age security program.


Cyril Lloyd Francis: Not even you believe that.


William Arnold Peters: The hon. member says that not even I believe that. The sort of welfare assistance that is provided 50 per cent by the province and 50 per cent by the federal government is going to be the kind of pension we will be giving our old age pensioners. This will be money paid out of general revenue, just as if it were welfare. That is not a contributory plan and it is not the kind of plan that our old age pensioners like or will accept. A number of people will not accept this kind of charity from the state but would be willing to contribute to a fund from which they can draw.
I am sure the hon. member who raised that point realizes that in another field with which he is very familiar people do accept money when they feel it is their right to have it. They will not apply for money that is means-tested. Veterans only get veterans allowance if they meet other conditions. For example, I am sure all hon. members hear of widows who are in very serious straits before they apply for a benefit that their husband as a veteran did not apply for because he did not feel entitled to it.


Cyril Lloyd Francis: Would the hon. member permit a question?


William Arnold Peters: Certainly.


Cyril Lloyd Francis: I have listened with interest to the hon. member's point, but is he suggesting that the absence or presence of a means test is going to be the only factor governing the decision to apply? If so, how does he rationalize this with old age security, where there is no means test?


William Arnold Peters: I have not really gone into that, and it opens up another can of worms the government has been considering, namely, whether or not all benefits should be means-tested. The government has had a committee studying this question for a number of years and all kinds of piecemeal proposals have been made by the committee and fed to us by civil servants in the form of legislation.
My point, which I hope the hon. member is not going to miss, is that when people contribute to a fund that is earmarked for a specific purpose, they know what they are paying their money for. Having filed 20 or 30 income tax forms in their lifetime, they know certain amounts go to old age security, to the pension plan, and so on. My point is that they know these amounts are earmarked for that purpose.


Cyril Lloyd Francis: They pay for the benefits anyway, whether earmarked or not.
December 20, 1971


William Arnold Peters: There is no question that they have to pay. If I receive welfare I have contributed to the welfare fund while working. Part of my tax was used for that purpose. But it is still welfare, something that I am given. I do not think that the money is tainted; the taint comes from-


Cyril Lloyd Francis: The means test.


William Arnold Peters: Not entirely the means test, but partly from the idea that I had not directly contributed to that fund.


Mr.   Fernand-E. Leblanc@Laurier: Mr. Speaker, will the hon. member permit a question?


William Arnold Peters: Yes, Mr. Speaker.


Fernand-E. Leblanc: I would ask the hon. member whether the suggestion that the amount of the old age pension be mentioned on the tax form or included in the basic rate is not merely a question of semantics or a technical point. I believe it comes to the same thing. In my opinion, the argument that a taxpayer willingly contributes to the old age security plan does not hold water because those who receive the old age pension generally do not contribute to the Canada pension plan.


William Arnold Peters: That is not what the Minister of National Health and Welfare said. He said the principle of universality should be carried on. The minister has stated everyone would be entitled to a certain payment out of the fund. The only problem arises when the amount has to be increased. The government made an additional payment which it called a supplement, but applied a means test. But in both the government's white paper and the report on social services the case for universality is made. Family allowances, and I suggest old age security as well from now on, will drop the principle of universality and the government will only pay out when there is a need.
As far as unemployment insurance is concerned, all workers are going to contribute, but only a few will ever get money from the fund. But my point is that the Minister of Finance (Mr. Benson) did not tell us, or if he did I did not understand him, that the government was going to eliminate the contributory section from the old age security legislation and that the money would be paid out of a general fund. However, the government has not yet been able to design a scheme of income tax to get this money back again, though my colleague for Winnipeg North Centre hit upon an ingenious idea that eliminated most of the tax at the bottom end yet offered the same exemptions all the way up.
I suppose you would soon reach a Utopian system where everybody would be paid all kinds of dividends, or whatever you might care to call them, and only those who would need them would keep them. That is not what we are talking about when we speak about a guaranteed annual wage and a negative income tax structure. We believe that everybody has the right to at least a reasonable amount of money.
We believe that the tax structure should be such that when money is not needed it is returned to the state, so
Excise Tax Act and Old Age Security Act
that if a demogrant is given to an old age pensioner who has $5 million or $6 million, he is entitled to it but obviously some of that money should come back to the state. Obviously when a demogrant is not needed, the money should be returned to the state. However, the government is obviously making a change in the whole field. They are telling the public that this is a just society in which a just amount would be given to those at the bottom of the scale, and going all the way up the scale.
This government was faced recently with a court action and was told in effect that the law must be obeyed in the same way by everyone. If the law says you must pay out money, then you must pay it out. I presume that so long as the old age security fund exists, the government has the obligation to pay out at least the basic old age security to everyone who has made a contribution to that fund. Of course, there are limits and exceptions depending on how long you have lived in the country and a number of other factors, but that was your money and you had a right to it.
I suppose that someone in the legal department said that if that fund is established it would have to be used for that purpose. However, if we wipe out the fund and we decide to pay the demogrant-and I agree that there has been no indication from the government that they will not pay it-of $80 to old age pension recipients, they will not receive less money. Nevertheless, if the old age pensioner decides that that is a hand-out, that that is money he has not earned and is not entitled to, then I suggest he will consider and I will consider that the system has been changed. There is nothing we can do about it. But I think that everybody in this country owes a great deal of gratitude to the hon. member for Winnipeg North Centre who has brought this to our attention.


Mr. Hogarth:: You must be kidding.


William Arnold Peters: The hon. gentleman is one of those who believes, as do many Liberals, that so long as someone receives the money, it does not matter where it comes from. One can belong to the high church in the better part of the town, rent quarters in the slums at an exorbitant rent to poor tenants who cannot do anything about it, but the money is clean. This is like the Mafia. In my opinion it is very important where the money comes from and by what means it comes.
There is a great difference between receiving money from the Canada Pension Plan and receiving it from someone else because I do not have enough money to feed my wife and keep a roof over our heads. Every time I crawl to some civil servant who is a welfare officer I will certainly' be made well aware of the difference between that money and the money which I receive in my own right and to which I have contributed. People who have not had to do without do not see the difference. The landlord who never goes to the slums does not feel bad. They hire people to go to the slums and to evict other people; they do not do it themselves. It is not dirty business because they do not come into contact with it. But in my opinion there is a considerable difference between that money and the money one gets as one's right. I hope that eventually the government will bring Parliament and the country up to date on their thoughts regarding the old age pension. They will have to do that so far as programs like the old age pension are concerned.

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Excise Tax Act and Old Age Security Act


An hon. Member:: "Is" concerned.


William Arnold Peters: I have already indicated that we come from different sides of the track. The point I want to make for the people on my side of the track-


Mr. Fairweather:: And there are more of them.


William Arnold Peters: -is that they have a right to know what their future will be in terms of social security. This reminds me very much of a fellow getting a job in some of the industries in which I have worked, such as a mine which closes down after 19 years. It closes down just as the old age security fund is closing down. After 19 years your are out of a job, there is no money left in the fund, you do not have a pension-in those days pension plans were not portable-and you have to start all over again. You hope that the next job you get will be better.
I think the people have the right to know where Canada is going in terms of social security. They have the right to know why it is advantageous to drop the contributions to this fund. This was the first major piece of social security in this country. It was a fund which the government did not find obnoxious to administer. The money was not invested in some agencies. I am in agreement with those members who say that we should continue to pay the demogrant at the present time. However, I wonder why we wiped it out. Obviously, there must be a reason why the 4 per cent was wiped out.
I would have made some changes to that fund. I would have taken off the ceiling and I would have allowed enough money to accumulate in the old age security fund to allow us to pay greatly increased benefits to the older people of this country. There were a number of changes that could have been made. But I cannot see the reason for eliminating the old age security fund. Obviously, this is done for a purpose. My suggestion is that the government is eliminating it so as to change the whole idea of the demogrant and from now on more and more of our basic social legislation will be based on a means test.
This government will say to the people, "You have to establish a need no matter what kind of grant you get. We will not pay the old age security pension to people who are not in need, but we will pay more than $80, perhaps even more than $130 to people who will establish need." This does not answer the question which the older people of Canada will have to ask themselves concerning the removal of the sense of integrity which people feel they had under the old age security plan and which they now have with the Canada Pension Plan because they make contributions to it. They have put money into it. They have contributed in whatever way the government wanted them to contribute to the fund. It is their fund. They want to enjoy that fund as a right.
It seems to me the government has not done any good service by removing surreptitiously, through Bill C-259, the 4 per cent personal contribution and the 3 per cent corporation share, and now through Bill C-260 removing the sales tax as a contribution to the old age pension fund. This will not make people richer.
One hon. member said that the sales tax has been removed from oleomargarine and from some dairy

spreads. That is a slippery move, as one of my colleagues says. I suppose the extent of its slipperiness depends upon whether you are a farmer or not. And the government has removed the tax from pollution control machinery. Municipalities have had to fight pollution, and in fact they have been large-scale sources of pollution themselves. It is good that the tax is removed in that respect. The government lends municipalities money to fight pollution. I believe it should provide municipalities with the necessary machinery at as low a cost as possible. If necessary it should undertake the manufacture of pollution control machinery itself, and give such machinery to municipalities.
If the bill did not contain this provision I am quite sure it would have passed without much debate. But I am certain that anyone who listened to the speech made by the hon. member for Winnipeg North Centre must now be concerned. He pointed to the loss of something that most of us have grown fond of, the old age security program. Mr. Speaker, some of our own members are taking advantage of that program. An increase in salary does not prevent one from taking advantage of it.
As I say, most of us support the idea of an old age security pension fund built up in part by contributions from individuals and in part by contributions from corporations. Collecting such contributions through sales tax has worked well. We are unhappy that the pension will now be regarded as a government hand-out, rather than something to which pension recipients themselves contributed.


Mr. Max Saltsman (Waterloo):: Mr. Speaker, on the surface, what we are being asked to do through changing the source of this tax simply looks like an administrative matter to clean things up. But we have a duty to look beyond what appears on the surface and examine the full implications of such a move. I am concerned that something which may be of great importance to the future of the old age pension scheme is being put through in the dying hours of this session. The hon. member for Winnipeg North Centre (Mr. Knowles) has sometimes been called the conscience of Parliament. As that conscience he is very much concerned about old age pensioners. There is no one in this country who has fought so well for old age pensioners as the hon. member, and he is to be excused if he wants to know what will happen with this kind of legislation.
This debate illustrates a fundamental difference between some of us on this side of the House and other hon. members. This difference is between looking upon some government activity in the redistribution of income as a form of charity, or as a matter of right. There is an important principle involved. We in this party have always argued that in seeking redistribution of income we should get people to look after their own needs by contributing to government programs. In short, we saw the state in competition with private insurance plans and felt the state could introduce far better insurance programs- fairer, more equitable, cheaper to administer, and providing more benefits to all-and we believed in public involvement in those programs.
One of the schemes for which we fought and in which we believe strongly is the old age security pension pro-
December 20, 1971

gram. It is not a charity, not something to be buried in the general tax structure. It is a program that should be highly visible. People should see that they themselves are contributing to it, and when they collect their pension they should know the pension is theirs as a matter of right and not a charitable gesture.
We have much reason to be suspicious of what the government has been doing to universal programs recently. For example, the old age pension has been frozen at $80. It seems inconceivable that a large group of people will never receive any increase in their old age pension and that in future increments are to be based on a means test. The government can call this test whatever it wants, but it winds up being a means test. We believe it is grossly unfair.
We have argued that this discriminates against people who have small savings or a small pension from another source. Some of the predictions we made about the difficulties created by the introduction of such a means test have become realities. More and more old age pensioners are becoming resentful that the small amounts they earn from baby sitting or other sources disqualifies them from increases in their old age pensions. They feel cheated, betrayed and let down by the people who administer the program.
The government is taking the same approach to family allowances. On a number of occasions the Minister of National Health and Welfare (Mr. Munro) has said he intends to revamp the whole family allowances program. I will not deal with that question in this debate, but it indicates the direction in which the government is moving. It is trying to drop universal programs or turn them into programs that contain some kind of means test.
We are not opposed to increases being given to those in need. This is a cornerstone of our policy. But it seems to us that the additional resources needed to do this are not coming from those who have the ability to pay. They are not coming from industries like oil and gas which pays minimal tax. They are not coming from people who make their living from capital gains. The necessary tax is coming from those who can least afford to pay it. The redistribution is not from the well-to-do to the poor; it is from the near-poor to the poor. This is not a good way to redistribute wealth. If the old age pension is frozen at a low level and the same happens to family allowances, then it is the near-poor who are hurt.
We cannot give our approval to a program that abandons universality and moves toward the introduction of a means test, particularly when the necessary tax is being levied on those who can ill afford to pay it and when benefits are being taken away from people who are entitled to them by virtue of their contributions to the program.
One of the things that sets Canada apart is the intelligent use made up to now of both the old age pension and the family allowance. This makes us different from our neighbours to the south in terms of our social outlook and how we view justice as between people. I am very unhappy to see anything introduced that would work against such programs. If there is an advantage to the sales tax and to part of it going to pay for the old age pension, it is
Excise Tax Act and Old Age Security Act
the argument that the program is not universal in its contributory form because the poor who collect it do not pay income tax or corporation tax. But everyone pays sales tax in some form, and everyone who collects the old age pension, even if they never file an income tax return, has in fact contributed because of the sales tax on their purchases over the years.
While most of us regard sales tax as regressive and have been looking for ways out of it, there is a realization that it is going to become a larger instrument of government revenues than it is at present. It has been the experience of many European countries that a tax on consumables, including the necessities of life but also at other levels, is a cheap way of raising taxes. By allocating a portion of the sales tax to the old age pension fund we can guarantee that it will increase and continue to serve old age pensioners in the future, but by trying for administrative ease the government will destroy the philosophical basis and the justification for a separate fund for old age pensions. I for one, Mr. Speaker, think that the government owes this House an explanation of its intentions and its reasons for wanting these particular changes made now. If we do not get an explanation then we must suspect that the government has other things in mind than trying to make things easy for civil servants.


Mr. Randolph Harding (Kootenay West):: Mr. Speaker, I should like to take part in the debate on this very interesting bill. First, I must say that the changes dealing with the Old Age Security Act make one wonder where we are going. Therefore I look forward to hearing the real reasons behind the proposed changes.
I should like to speak briefly on those sections of the bill dealing with anti-pollution equipment. Our group has been pressing for the exemption of anti-pollution equipment from the sales tax as one of the incentives to encourage all groups in Canada to take a more active role in pollution abatement. The municipalities need the most assistance, but as I read the bill they are not covered by the exemptions in it. I feel that this matter should be of interest to every member of the House. Municipal groups have come to us from one end of Canada to the other asking for tax relief.
The hon. member for Moose Jaw (Mr. Skoberg) asked the parliamentary secretary whether municipalities were covered in the exemptions, but to date we have not received the information. From the material we have received from the Canadian Federation of Mayors and Municipalities it is my impression that the municipalities are not covered. I ask the parliamentary secretary and all members of this House, why should we give industry exemption from sales tax on anti-pollution equipment and not give it to municipalities which in my opinion need it most? This is one of the reasons we are interested in discussing the bill on second reading.
I wish to tell the parliamentary secretary through you, Mr. Speaker, that if they do not bring in an amendment to clause 4 giving some relief to municipalities on sales tax respecting anti-pollution equipment, we will bring in an amendment and have another debate on it. This is the very thing we have been preaching and urging. Groups have been appearing before our committees for months asking for some kind of relief, yet Bill C-260 does not

December 20, 1971
Excise Tax Act and Old Age Security Act
cover the municipalities of Canada. Why is the exemption given only to industry? I think clause 4(2)(b) is the key to the whole thing. It provides:
machinery and apparatus sold to or imported by manufacturers or producers for use by them directly in the detection, measurement, prevention, treatment, reduction or removal of pollutants to water, soil or air attributable to the manufacture or production of goods-
There are other clauses which can be dealt with in committee. The municipalities in many instances do not have the tax base to allow them to take adequate measures for control, and I see absolutely no reason why they are not included in this legislation. I trust the explanation will be given by the parliamentary secretary later in the debate.
I should like to refer again to the news release issued by the Canadian Federation of Mayors and Municipalities on September 21, 1971. They reiterate what we have been trying to get across to the government, that changes must be made to the legislation, and made now. The hon. member for Ottawa West (Mr. Francis) in his remarks said that we are talking nonsense and wasting time, trying to take time from debate on legislation coming in tomorrow and the next day. Mr. Speaker, nothing in Canada is more important than pollution and environmental problems.


Some hon. Members:: Hear, hear!


Randolph Harding: We ask members on all sides of the House to look at the legislation and ask themselves whether they want assistance for their municipalities. If they do, they must get to their feet and ask the government to make a change in the section which will make anti-pollution equipment for municipalities exempt from tax, as it is for industry.
That is all I have to say now, Mr. Speaker. I am not trying to talk out the bill, but I feel that the clause dealing with pollution equipment is not strong enough. I am in favour of taking the sales tax off equipment for industry because it is a step forward. But why leave municipalities out? We are sick and tired of privilege being given to those who make a tremendous profit on the sale of this type of equipment, and we are asking that the taxpayers of this country be given some relief at the municipal level. It can be done through this bill. That is what we are asking and what we will try to get when the bill comes to committee stage, because we are going to force a debate on this clause by moving an amendment.


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


Some hon. Members:: Question.


Mr. Speaker:: Is it the pleasure of the House to adopt the said motion?


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Laniel in the chair.
Gérald Laniel: Shall clause 1 carry?
On clause 1-


Marcel Joseph Aimé Lambert: Mr. Chairman, this is an amending bill and therefore the discussion must be relevant to the particular clauses being considered.


An hon. Member:: That will be the day.


Marcel Joseph Aimé Lambert: The hon. gentleman who has just commented might look at the situation and see how members of his party have behaved themselves.


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: The hon. members for Lanark-Renfrew-Carleton, and New Westminster always make their noises from their seats. Their contributions in the present discussions have been precisely nil.
On the face of it, it would appear that in clause 2 there is an actual increase in the proportions. I want to say that this is not so. I fully agree with the hon. member for Winnipeg North Centre and I think the minister will agree, too, when I say that at this stage we are now doing away with what one might call a designated tax. I am not persuaded that we should do away with it. I think there was great psychological advantage in having the public understand that they were paying part of the sales tax as a contribution toward their old age security. This provision will eliminate that. It is true that under another clause of the bill it is provided that the consolidated revenue fund will make payments to the old age security fund, but that is not the same thing. The public will not understand that.
The hon. member for Laurier may shrug his shoulders. Will he ask his constituents about their contribution toward an old age pension that they considered as theirs by virtue of the contributions made? Now, of course, this payment is to be just another transfer payment from someone else. The individual cannot identify himself with it. I say that there was psychological value in having people identify the payments they were making in certain respects to retirement pensions. This idea was strongly advocated with regard to the Canada Pension Plan, which is identified with the individual. I think a retirement plan ought to be identified with the individual.


Douglas Aird Hogarth: Mr. Chairman, would the hon. member permit a question?


Marcel Joseph Aimé Lambert: Certainly.


Douglas Aird Hogarth: What about the great number of Canadians who do not contribute to the fund in the way the hon. member has suggested, under the auspices of the Income Tax Act, that is to say, those Canadians who have not yet paid income tax but by virtue of their age receive the old age pension?


An hon. Member:: They pay sales tax.


Marcel Joseph Aimé Lambert: It is very simple. Those people are paying sales tax.


Cliff Downey: That was a very poor question.


Marcel Joseph Aimé Lambert: The hon. member for New Westminster has precisely put his finger on the point. Mind you, he did not intend to. We recognize that there are many earning low incomes who do not pay income tax
December 20, 1971

and that, therefore, they do not make their contribution of three points to the old age security fund. Nevertheless, they pay sales tax because there is no way that you can escape sales tax.


Douglas Aird Hogarth: Would the hon. member permit another question? Is the hon. member suggesting that those who do not pay the 3 per cent surcharge on income tax pay sufficient sales tax to warrant the amount that they are being paid by way of pension?


Marcel Joseph Aimé Lambert: I am not saying that, because there is no question here of an individual contributing amounts which will be equivalent in any way to his pension. After all, the person who is well-to-do contributes a great deal more than the pension he will receive. I was talking about the feeling of participation.
That point was made by the hon. member for Winnipeg North Centre and many others. He and others talking about this sense of participation. You can see it under the Canada Pension Plan. The idea of participation is reinforced by the Canada Pension Plan, and it seems to me it is a good idea for the individual to identify the payments he makes as being contributions toward the old age security pension. If we ever come to the point of the guaranteed annual income, either by introducing the negative income tax or tax credits-and I always thought that Bill C-259 was wrong because it did not use the tax credit system-we will need to organize the income tax on a much more flexible basis if we are to take care of aspects of that kind. Some provinces are ready to move in that direction. However, we are opening up a much wider field for discussion than is contemplated by this clause.
As I understand it, tariff item 47600-1 deals with certain equipment. I am referring to the items listed under subparagraph (3). Tariff item 47815-1 deals primarily with surgical equipment and with driving kits that persons who are incapacitated because of physical infirmity may fit to their automobiles so that they may drive them. That is perfectly all right and I entirely support this provision.
There is one point that I should like to see developed more, Mr. Chairman. The hon. member for Kootenay West discussed it with some vehemence a short while ago and I wish to deal with it. I felt that removing the sales tax as an incentive for manufacturers to purchase anti-pollution equipment was a step in the right direction. In other words, manufacturers can now acquire such equipment without paying tax. The scope of this measure is very limited. According to clause 4, section 20 (2) (b) found on page 2 of the bill, such machinery and apparatus must be used directly in the detection, measurement, prevention, treatment, reduction or removal of pollutants to water, soil or air attributable to the manufacture or production of goods.
I think this provision may be fairly limited. I am not sure how far these people will be able to move. The hon. member for Kootenay West said that the provision should be given to municipalities, but the municipalities in the main are not in the business of producing goods. I think under the National Housing Act, and I would certainly like to see the government move in this direction, the credits could be improved and upgraded.
Excise Tax Act and Old Age Security Act
Rather than a sales tax credit, municipalities could be given an incentive for forgiveness features in loans for sewage treatment plants in the secondary and tertiary fields. This is a much better program than saying to the municipalities or provincial governments that they can take off the sales tax. There is a difficulty with the provinces. The federal and provincial governments have agreements whereby they each pay the sales tax to the other chap. If you start making exceptions, you get into difficulty. I do not think that is the way to approach it.
With regard to municipalities and provinces in connection with machinery, equipment and installations to deal with pollution control, it is far better to have a major incentive scheme of the kind that existed. Some may still exist although they are very limited. These provide forgiveness features on loans for programs with regard to these very expensive control systems. There are no two ways about it, they are very expensive. That is the only way that can be done. To say that municipalities and provinces should not have to pay sales tax on machinery or apparatus used in the production of goods is not feasible. It is another thing to put it in a category where you can undertake a major program that will bring results across the whole country, not just on a hit-or-miss basis as it might be.
I sympathize with the objective of inducing municipalities and provinces to enter the field of pollution control, but with the greatest of respect I do not think this is the place to do it. If I were in support of the idea of introducing an amendment, I might find some difficulty in limiting it within the terms of the ways and means motion.


Stanley Howard Knowles: Mr. Chairman, as the explanatory notes to this bill make clear, clause 1 is consequential to clause 5. I mention that as a prelude to making the statement that I think we should be entitled to discuss clauses 1 and 5 together since their combined effect is one operation, namely, the removal of the 3 per cent sales tax from the Old Age Security Act and the adding of 3 percentage points to the sales tax set out in the Excise Tax Act. As hon. members are aware, this area has concerned many of us who have taken part in this debate. We have done so because of a very real concern as to what use might be made of this change of tax policy in the future.
I say to the hon. member for Ottawa West that I listened with interest to his criticism earlier in this debate. However, I submit that there is one thing one has to watch around this place. That is the danger that victories that were won can be lost. As a matter of fact, I was quoting this afternoon from the report of the special joint committee on old age security that met in 1950. I remind any who were around at that time and those who have read history that one of the prominent members of that committee was David Croll, now a member of the other place. He was not only a prominent member of the joint committee, being then a member of the House of Commons, but he was one of the hardest fighters for the complete removal of the means test and for establishing old age security on a universal basis.
That same David Croll is now the chairman of a committee which recently issued a report stating, among other things, that the Old Age Security Act should be abolished,

December 20, 1971
Excise Tax Act and Old Age Security Act
this proposal having been made in the context of his particular plan for a guaranteed annual income. I am simply making the point that things that were once won, and which one thought might have been established, can be lost if one does not watch out.
I expressed my fear this afternoon and I express it again tonight. By removing the direct relationship between individuals and the whole concept of old age security through the way in which they pay their taxes, there can be a lessening of the declared right to old age security on a universal basis. I again point out that one not only has material from as far back as 1950, but there is the white paper of the present Minister of National Health and Welfare which was tabled only a year ago. In it the minister said, among other things:
Personal income taxes as well as other earmarked taxes have been collected from people since 1952 to finance this program, establishing an expectation and a right to the pension.
The point I am trying to make is that this government has said time and again that one of the reasons that justifies the universality of the old age pension is that people pay for it through taxes that are identified for old age security. My fear is that if there is no such relationship, this or some succeeding government may go still further in terms of whittling away the universality that we wrote into the Old Age Security Act.
I remember a prominent deputy minister of welfare saying in a public address a few years ago that one of the real sources of pride in this country is the fact that we have established family allowances and old age pensions on a universal basis, and with this sort of thing having been won we can count on it being here for all time. That is not the case. That is my concern about this change in the tax basis.
At no time this afternoon did I or anyone else in this group suggest that this change envisages doing away with old age pensions. What it does envisage is the possibility of arguing against the universal right which has been related to the earmarked taxes. That is what I would like to fend off. As a matter of fact, Mr. Chairman, if we can now get the Minister of Finance to make a statement on this matter, it will be extremely welcome. He may have his reasons for not having referred to it in his budget speech of June 18, or when he introduced Bill C-259, or when this bill was introduced today.
We were told about these changes in respect of all three taxes in the resolutions and in the bills, but not one word has been said in explanation. But if the minister can now tell us that there is a philosophy behind this, that there is a rationale, and that it is not the intention of the government in the course of these changes in tax policy as far as old age pensions are concerned, to cut by one iota the right to universal pensions, I shall be pleased. I may even be satisfied.
But before he does that, may I correct one thing 1 said this afternoon and which I have since found to be wrong. Let me be the first to correct it. It was drawn to my attention by someone else, but I am happy to correct it. I made the statement this afternoon that the Minister of National Revenue would in the future be required to estimate the amount which^ would have been collected in

personal old age security tax and in corporation old age security tax and that this amount would have to be transferred from the consolidated revenue fund into the old age security fund. Along with that I said this was not to be done with respect to sales tax. I now find that under the wording of Bill C-259 cross-related to section 24 of the Old Age Security Act the same thing would happen with respect to sales tax revenues.
Thus, an amount estimated to be what would have been derived had the old law still been in effect would be transferred to the fund. In other words, it is clear there is to be no change, in the immediate future at any rate, in the total amount of dollars going over. But this does not detract from the basic point we have made this afternoon, namely, that the earmarked relationship, the sense individuals have that they are paying for old age security and are therefore entitled to it, is to be wiped out by the way in which this is being done.
The Minister of Finance will probably tell us that the old age security fund as such is being retained. This, I might say, is a bit of fiction. It is just a matter of bookkeeping. I think that what is more important is to retain something which emphasizes each individual's right to a pension because of his contribution in one or two or three ways. I come back again to the report the committee made in 1950 and which the government accepted in 1951, namely, that it was a good idea to have this kind of relationship. I would not like to see it go, because the danger is created of the possibility that the government could get away from the universal concept, as has already happened in connection with the guaranteed income supplement. We have seen it happen, too, with respect to family allowances.
One of the reasons I am not unreservedly supporting the hon. member for Humber-St.-George's-St. Barbe in his frequent requests that the bill which deals with family security be enacted right away, is that although provision is made for improvement in the allowances to be paid it is accompanied by income tests which I think ought to be looked at very closely. This is my concern in connection with the legislation before us. I say to the hon. member for Ottawa West, despite his fun this evening, that it is a real concern. When I saw that this earmarked tax relationship, declared to be a prop for universality, was being removed, I was most concerned about what might happen in the future.
I hope that this debate, if it does nothing else, will produce a statement on what I suggest is an important subject and one on which we have heard not one word thus far from the Minister of Finance.


Edgar John Benson: I should like to say to the hon. member for Winnipeg North Centre that there is no intention to get rid of the universality of the basic old age pension. The government has often indicated this to be the situation.
When we were going through the process of reviewing personal and corporate income tax in connection with Bill C-259, one of the stated intentions was to get rid of designated taxes such as the old age security tax, the social development tax, and so on, and combine them in one system. At the same time, we did not want to get rid of the old age security fund. So what we have done in the bill before us, which takes care of the sales tax as well, is this:
December 20, 1971

we have authorized the Minister of National Revenue to transfer to the fund personal income tax, corporate income tax and sales tax in an amount equivalent to what would have been derived from the various percentages applied as special taxes. I believe this is a more efficient way of doing things. It makes it a little simpler for people to calculate their personal tax, and I think this is desirable.
As to people knowing that they contribute to the old age security fund, I doubt whether the majority of people even know they pay the sales tax, let alone that a certain percentage goes to the fund. The fund is to continue. There is no desire to get rid of universality. I think I have given the hon. member the assurance for which he is asking.


Stanley Howard Knowles: There are one or
two further points I should like to make. The minister states he has no intention of getting away from the present practice. I wish he would confirm statements which have been made by the Minister of National Health and Welfare. Does the right of entitlement, which has been based on the taxes the way they were, still hold? The Minister of National Health and Welfare has declared that it was because the taxes were earmarked there was a right which people could assert. Will that still hold?


Edgar John Benson: The right is given to the pensioner by Parliament. The only way of changing this would be for the government to amend the Old Age Security Act in order to change the amount paid to people. I can assure the hon. member that we have no intention of changing the universality of the basic pension.


Stanley Howard Knowles: I am glad to hear that.


Cyril Lloyd Francis: You knew that, anyway.


Stanley Howard Knowles: I did not know it, and I can tell the hon. member that before I leave this building tonight I shall index these statements which have been made by the minister for use at an appropriate time.
I have one other question. The minister seems to glory in the fact that the special taxes for the old age security fund and the social development fund have been done away with but that the fund has been kept in existence. Does he have any dealings with the Minister of Labour? Does he not realize that in the case of unemployment insurance the special taxes have been kept alive but that the fund has been done away with? Would not a little consistency over there be a good idea?


Gérald Laniel: Is the hon. member for Ottawa West rising on a point of order?


Cyril Lloyd Francis: Mr. Chairman, I should like to ask the hon. member for Winnipeg North Centre a question at some convenient point, if he will permit it.


Gérald Laniel: The hon. member for Winnipeg North Centre has asked the minister a question and now the hon. member wants to ask him a question before he has had an answer from the minister. I will leave it to the hon. member for Winnipeg North Centre.
Excise Tax Act and Old Age Security Act


Stanley Howard Knowles: We are in committee of the whole, Mr. Chairman, so I would be happy to have the question.


Cyril Lloyd Francis: Mr. Chairman, I have been trying to follow the logic used by the hon. member and I should like to ask him this question. Following his argument, does he contend that the most desirable way to deal with old age security is to have a record of individual contributions, the same as with the Canada Pension Plan? If so, what is his justification for an old age security program in addition to a Canada Pension Plan? Is he arguing that the two should be combined in one in order to guarantee what he considers to be an individual's right to receive benefits having made a contribution?


Stanley Howard Knowles: Before I am through, Mr. Chairman, I will be making this afternoon's speech all over again. I pointed out this afternoon that old age security is not based on each individual's account. This is the way we recommended in 1950 and I accept that way. If my hon. friend reads about this matter in the white paper entitled "Income Security for Canadians" he will find the idea is expressed that old age security which is financed without individual accounts is the first deck of a total social security program. I approve of this arrangement whereby the first deck is financed without individual accounts but in a way that the people feel they have a right to the money.
Then the second deck, the Canada Pension Plan, is on an individual account or contributory basis. I think that these two together make a pretty good program. I do not want to see them destroyed by a government that nibbles away at the first deck, namely, universal old age security.


William Arnold Peters: Mr. Chairman, I am still not convinced by the Minister of Finance of the advisability of retaining an account. Personally, I see little merit in it. I presume the minister issues these cheques out of general treasury and I cannot see any point in keeping money in the general treasury that is used for a specific purpose. If this country goes broke we just are not going to pay our old age pensioners their cheques; it is that simple.
The old system was based on a totally different concept. I know we are eliminating it, but my point is that I do not see the merit of retaining the money in a specific account. Previously the 3 per cent sales tax went specifically into this fund. Now it will not. The 12 per cent tax will be paid into the federal treasury and the Receiver General will turn the money over to the Minister of National Health and Welfare who will issue the cheques, but I do not think that this meets the point about the rights of individuals who have made contributions. I suppose that the 4 per cent on my income tax, which will of course be handled by the Minister of National Revenue in a somewhat different way, will not cost me any the less though I shall not be paying 4 per cent as such.
If I may talk on clause 1, I shall not talk on the other clauses. I should like to make a general plea to the minister. There are some people in this country who cannot speak very well for themselves but who nevertheless have a personal interest in these matters. One of these groups is that which receives old age security, and another is the group which receives family allowance. I think there

December 20, 1971
National Defence
would be much merit in the government shortly bringing together its legislation in the social security field. I do not discount in this the unemployment insurance legislation, though the payments are being treated in almost the same way but on a means test. For example, if a miner gets laid off and a benefit comes to him from the mine, this is deducted from the amount he receives from the Unemployment Insurance Commission. Any money paid to him from the assistance plan also takes account of his income.
I think some confusion arises from the way these programs are being changed. There would appear to be two different systems which in many cases work against each other. I hope that before the end of this Parliament the government will bring together its social security legislation in order to allay the fears that I am sure many of us have when we change any items of social legislation in this nation.


John (Jack) Henry Horner: Ten o'clock.


Gérald Laniel: It being ten o'clock, shall I rise, report progress and request leave to consider the bill again at the next sitting of the House?


Some hon. Members:: Agreed.
Progress reported.



ROUTINE PROCEEDINGS


Allan Joseph MacEachen: Mr. Speaker, I should like to raise a point of order. I would ask for consent to revert to motions in order to move a reference to the Standing Committee on External Affairs and National Defence.


The Acting Speaker (Mr. Laniel):: The House has heard the proposal made by the minister. Is there unanimous consent?


Some hon. Members:: Agreed.


Allan Joseph MacEachen: Mr. Speaker, I move, seconded by the Minister of National Revenue (Mr. Gray):
That the white paper entitled "Defence in the 70's", laid before the House on September 7, 1971, be referred to the Standing Committee on External Affairs and National Defence.


Gerald William Baldwin: Mr. Speaker, we agree to that. If there is anything that needs looking at, it is the defence policy of this government.


William Arnold Peters: Mr. Speaker, I hope the motion includes the right to travel over the Christmas holiday.


James Aloysius McGrath: May I ask the government House leader when we may expect a similar motion referring to the Standing Committee on Regional Development the first report of the Atlantic Development Council which was tabled in the House in April of this year, because there is a

great deal of interest in it, as the minister knows, and I think it would be an appropriate reference to the committee.


Allan Joseph MacEachen: I really cannot say at the moment when such a reference will be forthcoming.


James Aloysius McGrath: Will it be forthcoming?


Allan Joseph MacEachen: Yes.


The Acting Speaker (Mr. Laniel):: The House has heard the motion just put. Is it the pleasure of the House to adopt the said motion.


[Stage Direction]
Motion agreed to.

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

Mr. William Knight (Assiniboia):: Mr. Speaker, I rise to address the House this evening because of the very insufficient answer I received from the Parliamentary Secretary to the minister of Agriculture (Mr. Lessard) pertaining to the question of whether or not the House of Commons will have the opportunity to debate the government's program to supposedly aid small farmers in their attempts to expand their operations.
The answer I received is indicative of the negative attitude of this government to agriculture. Its performance in the last four years has been anything but good. To appreciate this hon. members need only look at the Lift program which proved to be a disaster, at the inadequacy of the stabilization program and the mess in which we find ourselves with regard to Bill C-176. It seems that the government is reluctant to discuss the merits or demerits of its program for small farmers. What is the definition of a small farmer in terms of the program? Is the Minister of Agriculture (Mr. Olson) suggesting that he does not know?
If this government is really serious about aiding the small farmers in Canada, then it must create a viable agricultural economy that will show the small farmer that it is worth while for him to go further into debt in order to develop a sound economic unit.
There are two very important problems facing the farmers in Canada which the government must be prepared to tackle. First is the very low returns the farmer is getting for his products. Farmers are receiving only the same price, if not less, for their products as they were receiving decades ago. Therefore, the government should bring in a two-price system for wheat. The domestic price should be $1.25 a bushel more than the bushel being sold on the international market. This would mean an additional $70 million approximately for the producer, while the cost to the consumer would be minimal. After all, we on the Prairies have heard the Liberal party promise a two-price
December 20, 1971

system for seven long years. It is time they introduced one.
In view of the rising costs of production the government should be prepared to bring in a price support program for other grains as well. This brings me to the second area of concern to farmers, the accelerating costs of production. The government spent thousands of dollars on the Barber Royal Commission on the Price of Farm Machinery to tell every farmer what he knows, namely, that the price of farm machinery is too high. It is time the government seriously examined the farm machinery industry in order to find means of curtailing the ever-rising costs which the farmer has to face.
In conclusion, if the government wants to encourage the small farmers to stay in the business of farming, it must come to grips with the cost-price squeeze in which the farmer finds himself.


Mr. Marcel Lessard (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, it is not very easy to reply to the hon. member for Assiniboia (Mr. Knight) because the hon. gentleman asked me to define a small farm. Depending on the type of production in which a farmer is engaged, it might involve quite different implications. To decide tonight on a precise definition of a small farm is not possible. It is doubtful if debate on such a definition at this time would be a useful exercise, for at this stage it is to a large degree variable. This is one of the reasons for embarking on this endeavour as a program rather than as specific legislation. The government recognizes the complexity of the problem and prefers to obtain some experience in this field prior to introducing legislation.
The minister indicated on another occasion that funds for this program have been voted upon and approved by the House in the estimates of the Department of Agriculture for the past two fiscal years. Mr. Speaker, I am sure that the hon. member would not wish to dispute the government's or Parliament's wisdom in proceeding with the program in this fashion rather than at a much slower pace.



UNEMPLOYMENT INSURANCE-NEW PROCEDURES TO EXPEDITE PAYMENT OF BENEFITS

Elmer MacIntosh MacKay: Mr. Speaker, on December 13 of this year I had occasion to question the Minister of Labour (Mr. Mackasey) concerning a more expeditious way of handling UIC payments. His answer was helpful and encouraging to some extent, but unfortunately it did not go far enough. There is a real problem in this country concerning the situation with regard to UIC benefits. It is not a subject which should be made a matter of political partisanship. It concerns all members and all parties. This evening I should like to put forward a few suggestions which I hope the minister or his representatives may look at in good faith.
In my constituency of Central Nova we have what I consider to be a unique problem. It is similar in many respects to that in the city of Sydney, Nova Scotia, where the department has taken a second look at the problem which exists in this particular area of the province and, as I understand it, has kept the Sydney office open, or at least it is largely undisturbed. I strongly urge the minister
Proceedings on Adjournment Motion
to take a second look at the Pictou County area of my constituency where we have heavy industry, a lot of labour unions and a lot of people adversely affected by the government's policy on this matter.
I do not like to take my allotted time reading things into the record, Mr. Speaker, but I do wish to quote from a letter sent by one of our municipal clerks which sums up the situation admirably. In her letter she states:
I have taken the matter up with our welfare officer and she informs me that under the present system at least four weeks elapse before the cheques are received. This period has, at times, been extended to nine weeks.
A great deal of the money expended for welfare in this county is spent on families who are waiting for their unemployment insurance cheque. In this day and age practically no families can finance themselves for from four to nine weeks.
Our welfare costs this year have greatly exceeded the costs of previous years and also greatly exceeded our estimates.
If anything can be done to shorten the waiting period, it certainly would be of great assistance in lessening the tremendous welfare costs which we are now up against.
The letter is from Helen Carson, municipal clerk of the municipality of Pictou County. The minister has received numerous representations from labour groups in my constituency. He has received telegrams and messages dating back to last spring when he was warned of the chaos that would result from closing the regional office in New Glasgow, or at least from making drastic changes in it.
Having said that, I would like to make a few suggestions. First of all, Mr. Speaker, it seems rather incongruous to me that with regard to the Income Tax Act a citizen of this country is in effect put on the honour system. When he applies for a driver's licence he is put on the honour system. As far as the UIC system itself is concerned, his interim statement or bi-weekly statement of his eligibility is taken, and yet as far as his original acceptability is concerned it appears that the administrative and investigative waiting period is largely the reason why there is so much unacceptable delay.
I would like to suggest that this waiting period, if it is attributable to the necessity to investigate people, be eliminated and that a person be permitted to sign an affidavit so that his benefits can start as soon as the necessary deemed period, whatever it may be in the government's opinion, has passed. If the applicability or suitability for the recipient's benefit is to be examined, let it be examined on the government's time instead of the time of the working man who is waiting for those benefits which he feels are due to him.
Another thing that concerns me is what I consider the perversion that is being used in regard to vacation with pay acts across this country. If a person has benefits accruing to him, it often means that his UIC benefits do not start until the waiting period occasioned by vacation pay lapses. The minister had something to say about that in the House today. The incongruity is that if a person receives the benefits some time before a lay-off occurs, then no waiting period is imposed in respect of funds made available to him when laid off.
I suppose that in future, labour organizers and union negotiators will make sure that the vacation with pay is made available on an accrual basis so that it is not includ-

December 20, 1971
Proceedings on Adjournment Motion
ed in the waiting period for the UIC benefits. It seems strange that a person could have $5,000 in the bank and receive UIC benefits or receive vacation pay moneys before he is laid off without undue interruption, but if $400 or $500 is due when his employment ceases he must wait until it is used up before the UIC benefit starts. If this is not bad enough, he must also wait four or five weeks after the benefits he has been allocated through vacation pay expire, once it is used up.
Surely there is no reason why, while he is receiving the moneys from his employer which represent his vacation pay and waiting for UIC, the administrative investigation could not be done then so that as soon as the vacation pay is used up he could begin receiving the UIC benefits. I think this is inexcusable. It seems to me analogous to what happened at DEVCO where the UIC Act was used to supplement DEVCO legislation. Here we have vacation pay used in effect to at least supplement if not modify provisions of the UIC regulations.
In this day and age, Mr. Speaker, I see no reason why a person who is going to receive unemployment insurance benefits should not receive them immediately. I do not see why a person's simple affidavit or declaration would not be sufficient to determine his eligibility. If people are dishonest, then they can be caught while benefits are being paid to them and can be prosecuted in the same way as under the Income Tax Act.


Mr. Ray Perrault (Parliamentary Secretary to Minister of Labour):: Mr. Speaker, this afternoon the minister stated that shortly he hoped to be in a position to describe in more detail procedures designed to speed unemployment insurance benefit payments. However, the Unemployment Insurance Act (1971), section 48(2) provides for assignment of benefits to provincial government or municipal authorities. I can tell the House, Mr. Speaker, that officials of the Unemployment Insurance Commission have completed detailed discussions with all provincial governments in this regard and agreement has been reached on the administrative procedures that will be followed.
Briefly, the procedure will be that when an individual presents himself at a welfare agency with a request for financial assistance because his unemployment insurance claim has been delayed, the welfare officer will establish contact with the Unemployment Insurance Commission district office involved. If it is determined that a claim has been or will be delayed beyond four weeks through no fault of the claimant, the welfare officer can suggest to the claimant that he assign his entitlement to benefit to the agency for the week or weeks concerned. Each month the Unemployment Insurance Commission will send a list to the province showing details of the assignments that have been honoured, together with a cheque to cover the total amount. The details on the list will permit distribution to the local agencies concerned.
It is noteworthy that this procedure does not provide for assignment at the discretion of the welfare officer, but I am sure hon. members would agree that it does permit control over the possibility of duplication of payments.



CRIMINAL CODE-POSSIBLE AMENDMENT TO ENSURE STRICTER CONTROL OVER GUNS IN LIGHT OF MURDER INCREASE

William Warren Allmand: Mr. Speaker, this afternoon I asked the Minister of Justice (Mr. Turner) if he was considering amendments to the Criminal Code to restrict the availability of firearms and other dangerous weapons. The minister replied that the government and Parliament has taken serious action on this matter in 1968 and 1969 when we passed the Criminal Code omnibus bill. It is true that we took action on this matter in 1969 and that we passed amendments at that time which went in the right direction. However, I do not think they went far enough. I said so at the time and I repeat this tonight.
Last Thursday, a 35-year old Montreal policeman, Constable Jean-Guy Sabourin, was shot by a bandit with a machine-gun. This tragic incident took place when three bandits had just finished robbing Simpsons' department store in downtown Montreal. One might ask where these bandits got a machine-gun. Would the police constable have died if the machine-gun had not been available? Would the bandits have attempted the robbery if such weapons were not available?
I submit, Mr. Speaker, that the easy availability of dangerous weapons in this country is a scandal. There is no reason for it. It is a strange society where there is more control over the licensing of cars and car drivers than over weapons and there is more control over the sale of liquor than there is over the sale of guns and ammunition. Just down the street, here in Ottawa, a store has set out guns in its window as possible Christmas gifts.


An hon. Member:: Shame.


William Warren Allmand: Earlier this fall I presented a motion in the House of Commons to have the Standing Committee on Justice and Legal Affairs conduct an investigation into the nature and causes of violent crimes in Canada and to report proposals to the House of Commons for correcting this situation. One of the matters that I would expect such an investigation to deal with is the availability and control of weapons. There are also many other matters it could deal with. I still urge the government to initiate such an investigation. In the meantime, however, I strongly urge the government to tighten up the control of dangerous weapons.
In particular, I should like to make the following suggestions. First, all firearms should be sold by retail only through government stores run under a gun control agency. Perhaps this agency could be under the authority of the RCMP or the Attorneys General of the provinces. Second, they should only be sold on application and there should be a delay of perhaps one or two weeks between the receipt of the application and the sale of the gun. There should be a separate application for each weapon, and there should not be a general permit to carry weapons for all purposes. Third, all such applications should be distributed to the police authorities and they should be given public notice. Citizens and public authorities should be allowed to file objections to any such sale or permit. Fourth, applications for sale should only be granted after the applicant has passed a test indicating that (a) he
December 20, 1971

knows how to handle the weapon properly and safely; (b) that he knows the different laws and regulations relating to firearms, and (c) that he has assured the authorities that he needs the weapon for the defined legal purposes set out in the law.
Fifth, the application should only be granted where the applicant needs the weapon as a peace officer, where he needs it to hunt for his food and clothing, when he wishes to hunt for sporting purposes under controlled conditions or where he needs it to protect his life and property, in certain cases. Sixth, the holder of a permit for a firearm should file a report with the gun control agency each year indicating the use and present condition of the weapon. Seventh, no holder of any firearm should be allowed to sell, trade or give away a weapon. Once a weapon is no longer required, it should be turned back to the government-run gun control agency.
Eighth, under no circumstances should a person other than a peace officer be allowed to own, possess or use a handweapon, shortened rifle or shotgun or rapid-fire gun such as a machine-gun. These weapons are presently described as restricted weapons. I feel they should be described as prohibited weapons except for peace officers. Ninth, no one should be allowed to manufacture or import firearms unless they have the strict authorization of the government gun control agency.
Many people will state that these rules are not necessary, that they go too far and nothing is wrong with having a gun if it is used properly. It is probably true that most people who have guns are no threat to society, but on the other hand we have to measure the balance of benefits to society in permitting or restricting the availability of weapons. Despite the fact most people use weapons properly, we are still faced with the situation that they are too available for those who wish to use them for criminal purposes, such as happened last week.
Consequently, I suggest there is greater benefit to be gained by society in a stricter control of these weapons than the benefit now enjoyed by those who use guns under the present law. If such a law saved only one life per year, such as that of Constable Sabourin, it would be
Proceedings on Adjournment Motion
well worth it and would compensate for the inconvenience of those who do not have the full availability of guns.


Mr. Albert Bechard (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, may I think, first of all, my two colleagues from Madawaska-Victoria (Mr. Corbin) and Lapointe (Mr. Marceau) who constitute a most inspiring audience.
Mr. Speaker, the hon. member for Notre-Dame-de-Grace (Mr. Allmand) brought up a matter from which stems the terrible tragedy which occurred last week in Montreal when police agent Jean-Guy Sabourin, in the course of his duties as agent of the peace, was savagely slain by a gangster armed with a submachine gun.
On behalf of the Minister of Justice (Mr. Turner) and on my own behalf, I wish to offer Mrs. Sabourin and her three young children, as well as the other members of the family, our heartfelt and most sincere condolences.
The minister and the government are genuinely concerned with savage acts perpetrated against those who are invested with the duty of protecting society, people and goods.
The hon. member does know that in 1969, thanks to the present government and to the Minister of Justice in particular, substantial amendments were made to the Criminal Code in connection with firearms and particularly those with restricted uses like machine guns.
In this regard I shall refer the hon. member to section 83 of the Criminal Code and the following sections with which he is well acquainted and which appear in the 1970 edition.
When these amendments were being prepared, the idea of general registration of all firearms was examined from every angle and the RCMP was consulted in this respect. However, the conclusion arrived at was that such a procedure would be difficult if not impossible to enforce.
We appreciate the difficulty of producing faultless legislation whether in the field of criminal law or in any other. There will inevitably be imperfections.
Therefore, Mr. Speaker, I would assure the hon. member for Notre-Dame-de-Grace that I shall consider it a duty to pass on his suggestions to the Minister of Justice.
Motion agreed to and the House adjourned at 10.27 p.m.

Tuesday, December 21, 1971