1971-12-21

ROUTINE PROCEEDINGS


[Stage Direction]
Eleventh report of Standing Committee on Justice and Legal Affairs-Mr. Gervais (Sherbrooke).

[Stage Direction]
Tenth and eleventh reports of Standing Committee on Procedure and Organization-Mr. Blair.

[Stage Direction]
Ninth report of Standing Committee on Transport and Communications, in the two official languages-Mr. Les-sard (LaSalle).
(Editor's Note: For text of above reports, see today's Votes and Proceedings.)


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I ask leave to present a motion under the provisions of Standing Order 43. In view of comments that have been made by members in all parties during the last day or so, I believe that this time there will be the necessary unanimous consent. The motion is also one that would save the taxpayers several millions of dollars. I therefore move, seconded by the hon. member for Vancouver East (Mr. Winch):
That this House urges that arrangements be made for the early consideration of Bill C-133, or that the government itself introduce a measure to abolish the Senate, and that the making of appointments to that body cease forthwith.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: The motion cannot be put.
24725-45J


Mr. Nowlan:: The way they have acted they should be "debolished".


An hon. Member:: "Debolished"?


John Patrick (Pat) Nowlan: "Debolished" and demolished.



ENERGY, MINES AND RESOURCES TABLING OF DEPARTMENTAL REPORT FOR YEAR ENDED MARCH 31, 1970

Mr. Allan B. Sulatycky (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, in accordance with Standing Order 41(2) I wish to table, on behalf of the Minister of Energy, Mines and Resources (Mr. Greene), copies in both official languages of the department's annual report for the fiscal year ended March 31, 1970, pursuant to section 5 of the Department of Energy, Mines and Resources Act.



LABOUR CONDITIONS


Mr. John Lundrigan (Gander-Twillingate):: Mr. Speaker, I request unanimous consent of the House to propose a motion under Standing Order 43 on a matter of urgent necessity. I hope Your Honour will allow me the necessary minute to give a brief, succinct but necessary preamble.
Early in 1967 the Bureau of Statistics, now Statistics Canada, projected a large-scale program of occupational job vacancy surveys for the use of business, industry, the federal and provincial governments, and universities. The main purpose of the survey is to provide a measure of the demand for labour in Canada. The data can be used to assist in formulating manpower training, immigration policies, educational courses, and the development of career planning. Late in 1969-this is my last sentence, Mr. Speaker-the program began to operate. In the past two years Statistics Canada has supplied such data to the Department of Manpower and Immigration on a regular basis but has withheld this data from the provincial governments and the public. I would like to propose, seconded by my colleague the hon. member for Central Nova (Mr. MacKay):
That this House orders Statistics Canada and the responsible ministers to cease the suppression of this $3 million, 106-man job vacancy survey and immediately publish the survey together with all relevant and incidental material.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.

December 2L I 971
Proposed Legislation


Some hon. Members:: No.


Mr. Speaker:: The motion cannot be put.



INDUSTRY


Mr. Jack Marshall (Humber-St. George's-Sl. Barbe):: Mr. Speaker, I wish to propose a motion under Standing Order 43 on a matter of urgent and pressing necessity. The continuing daily crisis experienced by the pulp and paper industry across Canada, resulting in unemployment and social problems for many thousands of Canadians, emphasizes the need for measures by government to consider the problem as a national emergency. I therefore move, seconded by the hon. member for Gander-Twillin-gate (Mr. Lundrigan):
That the government appoint a joint committee consisting of members of Regional Development, Labour, Manpower and Immigration, Finance, Trade and Economic Affairs to analyse the problem and identify the solutions which could alleviate the difficulties faced by the pulp and paper work force.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: The motion cannot be put.



CANADA-U.S. AUTOMOTIVE PACT-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION UNDER S.O. 43

Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I rise under the provisions of Standing Order 43 which provides that in cases of urgent and pressing necessity a motion may be moved if unanimous consent is given. I should say, Mr. Speaker, that I have taken care to distribute copies of this motion to the House leaders and I expect that, given the urgency of the matter, I will get unanimous consent and no debate will be necessary.
The matter of urgent and pressing necessity arises out of statements made yesterday by the Minister of Finance (Mr. Benson) in which the minister suggested that a ceiling is to be placed on the level of Canadian automotive production. This position flatly contradicts the second stated purpose of the Canada-United States Automotive Agreement, Article 1(b), which asserts Canada is to have a "fair and equitable" share in the future growth of the total automotive market of the two countries.
Therefore, under the provisions of Standing Order 43, I ask leave to move, seconded by the member for Brant (Mr. Blackburn):
That this House reasserts its commitment to Article 1(b) of the Canada-United States Automotive Agreement which reads:
"The liberalization of United States and Canadian automotive trade in respect of tariff barriers and other factors tending to impede it, with a view to enabling the industries of both countries to participate on a fair and equitable basis in the expanding total market of the two countries".


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: The motion cannot be put.



GOVERNMENT HOUSE


Mr. Murray McBride (Lanark-Renfrew-Carleton) moved: for leave to introduce Bill C-276, respecting the designation of Rideau Hall and Government House as Rideau Palace.


Some hon. Members:: Explain.


Murray Arndell McBride: Mr. Speaker, the bill I put forward today does not basically alter anything. It clarifies what already exists. Its purpose is to designate as Rideau Palace the residence situated in the National Capital Region presently known as Government House and also referred to as Rideau Hall in order to indicate more accurately to both Canadian citizens and visitors from other nations that it is the home of the Queen's representative.


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


Mr. H. W. Danlorth (Kent-Essex):: I would have liked to direct my question to the Minister of Industry, Trade and Commerce, Mr. Speaker, but perhaps I may be allowed to direct it to the Prime Minister because of his intimate knowledge of the subject. In view of the tremendous number of Canadian jobs at stake and the great importance to the immediate future of the Canadian automobile industry as a whole, can the government assure the House that every effort is being exerted to influence the United States government to exempt the automobile industry from the provisions of the new DISC legislation?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, this matter has been discussed. I do not know if discussions are now going on regarding DISC with our Washington counterparts. When the minister returns from a trade mission to Morocco, I believe later this day, I will refer the question to him.


Harold Warren Danforth: Mr. Speaker, may I direct a supplementary question to the right hon. gentleman. Is the government taking a definite stand to safeguard the present provisions of the Canada-United States auto pact in the negotiations currently taking place, and are we advancing the proposition that the DISC provisions appear to be a direct violation of the GATT?
December 21 l_1_971


Pierre Elliott Trudeau: Yes, Mr. Speaker. According to my recollection, at the very outset when the DISC provisions were known about, although at that time we did not know in what form they would pass the American Congress or the American executive, we said that they were a contravention of GATT as we understood it.



CANADA-U.S. AUTO PACT-POSSIBLE CEILING ON CANADIAN PRODUCTION

John Edward Broadbent: Mr. Speaker, may I direct a supplementary question to the Prime Minister. In view of the statement made yesterday by the Minister of Finance, can the Prime Minister inform the House whether agreement has been reached between Canada and the United States to set a ceiling, either now or in future, on the level of automotive production in Canada?


Pierre Elliott Trudeau: No, Mr. Speaker. No agreement has been reached along those lines.


John Edward Broadbent: Since the Minister of Finance referred to certain guarantees or protective devices that would ensure that a certain level of production would be maintained in Canada, can the Prime Minister inform the House as to what form these guarantees or protective devices are to take? Are they to be in the form of letters of commitment from the manufacturers or in the form of safeguards contained in a written agreement between Canada and the United States?


Pierre Elliott Trudeau: Mr. Speaker, this involves the whole matter of the negotiations between Canada and the United States which have been going on for many months. I do not think it would be appropriate at this time for me to say what stage they have reached, nor what final form they will take.



UNEMPLOYMENT INSURANCE


Mr. Barry Mather (Surrey-White Rock):: Mr. Speaker, my question was for the Minister of Labour but in his absence perhaps I could direct it to the attention of his parliamentary secretary. Can the minister or his parliamentary secretary indicate what is the basic cause of the confusion in the payment of unemployment insurance benefits, particularly in the lower mainland of British Columbia, which has resulted in increased welfare costs in some cases? Would the hon. gentlemen look into this grievous situation immediately?


Mr. Alexander:: That problem exists all over the country.



AGRICULTURE


Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I would like to put a question to the hon. Minister of Agriculture.
Inquiries of the Ministry
Considering the price difference eastern producers must pay for feed grains, can the hon. minister do something to improve the situation?


Hon. H. A. Olson (Minister of Agriculture):: Mr. Speaker, we spend over $20 million per year in assisting with transportation in order to bring the prices as close together as possible.


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I have a supplementary question for the hon. Minister of Agriculture.
Does he consider the millions of dollars the federal government has paid are enough to do justice to eastern and western producers on the same products?


Mr. Speaker:: Order. The hon. member for Bellechasse invites the minister to express an opinion. As asked, the question is not acceptable.
I now recognize the hon. member for Joliette who has a supplementary.



FEED GRAINS-MEETING BETWEEN MINISTER AND CATHOLIC FARMERS UNION

Mr. Roch La Salle (Joliette):: Thank you, Mr. Speaker.
Since an important UCC delegation will be in Ottawa tomorrow in order to discuss feed grains, is the minister going to meet with them?


Horace Andrew (Bud) Olson: Yes, Mr. Speaker. I think there will be several other members of the Liberal caucus as well as other ministers who will meet with them.



PROPOSED JAMES BAY HYDROELECTRIC PROJECT- REQUEST FOR STATEMENT ON NEGOTIATIONS-AVAILABILITY OF TECHNICAL APPENDICES TO ENVIRONMENTAL REPORT

Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, my question relates to the proposed James Bay water diversion and power project and the report expected thereon shortly. In the absence of the Minister of the Environment perhaps I could direct my question to the Prime Minister. Do I have the attention of the Prime Minister, Mr. Speaker? In view of the concern in many quarters, will the Minister of the Environment or the Prime Minister make a statement on motions, preferably tomorrow, on the status of negotiations between the federal and provincial governments on this project? The reason I ask the question is that there is a great deal of concern whether negotiations are proceeding without public knowledge.


Mr. Speaker:: Order, please. The hon. member has asked his question. He should allow the reply to be given.

December 21L 1971
Inquiries of the Ministry


Mr. Eymard Corbin (Parliamentary Secretary to Minister of the Environment):: Mr. Speaker, I doubt very much that the minister will be able to make a statement tomorrow on motions. May I assure the hon. member that the report of the joint federal-provincial task force will be made public early in the new year. It will be a public report, and the technical papers which serve as a basis for the report will also be made available.


Gordon Harvey Aiken: When the report is made public, will all the detailed appendices to the report appear with it?


Eymard G. Corbin: As I said, Mr. Speaker, the technical appendices to the summary report will be made available.



PROPOSED JAMES BAY HYDROELECTRIC PROJECT-OBTAINING OF PERMISSION BY QUEBEC UNDER NAVIGABLE WATERS PROTECTION ACT

Mr. G. W. Baldwin (Peace River):: I have a supplementary question. The parliamentary secretary might take notice of it for the minister. In light of the environmental tragedies which have taken place in other parts of Canada, is the government able to give an assurance that this project will not proceed until the province of Quebec has sought permission under the Navigable Waters Protection Act and/or such other federal regulations as may be applicable and that there will be no commencement of construction until these actions have been taken and completed?


Eymard G. Corbin: Mr. Speaker, I assure the hon. member that all possible environmental consequences of the development of this project will be looked at very seriously.



PROPOSED JAMES BAY HYDROELECTRIC PROJECT- EFFECT ON CANADIAN DOLLAR OF FOREIGN CAPITAL INFLOW

Mr. Max Saltsman (Waterloo):: May I direct a supplementary question to the parliamentary secretary. Will the study of the environmental effects of this project be accompanied by a study of the effects on the Canadian dollar from the massive inflow of capital for this project?


Mr. Speaker:: Order, please. Perhaps the hon. member might ask a supplementary and the Chair will then move on to the next subject.


Max Saltsman: As the parliamentary secretary does not seem to be in a position to answer that question, I will direct my supplementary to the Prime Minister. Is some consideration being given to the effect this project will have on the value of the Canadian dollar?


Pierre Elliott Trudeau: I will take this matter up with the parliamentary secretary, Mr. Speaker.
[Mr. Speaker.)



THE SENATE


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, will the Prime Minister advise the House of Commons what sections of the so-called tax reform bill the Minister of Finance informed the Senate, if they passed the bill as it was, incomprehensible or otherwise, would be amended at the next session?


Pierre Elliott Trudeau: Mr. Speaker, I did not realize the question was directed to me. I think I caught the gist of it. The Minister of Finance has been saying all along that a complex bill of this size might happen to have some sections which might have to be clarified in the future. If so, as was the case with previous tax bills, we will clarify them in future sessions.


John George Diefenbaker: In view of the incomprehensible position in which the other place finds itself as a result of pushing through legislation it did not understand and which was bulled through the House of Commons-


Some hon. Members:: Oh, oh!


John George Diefenbaker: -will the Prime Minister say whether now, 46 years after the Right Hon. Mackenzie King promised reform of the Senate, he intends to set up a task force in respect of the Senate?


Pierre Elliott Trudeau: Mr. Speaker, on the premise of the question about the ability of the Senate to understand or otherwise, I think it is premature for the right hon. member to speak in their name. As for the question itself, I would remind the House that the government did present a white paper on the constitution in which was included a proposal for reform of the Senate. It was linked with a series of other measures of constitutional concern but, as the right hon. member knows, agreement has not been reached.


John George Diefenbaker: In view of what the other place did yesterday in connection with the income tax bill, would this be one of the matters which would be taken into consideration in determining the nature of the reform of the Senate?


Pierre Elliott Trudeau: If the right hon. member would refresh his memory in connection with what we proposed by way of reforming the Senate he would see that what has happened in the past days in the other place would have little bearing on it.


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, my supplementary is to the Prime Minister and it reverts to the statement he made that the Minister of Finance had indicated to the Senate banking and commerce committee that there were areas in which amendments would be brought forward. Is it the intention of the Minister of Finance and the administration to maintain the same standard of performance they displayed with regard to the Estate Tax Act, where the minister indicated to the Senate that amendments would be brought forward
December 21, 1971

immediately to correct obvious deficiencies but no amendments were ever brought forward and the act was repealed?


Pierre Elliott Trudeau: Mr. Speaker, we always try to have the highest possible standard of performance.


Marcel Joseph Aimé Lambert: In other words, there will not be any amendments.



ENTRY OF AGRICULTURAL PRODUCTS INTO EUROPEAN


Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, may I ask the Prime Minister whether he raised the subject of trade in agricultural products with the European Common Market in the course of his recent discussions with Prime Minister Heath? If he did so, was he able to obtain assurances of British co-operation when that country enters the Common Market?


Pierre Elliott Trudeau: This question was considered in general terms. When the Prime Minister of Britain and I discussed it I merely reiterated the position which had been taken on previous occasions by the Minister of Industry, Trade and Commerce and by the Secretary of State for External Affairs. The British Prime Minister indicated again that he thought the co-operation of the Canadian government or, rather, the understanding of the Canadian government with respect to the British position would be an incentive to them to try to keep our interests in mind when the whole matter is discussed in the European Common Market.


Leslie Gordon Benjamin: Since President Nixon has taken initiatives on behalf of United States agriculture in his meetings with both President Pompidou and Prime Minister Heath in connection with trade with the Common Market, would the right hon. gentleman tell the House whether he intends to involve himself on behalf of Canadian farmers in the discussions which are going on and, if so, would he be prepared to make a statement on motions?


Pierre Elliott Trudeau: No, Mr. Speaker. If any statement were to be made on this subject I think it would be made by the appropriate minister, not by myself.



ENTRY OF AGRICULTURAL PRODUCTS INTO EUROPEAN COMMON MARKET-DISCUSSION WITH PRESIDENT NIXON

Leslie Gordon Benjamin: May I ask the
Prime Minister whether in his conversation with President Nixon the question of entry of agricultural products into the European Common Market was discussed? Was he aware of the intention of the President to take initiatives when he met with President Pompidou and Prime Minister Heath?


Pierre Elliott Trudeau: I was, of course, aware that one of the thrusts of Mr. Nixon's eco-
Inquiries of the Ministry
nomic policies was to bring the Common Market countries to a realization that they would have to consider arranging for a different and better deal on the agricultural side with non-members of the Common Market. In this sense, not only was I aware of what the President had in mind but we referred briefly to that point. I am not sure whether the hon. member wants any further information.



EUROPEAN COMMON MARKET LEVY SYSTEM-POSSIBILITY OF SIMILAR ACTION BY CANADA

Mr. R. E. McKinley (Huron):: Is the government giving any consideration-I shall address my supplementary to the Minister of Agriculture because the Prime Minister is not listening. Is the government giving any consideration to the setting up of a levy system in Canada to counteract the levy system under which producers have the privilege of operating in the European Common Market?


Horace Andrew (Bud) Olson: It is well known that the government's position is to liberalize trading relations, not to add further restrictions.



REGIONAL ECONOMIC EXPANSION


Mr. Craig Stewart (Marquette):: Mr. Speaker, may I direct my question to the Minister of Supply and Services or the Acting Minister of Regional Economic Expansion. In light of the fact Saunders Aircraft Limited of Gimli is receiving approximately $2,000 per job in federal assistance, is the government going to hold talks with this company on its apparent inability to employ Canadian workers?


Pierre Elliott Trudeau: Mr. Speaker, I do know that the Department of Manpower and Immigration is looking into the matter and I am sure that the minister or his parliamentary secretary will have an answer if the question is asked tomorrow.



FINANCE


Mr. Real Caouette (Temiscamingue):: Mr. Speaker, in the absence of the Minister of Industry, Trade and Commerce, as well as of the Minister of Finance, I shall put my question to the Prime Minister.
In view of the increase in the price of gold, from $35 to $38 an ounce, can the government assure this House that the increase will not affect the subsidies now paid to Canadian gold producers?


Pierre Elliott Trudeau: No, Mr. Speaker, I cannot give this assurance, but I am taking note of the question.

D ecember 21, 1971
Inquiries of the Ministry
[English]	INDIAN AFFAIRS



INDUSTRY


Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, my question is for the Prime Minister. What special plans can the government announce that might meet the very grave effects of the shutdowns in the pulp and paper industry at Bathurst, New Brunswick, and at other centres, which were the subject matter of meetings between the premier of New Brunswick and the Minister of Regional Economic Expansion last Friday?


Pierre Elliott Trudeau: Mr. Speaker, I have not had a report on these meetings and therefore I cannot answer the question at this time.



POST OFFICE


Mr. Jack Murta (Lisgar):: Mr. Speaker, I should like to direct my question to the Postmaster General. Last Friday the Postmaster General stated in the House that he had not received the letter from the five western carriers outlining their complaints about adequate compensation when the Post Office takes over their businesses in 1972.1 should like to ask the Postmaster General whether he has received their letter and also whether a positive reply has been made in order to avert unnecessary disruptions of postal services?


Hon. Jean-Pierre Cote (Postmaster General):: Mr. Speaker, I received the letter alluded to in the House a few hours after leaving the House, last Friday.
A reply will probably be sent tomorrow inviting those who are really interested to come and meet the officials of my department here in Ottawa.



URBAN AFFAIRS


Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Minister of State for Urban Affairs. Is it the intention of government to remove the E. B. Eddy plant in Hull at public expense? If so, when is the move anticipated and what is the estimated cost?


Mr. Speaker:: Order, please. I would suggest to the hon. member that a question which obviously cannot be urgent today ought normally to be placed on the order paper. If there is urgency about a reply, the matter can be considered at the time of adjournment.



APPOINTMENT OF REPRESENTATIVE ON PAROLE BOARD AND COURT WORKERS TO ASSIST PERSONS CHARGED

['Mr. Speaker, I will take notice of this question on behalf of the Secretary of State for External Affairs.']
Mr. John Gilbert (Broadview):: Mr. Speaker, my question is directed to the Solicitor General. In view of the representations made by the Native Council of Canada to the Solicitor General last Friday, and particularly the serious shortage of Indian court workers to help Indian inmates in their court appearances and their rehabilitation, and also in view of the absence of any Indians on the federal parole board, when will the Solicitor General be appointing Indian court workers and a representative on the federal parole board?


Hon. Jean-Pierre Goyer (Solicitor General):: In the first place, Mr. Speaker, I was quite surprised at the comments of some delegates to the press because they were not at all in accordance with our agreement. The meeting was quite friendly.
To answer more precisely the point raised by the hon. member, I must say that the Senate is now considering the parole system and since we have not yet received its report and studied its recommendations, I do not think that it would be appropriate for me to comment on that suggestion. However, it is sure that if citizens are to take part in the operation of the Board, Indians as such will have their large share.



Mr. Cliff Downey (Battle River):: Mr. Speaker, my question is directed to the right hon. Prime Minister. In view of the fact that France was not included in the 14 European countries that have agreed to work with the United States to combat drug smuggling, will Canada be making representations to appropriate officials in France to solicit their co-operation in this vital area?


Pierre Elliott Trudeau: Mr. Speaker, I will take notice of this question on behalf of the Secretary of State for External Affairs.



INDUSTRY


Mr. Norman A. Cafik (Ontario):: Mr. Speaker, my question is for the Minister of Industry, Trade and Commerce but in his absence I should like to direct it to his very capable parliamentary secretary. In winding up operations under the Employment Support Act, will applications made under the act that have not yet been approved still be given consideration for the period during which the 10 per cent surcharge remained in force?
December 21. 1971


Mr. Bruce Howard (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Yes, Mr. Speaker. Arrangements under the Employment Support Act are such that companies entered into agreements with the government to maintain a certain level of employment in return for which the government would pay a certain amount of money. So companies would be eligible to apply, and to continue to apply, for assistance for the period up until December 20, at which time the Employment Support Act no longer applied to the United States surtax.



NATIONAL CAPITAL COMMISSION


Mr. Thomas M. Bell (Saint John-Lancaster):: I have a question for the Prime Minister. In order to provide a restful season for the people of Ottawa who are mainly affected, would the Prime Minister announce before the end of the year the new appointment to the National Capital Commission of a balanced, forward-looking, sensible chairman?


Pierre Elliott Trudeau: Mr. Speaker, the present one has not resigned, but if ever he should I will try to find one as good as he is.


Some hon. Members:: Hear, hear!



GOVERNMENT ADMINISTRATION


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, the Prime Minister's reference to trying to find something reminds me of certain outstanding leaks. I should like to ask the right hon. gentleman whether the government has succeeded in finding the source of the leaks of confidential documents that apparently took place about five weeks ago?


Pierre Elliott Trudeau: No, Mr. Speaker.


Robert Lorne Stanfield: In view of the seriousness of the matter to the government and certainly to the people of this country, may I ask whether the Prime Minister will make a statement to the House before the House adjourns, either before Christmas or the end of the year as the case may be, regarding the status of the investigation and as to how the government intends to proceed to trace the source of these leaks within the government service?


Mr. Guay (St. Boniface):: Raking the bottom of the barrel, Bob.


Pierre Elliott Trudeau: Mr. Speaker, I do not think any statement is called for. I have answered the question as directly as possible when I said the investigation is proceeding and that there is nothing to report at this time.
Inquiries of the Ministry


Robert Lorne Stanfield: On a point of order in regard to the remark made by the hon. member for St. Boniface, Mr. Speaker, I was not even raking the Prime Minister, let alone the bottom of the barrel.


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


Joseph-Phillippe Guay: Mr. Speaker, I would like to thank the Leader of the Opposition. I will take his comments as notice and give him an answer at a future date.



DUTIES OF NEW APPOINTEE TO CABINET, W. R. LUYENDYK

Stanley Howard Knowles: Mr. Speaker, I have a supplementary or at least a related question for the Prime Minister. In view of the announcement of a few days ago that Mr. W. R. Luyendyk has been appointed Assistant Secretary to the Cabinet-Security and Intelligence-can the Prime Minister say whether this gentleman's functions are confined to this area or if he has other duties and can he also say what relationship there is between his duties and security and intelligence in the RCMP and in the Solicitor General's group as well?


Pierre Elliott Trudeau: Mr. Speaker, I really cannot answer that in a few words. There has always been to my knowledge someone in the Privy Council office concerned with advising the cabinet on security matters and providing the secretariat for that area of government, much as there are other secretariats in the area of federal-provincial relations, economic policy, and so on. This is merely a matter, I believe, of replacing one gentleman who has left because of health reasons by another gentleman who is healthy.


Mr. Speaker:: Order, please. I think at this point I should bring to the attention of hon. members that we will soon be running short of time and some hon. members to my left have been having quite a bit of exercise this afternoon.


Stanley Howard Knowles: Mr. Speaker, I wonder if the Prime Minister has overlooked the fact that this gentleman's duties are not only security but also cabinet intelligence.


Mr. Speaker:: Order please.



NATIONAL DEFENCE


Mr. Gerard Laprise (Abitibi):: Mr. Speaker, I have a question for the Minister of National Defence.
Considering that it was announced recently that the base at La Macaza was to be closed down, would the minister tell the House if anything has been done to dispose of this base, if the buildings and the land have been put up for sale, and if he intends to announce any such
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December 21, 1971
Inquiries of the Ministry
measures so that the people of the area may know what is going to happen?


Hon. Donald Macdonald (Minister of National Defence):: Mr. Speaker, we have had discussions with representatives of the people of the area, in which I and my colleague, the Minister of Regional Economic Expansion, have taken part. It is true that we intend to close this base next September. Meanwhile, my colleague, the Minister of Regional Economic Expansion, is taking under consideration the suggestions that were made and the possible uses to which the base and its facilities could be put.



AGRICULTURE


Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I should like to direct to the Minister of Agriculture a question which is very like unto that I directed to his parliamentary secretary a few days ago. In consideration of the serious depression of the potato industry in this country, can the minister advise whether he is taking any steps or making any overtures to emulate the excellent example of the United States government which has just purchased vast quantities of potatoes for distribution in processed form for external aid welfare programs.


Horace Andrew (Bud) Olson: Mr. Speaker, while we have offered to the world food program dehydrated potatoes in several forms we have no firm commitment that they wish to have them, but I can advise the hon. gentleman that several weeks ago we put forth a program to buy a large quantity of potatoes in Canada too.



PENITENTIARIES


Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, I rise simply to ask the Solicitor General whether he has an answer to the question I asked him last week concerning allegations by the Black United Front.


Jean-Pierre Goyer: Mr. Speaker, representatives of the Black United Front visited the Dorchester penitentiary twice. They were able to meet the inmates. Following statements of these representatives published in the press, to the effect that they had been misquoted, a meeting has been arranged for December 22 in Dorchester between representatives of the Black United Front and the penitentiary authorities in order to consider the grievances of the Black United Front and of the inmates, as well as the type of program recommended to the authorities by the Black United Front to assist in the rehabilitation of the inmates.


Robert Jardine McCleave: Mr. Speaker, I thank the minister for clearing the air and simply request that after the meeting is held on December 22 perhaps a further public statement would be made. I realize we may not be meeting at that time, but it is important to have the air cleared on this matter.



EDUCATION


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I have a question for the Prime Minister. In view of the Prime Minister's suggestion recently that university education should be on a year-round basis, is he now prepared to discuss the necessary financial arrangements with the provinces?


Pierre Elliott Trudeau: Mr. Speaker, the member should know that we have contributed to the tune of nearly $1 billion a year to post-secondary education and this itself should be an indication of the government's willingness to participate in the financing of postsecondary education.


Lorne Edmund Nystrom: May I ask the Prime Minister whether he will discuss his specific proposal about year-round university education with the provinces and whether or not he will do so in the near future?


Pierre Elliott Trudeau: Mr. Speaker, it is not on any agenda of any meeting, if that is what the member is asking, but it seems to me this is the kind of thing the provinces should be able to do on their own. I am willing to remind them from time to time if the member wants me to.



HOUSING


Mr. W. C. Scott (Victoria-Haliburton):: Mr. Speaker, I have a question for the Minister of State for Urban Affairs dealing with the report that a grand jury in Toronto has recommended the closing of Rochdale College. Would the minister say whether or not his department will now consider closing the college and seeking an alternative use for the facilities?


Hon. Robert K. Andras (Minister of State for Urban Affairs):: Mr. Speaker, I have explained this before. Last August we began proceedings toward foreclosure. The matter is now before the courts so I cannot go into great detail, but we are hopeful of obtaining possession and financial control at the end of this month. There is nothing we can do to speed up that process and still respect the law in this situation. I might say too that since last August, although far from perfect, the housekeeping, the behaviour pattern and a whole series of things at Roch-

December 21, 1971

dale have improved, so I fail to see why there should be so much gloom and doom about the whole situation.



POLLUTION


Lincoln MacCauley Alexander: Mr. Speaker, I would like to direct a question to the Parliamentary Secretary to the Minister of the Environment, following a question asked by the hon. member for Kent-Essex concerning Union Carbide moving from Ontario to Quebec because of the less stringent pollution control standards there. Is the parliamentary secretary in a position to give us some indication as to the department's thinking in this regard? I am thinking of whether in fact meetings are to be held with the provinces in order to standardize pollution standards and prevent this sort of thing happening.


Eymard G. Corbin: Mr. Speaker, the department has been tackling this problem for quite a while now. We are working co-operatively with all the provinces to establish air pollution controls that would be uniform across Canada. On October 21 the Minister of the Environment tabled in the House of Commons proposed air quality objectives. If all provinces adopt legislation to enforce these objectives, uniform standards would be applied across Canada.



NATURAL RESOURCES


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I have a question for the Prime Minister. I wonder if the right hon. gentleman can tell us whether there have been any new initiatives taken lately by his government, the government of Nova Scotia or the governments of the other maritime provinces respecting the issue of offshore mineral rights and, second, whether this is a matter of high priority so far as the Prime Minister is concerned?


Pierre Elliott Trudeau: Mr. Speaker, I cannot at this time report any further measure of agreement. I am afraid the matter may have been slowed down a little bit because of the illness of the Minister of Energy, Mines and Resources. But I have, as recently as two months ago, made my views known to the Premier of Nova Scotia who told me then that he was going to have a meeting with the other Atlantic premiers or Maritime premiers to see if we could make some advance. I must confess I have had no report of that further meeting. I do not know if it took place and if there has been a report. I will look into the matter.
Inquiries of the Ministry



AGRICULTURE


Mr. Don Mazankowski (Vegreville):: I should like to direct my question to the Minister of Agriculture. Having regard to the large number of foreclosures being undertaken by the Farm Credit Corporation, particularly in the province of Alberta, can the minister say whether any consideration has been given to providing a temporary lease-back arrangement in order to allow the farmers affected to re-establish themselves?


Horace Andrew (Bud) Olson: No, Mr. Speaker, I do not think any particular attention has been given at the moment to that aspect of these foreclosures, but I must remind the hon. member again that no foreclosures are proceeding that are not several years in arrears.


Donald Frank Mazankowski: With all due respect, may I tell the minister that foreclosures are being undertaken. I should like to ask the minister whether, in view of the policy outlined in March indicating an intention to help farm people who want to readjust, any consideration is being given under the gamut of that proposal to assisting these farmers to make that adjustment?


Horace Andrew (Bud) Olson: That aspect of it no doubt will be taken into account, and indeed has been, but of course that is not related to the other part of the question.



PENITENTIARIES


Mr. Mark Rose (Fraser Valley West):: My question is directed to the Solicitor General. In view of the fact unemployment is very serious in the lower mainland of British Columbia and in view of the fact the British Columbia penitentiary at New Westminster is reputedly shortstaffed in many of its classifications, is the minister aware of the overtime work being required at that institution from the existing staff and has he any plans to hire more personnel?


Jean-Pierre Goyer: Yes, Mr. Speaker, we have prepared such program. In fact, we shall be recruiting some 100 people within a couple of months.


Mark Willson Rose: I am sorry, Mr. Speaker, but I did not quite get the minister's reply. Perhaps he has said this already, but were increased staffing plans considered in the introduction of new policies and programs within the correction service?


Jean-Pierre Goyer: Yes, Mr. Speaker.
24725-46!

December 21, 1971
Excise Tax Act and Old Age Security Act [English]



VETERANS AFFAIRS


Jack Marshall: My
question is for the Minister of Veterans Affairs. Would the minister advise whether he has received representations from the National Prisoners of War Association for consideration of their particular problems in line with the advantages granted to Hong Kong veterans under veterans legislation, and would he advise whether consideration is being given to referring the problem to the Standing Committee on Veterans Affairs?


Hon. Jean-Eudes Dube (Minister of Veterans Affairs):: have received on several occasions representations from the former prisoners of war and I have discussed this matter with them. At one stage my department reviewed 800 files and we have not discovered sufficient evidence to enact special legislation in their case. However, we have recommended to them that they themselves should apply for medical examinations and if they suffer from a special disability they will receive pensions accordingly.


Mr. Speaker:: Orders of the day.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, December 20, consideration in committee of Bill C-260, to amend the Excise Tax Act and the Old Age Security Act-Mr. Benson-Mr. Honey in the chair.
The Chairman:: When the committee rose on Monday, December 20, clause 1 of the bill was under consideration. Shall clause 1 carry?


Some hon. Members:: Agreed.


[Stage Direction]
Clause agreed to.
Clause 2 agreed to.
On clause 3.
Marcel Joseph Aimé Lambert: Mr. Chairman, yesterday I asked the parliamentary secretary or the minister to advise the House whether any study had been made and whether they have received any representations from the electronics industry in this country. I asked the parliamentary secretary if he could inform us whether, as a result of the removal of the 15 per cent excise tax on electronic equipment, there had been any step up in the manufacturing and sale of Canadian equipment because this was the stated reason for the removal of the 15 per cent tax. The removal was not directed towards improving the price position of imported goods in this particular category. I should like to know what conclusions the gov-

ernment has reached and what information they may have gathered up to date.


Mr. Mahoney:: The government does not have the results of any survey that it has done. However, the manufacturers of television equipment in Canada released a statement toward the end of October, which I believe was reported in the October 20 issue of the Financial Post, which indicated an upward revision of sales of colour television by them from something in the order of 345,000 to 445,000 sets during the current year. We consider that part of that substantial increase in sales can be attributed to the removal of the excise tax.


Marcel Joseph Aimé Lambert: I wonder whether the parliamentary secretary can tell us the degree of Canadian content in those colour television sets, because it is my information that a great proportion of the components of these sets, even though they bear Canadian names, are merely assembled in Canada and do not represent actually any increase in the manufacture in Canada.


Patrick Morgan Mahoney: I am afraid that I have no information on that particular point.


Mr. Rowland:: I would like to ask the parliamentary secretary whether the government has made any attempt to monitor the effects of the elimination of this tax since June 19 in order to determine whether or not the reduction in price, which could be represented by the removal of the excise tax, has in fact been passed on to the consumer. Have they been monitoring, for example, DBS statistics in that area?


Patrick Morgan Mahoney: There was an immediate announcement of price reduction in this area following the removal of the 15 per cent excise tax. It is our understanding that the market forces have resulted in the capacity of the Canadian industry being taxed to the full in recent months and prices seem to have followed the demand upward. However, there are certainly examples of special sales at the retail level that would indicate that in many cases lower prices are available.


Douglas Charles Rowland: Am I to take it then that the removal of the excise tax has not resulted in a reduction in the price of the equipment affected by the removal?


Patrick Morgan Mahoney: No, Mr. Chairman, but the hon. member may take it that the DBS surveys that will be followed in this regard since June 18 are not completed as yet. I cannot answer on an official level. However, price reductions were announced, as I indicated, immediately following the tax change. The supply and demand situation seems to have moved prices upward. The manufacturers are operating at a very high level of capacity now, and demand in the Canadian economy has risen considerably for this type of goods in the past half year.


Russell Clayton Honey: Shall clause 3 carry?


Some hon. Members:: Carried.
Clause 3 agreed to.
On clause 4.


Mr. Skoberg:: municipalities the same type of sales tax exemptions as are being granted to manufacturers. First of all, can the parliamentary secretary tell me the real purpose in granting this tax exemption? Is it a tax concession to encourage production, or a tax exemption to encourage the removal of pollution? This question must be answered before we can look at the clause in its proper perspective.


Patrick Morgan Mahoney: The removal of the excise tax on pollution control equipment used in processing and manufacturing is consistent with the policy of the government to encourage production and manufacturing, and hence employment. It is not specifically an incentive directed at pollution control so much as an incentive to manufacturers and producers to upgrade their facilities and thus have the result of reducing pollution.


John Leroy Skoberg: In considering what the government has tried to accomplish in this regard within the past year and a half or two years, we have to look at the over-all structure of the two areas. We must determine whether this incentive will produce a climate in which manufacturers will be encouraged to undertake the type of pollution control that we would all like to see them undertake. I am rather amazed, after reading the correspondence that has been exchanged between the Minister of Finance and the Canadian Federation of Mayors and Municipalities, that the government has been so little concerned about granting a similar type of concession to municipalities. If we look at this from the point of view that a manufacturer is going to obtain some type of tax concession, then possibly we would argue against it. However, I point out that the relevant part of the clause reads:
-machinery and apparatus sold to or imported by manufacturers-
It appears, therefore, that manufacturers can import this machinery without paying this tax provided it is used for "detection, measurement, prevention, treatment, reduction of or removal of pollutants."
The Canadian Federation of Mayors and Municipalities tried to elicit information from the government on this matter. I am sure all hon. members have copies of this correspondence in their files. On June 25 last the Federation wrote, and I quote:
Under the present Excise Tax Act, municipalities are granted some specific exemptions for anti-pollution equipment. However, this list of items is limited and there is still much anti-pollution equipment such as incinerators, recycling systems and crushers on which municipalities must pay tax. It is our interpretation that under the terms of the new exemption municipal government will be the only institution paying federal sales tax on anti-pollution equipment.
The reply by the Minister of Finance on July 26 is along the lines of comments made yesterday by the hon. member for Edmonton West when he was speaking on this clause. Here is what the minister wrote, in part:
Were we to extend this exemption, the description of the equipment that would qualify for this exemption would be a complicated question. For example, incinerators, though they may reduce waste, also cause air pollution; regarding crushers, they have no other utility than to facilitate the transportation of wastes.
A further letter from the Federation dated September 15 spelled out in detail why it thought municipalities should be exempted under the provisions of this bill. In particular it asked the minister:
Excise Tax Act and Old Age Security Act
Exactly what are these definitional problems that appear to be so complex for municipalities but which you seemed not to face or were able to resolve in the case of manufacturers and producers?
That is the type of question someone on the government side must answer. If the problems were so complex so far as manufacturers and producers were concerned, how could they be resolved in their case but not in the case of municipalities? There should be no difficulty resolving the same types of problems with respect to municipalities.
In his further reply of October 22, the Minister of Finance tried to deal with this matter of how to distinguish between pollution control machinery that should be exempted and that which should not be exempted. The last paragraph of that letter reads:
You may have in mind the exemption that has been in the law for some years for equipment to carry refuse or waste from production machinery. Neither this exemption nor the exemption announced in June extends to motor vehicles.
It appears that we are simply going round and round the block. Away back on April 22, Mayor Ivan Dent presented a brief from the Canadian Federation of Mayors and Municipalities to the government, and in that brief commended the government for trying to do something about pollution control. But the position still exists that municipalities which purchase pollution control equipment do not receive the same consideration as manufacturers and producers.
Yesterday the hon. member for Edmonton West, speaking on this problem which was raised by myself and my colleague from Kootenay West, as recorded at page 10,643 of Hansard said:
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.
Then, he went on to say:
-I do not think this is the place to do it-
He meant that such an exemption should not be made in this bill. But he failed to explain why municipalities should not be given the same consideration as producers and manufacturers. It seems as though we are just playing with words. Municipalities are a basic ingredient of our democratic society. They have to answer first so far as the public are concerned. They are trying to bring about pollution control, but the government says they are not to receive the same consideration as producers and manufacturers. We also know, Mr. Chairman, that in different areas of the country many apartment with incinerators do not receive consideration, and I am sure other hon. members will have something to say about that. It seems to me that our pollution control measures must be consistent, and we must also be consistent in our treatment of municipalities. Usually this government regards them as fairly credible bodies-especially when they want to foist more education costs on them-but now when it has a chance of doing something for these municipalities the government is found wanting.
I would therefore move:
That clause 4 of Bill C-260 be amended by inserting in line 29 on page 2, after the word "producers", also in line 36 on page 2, after the word "producers", and also in line 6 on page 3, after the word "producers", the following words, "or municipalities".

December 21, 1971
Excise Tax Act and Old Age Security Act [Translation]


Joseph Adrien Henri Lambert: Mr. Chairman, I would like to ask the parliamentary secretary for fuller information regarding clause 4, particularly on the categories of dairy products affected by the bill. I agree with the frist part of the provision repealing old section 20 on pesticides, but I would like him to specify what happens to margarine, dairy products and edible oils, because the government has brought forward an amendment to this clause exempting the products mentioned above from the tax as of January 1, 1972.


Patrick Morgan Mahoney: Mr. Speaker, the products referred to here in addition to margarine and oleomargarine are spreads made from dairy products which do not qualify as butter because of low butter content. All of them all into the category of butter substitutes of various classes. I am afraid I cannot give the hon. member a trade name by which he and I might identify the subject, but it is spreads that do not have the necessary butterfat content to qualify as butter under the appropriate regulations but are nevertheless sold commercially.


Joseph Adrien Henri Lambert: Mr. Chairman, I have another question.
Does Canada import or did it import in the last two years several of the products the parliamentary secretary mentioned?


Patrick Morgan Mahoney: Mr. Chairman, this is of course the Excise Tax Act, not the customs tariff, and the products we are talking about, margarine and oleomargarine, as far as I am aware are entirely manufactured in Canada. They are not imported in any significant amount if at all.


Russell Clayton Honey: Order, please. The Chair has the amendment moved by the hon. member for Moose Jaw, and it might be well to put the amendment now as the Chair is prepared to accept it unless there are arguments to the contrary.


Patrick Morgan Mahoney: Mr. Chairman, surely an amendment which will create an additional series of exemptions from payment of tax is out of order as upsetting the balance of ways and means decided upon by the government.


Stanley Howard Knowles: That argument is out of date.


Russell Clayton Honey: Are there other hon. members who might like to assist the Chair?


Marcel Joseph Aimé Lambert: Mr. Chairman, I do not want to argue the question of acceptability, or whether the motion is in order or out of order, in relation to this particular bill. However, I have some arguments with regard to what has been said about the purpose of the amendment, and its place in the Excise Tax Act.


Stanley Howard Knowles: Mr. Chairman, I do not know whether my quip reached Hansard when I responded to the parliamentary secretary by saying that his argument was out of date. I hope it did because that is

the pith of my submission. The argument that private members cannot move amendments because they upset the balance or ways and means is a form of words that really does not apply any more in these matters.
The Chair has ruled, for example, that an amendment reducing taxes across the board is in order provided that it does not transfer the incidence of the tax to someone else. It has also been ruled that we have the right to oppose a tax, and all this amendment is doing is opposing the imposition of a tax on municipalities when they purchase certain equipment. If it were the imposition of a tax we would be in trouble if a private member tried to move it, but I submit that the rulings made by the Chair in recent weeks are correct and that this amendment is in order and should be put.


Patrick Morgan Mahoney: Mr. Chairman, in recent weeks on Bill C-259 we were dealing with rather exceptional circumstances in that the ways and means motion had been supplemented by a particular motion of the House regularizing a variety of proceedings that had occurred before. On Bill C-260, I think we are back to a rather more traditional budgetary measure being handled in the customary manner, and therefore the ways and means motion does indeed govern what is and is not acceptable in this bill from a procedural standpoint. I do not think the various arguments that could be adduced under Bill C-259, whereby basically if the amendment was within the subject matter of the bill it was in order because of the special resolution passed by the House, has any application to this point. We are back to a situation now where the ways and means motion under the Standing Orders of the House must be strictly applied.


Russell Clayton Honey: I want to thank the hon. parliamentary secretary and the hon. member for Winnipeg North Centre who assisted the Chair on the procedural acceptability of the amendment. The Chair's first inclination was to accept the amendment, and I may be in error but I am prepared to accept it. I agree with the hon. parliamentary secretary that, of course, the Standing Orders and precedents must be observed. When we were dealing with Bill C-259 I think we did observe them, although there might have been some relaxation in the last hour or two.
The hon. parliamentary secretary has indicated that this amendment would upset the balance of ways and means, but I am inclined to agree with the hon. member for Winnipeg North Centre that the precedent may not be as important now as it was in other years. This is alleviation of taxation; it is not imposition of a new tax and the Chair is prepared to accept it. I shall put the motion of the hon. member for Moose Jaw, which reads:
That clause 4 of Bill C-260 be amended by inserting in line 29 on page 2, after the word "producers", also in line 36 on page 2, after the word "producers", and also in line 6 on page 3, after the word "producers, the following words, "or municipalities".


Mr. Harding:: I wonder if I could ask the parliamentary secretary a question. Is the pipe for storm sewers and sanitary sewers required by municipalities currently exempt from sales tax?


Patrick Morgan Mahoney: Mr. Chairman, at some time in the past the amendment in this bill was considered to be an appropriate one. Sometimes I find myself on the side of the hon.
December 21, 1971

member for Edmonton West, since the party forming the government has to take a middle course between the two opposition parties. I really could not put the argument much better than he put it last night when he advanced the reasons for declining to exempt all municipal purchases of pollution abatement equipment or, for that matter, other equipment from the federal sales tax.
The exemption that we are seeking here recognizes that the cost of pollution abatement is a necessary cost of production. It is consistent with existing exemptions in the bill for production equipment. That is the reason for the exemption. In our thinking we have advanced to the appreciation that the cost of pollution abatement equipment is a proper cost of production, and that is why we want this particular amendment to go forward.
The hon. member for Kootenay West was quite correct. Materials purchased by municipalities for sewage systems, drainage systems and sewage treatment plants are exempt. Of course, that includes a large part of the equipment purchased by municipalities in this area.
The argument presented by the hon. member for Moose Jaw that municipalities will remain the only bodies subject to the payment of sales tax when buying pollution abatement equipment is most fallacious. This provision applies as well to service agencies, transport companies, and so on, and is by no means restricted to municipalities. The exemption here and the exemption that will be brought forward is to apply to production equipment. That is the extent to which the government is prepared to go at this particular point with the amendment to the Act.
I might say that the hon. member's amendment would not be particularly helpful to any municipality unless that municipality happens to be engaged in production. That will be the effect of the amendment if one reads the section as it now is. I really do not feel, therefore, that he would achieve at all what he thought he would by presenting the amendment which has been accepted by the Chair.


Marcel Joseph Aimé Lambert: Mr. Chairman, first, may I commend to the hon. member who moved the amendment the reading at this time of Part XII of Schedule III which deals with municipalities. He is faced with a procedural problem in that this particular part of that schedule is not included in the amending bill and, therefore, he may not move an amendment to it. Part XII of Schedule III exempts the payment by municipalities of tax on culverts, firefighting equipment, and so on. Subparagraph (e) of section 1 reads:
(e) goods for use as part of sewerage and drainage systems and. for the purposes of this exemption, any agency operating a sewerage or drainage system for or on behalf of a municipality may be declared by the Minister to be a municipality.
Section 2 says that articles and materials for use exlcu-sively in the manufacture of the tax exempt goods mentioned in the section I have just referred to are included.
The amendment that the hon. member moved comes under Part XIII of Schedule III. Part XIII is headed, "Production Equipment, Processing Materials and Plans". It deals with that category of industry and not with municipalities. Although I sympathize with what the hon. member is trying to do, I would find it difficult to bring
Excise Tax Act and Old Age Security Act
his amendment under this heading. It seems to me that what should have been done to answer the prayer of the Federation of Mayors and Municipalities is to amend Part XII of the act. I know Mayor Dent of the city of Edmonton and I know that the city is not in any way engaged in the production of goods. After all, this amendment would not help municipalities in any way. The section, if amended, would read:
(b) machinery and apparatus sold to or imported by manufacturers or producers or municipalities, for use by them directly in the detection-
The key words come at the end of the paragraph and are, "attributable to the manufacture or production of goods". Those words have not been included for dressing up the subsection. I do not know what municipalities are producing goods and that is where the limitation would come in. The amendment would not help municipalities to deal with other aspects of the pollution for which they are responsible. It seems to me, as I pointed out yesterday, that there is a far better way of giving municipalities direct assistance. We should not force them to buy tax exempt equipment which is irrelevant to their purposes. Actually, under a program of forgivable loans, we ought to give municipalities a real incentive to get into the sewage treatment business. Not only would municipalities gain advantages that way from forgivable loans, but they could improve their employment situation as well as their pollution standards. They would also, by reason of the provisions of Part XII of the act, not have to pay any sales tax whatever on any equipment used in these sewage systems, and the same would apply to equipment used to control air pollution.
I do not know whether the hon. member thinks that the production of electricity is the production of goods. I know that the city of Edmonton could clean up a great deal of its municipal electric production plants. The responsibility there comes under another aspect, and the question of sales tax is not involved. I, myself, cannot support this amendment at this particular time, since its effect will be limited to the production of goods manufactured by municipalities.


Randolph Harding: Mr. Chairman, in speaking on this amendment, I am particularly interested in noting that anti-pollution equipment bought or used by municipalities is exempt from the 12 per cent sales tax. That is the point we are trying to put across to the parliamentary secretary and the government. Whether the amendment is in the right place or whether we must add another section is immaterial to the basic argument we are following. The point is this: the municipalities now are hard pressed to find sufficient cash for carrying out pollution control programs, and this is one way we can give them material assistance. We can exempt from sales tax that type of anti-pollution equipment that a particular municipality might require. I am not certain, for example, whether sanitary sewer pipe is exempt from this tax.


Marcel Joseph Aimé Lambert: It is.


Randolph Harding: The hon. member for Edmonton West suggests that it is exempt. The municipality will not need to pay sales tax on that, and that is good. I believe that this commodity is mentioned in the act. Yet I ask, what about

D ece m b er 21, 19 71
Excise Tax Act and Old Age Security Act
recycling equipment? That has not been mentioned. Any one who has studied environmental problems realizes that if we are ever to get to the very nub of pollution prevention in Canada, we will need to go into the recycling field in an immense way. We must look at the recycling of all kinds of products. We shall find that municipalities will need to take up recycling in their respective fields. Not only will municipalities be involved but provincial governments as well, and some of this recycling might be carried on on a private basis.
The recycling equipment of municipalities should be tax exempt. It must be exempt, and to encourage them to take up this type of anti-pollution work, these exemptions must be included in the bill. I do not see why the government cannot say, "All right, we will stand the bill for a short period and introduce a section that will deal with this problem." It is not only the members of my group who are interested in this matter, Mr. Chairman. All the municipalities from one end of Canada to the other have been pressing the department and the government for relief along the lines we have suggested.
I again urge the parliamentary secretary to hold this section over and have a look at it. If he does not like the amendments we have offered, why not bring in a section that will meet with the approval of his department? I suggest it will meet with the approval of the vast majority of members of this House. They, too, are interested in the war against pollution in Canada. This is one way of fighting it. I again suggest that some encouragement be given to the municipalities by proceeding along the lines we have suggested.


Mr. Latulippe:: Mr, Chairman, about clause 4 concerning pollution, I should like to ask the parliamentary secretary to the minister whether or not the government really intends to help municipalities fight pollution.
I should also like to know whether or not, the government is considering any help to industries that have great problems with water pollution, because some of them have had to pay significant fines for violating antipollution rules.
But if municipalities are exempted from the tax on certain materials used in the construction of facilities designed to control pollution, we should also exempt from this tax manufacturers who, by using water, contribute to pollution.
A great number of Canadians are living on lake shores. Some reside there the year round. They are faced with the problem of water pollution because inspectors visit them and condemn all their facilities. They force these citizens to take measures against pollution and this costs thousands of dollars. I ask whether it would not be possible to include in some clause a provision to the effect that citizens residing along lake shores, in camps for instance, be exempt from the tax on building materials, so as to contribute to pollution control.
Provincial governments now send inspectors to visit facilities and they condemn several of these. So, citizens have to spend considerable amounts to fight pollution.

If the government really wants to fight pollution, citizens and corporations should at least be exempted from paying the tax on building materials, if there is no other way to assist them through grants, for instance, which might be too costly. Citizens should be exempted from payment of that tax, particularly major industries which have to spend millions of dollars to fight pollution. I make this request of the minister who said a little while ago that several things would not come under the tax.
I therefore ask whether citizens and corporations I have mentioned will be exempted from payment of the tax on building materials.


Patrick Morgan Mahoney: Mr. Chairman, there is nothing in the bill to eliminate the sales tax currently imposed on construction materials, or is it the intention of the government to introduce such an exemption at the present time. The question of that exemption has been forcibly brought to the attention of the government on numerous occasions by many organizations and associations as well as by members of this House. However, if and when a decision is made on that, it will be announced by the minister in a budget statement.
This particular bill does not embrace that concept. The same situation applies, of course, to the total exemption of purchases by municipalities from sales tax. This is a position that is argued by the Federation of Mayors and Municipalities. It has been argued by members of this House. However, a decision in this regard is a matter of a budgetary nature and can only be dealt with in the usual way. This particular bill does not encompass that.
With regard to the concern of the hon. member for Compton in connection with processing and manufacturing industries, yes, clause 4(2) of the bill proposes to exempt and I quote:
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-
On that point, Mr. Chairman, I am able to assure the hon. member that this particular bill does comply with his requirements.
In speaking to the amendment that is before the House, I should specifically point out to hon. members that they will have a bit of nonsense if they accept the amendment. The amendment the hon. member really wants to make will, I presume, put an additional classification in Part XII of schedule III to the Excise Tax Act. The way clause 1 (b) of Part XIII will read if the amendments are adopted is that the following will be exempt:
equipment sold to or imported by manufacturers or producers or municipalities for use by them for exhausting dust and noxious fumes produced by their manufacturing or producing operations;
I really do not think that municipalities in Canada are all that widely engaged in manufacturing or producing operations or that the object the hon. member has in mind will be at all served by this bill.
The amendments he has proposed to the ensuing subclauses of clause 1 of Part XIII would, of course, be equally non-sensical. As I have said, the question is something which is constantly brought to the attention of the government. Up to this point, the government has not
December 2T 1971

accepted representations that have been made by or on behalf of municipalities. If and when the government does accept those representations, the Minister of Finance will announce that decision in a budgetary statement.


Gordon Harvey Aiken: Mr. Chairman, I would like to make my own position clear on this matter, because the effort to exempt as much pollution control equipment as possible from tax and to encourage municipalities, private industry and so forth to continue with pollution control efforts has always been something in which I have been most interested. It is indeed unfortunate, but it is nevertheless a fact we have to face, that the bill before us provides no opportunity to move an amendment along the lines of the one that has been moved.
I have every sympathy in the world with the intent of the amendment to make certain municipal equipment tax free. However, in this case it is not the municipalities which are the manufacturers or producers. It is someone else. Accepting the amendment would not enable us to accomplish the intent which the hon. member desires. My hon. friend from Edmonton West has drawn attention to the difficulty in which we find ourselves. Although the amendment has been accepted by the Chair it would still, if approved, fail to produce any results along the lines we would like to see.
Taxation on equipment of this kind leads to some strange rulings. I would certainly like to see the position cleared up. Not many years ago, I was personally involved in a case concerning fairly large concrete tiles. The department ruled that if the tiles were to be installed horizontally and used for drainage they would be tax exempt, but if they were installed vertically and used for well tiles they would be subject to tax. While I wish we could accomplish what the hon. member has in mind, it does not seem possible to do so by way of this amendment, or even under this bill.


Bruce Andrew Thomas Howard: Mr. Chairman, while we are dealing with this clause of the bill, and dealing with provisions to improve the position of those who purchase materials to be used to control or eliminate pollution, I should like to refer to a parallel area of concern.
In addition to the direct attack upon pollution in which some municipalities and companies are engaged, an indirect approach is taking place. Many municipalities which have never done so before are now installing chlorinating facilities, using chlorine to make domestic water safe for use. In the past this has often not been considered necessary, but the growth of population and increasing concern about water purity has led to action on the part of a large number of smaller municipalities. While I realize it is probably not possible to take action at this point along the lines I have in mind, I suggest that when the next major review of the Excise Tax Act takes place the government should consider removing the tax from chlorine, an ingredient which is important to the maintenance of the health of the people. The municipalities most affected would be the smaller; municipalities, those which are least able to raise the taxes necessary to provide for programs of the kind I have mentioned. I believe the government
Excise Tax Act and Old Age Security Act
should encourage municipalities to take all possible measures for the good health of Canadians, and this is why I recommend strongly that the parliamentary secretary take note of the point I have made and use his best efforts to secure the removal of chlorine as a taxable item when the next revision of the act takes place, provided it is used for the chlorination of water within Canada.


Douglas Charles Rowland: There is no question that in this amendment my hon. friend from Moose Jaw is attempting to exempt municipalities from the incidence of excise tax in respect of anti-pollution equipment. It is also true he will not be able to accomplish everything he has set out to do in the amendment he has laid before the House. He is not able to do so because the government has not placed before us clauses whose amendment could effect that purpose. However, I think the hon. member for Edmonton West and the hon. member for Parry Sound-Muskoka gave in too soon.
In addition, it seems to me the parliamentary secretary was a bit out of line when he said the amendment would have the effect of making the clause nonsensical. Municipalities in Europe are going into the recycling of waste material in a big way and municipalities in North America will have to do the same if pollution is to be controlled. I should like to mention developments which are taking place on an experimental basis and which might well place municipalities in the position of becoming manufacturers. It is now possible to take celluloid products and turn them into protein. Municipalities could become involved in this process. It is now possible, on an experimental basis, to change human and animal waste into motive fuels. It may be necessary for municipalities to enter this processing field in an effort to beat their pollution problems.
The amendment before us would at least accomplish one thing. As the municipalities move into the recycling of waste, and turn out products which are useful in the marketplace, the costly facilities they will need for these purposes will be exempt from taxation. This will encourage municipalities to move into such areas of endeavour. As I say, municipalities in Europe have already done so. The amendment would make installations established by municipalities for these purposes exempt from taxation, and thus encourage municipalities to undertake endeavours of this kind.


Leslie Gordon Benjamin: Mr. Chairman, I know my hon. friend from Moose Jaw realized when drafting his amendment that there would be a real problem in arriving at a suitable wording. Since his amendment had to be kept in order he could not, of course, go beyond the wording of the bill.
The representations which have been made to the government and to all Members of Parliament by the Federation of Mayors and Reeves have been extensive and well thought out. We have all received press releases and briefs from the federation. So far, it seems, the government has chosen not to pay any attention to these representations. It is passing strange that ways can be found to exempt manufacturers and producers from excice tax with respect to equipment used for pollution control, but that similar action cannot be taken when municipalities are concerned. The minister, in his letter, said that providing

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exemptions for municipalities would be a complicated matter, yet it is not complicated for the manufacturers and producers. That is a little hard not only for the mayors and reeves to swallow but for some of the members of the House to swallow as well.
Further, in his letter dated August 4, the Minister of Finance said that incinerators, though they may reduce waste, also cause air pollution and therefore he did not see how they could be exempted from the excise tax. Now, either the minister did not know or he conveniently forgot, but the president of the association, replying to the minister on August 16, pointed out that we now have the technology to manufacture incinerators that meet pollution control standards. He submitted they should, therefore, be exempt from excise tax. The minister makes a great deal about crushers not being exempt because they have no use other than facilitating the transportation of waste materials. If that argument is logical, then since pumping equipment, like crushers, are an integral part of a solid waste disposal system, why is pumping equipment exempt but not crushers?
These are some of the inconsistencies we see in this bill, some of which the hon. member attempts to solve in his amendment. If the wording of the amendment is not exactly as the parliamentary secretary would like it, he could get his officials or some of the roosters in the gallery to draft a proper amendment in the next minute or so. We are not particularly wedded to our wording. The mayors and reeves have pointed out that as a result of the bill the government's revenue from manufacturers and producers will be reduced by about $8 million a year. Why cannot the municipalities have an equivalent reduction in their costs?
If the amendment passes, no doubt it would cause some head scratching in the back rooms in terms of interpreting the regulations, but I am sure that problem can be solved. The municipalities have waited a long time for some relief in this area yet the Minister of Finance still finds excuses which I submit are unjustified. Although the parliamentary secretary might be hesitant to make any move that might displease the Minister of Finance, we do not feel the same way. This is another reason why the amendment has been moved. All of the reasons given by the Minister of Finance in his letter to the federation in August have been amply shot down in flames by the federation's reply of August 16.
Today the federation issued a press release criticizing the inadequacies of the government's proposals, both in their budget and in this bill, in regard to exemption from excise tax of pollution control equipment. Every city in Canada has been and is under great pressure to build new sewage disposal systems, all the way from new incinerators to tertiary treatment plants. This pressure will continue, not only from the public sector but also from senior governments, and I say it is incumbent upon the government to accept an amendment that would exempt such equipment from excise tax.
My hon. friend from Selkirk just touched the surface of the problem. It is true that cities and municipalities will be able to manufacture goods and materials from recycling and other methods of handling sewage and waste materi-
(Mr. Benjamin.]
als. Although this amendment might make it a little difficult to administer, the parliamentary secretary and his officials appreciate the intent of the amendment and I see no reason for their being unable to express this intent in the form of action. I suggest the Department of Finance and the Minister of National Revenue will experience no difficulty whatsoever on passage of this amendment.


Mr. Peters:: Mr. Chairman, I listened with great interest to members on both sides of the committee supporting this amendment but at the same time admitting they have serious difficulty with the wording. I agree this is the case, particularly in view of the fact that under normal circumstances the manufacturing industry has not been primarily concerned with the disposal of waste. I am sure the parliamentary secretary would agree that unless manufacturing plants are provided with pollution control facilities we shall never be able to accomplish effective pollution control in this nation, particularly if we neglect one of the major sources of pollution in a given area, namely pollution resulting from municipal operations themselves. It used to be good enough for a municipality simply to burn its garbage and to dump its sewage into the nearest waterway. Although we are all aware that most industries used to dispose of their waste in this way, they now find it economically advantageous as well as environmentally advantageous to implement some form of pollution control.
It is true, as several of my colleagues have said, that municipalities will be subjected to pollution controls that are greatly different from any previous controls. All kinds of developments are taking place to produce useful byproducts from reclaimed waste, and many of these byproducts will come from fields with which we are not too familiar at the present time. Indeed, it may well be the case that a large segment of municipal workers will be engaged in producing byproducts from sewage and other forms of waste material. I bow to the superior wisdom of all members who were able to foresee many of the technical changes that are going to take place, such as the establishment in municipalities of pollution control methods that had not even been considered a few years ago. As most hon. members know, garbage has been reclaimed in some parts of California. From this reclamation hydrocarbon substances are derived which, when the process has been perfected, will be a valuable asset to the area and which they hope will heat much of the urban area that hitherto had been plagued by this very substance when it was in pollutant form.
It is quite possible, despite the remoteness of the subject today, that municipalities will be manufacturing, that there will be by-products and that the new technical changes involved will bring municipalities a great incentive to eliminate what has been possibly our major pollutant in the nation, municipal waste in all its various forms.
I am sure at this late stage in the session, and even at this late hour in the day, the parliamentary secretary will not recommend that this amendment go back to the officials for improvement. I say that not unkindly but because that is not the way the government operates. It would take a long time to think about that. I fail to see the minister being at all concerned with this amendment if it does not

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apply. However, if the municipality is not in a position to take advantage of this amendment, what difference would it make. It would simply have the effect of cluttering up the act. We have been here long enough to know that a great deal of legislation is cluttered up with things much less valuable than any concession that might be made to pollution control in the municipal field.
I suggest there really is not much basis for objection to this amendment if we presuppose that municipalities will soon be in the manufacturing field. Municipalities will not be in this field in the same way industry is because the pollutants from industry must be recycled or handled some other way. I believe the government is now taking cognizance of this and is making concessions. The municipalities, however, will in fact be using pollutants as the primary source of their material for manufacture. I can see the day, and I suspect it will not be too remote, when the moneys which are being provided by this and other governments will be used to speed up our ability to develop programs and methods to dispose of municipal pollution in a much more efficient way. So I suggest to the parliamentary secretary that if he is right, and this amendment is not applicable to the municipalities today, there really should be no objection to passing it. If there are municipalities in the manufacturing field or which intend to manufacture, I presume from the wastes of the municipality, and in that way provide pollution control in a very important way which would improve the environment of the community, then what is wrong with that.
Although I cannot think of any municipality, and other members have not mentioned any specific municipality, that is in the production field, I suggest there are those of us, including you, Mr. Chairman, who believe this is inevitable because this government has basic environmental control legislation and is also working on the scientific developments that will make possible the improvement of the environment by the elimination of municipal pollution. By following this course we will probably be providing the technical know-how which in the end will result in developments that would make this amendment applicable. I believe the parliamentary secretary would be less than fair if he were to say the government will apply this to manufacturing and industrial corporations but not to the municipalities. All we are asking is that the parliamentary secretary have a little foresight in respect of the elimination of pollutants in the municipal field through technical change and give support to this amendment which he believes will not be effective or necessary at the present time.


Roch La Salle: Mr. Chairman, I should like to make a few comments on this amendment which I find is very justified because, to my mind, it would be perfectly normal for this bill to take the municipalities into account. Indeed, the Canadian Federation of Mayors and Municipalities expressed its point of view and as the government attaches great importance to the pollution problem, I feel we would only be proving our good faith toward municipalities by giving them the benefit of an exemption.
Moreover, the wording of the amendment seems to create difficulties. It would be easy for the parliamentary secretary to understand, first of all, the principle of the
amendment. I believe all members would agree that municipalities should benefit from some assistance, to the extent provided by this bill, because municipalities are really anxious to fight against pollution.
If we really want to pass a constructive legislation to that effect, I suggest that the government should pay the entire construction costs of sewage treatment facilities for municipalities which are devoid of them as a result of the prohibitive costs of such projects. Since the bill under consideration does not specially deal with those municipal projects, I think that it would be advisable to enable them to enjoy the same advantages as industries. I shall limit myself to these few comments, Mr. Chairman, as such intervention permits me to support without any reservations the principle of the amendment moved by the hon. member. I hope that the parliamentary secretary, with the help of his advisers, will be able to find a formula which will allow municipalities to avail themselves of the maximum assistance. In so doing, the government would prove its good faith regarding the fight against pollution.
I hope that the parliamentary secretary will agree to include the word "municipalities" in the bill, thus permitting municipalities to profit by this legislation. I hope he will say yes to the Canadian Federation of Mayors and Municipalities which, in the opinion of all hon. members, is an organization sufficiently serious to be listened to.
I shall therefore limit myself to these few comments. If the government really wants to help municipalities fight against pollution, I think it would be in its greatest interest to enact legislation to grant enough money for the establishment of sewage treatment plants in each Canadian municipality.


Lorne Edmund Nystrom: Mr. Chairman, I just want to say a word or two in support of the amendment moved by the hon. member for Moose Jaw. I am not sure whether or not the parliamentary secretary is aware of the press statement issued by the president of the Canadian Federation of Mayors and Municipalities. The press release, issued an hour or so ago, appeals to the government once again to extend to municipalities the same privileges that are being extended under this bill to manufacturers. I suggest very strongly to the parliamentary secretary that he consider their representation. I think he knows what it is, but in any case I will quote the last part of the press statement which reads:
Because of the critical importance of pollution problems of all kinds, the Canadian Federation of Mayors and Municipalities has the obligation to insist that the federal government revise its policy regarding the exemption of municipalities from sales tax on anti-pollution equipment. We are convinced that, in the interest of the objectives subscribed to, Bill C-260 has to be amended to extend to municipalities the same privileges that are given manufacturers and producers.
I want to remind the parliamentary secretary that the municipalities in this country are concerned. I am sure the amount of money that is involved is not great, and I am sure all members of the House can agree in a short period of time to the amendment. I suggest also that it is important that we do all we can to combat the problem of pollution in this country. We know that some pollution in

Excise Tax Act arid Old Age Security Act
our rivers and lakes comes from the municipalities in the form of raw sewage, and it is about time we did all we can to clean up these types of waste. This provision could be an incentive to the municipalities to purchase anti-pollution equipment. Municipalities are hard pressed for funds at this time, and since we are granting this privilege to the manufacturers and producers, why can we not do the same thing for the municipalities? Why do we have this double standard?
In answering that question, the parliamentary secretary said that this provision is not really to promote the fight against pollution but to increase productivity in this country. I suggest that even though increased production is important it should go together with the reduction of pollution. I urge on behalf of municipalities in my area that the parliamentary secretary accept this amendment, and if it is not acceptable, let us draft one that is so that municipalities can be included among those who are exempted from the excise tax.
Another point made by the hon. member for Selkirk was that if this amendment is accepted it will result in the creation of some jobs in the recycling of waste. I hope that members on the other side of the House will add their support for the amendment that is before us so that municipalities are granted the same privileges as manufacturers in this country.


Mr. Horner:: I should like to say a word or two in support of the amendment that is before us now. Some concern has been voiced as to whether or not this is the proper place for an amendment which would exempt the municipalities from the excise tax on machinery used to create a pollution free environment. If I wanted to chastise the government, I would point out that this is one more example of a poorly drafted bill. At first it gives the impression of being drafted satisfactorily, but when we examine it closely we realize that not all aspects of the situation are covered.
Many municipalities across the country are still the biggest polluters of our lakes and rivers. The most important factor is not the amount of money that the government will have to expend, not the fact that every municipality will have to develop recycling machinery and manufacture something from the waste, but some technicality that the government has failed to take into consideration in drafting the bill. The vote on this amendment, which will take place shortly, will be an expression of opinion as to whether or not municipalities should be exempted from excise tax on recycling machinery. If the amendment carries this afternoon, I do not expect any earth shaking events to take place in the municipalities but I do believe that many of them will become more interested in creating a pollution free environment. That is what we as legislators should be concerned with. Every piece of legislation contains regulations which carry out the intent of the legislation. If the amendment is accepted, no doubt the regulations governing the application of the excise tax on recycling machinery could be drafted in such a way as to take into account the fact that the amendment is not in the right place.
Last evening I listened very carefully to the remarks made in the House and I reread the comments of the hon. member for Edmonton West with regard to this matter.

Without a doubt he is one of the most knowledgeable members in the House with respect to the legal aspects of the legislation and the proper drafting of bills. His experience in the Chair has contributed a great deal to his knowledge and his insistence that the rules be followed is shown by his statement that this is not the right place for this amendment. It is regrettable that this matter was not considered more thoroughly when the bill was being drafted. However, all we can do at present as legislators is to express our intention that municipalities be encouraged to develop recycling machinery for waste products as quickly as possible. The old system of waste trenches and earth fills is no longer suitable. Very soon major cities will run out of available land and the old system cannot be used for many more years. So, we must encourage municipalities to get into the business of recycling. We must express our intention here that if at some time in the future municipalities purchase machinery for recycling, the excise tax will not be applied to it.
Although it may not be the correct thing to do to vote in favour of an amendment which is not in the correct place, I find myself inclined to vote for the intent of the amendment and I hope that other hon. members will do so also. Once the municipalities find themselves in a position to take advantage of this regulation the government might find itself embarrassed by a poorly placed amendment, but in such a case the government might bring in a further change according to the wishes of the House.
p m.)


Randolph Harding: I am not trying to hold up the debate on this measure, but I want to point out to the parliamentary secretary that the amendment which we are debating for the removal of the sales tax from municipal anti-pollution equipment does not apply only to municipalities. Just today I received a letter from the British Columbia School Trustees Association, as a result of which I believe the legislation should be amended to give relief to school boards which have jurisdiction over a large number of schools. If a school board constructs over $3,000 worth of equipment in its maintenance and repair shops over a year, it is forced to take out a manufacturer's licence, and pay excise tax on everything over the $3,000. This is utter nonsense. A sum of $3,000 spread over a large number of schools is very little. They are asking the government to change the regulation in order to give them an exemption. Why should any school board have to pay excise tax on cabinets, book shelves, or some such construction that has taken place in the school district? This is sheer nonsense. This is why we are asking the government to make this change.
Some time ago I wrote to the Minister of National Revenue about the matter, and in his reply he wrote:
I am bound to work within the existing framework of the Excise Tax Act as enacted by the Parliament of Canada.
We are now in the process of changing that act. We now have a chance to exempt school boards from excise tax. Will the parliamentary secretary take this into consideration? Will he hold up this clause for a few minutes and take another look at this aspect of it? The government is telling school boards that they are manufacturers and that they must take out a manufacturer's licence. Again I appeal to the minister to use a little common sense.
December 21, 1971

Let us look at the problem of school boards and the problem of municipalities with respect to anti-pollution equipment. I appeal to the parliamentary secretary to take this step and then let us get on with something else. Hon. members are anxious that something be done. I am quite sure that the majority of government members are also in favour of this.


Mr. Kaplan:: Mr. Chairman, I would like to ask the hon. member why he regards the tax revenues of a school board as being more sacred, if I may put it that way, than the tax revenues of the federal government? It is not as though he was talking about a different set of taxpayers. After all the taxpayers are the taxpayers in each case. Whether the money is levied by the federal government or by the school board, it still has to be paid by the taxpayers.
I cannot understand why he regards himself as being here to lobby for one level of tax jurisdiction as against another. If he wants to make the point that it is easier for the federal government to raise the money than it is for the school board, I do not agree. It is just as easy for a school board, if it is financed on a proper tax base and the provincial government has a just system of taxation. In that case it is just as easy for the $3,000 of needed tax revenue to be raised at one level as at the other. I cannot understand why hon. members should lobby for a tax jurisdiction they do not represent against the interests of the tax jurisdiction that they do represent.


Randolph Harding: Mr. Chairman, the hon. member does not realize that school boards, which may cover a number of municipalities in an area, do not have the same tax base as the federal government.


Robert Phillip Kaplan: Whose fault is that?


Randolph Harding: Through you, Mr. Chairman, I ask the hon. member does he think that when a school board has half a dozen men doing maintenance and repair work, such as building cabinets, shelves, cupboards, and things like that which remain in the schools, it should pay a 12 per cent sales tax?


Robert Phillip Kaplan: Sure.


Randolph Harding: Well, I don't. These boards have these men on staff. If they have to move into a school and do a small amount of repair work, or put up shelves or trophy cases, why should they be charged sales tax? They are not selling these products outside the schools. They are not making any profit on them. These things are kept within the school district. The boards are asking for an exemption and, so far as I am concerned, should be given a 100 per cent exemption by the federal government.


Robert Phillip Kaplan: Does the hon. member feel that a business, when it produces something that is used in the business, should not have to pay the same tax? Or does he feel that when a taxpayer produces something which he uses in his own business, and that has value, he should pay a tax on that increase in value? This tax theory is based on a very sound tax principle, and if it were otherwise you would create a disadvantage to conducting business in the most orderly and most economic way. Once that tax applies, it makes it harder for a company or business to put out a
Excise Tax Act and Old Age Security Act
job as compared with doing the job itself. So, for the sake of neutrality the law provides that whether it does the job itself or gets a contractor to do it, the excise tax has to be paid. Why should a school board corporation be in any different position? I believe it should be in the same position.
Actually it would be better if taxes were lowered, but that is not the issue here. The issue is that the hon. member insists that it is unfair for taxes to be raised at the municipal or provincial level, and at the same time it is fair to raise taxes at the federal level. I would like him to try to convince me that there is some reason federal taxpayers, who are the same people as provincial and municipal taxpayers, should bear these burdens. I just cannot see it.


Randolph Harding: The hon. member asks whether I think we should treat an individual manufacturer the same as a school board. There is no comparison, Mr. Chairman. His suggestion is utter nonsense. A school board is forced to get revenues from the school district through what I consider to be a very regressive form of taxation, namely, taxation on property. They have a tough time to raise sufficient revenues to keep their operation going. I have here a resolution received from the British Columbia School Trustees Association which supports my point, and I quote:
The BCSTA supports the principle that all expenditures for construction and operation of public schools are in the public interest, and should accordingly be exempted from all federal and provincial sales taxes.
If my friend does not take that stand we are back in the stone age and that is where he ought to be.


Some hon. Members:: Hear, hear!


Robert Phillip Kaplan: Mr. Chairman, the hon. member has made one good point, that the school boards in some parts of this country are forced to depend on a very regressive tax system. But that is not the fault of this government. I cannot see why they should come to Ottawa and say that because the provinces apply a regressive tax system to school corporations, the federal government has some responsibility to make the laws here more complicated, more exemption-ridden, more full of loopholes for the sake of trying to redress a failing which is entirely within the jurisdiction of the provinces.
After all, there is only one tax that the federal government can apply but the provincial governments cannot, and that is the customs tariff which is not an important source of revenue for the federal government. Apart from that, the provinces have the power to give the school boards the right to impose income tax, sales tax or any kind of tax that the federal government itself uses to raise money. I should like to see the hon. member opposite stiffen his backbone a bit with other levels of government who come asking for exemptions. He should tell them that they have a responsibility to raise money within their own jurisdiction for their own purposes.


Randolph Harding: Mr. Chairman, this is the last reply I am going to make. I would like to ask my Liberal friend from Don Valley if he puts hospitals in the same category as

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school boards. Hospital boards are exempt under the act and hospitals are financed by the same method as school boards but their expenditures are exempt from the excise tax. Hospitals are for use of the general public, and we say that school boards should be in the same category and be exempt too. Where does the hon. member stand on the hospital question? Is he opposed to that as well?


Robert Phillip Kaplan: Mr. Chairman, like my hon. friend I shall refrain from further participation in this debate, and only answer that question by saying that there is a very big difference between the way the hospitals are funded and the way schools are funded. After all, hospitals have no taxing jurisdiction although perhaps they should. School boards have, and it is the responsibility of those levels of government that give school boards taxing jurisdiction and make them responsible for accountability to make sure that they have an adequate source of revenue and are financed in the proper way. I think they would be better off to do that than to find lobbyists in this House who try to argue that shifting money from one type of tax to another is somehow doing something for their constituents.


Leslie Gordon Benjamin: Mr. Chairman, in order to make the parliamentary secretary feel a little better I should like to ask if he would consider an additional area in which excise tax could be collected. Would he consider levying an excise tax on all election expenses of candidates of political parties?


Patrick Morgan Mahoney: Mr. Chairman, I am not going to regard that suggestion as being a serious one, but there are a couple of others upon which I would comment. The hon. member for Crowfoot said that the committee should accept this amendment by way of expressing its opinion. I would suggest to the committee that an amendment to a tax bill is a rather unusual way of expressing an opinion. There is machinery in our Standing Orders to allow motions to be presented in the Private Members' hour or to allow supply day resolutions and things of that nature whereby the House can express its opinion without amending a tax bill.
The hon. member for Kootenay West has asked that I hold up the bill for a few seconds, I am afraid that even if I hold it up for many seconds I could not alter the budget speech of June 18, or the ways and means motion on which this bill is based, and my acquiescence with that particular suggestion would serve no useful purpose.


Max Saltsman: Mr. Chairman, I could understand if in rising to oppose the amendment the parliamentary secretary had made some statement that the government was not in a position to accept it at this time or that the government did not have the imagination to consider it and so he had to oppose it but would give it some thought for the future. This would have been some kind of decision.
I regret that we have had the kind of debate which took place in the past few seconds with the interjection of the hon. member for Don Valley. I have not heard such an archaic argument for a long time. I am surprised at his plea for neutrality. That would have been more impressive if during the course of the tax debate I had heard him argue neutrality when it came to taxation of mining and

resource industries. It seems to me he is a great defender of the special privileges enjoyed by the mining and resource industries and is prepared to give them the privilege of paying no tax at all to the federal government. What seems to bother him is that public expenditures might get some kind of break. He does not seem to object to the same thing for private expenditures. I am quite surprised at his attitude.
Let us go back to his argument regarding the taxing powers of provincial governments. I know he has quite a profound knowledge of the tax system, since he was one of the distinguished members of the House of Commons committee which studied it. He knows that there is a distribution of income that the federal government can make but the provincial governments cannot. Funds that are allocated by the federal government have an equalization action to them. It may be that Ontario does not require assistance from other provinces and, therefore, it could make some sense in Ontario to say let the provinces raise the revenue and redistribute it to the cities. But it still does not make any sense for the country as a whole, because many provinces need the redistribution effect that can only come from transfer payments at the federal level. When we argue for certain things at the federal level we are arguing for equality across the country, especially for those provinces not in a strong position or who do not have a strong tax base. The hon. member for Don Valley referred briefly to the regressive nature of municipal taxation. In some cases this and provincial taxation has a profound regressive effect which can only be overcome by assistance from the federal government.
I am disappointed at the hon. member's intervention. I could have understood if he had said "I am a backbencher and would like to support you but I do not want to get into trouble." That would have been a perfectly human kind of statement. Or if he had said "I think the parliamentary secretary who is leading this debate is in trouble and needs my assistance," I could have understood that, but when he tries to argue against the merit of the proposal before this House I think he is on shaky ground. Knowing him as a solid type of fellow, I am surprised that he saw fit to make this kind of intervention.


The Deputy Chairman:: Is the House ready for the question?


Some hon. Members:: Question.


Gérald Laniel: Shall the amendment to clause 4 carry?
Amendment (Mr. Skoberg) negatived: yeas, 21; nays, 52.


Gérald Laniel: I declare the amendment lost. Shall clause 4 carry?
On clause 4-


Leslie Gordon Benjamin: Mr. Chairman, there is one-


Roch La Salle: Mr. Chairman, I am rising on a point of order.


Gérald Laniel: The hon. member for Joliette rises on a point of order.
December 21l 1971


Roch La Salle: Mr. Chairman, I really have the feeling that I have not been counted among those in favour of the amendment. The names of 21 members have been listed and, including myself, I counted 22 members. It seems to me that they did not look in my direction.


Gérald Laniel: The point raised by the hon. member is valid. The clerk of the House has drawn my attention to the fact that he did not list the hon. member among those who supported the amendment. That will be corrected.


Leslie Gordon Benjamin: Mr. Chairman, I should like to present a further amendment to this clause covering an area of the bill which has been overlooked. The hon. member for Selkirk yesterday made some pertinent remarks concerning an effective way of monitoring those products which are exempt from sales tax, in order to make sure that lower prices resulting from abolition or reduction of sales tax are passed on to purchasers of those products. I think members on both sides of the House will recall with some bitterness what happened when the government removed the tax on drugs. Some drug manufacturers, some wholesalers and some retailers almost immediately after the tax on drugs was reduced or eliminated began raising the price of drugs, the result being that within a matter of weeks or months the consumers of those drugs derived little or no benefit from the fact that certain taxes on those drugs had been removed. Surely, Mr. Chairman, this loophole needs to be corrected.
I wish to move an amendment to clause 4 which, if accepted, would permit the Minister of National Revenue to watch this aspect in an efficient and practical manner. That is to say, while enforcing the Excise Tax Act provisions and while collecting excise taxes, the minister could make sure that lower prices made possible by removing excise tax are passed on to the consumer. In order to try to accomplish what my colleague for Selkirk referred to yesterday, I wish to move:
That Clause 4 of Bill C-260 be amended by inserting therein, immediately after line 38 on page 3, the following additional sub-clause:
(5) In the case of any excise taxes eliminated by the provisions of this section, the Department of National Revenue shall make arrangements for monitoring procedures to ensure that the savings so effected accrue to the purchasers of products so exempted.


Gérald Laniel: Shall the amendment carry?


Max Saltsman: Mr. Chairman, I wish to say a few words to support the commendable amendment put forward by the hon. member for Regina-Lake Centre. I think there is a compelling need for the kind of scrutiny called for by the amendment. If hon. members will recall some of the events that took place after the levels of excise tax imposed on drugs were changed, they will see the importance of introducing some mechanism for examining any changes in prices of products that may result from excise taxes being dropped or lowered. I well recall that while the excise tax was imposed on drugs, the manufacturers and others connected with the drug industry said that drug prices in Canada were high because of the high level of the excise tax on drugs. They suggested that if the government were to remove the excise tax on drugs, the price of drugs would drop substantially. It was always the
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excise tax that was the cause of problems connected with the drug industry.
We have heard the same arguments advanced regarding the high cost of construction. It has always been the excise tax on building materials that was to blame and never the price of land, never the speculation and never the interest rates. It was always the excise tax. On the surface, those arguments sound reasonable, because the excise tax represents a cost that is built into the cost of these goods. Yet, what do we find on close examination? Whenever the excise tax is removed, a new argument emerges. The people concerned say, "You see, we cannot drop the price by 10 per cent", and we must assume here that the tax of 10 per cent has been removed. They say, "We cannot possibly drop the price by that amount because, you see, we were about to increase prices by that exact amount. By removing the excise tax, you have enabled us to maintain the same price we charged before."


An hon. Member:: Right.


Max Saltsman: It appears that that tax which previously was so horrible, and which was responsible for high prices, is no longer responsible for the high prices which must be charged. The excise tax, once it has been dropped, no longer looms as an important factor in the previous high prices. Very often the chief advantage, after excise taxes are dropped, accrues to the people connected with a particular industry, to the manufacturers and others, and not to the consumer. I think, if we examine the facts, we shall see that this situation has come about over and over again. After all, this matter affects the people of Canada. It is because the taxpayers of Canada are being asked to pay higher taxes in certain fields, namely, higher personal income taxes and perhaps increased corporate taxes, that the government is able to remove the excise tax from certain areas.
This tax has contributed immensely to the national revenues. If taxpayers are being asked to pay increased personal income taxes in order to permit the lowering of certain prices to the consumer, I submit that we should make sure that the lower prices made possible by the elimination or reduction of excise taxes are passed on to the consumer. Until now there has been no evidence to indicate that this has been the case. It should not be necessary for a representative of the government to stand up and say, "Yes, we think this is a worthwhile suggestion and we shall consider it." After all, when tax reductions are not passed on, the government's own plans are frustrated. The government merely suggests that it is serving notice, through the reduction of excise taxes, that it wants price reductions passed on to the consumer. After that the whole thing sort of peters out, and nothing comes of it. I have yet to hear of any minister coming to the House and saying, "I have conducted a thorough investigation in this field and am satisfied that the amount of excise tax which has been taken off a product has been passed on to the consumer." These savings simply get lost in the shuffle.
I would think that a government that was interested in the consumer, and was interested in seeing that the taxes that were foregone resulted in lower prices, would be very pleased to have one of its representatives rise in the House

December 21, 1971
Excise Tax Act and Old Age Security Act
today, if not to support the amendment, at least to say the government was going to ask its members to agree in principle that such a monitoring agency is important. This House should be given the assurance that it will be done. If they are not prepared to give that assurance, we can only assume they really do not care what happens to government revenues, and they are indifferent to the effects that these changes in tariffs have on the economy of the country.


Mr. Francis:: Mr. Chairman, I listened with interest to the hon. member's amendment. There is not a member of this House who does not sympathize with the case put forward, the concern that tax reductions are not passed on to the public. This particular industry seems to be especially guilty in this respect. There are one or two aspects of the amendment that give me concern. First, it gives a direction to the Department of National Health and Welfare to undertake a price monitoring activity.


Stanley Howard Knowles: The Department of National Revenue.


Cyril Lloyd Francis: I am sorry, I misunderstood. I do not have the wording in front of me. In that case, I will amend what I was going to say. It does, however, introduce a price regulation, an examination function of government activity. I do not know how the government ensures that certain price reductions as a result of tax changes are passed on to the consumer in a period of inflation. Certainly the labour cost element, and the hon. member who proposed the motion, supported by sections of organized labour who have refused to co-operate in any attempts at price stabilization in this country in any official sense-


Some hon. Members:: Oh, oh!


Cyril Lloyd Francis: This is true. The hon. member who proposed the amendment must realize that in a period of inflation there is a major difficulty in trying to bring about price stability in that area. It is not a case of black and white. It is not a case of wicked manufacturers or wicked druggists dispensing at the retail level being solely responsible for gouging the poor, innocent consumer. The Lord knows our drug prices are too high. Canada's record in this regard is not good enough. However, creating a price monitoring agency for various price changes should not be faced piecemeal. It should be faced with an overall responsibility. It will require the co-operation of organized labour as well as other spokesmen in the community to be effective.
I like to think that the hon. member who so ably proposed this amendment this afternoon will go to the spokesmen for organized labour and say that the entire community has to carry the responsibility for price stability and price reductions, not just certain sections of it.


Marcel Joseph Aimé Lambert: Mr. Chairman, outside of that portion of section 4 which removes the sales tax on margarine products, can the parliamentary secretary advise the procedures that will be followed by manufacturers in availing themselves of the exemption that is now being created for them with respect to equipment they will use in controlling pollution arising out of the production of their goods? Will this be on a drawback system or will they be issued a licence by the Minister of National

Revenue which, on presentation, will entitle them to purchase the good tax free? I am concerned that this amendment, which is strictly limited to those items in clause 4 of this bill, will in any event be covered by the procedures of the Department of National Revenue.
If the manufacturer must apply for a drawback, he is going to get the whole benefit of the removal or exemption of the sales tax on the equipment in question. It is not as though they become shelf goods at a price sold by the vendor. I can understand that there are difficulties with regard to drugs or margarine, but I do not know what the supermarkets will do with regard to the difference in pricing that will arise out of the removal of sales tax on margarine. Some part of it they may have kept, and some part they may have passed on to the consumers. However, in the case of manufacturers buying this specific equipment, is their particular exemption in the form of a drawback? Is it obtained through the furnishing of a licence? Do they get the benefit of the removal of all the sales tax which would otherwise be payable on goods?


Patrick Morgan Mahoney: If I understand the hon. member correctly, Mr. Chairman, the situation he describes is one that will be covered by a licence. The party selling the goods will sell it to someone who has a licence and certifies it is being used for the appropriate use. Therefore, no tax would be collected and no drawback would be involved.


Marcel Joseph Aimé Lambert: To that extent, under that procedure, is it felt that the whole of the reduction in the tax paid price is given to the purchaser of the goods? The amendment states "the savings so effected accrue to the purchasers of products so exempted." In the particular case of these manufacturers who buy this antipollution equipment, are they or are they not getting the whole of the benefit of the reduction as a result of taking off the tax?


Patrick Morgan Mahoney: Mr. Chairman, in the case of antipollution equipment, the person buying it from the manufacturer would ordinarily be either a contractor for or the person who would be using it himself in the future. In either case, the excise tax should not be reflected in the purchase price originally because he has a licence and certifies that he is using it for an exempt purpose.


Gérald Laniel: Is the committee ready for the question? The question is on the amendment moved by the hon. member for Regina-Lake Centre.
Amendment (Mr. Benjamin) negatived: yeas, 16; nays, 55.
Clause agreed to
Clauses 5 and 6 agreed to.


[Stage Direction]
Title agreed to.
Bill reported.
The Acting Speaker (Mr. Boulanger):: When shall the bill be read the third time?


Some hon. Members:: By leave, now.


Hon. Alistair Gillespie (for the Minister of Finance) moved: that the bill be read the third time and do pass.
December 21, 1971


William Arnold Peters: Mr. Speaker, we have listened to a good deal of discussion on aspects of municipal participation in the field of pollution control. The concessions which have been made to industry have been considered by the committee and by the House, and have been praised as being worthwhile. Hon. members have argued that similar consideration should be extended to that other major partner in the pollution field, the municipalities.
The municipalities have asked for concessions in connection with sales tax not only with respect to antipollution equipment but with respect to the materials used for municipal development generally. It is evident that the interests of the municipalities in controlling pollution and protecting the environment coincide with those of the provincial and federal governments, not to speak of the interests of the public as a whole. It has been our opinion that municipalities should be given full relief in respect to all pollution control activities in which they participate. It is true that sales tax is already being waived with respect to the purchase of certain types of equipment. Nevertheless, the municipalities are now entering into other fields, and if they are to succeed, their activities need the same favourable climate as the government is now offering to manufacturers.
In the course of the debate today several hon. members sought to show that industry was in a more favourable taxation position than were the municipalities, that the municipalities were really operating under a system of double taxation; an individual was obliged to pay tax to a municipality which, in turn, had to pay sales tax to the federal government in connection with goods used by the municipality and by the school board.
It may well be that in opening up the subject of sales tax generally, we in this party were handicapped by decisions reached by civil servants to the effect that only certain concessions could be made available at this time. Nevertheless, I submit that the arguments put forward today by a number of hon. members, prompted by representations made by those in the municipal field, are worthy of serious consideration.
On the government side, there appears to be an unwillingness to face the consequences of certain changes which are taking place. Consider, for example, the position of school boards which have amalgamated in order, among other things, to save expense on purchasing and maintenance. The limit of $3,000 on the exemption available to a very small school would certainly not be adequate to reflect the scale of operations of a much larger amalgamated school board. I point out that these particular operations do not interfere with any local industry or prejudice the jobs of local workmen. They are engaged in only to simplify the operation of supply and maintenance. All these arguments have been legitimately put forward, and they are deserving of consideration. If it were not for the Christmas spirit I would certainly consider moving that this question be referred back to the committee for further study. It is unlikely, though, that the parliamentary secretary would give any consideration to changing the legislation at this late date. After all, the bill before us goes back to July, 1971 and its provisions will apply fully in January, 1972. The"hon. member would probably argue, with some reason, that there is now no time left in which
Excise Tax Act and Old Age Security Act
to make major changes in the Excise Tax Act which would provide for concessions to be made to municipalities, school boards and other agencies.
I make a plea to the minister to consider in the near future making concessions to the municipalities which would enable them to engage fully in the work of pollution control. If there is anything in which young people today are interested collectively it is probably in some method of ending our destruction of the environment. Without a doubt we have gone through more resources in the last 20 years than the whole world had done in all the time which existed prior to that point. Young people today are identifying pollution as one of the major problems they have to face. Ten years ago our children were worried about the atomic bomb. They were saying there was no future for them because eventually the bomb would be dropped and we would all go up in smoke. Our young people do not feel this way today. They feel they have inherited a world that is badly polluted, an environment that has been destroyed. Our urban centres are not what our young people wish to have.
Much of the abuse of the environment stems from our inability to control pollution. Looking at the Ottawa River which flows past the Parliament Buildings we find water that is repulsive to drink. Indeed, it might be medically unsafe. Certainly, it has been medically unsafe at times to swim in it. It is true that some pollution comes from Renfrew and Pembroke which have industrial centres, and some comes from Timiskaming's pulp mill. Almost all of the pollution from the head of Lake Timiskaming, where I live, to the Ottawa River comes from human waste.
It seems to me we should make every concession possible to enable municipalities to purchase and instal pollution control equipment. We have an obligation to put the best brains in the National Research Council to work finding much better ways of handling sewage. In some other countries sewage has been turned into a very valuable commodity. With the technology available in the world today we could provide modern utilities to reclaim a great deal of value from sewage. We could return the water to the river almost pure enough to drink, and that would certainly eliminate pollution in the Ottawa River.
The reason the municipalities do not do this is money. What facilities there are are insufficient. We have put up money to construct lagoons, but in most areas these lagoons do not function properly. As most hon. members know, a lagoon is really a septic tank or pond into which you pump sewage. The water evaporates but eventually the pond fills up with solids and you have to construct another pond. In my particular area we have 37 inches of rain a year. If it were not for the thermal heat units in the area we would be hard pressed to evaporate 37 inches of water. About as much water is added to the lagoon in the form of precipitation as is extracted by evaporation. For six months out of the year the water freezes over, and obviously no evaporation takes place. If there is any runoff in the spring the pond overflows into the river, and the waste comes once again into the Ottawa River system.
The taxpayers have been paying a small fortune for these ponds and for the sewage systems that pipe the

December 21. 1971
Excise Tax Act and Old Age Security Act
effluent into the ponds. Yet I doubt that anyone has done any work on their feasibility for northern Ontario. The idea originated in the southern United States where I imagine about 200 inches of water evaporates every year. Although it is a good idea down there it is not so good when applied to northern Ontario. When people in northern Ontario ask their municipality for clean water, the water resources board of Ontario supplies a unit. I have attended the opening of several of these units, elaborate buildings, the grounds all nicely sodded, flags out front and so on. Water is taken out of some sewage laden lake, processed in the plant, and water sold to people on the street at a higher price than water from spring wells which have been used for 20 to 30 years.
My point is that we have not made sufficient effort to correct the situation. We still hear Members of Parliament saying that there should be a sales tax on that equipment.


Mr. Whelan:: There is no sales tax on that sort of thing.


William Arnold Peters: Yes, there is. We have just been debating an amendment that would remove this tax from various items.


Eugene Whelan: A sales tax on sewage treatment plants?


William Arnold Peters: Yes, and on recycling plants and reclamation plants. Cement sewage pipes are exempt, as are some other pieces of sewage control equipment such as valves, and so on. But this type of equipment is very old. The sort of equipment I am talking about is modern and technically advanced. It not only processes sewage but reclaims what is of value, which is then used for other purposes. In other words, this sewage is recycled and reused, instead of being filtered, certain solids removed and the rest dumped into the river. As long as the hon. member for Essex (Mr. Whelan) believes that we have done all we can in this field, he is justified in the vote he cast earlier this afternoon which indicated his unwillingness to help municipalities.


Eugene Whelan: A point of order, Mr. Speaker.


William Arnold Peters: I must admit I do not understand the position he took-


The Acting Speaker (Mr. Boulanger):: Order. The hon. member for Essex is rising on a point of order.


Eugene Whelan: Mr. Speaker, the hon. member is putting words into my mouth which I do not intend to accept. He said that I condoned this sort of thing. In my own municipality I attended the opening of a new sewage plant, as modern a plant as can be built today. Most of the equipment in the plant was tax exempt and always has been tax exempt. I have been instrumental in getting government money to build the plant in my constituency. If anything has been over-emphasized, it is what the hon. member and his party have stated today, namely that this sort of equipment is not tax exempt. Practically all pollution control equipment today is exempt from tax.


William Arnold Peters: Mr. Speaker, I do not know whether that was a point of order, a question of privilege, or the hon. member's contribution to this debate today. If I would not be out of order, I would be prepared to tell him just what is exempt from the excise tax. There are about 12 items all

of which are clearly stated. They are not related to the monitoring devices that are necessary in controlling pollution. They do not have relation to the recycling devices that are available. Nor are they what I consider to be the new advances in technology in the field of pollution control.
An advantage would be provided to the municipalities by the establishment of a plant which would in effect sort out the various nutrients in the sewage, recycle it and obtain some gain thereby. Because this was not understood I can sympathize with the vote of some hon. members. However, I believe this is a matter to which the government should give consideration. It is also a matter which I hope some of the officials of the department will consider. I am well aware of the fact that many of the municipalities that would bother to take advantage of the anti-pollution devices would find advantage in reclaiming those wastes.
I hope to see the day when the municipalities will be in a position to adapt the reclaiming process to automobiles. This has not been considered by the manufacturers. It has not been really considered in any shape or form by any segment of that industry. Old automobiles are becoming a large source of pollution in the municipalities. The municipalities have great difficulty in disposing of this pollutant. I am quite sure that if efforts were made we could find a way to use even this pollutant, which probably more than anything else destroys the aesthetic appearance of the area. Perhaps this objective could be achieved by the recycling process, and if so we might be able to obtain some money from these old wrecks we see lying around the country.


Eugene Whelan: Mr. Speaker, may I ask the hon. member a question?


William Arnold Peters: Yes.


Eugene Whelan: I should like to ask the hon. member if he is aware of the fact that the federal government has already invested $10 million in a plant for the purpose of doing what he has been talking about, the recycling of automobile bodies. An amount of $30 million of the taxpayers' money and the money of private individuals has been invested in such a plant. Even with all the brains of Ph.D's and so on it has been found that this will not work. This plant is sitting idle. I look at it through my window every day. But the idea had been to use these wrecks for the production of iron powder. That plant never went into production even though there has been an investment of $30 million. It is said that $5 million more is necessary to make it work. A great amount of money has been spent and they still do not know how to accomplish their purpose. I wondered if the hon. member was aware of this.


William Arnold Peters: I am aware of it now. I certainly appreciate the fact that the government has spent this money on this pollutant. If the parliamentary secretary is prepared to move that a sum of money be allocated for this purpose, I would be prepared to support him at this time because I believe this is a very large source of pollution for which a use should be found. It is very interesting to drive down some of the major highways, such as 401 for example, and
Dec ember 21, 1971

see under an overpass a car parked with its tires off. Such cars are abandoned and someone has to take them away. They become a pollutant in our environment which is exceedingly difficult to remove.
When I began it was my intention to refer to the fact that the House, in its wisdom, decided in committee not to accept the amendment of the hon. member for Moose Jaw (Mr. Skoberg) who is very interested in this subject of pollution and the problems the municipalities encounter every time they pay a tax to the government on something that is being made by one of their agencies. I suggest that pollution control is a major element in the costs of the municipalities. Those costs increase as we demand more and more efficient control of our environment. I think the government can make a contribution by removing the taxes the municipalities must pay, and I applaud the government today for allowing industry and manufacturers to be exempt from taxes in respect of pollution control equipment. I hope that other members will see fit to continue our efforts on behalf of those who labour so hard in the municipal field, so the municipalities will have a concession from the federal government and Canada can be made a cleaner place in which to live.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Boulanger):: Order. It is my 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 Selkirk (Mr. Rowland)-Fisheries-Selkirk fish plant-inquiry as to possible closing; the hon. member for Yorkton-Melville (Mr. Nystrom)-Youth-Opportunities for Youth Program-writing of evaluation report by private consulting firm-selection of projects for analysis.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Gillespie (for the minister of Finance), for the third reading of Bill C-260, to amend the Excise Tax Act and the Old Age Security Act.
Mark Willson Rose: Mr. Speaker, this particular topic pursued by the hon. member for Timis-kaming (Mr. Peters), the hon. member for Moose Jaw (Mr. Skoberg) and others has properly been very thoroughly examined. My intervention in this debate will not be lengthy. However, in saying that I must also put forward a point that there has been a great deal of debate all this fall on a number of topics much of which has been repetitive. I feel that, as a member, I am entitled to some time this afternoon to speak on behalf of the municipalities I represent in the Fraser Valley. The hon. member for Timiskam-ing mentioned the good work the municipal officers and
Excise Tax Act and Old Age Security Act
elected officials have done. He also mentioned the massive costs faced by the municipalities because of the extra services they are asked to provide which were not necessary when many municipalities were part of an agrarian society. Now, with greater technology and the movement to major cities the costs have intensified. The taxing power of the municipalities, however, has not kept pace.
In fact, I believe it is fair to say that the more dense the population of any municipality the higher the per capita cost faced by that municipality. I have some familiarity with this having at one time served on a municipal council. With the best will in the world, I think the members of that council were very conscious of the fact, living on the banks of the Fraser and concerned with environmental and sewage problems of that municipality and those surrounding, that they should do something about this problem of antipollution and pollution abatement. The point is, however, that we did not really accomplish this although we did establish a sewer system. Most of the sewage went to its destination in Burrard Inlet or the Fraser River without the benefit of even primary treatment.
So when we are talking about cleaning up our environment we are talking about costs facing cities and municipalities across the country. Of the nine municipalities that I represent in the Lower Fraser I do not know one that is not dumping raw sewage into either the Fraser or Burrard Inlet. We are a little hypocritical about this. When the government appoints, perhaps for appearances only, a new ministry called the ministry of the environment, that looks great. But we are not serious about this, because the government makes this appointment in the hope that perhaps we can clean up our environment and take steps to curtail its constant erosion caused by technology and increased population, and this looks great, but it is only a public relations job if we do not also assist, through taxation and other measures, the various levels of government which can take the steps necessary to clean up the environment.
Last night on CBC there was an excellent documentary at 10 p.m. to 10.30 p.m., I believe. It dealt with the interrelated problems of food chains, the population explosion and pollution. Anybody who watched that program knows that many people are concerned that, if we persist in the expansionist-minded preoccupation with the GNP, technology, crowding, population explosion and all the rest of it, we will prove that Malthus was right and that ultimately we are leading toward the destruction of human life on this planet.
I feel as strongly about the kind of thing we might be doing here to combat pollution as I do about the lunacy of the nuclear arms race, regardless of which country happens to be engaged in it at the moment. If we are really serious about attempting to make the world a more liveable place for perhaps another generation or two, then we most devote considerable funds to our fight against pollution. It makes no sense to me to be encouraging the municipalities, through the Department of the Environment, on the one hand to clean up their own backyards and on the other to deny them federal assistance through tax laws to do it. It is contradictory.

December 2 El 9 71
Excise Tax Act and Old Age Security Act
We have done the same thing with the Canada Water Act which, incidentally, was passed approximately two years ago. Not one river basin board has been developed in any province since then; but what is worse, we have done something similar to what we are doing here. We have set up the Canada Water Act and the particular agency to administer the act, without providing one cent of federal funds to assist in the cleaning up of the various river basins so as to achieve decent water standards across Canada. So we are not talking about piddling or insignificant things here. It is not just a matter of whether or not we should give a tax break on some sewer pipe to some municipality, which the hon. member for Essex (Mr. Whelan) says is tax free anyway, but we are attempting to reflect the whole concern of our party and the people we represent and, I am sure, members on all sides of the House, about where we are going environmentally.
The parliamentary secretary says, "I agree with you, but why pick on my bill?" We all want to get it over with and go home for Christmas. My reply to him is there may not be too many Christmases if we continue with this kind of lunacy. Every year for the four years I have been here this House has been subjected to these Christmas cliff-hangers. We can plan everything else, but just before Christmas we do not know about the DND planes and whether we will be here between Christmas and New Year. Surely, with this great group of planners, an automated and computerized society and our new committee system, we should be able to organize things so as to have a reasonable foreknowledge of when we are going to start the session and when we are going to end it. These cliff-hangers have gone on long enough.


The Acting Speaker (Mr. Boulanger):: The parliamentary secretary wishes to rise on a point of order.


Patrick Morgan Mahoney: Would the hon. member accept a question? Would he not agree that if it were not for Christmas he would be making the same complaint about Good Friday?


The Acting Speaker (Mr. Boulanger):: I hope that next time the parliamentary secretary will not raise a question on a point of order.


Mark Willson Rose: I would tell the parliamentary secretary in reply that I hope this debate will not last until Good Friday. I would also tell him that probably I have a more profound respect for this important religious holiday than he has.


Some hon. Members:: Oh, oh!


Mr. Allmand:: Look at the halo.


Mark Willson Rose: My next few words are words which usually bring applause. In conclusion-


Some hon. Members:: Hear, hear!


Mark Willson Rose: -if I may be so bold as to correct the hon. member for Essex, when he alleged inaccurately in speaking to the hon. member for Timiskaming that practically all anti-pollution equipment is tax free, I say to him that if this is the case, why is it that such an august body as the Federation of Mayors and Municipalities as recently as December 23, 1971-which is pretty recent since it is this

coming Thursday-has issued a release under that date in which they quote their representations to the Minister of Finance (Mr. Benson) on the matter of tax exemptions on this kind of equipment. They received a reply which I suppose they consider to be equivocal and evasive-those are my words not theirs-and conclude by saying:
We are convinced that, in the interest of the objectives subscribed to, Bill C-260 has to be amended to extend to municipalities the same privileges that are given manufacturers and producers.
Obviously they must have some complaint or they would not have gone to the trouble of seeking an amendment to this bill to provide more funds for anti-pollution equipment. I think all they are asking for is equity with manufacturers. For the hon. member to assert that all this equipment is tax free is irrational and inaccurate. I am surprised that he said this.


Eugene Whelan: May I ask the hon. member a question? How can we give a municipality the same concession as is given to industry, because industry can write off any equipment in two years, and municipalities are not in business. I would tell the hon. member that I was a member of the organization to which he referred.


Mark Willson Rose: I am not prepared for the moment to argue with that kind of smokescreen. Clause 4 (2) (b) reads:
Machinery and apparatus sold to or imported by manufacturers or producers for use by them directly-
Municipalities want the same right, and that is all we are talking about. They do not have that right at the moment. Regardless of that right, we have lost on this particular occasion. But I think it is important to say these things because it is absolutely hypocritical on the one hand to decide that we want a clean environment and a fine life on this planet for our children, and on the other hand to deny municipalities, with their limited tax base, access to tax free pollution control equipment.
Municipalities do not have the resources that the federal government has. Their money comes from property taxation. I would not like to be responsible for denying them the right to clean-up their urban areas.


John Leroy Skoberg: Mr. Speaker, in the space of about 15 seconds I would like to reply to the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) who talked about the "nonsensical" type of amendment that was introduced. I tell him that we were perfectly aware that we could not move an amendment to a clause that was not before the House.
Last evening, and again this afternoon, we asked the Minister of Finance (Mr. Benson) to give serious consideration to the representation of the Canadian Federation of Mayors and Municipalities all across Canada. This is not the time to relegate municipalities to the status of second-class citizens. I repeat, the government should give serious consideration to the federation's representation. I hope this leads to the government introducing an amendment to Bill C-260.
If there has been any nonsense, it has been on the part of the government which failed to accede to the federation's representation. In the spirit of Christmas I hope that the parliamentary secretary will urge on the Minister
D ecem ber 21, 1971

of Finance the importance of introducing an amendment that will really mean something to Canadian municipalities.
Motion agreed to and bill read the third time and passed.


Mr. MacEachen:: Mr. Speaker, I regret that I have not previously advised the Clerk that consultations have resulted in a desire to deal now with Bill S-9, the Copyright Act.



COPYRIGHT ACT


[Stage Direction]
The House proceeded to the consideration of Bill S-9, an Act to amend the Copyright Act, as reported (without amendment) from the Standing Committee on Justice and Legal Affairs.
William Warren Allmand: That Bill S-9, an Act to amend the Copyright Act, be amended by deleting from Clause 1 lines 15 to 23 inclusive and substituting therefor:
"(4) "Copyright" in respect of the contrivances mentioned in the preceding sub-section shall have the meaning ascribed to it by sub-section (1) of section 3 of this Act with the exception of the sole rights to perform the contrivance or any substantial part thereof in public or to communicate the contrivance by radio communication."

He said: Mr. Speaker, this amendment is a technical one, not substantive. Its purpose is to assure that following the passage of Bill S-9 record producers will be left with the right to protect themselves against record piracy and/or unlawful reproduction and distribution of their products.
The Minister of Consumer and Corporate Affairs (Mr. Basford) stated in the committee that he wants to protect record producers against this type of piracy, that he wants them to retain all their other rights under copyright except performing rights. There is no disagreement between the minister and myself on substance but we do disagree on the wording of the bill.
After repeated examination of the bill I am convinced that the words in it do not protect the record producers against piracy. The minister and his advisers say that the words in the bill do protect them. Our disagreement is on legal drafting and it is an important disagreement. It is important because if the bill is passed in its present form it will not only take away the record producers' performing rights but also many of the other rights that protect them against record piracy. I shall explain this in greater detail.
Under the Copyright Act, section 4(3), record producers are given the protection of copyright. In order to determine the meaning of copyright for record producers under that section We have to look at the definition section, which is section 3(1). Under that section we find that copyright comprises a package of four more basic
Copyright Act
rights-the right to produce, the right to reproduce, the right to perform, and the right to publish. This means that no one but the holder of the copyright can produce the work, reproduce the work, perform the work, or publish the work unless the holder of the copyright grants a licence to another person to do these things, or unless royalties are paid to the holder.
These are the rights which a record producer presently holds under the Copyright Act. Now the minister has decided that it is not proper for record producers to have performing rights under the Copyright Act and he introduces this bill to take away that right. But what does he do? Instead of leaving the record producers all their copyright rights under section 3(1) except performing rights, he takes away all their rights under that section in section 1(4) of Bill S-9 a new definition of copyright for records. The definition says that for records copyright will mean the sole right to reproduce.
In other words, if Bill S-9 passes, the only right under copyright retained for record producers will be the right to reproduce. Whereas the record producers had four basic rights under the Copyright Act, under Bill S-9 they will have only one basic right, the right to reproduce, and this despite the fact that the government said it wanted to take away only one right. If we are interested in taking away only one right, the performing right, they should be left with three rights, the right to produce, the right to reproduce, and the right to publish. Why is the government leaving them with only one right? I can say that by taking away the production and publishing rights in addition to the performing right, Bill S-9 seriously handicaps the record producers in protecting themselves against record piracy.
This handicap is confirmed by the provisions in the recent treaty against record piracy which was concluded in Geneva on October 29, 1971. This treaty was signed by Canada. Section 2 of the treaty provides that each signatory state shall protect the record producer against reproduction and importation for distribution. After the passage of Bill S-9 Canadian record producers will have protection against reproduction but not against importation for redistribution. One wonders how the Canadian government can sign a treaty saying one thing and then introduce a bill saying another thing.
Furthermore, in attempting to accomplish the same goal the United States Congress passed a bill, U.S.646, on November 15, 1971, providing protection against reproduction and distribution. Bill S-9 provides protection only against reproduction. To correct this defect in Bill S-9 I have introduced the amendment before the House which would leave the record producers all the rights they presently possess under section 3(1) of the Copyright Act except performing rights and radio broadcasting rights. I have included broadcasting rights because the broadcasting companies are most concerned. My amendment reads:
That Bill S-9, an act to amend the Copyright Act, be amended by deleting from clause 1 lines 15 to 23 inclusive and substituting therefor:

December 21, 1971
Copyright Act
(4) "Copyright" in respect of the contrivances mentioned in the preceding subsection shall have the meaning ascribed to it by subsection (1) of section 3 of this act with the exception of the sole rights to perform the contrivance or any substantial part thereof in public or to communicate the contrivance by radio communication.
I say, let us leave the record producers all the rights they presently have except the right to perform and broadcast. In conclusion, I repeat that my amendment does nothing to change the principal purpose of this bill. It does, however, attempt to protect record producers in Canada against piracy of their works which the minister himself said he wishes to protect. I hope the government and the House will see fit to pass this amendment and grant justice to the record producers of this country.


Mr. D. R. Tolmie (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, Bill S-9 before the House was introduced in Parliament over a year ago. Because it is extremely short one would think it would be extremely simple. However, this is not the case and a great deal of parliamentary time and consideration has been given to this conceptually difficult legislation before appearing here for third reading. I want to thank members on all sides of the House for their willingness to deal with this legislation and for the help they provided in committee.
This is a most difficult area of law, perhaps because it deals with rights in respect of intellectual property. At the present time authors and composers of music have, and exercise, the right to extract money from radio and television stations and a whole host of other organizations that use music commercially, as payment for the use of their intellectual works. In 1967, the eight very large, foreign-owned record companies that produce 90 per cent of the records sold in Canada each year claimed the same right. They asked for a fee that would have had the effect of extracting about $4 million per year from the Canadian broadcasting industry.
The government had serious misgivings about this application, for three reasons. First, it was felt that this was wrong in principle, that while authors and composers have no other way of receiving fair remuneration for their work except fees for their public performance, the record industry does very well from the sale of records. Second, the government had referred the whole question of intellectual and industrial property to the Economic Council for review in 1966 and it was reluctant to see a new performing right exercised in the interim. Third, it was felt that the Canadian broadcasting industry, which bears great responsibility for the achievement of national goals in Canada as a matter of public policy, should not be required also to bear these extra costs-needless and unfair extra costs, in my view.
SRL withdrew their 1969 and 1970 tariff of fees but went ahead late last year with a tariff for 1971. The government met this with Bill S-9. Subsequently, the Economic Council reported and recommended the abolition of a performing right in records. Bill S-9 was considered at length by committees of both the Senate and the House of Commons. Every interest has been heard with regard to this legislation and, I might add, heard at length. I am opposed to the amendment which has been proposed.
[Mr. Allmand.l
It was suggested at the last minute that Bill S-9 removed more rights than it purported to do and affected more than merely the performing right in records. This was a matter of great concern, and to be absolutely certain that these allegations were without foundation the officials of the department were instructed to meet with representatives of those opposing the passage of the bill to consider the legal argument they were putting forward. As well, the advice of the Department of Justice was requested. I should add that we have several of the country's leading specialists in this field employed as consultants to the department. They were unanimous in their unequivocal endorsation of Bill S-9 as it presently stands. Furthermore, this position was fully supported by the considered opinion of the law officers of the Department of Justice.
I want to assure the House that Bill S-9 is designed solely to remove the alleged performing right in sound recordings and that the wording used does precisely what it purports to do, and nothing more. Allegations that this legislation, when enacted, would promote infringement of sound recordings have no substance in fact.
Two other points were raised in the Justice Committee and I would like to allude to them. First is the concern expressed by the hon. member for Fraser Valley West (Mr. Rose) regarding the inequitable position of performers. The Copyright Act is now being revised, and I think the minister expressed his concern and his sympathy for the position of the performers and stated quite unequivocally that the point made by Mr. Dodge of the CLC and by the hon. member will be kept in mind during the revision of the act.
This legislation is effective from January 1 this year, and some have argued that this has the taint of retroactivity. I dispute this because the record manufacturers have at all times known, and have been on notice, that the government would not stand idly by should they press their case for a tariff before the Copyright Act revision was before this House. When they did so last year, the government introduced this legislation and the parties affected were clearly aware of the fact that any performing right they had would be removed, effective January 1.
As an example of what might be considered retroactive legislation, a budget speech may not be followed by legislation for several months yet it is from the date of the budget speech that the legislation is made effective. This legislation is no different. Parliament has the power to specify when an act shall come into force, and while the legislation can have no effect until passed, public notice of the date intended for commencement was given so that persons could adjust their affairs if they wished.
Mr. Speaker, this bill received a detailed hearing in the Senate and was considered at length by a committee of this House. Its full implications were considered by the Deputy Minister of Justice and by his officers, as well as by the department's officials and consultants. I commend this legislation to the House.


Robert Jardine McCleave: Six o'clock, Mr. Speaker.


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.
December 21, 1971



COMMONS DEBATES AFTER RECESS

[Stage Direction]
The House resumed at 8 p.m.
Robert Jardine McCleave: Mr. Speaker, my colleagues in the official opposition have agreed that there shall be one speaker only on Bill S-9. It seems most convenient to make that speech at the report stage, the hon. member for Notre-Dame-de-Grace (Mr. Allmand) having pretty well put the issue before us with his amendment. I hope that I will be allowed to make the whole speech and then have it done with.
I think it will please all members of the House when I say that Canadian talent does reap its own reward and that last year, and I am speaking of the full calendar year, over $5.5 million was paid by the Canadian Broadcasting Corporation and various stations which make up the Canadian Association of Broadcasters to the artists, performers and composers of Canada. That is how much the Canadian broadcasting industry paid to these people. Clearly, artistic merit in this country is recognized substantially.
The issue that we are concerned about does not involve directly, although it might indirectly, the authors, composers and publishers as such. What it does involve is whether performing rights such as I have mentioned should be extended to the broadcasting or other public performance of recordings. It is this issue which brings Bill S-9 before the House. Is the right to broadcast or play recordings in public a proper right?
It has been argued, Sir, that if I am an automobile dealer and I decide to sell you an automobile and somebody else an automobile for the same price, I cannot, if the other purchaser decides to use that automobile in the taxi business, say to him, "Since you will make extra money out of this automobile which you are to use for commercial purposes I can, therefore, charge you extra for it." That, substantially, is the position the recording companies are asking us to adopt when they ask us to defeat Bill S-9. I say, on my own behalf and on behalf of my associates, that we reject that position of the recording companies. I want that clear on the record. We reject that position and therefore we are fundamentally in agreement with the principles set forth in Bill S-9. Let there be no mistake about that.


Some hon. Members:: Hear, hear!


Robert Jardine McCleave: Later in my speech, which will be remarkably brief, I will point out what I think was the error in the presentation of the hon. member for Notre-Dame-de-Grace. Nevertheless, we owe him a debt since at least he has put the issue before us and has presented in the best possible way one side of the argument. It does not appear that many support this position.
We find ourselves in distinguished company in rejecting the position of the recording industry and its friends. One could go back to someone with whom older parliamentarians in this House served, namely, J. L. Ilsley, one time member for Annapolis-Kings, and subsequently Chief Justice of the Supreme Court of Nova Scotia. In 1957 he brought in a far reaching report on copyright. He headed a royal commission on copyright. The Ilsley commission,
Copyright Act
in dealing with an issue similar to the one before us tonight recommended in part:
The act restricted by the copyright in a sound recording should be the making of a record embodying the record.
In other words, as suggested earlier by the Parliamentary Secretary to the Minister of Consumer and Corporate Affairs (Mr. Tolmie), the only right that should be protected is the right to reproduce. I think that is an important argument because, as the mover of the amendment has suggested and as the spate of telegrams which has arrived in the last couple of days has suggested, the piracy that takes place in the reproduction of records can be cured if we reject the principle of Bill S-9. I hope I can show in my speech that this argument is utterly fallacious. In any event, those who agree with Bill S-9 find themselves in good company, not only with the Ilsley Royal Commission on Copyright but with the report of the Economic Council of Canada. I quote a portion of that report which deals with this matter:
We continue to accept the concept of a performing right in the basic material because this is the only way in which a writer of such materials can get payment related to the use of his work in the market. The record maker on the other hand, in spite of many creative inputs by his staff, is really in the business of selling a physical item such as a disc or tape and it is this activity that should reimburse him.
I think that puts the point very well. I mentioned telegrams. I think it should go on record that counsel for the main opponent of this bill, in a last effort to hold off passage of Bill S-9, telephoned the Minister of Consumer and Corporate Affairs (Mr. Basford). I quote from his telegram:
-it was prepared not to exercise any of the rights which it presently enjoys under the Canadian Copyright Act pending a complete revision of the said act.
This is their latest position. It is an attempt to hold off passage of Bill S-9. I understand the minister is ill and cannot be here. I take it from the fact the measure was called and we are now debating it that the government has in fact rejected this last-ditch effort of the opponents of the bill. The parliamentary secretary indicates that this is precisely the position.
It does not disturb me very much that such an attempt was turned down. I think we are proceeding on the right course of principle. In my opinion, there is no reason to accept such a request. I do not think the right should have existed in the first place, if in fact it does exist under the present law. I am not prepared to concede that. The issue was never determined in the courts. I think we are bound on the right course. My conscience will not give me a twinge because I support the passage of Bill S-9.
I am sure the parliamentary secretary will take this message to his minister. We have been told over and over again in various committees, particularly the broadcasting committee, when dealing with performing rights and the creative abilities of Canadian artists, that there is desperate need for a new Copyright Act in Canada. The Economic Council of Canada has released its recent study. I hope we can expect some action in regard to the Copyright Act.

December 21, 1971
Copyright Act
I think in a moment or two I will be able to point out that the piracy argument, while a fallacious one with regard to the principle we are studying this evening still deserves some kind of answer. In the Globe and Mail, the second last page of the entertainment section, there is an article from Hollywood about the millions of dollars lost to record pirates. This points out the problem in the American recording industry. One witness who appeared before the justice committee said that as much as 25 per cent of the material sold as records in Canada represented pirate material. These were tapes brought across the American border. Believe it or not, most of our taping is done in the United States. As much as 25 per cent of the Canadian record industry can be said to be based on pirate operations. There is need for enforcement in that field.
The hon. member for Notre-Dame-de-Grace spoke about piratical operations. There is a provision in the Copyright Act to deal with that. It is a question of better enforcement. During the discussion in committee, the Commissioner of Patents, Mr. A. M. Laidlaw, was faced with this argument about pirates. He said, as recorded at page 51 of issue No. 43 of the proceedings of the Standing Committee on Justice and Legal Affairs:
-that right is derived from the fact that the manufacturer gets the right to produce either from the composer by the assignment of that right, or secondly through compulsory licensing provisions which are set out in section 19 of the act.
The hon. member can look there for the remedies that the recording industry now have and enjoy. The point about piracy was made by myself in an exchange with Mr. Laidlaw. I quote from the following page:


Robert Jardine McCleave: Could I boil it down? It seems to me that the one fact we are faced with here is no matter what SRL has as its interpretation of the law there is no change made whatsoever by what we are being asked to pass. Am I correct in saying no change whatsoever? If they were in trouble before, they will be in trouble in the future, but that is up to a better revision of copyright law. Am I correct in stating it that way?


Mr.   Laidlaw@: That is correct.


Mr. Basford:: And better enforcement.
That is the problem. It is not to put something new in the law, as suggested by the hon. member for Notre-Dame-de-Grace, but to put bigger teeth in the law, have a better method of enforcement or a higher penalty so that it is worth while tracking down the people who engage in pirate operations. I suspect that what is happening in Canada, with the remarkable amount of high-priced talent engaged on both sides of the issue and some considerable lobbying on both sides, is some sort of trial run for events in much larger markets such as the United States, West Germany and the United Kingdom. I am suspicious when I see counsel, who normally earn $1,000 an hour on enterprises like this, standing around. I do not think they are here for the amount of money that can be gained, even if the recording industry in Canada is successful against the broadcasting industry. The chips on the table are of such a size that we can imagine there is a far greater gain involved.
There is a provision in the bill that would make this law retroactive to January 1, 1971. If the recording industry had a right which it tried to exercise this year, that right would be wiped out by the retroactive provision that we have in this law. My colleagues and I resisted that in the

committee. If the House were proceeding at a different time of year I would found my doubts in a motion to strike out that part of the law. However, we are getting near the end of the session and Parliament can only do so much.
I talked this matter over with the recording industry. They are not so concerned about the difference a year will make as they are with winning the whole ball game. They are not going to win the whole ball game, so I do not feel too badly about not putting the issue to the House. The issue of retroactivity was well scouted in the Justice committee. My colleagues and I put forth the best arguments we could. When the matter was put to a vote after several hours, we stood alone; we could not persuade others of the righteousness of our cause.
I know my colleagues would want me to say, in the one speech to be made on this bill on behalf of my party, that in this regard the principle is the same: we are unalterably opposed to the imposition of retroactive provisions which could take a possible existing right and remove it by act of Parliament. We generally approve the principle of the bill and accordingly wish it to become the law of Canada.


Joseph Adrien Henri Lambert: Mr. Speaker, I am glad of this opportunity to say a few words concerning Bill S-9, entitled an Act to amend the Copyright Act. I leafed through the proceedings of the Senate Committee on Banking, Trade and Commerce, which devoted several meetings to consideration of the bill to amend the Copyright Act, and I was very much impressed by the convincing evidence given to that committee by some organizations and individuals.
I also received many representations from people directly or indirectly affected by Bill S-9, and I came to the conclusion that we should support the bill under study.
The bill is simple, I think. It concerns the removal from the act of the performing rights of record manufacturers or other owners of sound reproduction equipment, as if the record or perforated roll was in itself a musical or artistic work.
Evidence was produced before the Senate committee to the effect that if radio broadcasters, for example, had to pay fees as demanded by the consortium of large record companies, it would cost record producers over $4.5 million a year, of which more than $800,000 would be paid by the CBC alone.
Sound Recording Licences, which groups MCA, RCA, Warner Bros., London, Columbia, Polydor, Capitol and others-all American companies with the exception of two that are German or British-is asking for 2.6 per cent of the gross income of private radio stations, 0.5 per cent from private television stations and 4 cents per capita from the CBC, and that adds up to additional payments of over $4 million.
I must admit that over 75 per cent of that amount would leave the country because those companies are foreign-based and have only branches in Canada and the recordings are only reproductions of the initial recording.
December 21, 1971

It is true that in Great Britain record manufacturers are protected under the Copyright Act but such is not the case in the United States. Should Canada reject the amending measures under discussion, the majority of record companies which are only branches of American companies from which they obtain the original recordings would benefit in Canada of a right which the American government denies them. We are not as rich as the Americans and we should therefore act accordingly.
In his testimony before the Senate committee, the President of the Baton Broadcasting Ltd., of Ontario, Mr. Goodman, has proved that 90 per cent of all 11-inch records sold in Canada are subject to a per unit royalty of 60 cents that is paid over to the parent company which has delivered the licence to its Canadian branch plant.
Another aspect to be considered is that Bill S-9 does not purport to limit in any way the rights of artists, otherwise I would be one of the first to rise against such a restriction because we have in Canada very talented artists who deserve to be encouraged and whom the government should assist financially to enable them to improve their ability to the benefit of Canada as a whole.
We should emphasize, first of all the testimony of the right hon. J. L. Isley as contained in a brief he submitted in 1957 to the Royal Commission of inquiry on copyright and I quote the following from page 77:
The act restricted by the copyright in a sound recording should be the making of a record embodying the recording.
At the present time it would appear that an unauthorized public performance of a recording embodied in a record is an infringement of the copyright in the record. . , . We recommend the abolition of a record manufacturer's performing right and broadcasting right in records or in the recording embodied in the record.
In its Report on Intellectual and Industrial Property the Economic Council stated in January 1971:
It is presently stated in the Copyright Act that a particular sound recording as such has a 50-year protection against direct copying, just as does a photograph. A major point at issue here is the associated performing right in such a recording whereby a record-maker would have, like the writer of the words and music, a legal claim to collect a fee from public users of his product above and beyond the original sale price of the recording.
I still recognize the principle of the right of performance or of representation concerning the original work since that is the only way the author can obtain remuneration for the use of his work on the market.
However, as concerns the recording producer, even if his staff does valuable and truly creative work, his trade is the sale of a purely material thing, that is a record or a magnetic tape, and he must expect his remuneration from that trade. To say that he also deserves a royalty each time his product is used publicly would mean that the publisher of a book is entitled to a supplement each time the book is read.
This is why I support Bill S-9 now before the House. I consider that the artists whose works are broadcast day in and day out over the radio and in all parts of Canada are enjoying a free and extraordinary publicity which deserves to be recognized by the artists themselves, and I do not see why these same artists would oppose the passing of Bill S-9 which, in a way, protects them against those who sometimes exploit them very dishonestly.
Copyright Act
I for one consider that Bill S-9, besides protecting the Canadian radio stations, at the same time provides the Canadian artists with a protection that they did not enjoy before. In fact, they will no longer be exploited by American firms, to the prejudice of the artists and the Canadian people in general.
Mr. Speaker, I wanted to give my support to Bill S-9 in the course of this debate because I deem it fair and useful not only to the artists but also to the Canadian radio stations.


Mark Willson Rose: Mr. Speaker, we are considering an amendment put forward by the hon. member for Notre-Dame-de-Grace (Mr. Allmand). Since it was agreed that we would have one spokesman from each party and limit debate on the bill, perhaps I might be permitted to speak briefly to the amendment and later to the main motion.
I should like first of all to say that I am not particularly impressed with the piracy argument that is asserted in telegrams I have been receiving. It seems to me there was considerable discussion of these matters in the committee and that this question was resolved, certainly to my satisfaction if not to the satisfaction of the hon. member for Notre-Dame-de-Grace. He is a lawyer, and if he took the trouble to read section 4 that is being amended it seems to me very little more protection could be offered recording companies than that already provided.
This afternoon the hon. member suggested that the right of reproduction is protected here, though he had some doubt about the right of dissemination-at least, if I understood him correctly. It seems to me that if you control the right of reproduction you also control the right of dissemination because, after all, it is very difficult to disseminate something that has not been reproduced. I do not usually associate the statements of the minister with competence, though of course we always have competent statements from his parliamentary secretary. I can see no reason why any government in its right mind-and from time to time we do ask that question about this government-would put itself in the position of supporting any measure that would invite piracy in this country of intellectual and artistic properties. That argument just does not wash with me.


Mr. Jamieson:: Have you really anything to worry about?


Mark Willson Rose: I do not know that I have, because I have no intellectual or artistic properties to protect at the moment. But I should like to say that I think this whole thing is a red herring, and although I have a great personal regard for the hon. member I regret that I cannot support his amendment. Perhaps enough has been said about that for the moment.
My views about this legislation are well known to anyone who cares to read the minutes of proceedings of the Standing Committee on Justice and Legal Affairs which considered this bill for five, six sessions or more. Therefore I shall not go into the legal history of Sound Recording Licences' attempt, after over a quarter of a century's silence, to assert some right under the Copyright Act to levy a performance fee on radio stations in addition

December 21, 1971
Copyright Act
to that already paid by radio stations to performing rights societies such as CAPAC and BMI.
As I have said, I shall not go into the history of the matter for those who know the issues involved. Those who do not, probably do not care anyway. However, I must say at the outset that I speak on behalf of my party in direct support of Bill S-9. I regard the move by SRL, a foreign-dominated collection of huge recording companies, as little more than another grab at the public's pocket book. I feel that anyone examining the history of this industry would come to the conclusion that the ethics of this particular group are far from savoury.
SRL has fought a hard fight. It was a battle complete with high-priced legal help and a flurry of telegrams to MPs. Although I hate to say this, I think there has also been a manipulation of performers, and included in this manipulation were the struggling Canadian recording companies. And all this in an effort to support their claim. It seems to me that the local, indigenous recording companies and performers were perhaps forced to accept the benevolence of SRL only because they really had no other alternative. The blame for that, I think, we can lay directly at the door of government-perhaps not this government but historically at Canadian governments. I want to speak about that later.
I think we should examine what is behind this big push by SRL to assert there was some previously existing right under the Copyright Act. Two years ago SRL suddenly decided it wanted to assert this right and to go before the copyright appeal board with their case. Why were the stakes regarded as so high that it warranted such an expensive campaign? I think it is worth thinking about that question. If SRL's performance fee were legitimized in Canada, a foot in the door would be established for making an onslaught on the lucrative and huge market in the United States. It was important to establish that foothold here in line with the pattern of precedence.
Before the committee, SRL claimed that it knew this performance fee was paid in Europe and perhaps in Australia; therefore, logically it should be paid in Canada. If they go to the United States legislators and say this has happened in Europe, in Australia and now in Canada, how can you contradict the logic that it should apply in the United States? Conditions are not at all congruous. There are many state-owned radio stations. As a matter of fact, the situation in Europe does not at all prevail in Canada. I think that is the loophole in their argument.
Nevertheless, the SLR is playing for stakes much larger than their always-amended-downward claims. Of course they want, and need to get, and right now, into the United States market. That is why they are here. That is why they were willing to ask for assistance from various people such as performers and perhaps indigenous record manufacturers. I do not think any of us can buy that argument. The United States Congress, for example, for years has repudiated similar initiatives as those put forward by SRL. That is part of the history.
I think at this point it is important for me to say that while I completely reject the concept of performance rights as a charge on Canadian radio stations by recording companies, radio stations are currently paying fees to
(Mr. Rose.]
certain performing rights societies such as BMI which is owned by United States radio stations, and also CAPAC which is the equivalent of ASCAP in the United States, to the extent of 2.6 per cent of a station's gross revenue. The stations pay that whether they are music stations or top show stations.
I reject the idea of additional performance rights being granted these particular companies, for a variety of reasons. I shall not necessarily reveal these tonight. Certainly we examined a number of these reasons in the committee. I do not believe certain radio stations are paying too much for their principal product. They have music and I do not believe they are paying too much for this. The music they play is their reason for existence in most cases. I do not think their fees to BMI or CAPAC are unnecessarily burdensome. The fees the stations pay to BMI and CAPAC ultimately fall back to the truly creative individuals in the complex chain which ultimately results in the record. The fees paid by the radio stations through CAPAC and BMI go back to the creative people, the publishers and the composers.
A colleague asked me if I would give an illustration of what is BMI and CAPAC. I thought I had said earlier that BMI is a performing rights society owned by American radio stations and that its full name is Broadcast Music Institution. CAPAC is the Canadian Association of Publishers and Composers. In saying these things it should be recognized that the manufacturer of a $6 disc or record, such as Columbia or Capitol, is not rewarded directly by the radio station, but the publisher and composer receive approximately 2 cents each time the record is played. Publishers and composers are not amply rewarded for their creative efforts. I think the main plot of this enterprise, which is described by the council for SLR as a troika, is for the record companies to get more than the people who probably came up with the intellectual property in the first place.
The real "kicker" is that before most songs are released by most major companies represented by SRL, the company insists on obtaining the publishing rights from the composer and thus along with benefiting from the sale of the record for $6 the recording company also gets the publishing rights and therefore receives the one cent from BMI and CAPAC. In addition, I believe it is well recognized that the eight major recording companies represented by SRL are among the most vertically and horizontally integrated companies in the world. They own publishing companies, sheet music companies, broadcasting stations and a network. They control the industry down to the retail level. They can make or break a particular performer. They are interested in areas far removed from the music business. They are exceptionally greedy. They want to grab as much as they can possibly grab from any particular segment of society.
SRL's attempt to defeat Bill S-9 makes me sick. This is the reason, in spite of the fact that I have certain reservations, I shall vote with the government and support, of all people, the Canadian Association of Broadcasters, which also gives me some feelings of discomfort from time to time because while the Canadian Association of Broadcasters was very agile in supporting the government's position as against SRL's performing rights I am quite certain that if certain performing individuals such as
December^!, 1971

actors or singers attempted to establish a performing rights society here in Canada to reward the performers for their particular residual right, there would be almost a revolt or at least a reaction from these same people. CAB is for performers so long as SRL is going to get the action, but I wonder what their reaction would be if the performers approached the radio stations with their own performance group.
I should like to spend a minute or two on my real concern. While I do not, as I have said, support SRL's performance rights, in the words of at least two very famous men I want to make perfectly clear that I do support performing rights as opposed to performance rights. These performance rights have been asserted by various creative people through AFM ACTRA and Actors Equity, who have expressed support for the rejection of Bill S-9. I am also in sympathy with the struggles of our indigenous recording industry. I am not talking about the subsidiaries, but about the idigenous recording industry about which I am sure my hon. friend from Bellechasse (Mr. Lambert) spoke a moment ago.
I would like to see this indigenous industry flourish as a positive cultural force in our country. I think we should do all we can to assist them in developing the Canadian culture. We spend millions of dollars doing this in other areas. The creative people, through the CLC, appeared before the committee and took a position against the passage of Bill S-9 chiefly because SRL was the only group which recognized the residual rights of performers to benefit from any ongoing success of their intellectual properties.
I think it might be well to briefly underline what happens. If you happen to be the composer of a very successful work that is recorded you can receive benefit through CAPAC copyright for up to 50 years perhaps. If you are a fiddle player on an Anne Murray record you play your recording date; according to the contract it might end up as a $90 session, and from there on you are out in the cold. It seems logical to me that if one participates positively in creating a very successful recording as a performer in the backbenches of a musical group, that performer has a right, because of his efforts to be part of the success of that recording, along with the publisher and the composer. So I support performing rights as opposed to performers' rights as applied to recording companies, especially those which are not Canadian owned.
Why were the performing groups such as ACTRA, the Musicians Union and Actors Equity opposed to Bill S-9? They were opposed because they had years of frustration in dealing with the government in an attempt to have their residual rights recognized as a basic right in our copyright law. As a result of their frustration they used SRL as a vehicle to advance and publicize these claims which have been ignored by the government for years. SRL was merely a court of last resort for the performers and creative people. It is regrettable that this is so. It seems to me that Canadian recording companies and Canadian performers are getting into bed with SRL as the elephant, but all they will get out of it is a peanut. So I do not support their claim, and I regret to have to say this.
Copyright Act
The parliamentary secretary, kind, honourable and handsome gentleman that he is, said this afternoon that the Minister of Consumer and Corporate Affairs (Mr. Basford) is sympathetic to the economic aspirations of Canadian performers. What good is sympathy? One thing the government has been able to do for these people for years, perhaps above all else, is to give sympathy. That is hardly enough at this point.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but I must do so to remind him that the time allotted to him has expired. The hon. member may continue if there is unanimous consent. Is there such consent?


Some hon. Members:: Agreed.


Patrick Morgan Mahoney: Say something.


Mark Willson Rose: I thank kind hon. members in all quarters of the House for allowing me perhaps one or two minutes to say something in conclusion. So I will proceed with the climax of this speech-


Some hon. Members:: Hear, hear!


Mark Willson Rose: -as expeditiously as possible, and I promise in gratitude that I will not insist on the performing right. I believe it is recognized by the government that we need a complete overhaul of the Copyright Act. I think we need also-in fact, I am very determined about it-to push for a kind of amendment which would result in establishing in Canada once and for all the residual rights of Canadian performers to participate in the ongoing benefits of an artistic property in which they participated. That is crucial. When the copyright was first developed we dealt mainly with the print medium. That was not really airtight. But technological changes since that time have forced us to take a new look at the whole area of artistic and intellectual properties. I am pleased that the government is looking into this matter and I wish them success.
I have a suggestion to make. Let us boost the total charge on radio stations from 2.6 per cent to about 3 per cent. Let us distribute to CAPAC and BMI a grand total of about 2 per cent of the station's gross, which would ultimately flow to publishers and composers. Let us take the 1 per cent, or as it would work out according to the CRTC one-third Canadian content regulation, and through some kind of Canadian performance society distribute that one-third of the gross to Canadian performers and record companies through some formula. I am not hung-up on the particular figures; it is the proportion and the recognition of the rights that concern me. But why not try to develop such an amended formula? Who can quarrel with it?
I do not think stations would quarrel with it if the total required for performance fees with performance rights associations came down slightly or went up slightly. I do not think they can quarrel basically and philosophically with this suggestion. Certainly the Canadian performers would not quarrel with it. They would probably be very pleased because through SRL they would be making an effort to establish what they consider to be a very basic and crucial right for their own economic and cultural

December 21, 1971
Copyright Act
benefit, and that is why I am supporting this bill. Who in Canada needs SRL anyway?


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


Some hon. Members:: On division.
Motion (Mr. Allmand) negatived.


Allan Joseph MacEachen: that Bill S-9, to amend the Copyright Act, as reported (without amendment) from the Standing Committee on Justice and Legal Affairs, be concurred in.


[Stage Direction]
Motion agreed to.
Allan Joseph MacEachen: that the bill be read the third time and do pass.


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


William Arnold Peters: Mr. Speaker, I am sure that most of us have received representations from radio stations and other broadcasting outlets concerning this bill. I support the remarks that were made by the hon. member for Fraser Valley West (Mr. Rose) this evening and I am pleased that the amendment was turned down.
We have always wanted sufficient funds provided for Canadian performers in order to encourage them to stay in Canada rather than going to the United States for higher wages. We were pleased with the recent decision made by the CBC to retain a particular performer on a salary basis, as a result of which he will remain in Canada and develop his talents here. We have a very favourable record in the development of Canadian talent. One has only to watch American TV shows to see the influence that Canadians have on them. I found it interesting the other night listening to Mr. Olson doing what I did not realize at the beginning was a spoof on the influence of Canadian artists on American culture. He named individuals and stressed the number of Canadians who are participating in American programming. Most of them got their start on Canadian TV but went south of the border because they could earn more money there. It was a very good program.
I believe we have an influence on American cultural affairs far out of proportion to our size. Any effort made to provide greater reward to artists in Canada, to enable them to stay here, is worth while. Therefore, it was with some trepidation that I learned an agency had been formed in Canada to collect certain fees, not to give money to performers participating in the arts here but on behalf of the companies manufacturing records. These companies, under this arrangement, were going to get a rake off every time a record was played on a disc jockey show. Canadian talent is not second rate, but perhaps it suffers from the same fate as that of the prophet who is spurned in his own land. We did not really appreciate Wayne and Shuster half as much when they were doing weekly shows in Canada as we do now when they come to us via an American network with their own special shows.

The CRTC regulation requiring greater use of Canadian talent has been beneficial. I agree with the suggestion of the hon. member for Fraser Valley West that funds be increased for the purpose of providing artists and performers with a major share of the revenue. If we are going to allow radio stations to be charged a fee every time they play a record, and the revenue is to go to the companies which press records, we may well see some radio stations playing old records on which the copyright has run out after expiration of the seven-year limitation. I agree that the government has taken a proper step in this case to correct what many radio stations consider to be an abuse by record companies which are united with other companies in an agency set up for their self-help rather than for the sake of helping performers, artists, directors and others connected with the industry.
An important factor to remember is that disc jockeys play a large role in the merchandising of new Canadian talent. Records are donated to them by the record companies. The royalty that a performer receives depends on the volume of sales of his record beyond a certain figure. If a disc jockey likes a certain record, plays it repeatedly and it becomes a hit and is bought in the record stores, then the artist and the orchestra which provided the background benefit. Any curtailment on the use of such records will make it more difficult for newcomers to get into the field. I am told that about only one out of every thousand records becomes a hit. Most of the records played by disc jockeys do not find ready acceptance. Disc jockeys play a major role in communities which are served by only one local radio station. In such cases disc jockey shows are less expensive than other types of programs initiated by the local station. This is something which the CRTC will have to supervise closely.
Many of the disc jockey shows are loaded, and in the United States there have been pay-offs and kick-backs from record companies to disc jockeys, encouraging them to push particular records. This is something that must be borne in mind by the CRTC, as well as the time devoted to hot-line radio programs. If a controversy develops on a hot-line show, a station is inclined to devote a lot of time to that type of show to the exclusion of other forms of entertainment. This is particularly so in areas which are dependent on one radio outlet. There has to be a balance in these matters.
I appreciate the speed with which the government acted in this instance, Mr. Speaker. They have passed this legislation in advance of the United States and I know it is well received by radio stations and will make their operations easier and less expensive. The other fact has not been faced, however, and it involves the requests made by organizations representing actors, performers, artists and those connected with the production end of the recording industry. If any moneys are to be taken from the radio stations, obviously they should be directed to the performers.
It seems to me that we have an opportunity to encourage more Canadian talent now that the CRTC broadcasting regulations have been changed. We also have an obligation to provide the necessary funds in order to eliminate competition between the United States and
December 21, 1971

Canada so that it is not mandatory that anyone in this country seeking to rise above the current salary range look to the American market. Our market can be developed and more money provided to radio stations through the industry. I strongly urge the government to give the same speedy consideration to that aspect of the matter as was given to the protection of the radio stations who in my opinion were being victimized by an agency which found that the loopholes in the copyright legislation were almost a form of money.


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


Some hon. Members:: Question.


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


Some hon. Members:: On division.
Motion agreed to and bill read the third time and passed.



CUSTOMS TARIFF

Allan Joseph MacEachen: that Bill C-261, to amend the Customs Tariff, be read the second time and referred to a committee of the whole.


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


William Arnold Peters: Mr. Speaker, before this bill goes to the committee I would ask if a brief explanation is available. An explanation may have been given in the budget debate but I am not aware of it at the moment.


Patrick Morgan Mahoney: Mr. Speaker, Bill C-261 provides for the implementation, without change, of the ways and means motion relating to the Customs Tariff which was tabled in the House on June 18. The clauses of the bill correspond to and are in the same order as the paragraphs of the ways and means motion.
In his budget speech, the Minister of Finance (Mr. Benson) made mention of the more significant tariff changes which appear in the bill. These included the implementation of two Tariff Board reports without change. One proposed a reduced rate on raw materials used in the petrochemical industry, item 26910-1; the second recommended bringing the duties on polyethylene into line with the rates which apply on most other plastics made in Canada, items 93902-3, 93902-42 and 93902-82. He also referred to a new provision, item 41100-1, which would accord machinery used in sawmills and logging the same tariff relief as is now given to production machinery under the machinery program. Another change of general interest was removal of the duty on heavy fuel oils.
At this time I intend to comment only very briefly on the four clauses of the bill before the House. If hon. members so wish, I will be pleased to provide more detailed com-
Ways and Means
ments on individual tariff items of interest to them when we are going through the bill in committee of the whole.
The Customs Tariff contains three schedules. Schedule A to the Customs Tariff enumerates the goods subject to duty and those which enter free of duty. Schedule B provides for drawback of duty on certain products, while schedule C lists the goods which are prohibited importation.
Clause 1 of the bill amends schedule A to the Customs Tariff by deleting a number of existing tariff items and by inserting the tariff items which appear in schedule A to the bill. These changes are largely of a relieving or of a technical nature. They provide mainly for reduced rates of duty on production equipment and materials. They meet representations from associations and individuals.
Clause 2 of the bill deletes several items from schedule B to the Customs Tariff and provides for the insertion of the two items which appear on page 8 of the bill. Clause 3 provides for an amendment to an existing item in the prohibited schedule to the Customs Tariff. The amended wording is shown in schedule C to the bill. Finally, clause 4 is the usual provision for the tariff changes set out in the bill to come into force on a provisional basis on the day following the budget, subject to approval by Parliament.


William Arnold Peters: Mr. Speaker, may I ask the parliamentary secretary a question? What is meant by the expression "provides for drawback"? Is this an item which receives a rebate of excise moneys paid in the area of purchase and, if so, for how long a period does it apply?


Patrick Morgan Mahoney: A drawback is a refund that one is entitled to claim when goods have been imported under certain circumstances. The duty is paid in the original instance but if the party proves the necessary circumstances he is entitled to a refund.


William Arnold Peters: For a year?


Patrick Morgan Mahoney: I shall have to look at the bill, Mr. Speaker. I cannot say what time limit, if any, is imposed on the period for making application.


Marcel Joseph Aimé Lambert: Mr. Speaker, in appropriate circumstances I think we might have some fun tonight. If I were endowed with the skills of the hon. member for Halifax-East Hants (Mr. McCleave) and could write doggerel poetry, we could have a lot of fun looking through the various provisions that come up tonight for consideration in the Customs Tariff. The parliamentary secretary has read to us one of the most catholic, stereotyped statements ever to come out of the Department of Finance with regard to the customs section. I say "catholic" but I apologize and retract the term and say the most stereotyped statement.
Let us look at the various provisions. Some of them are worthy of note because they indicate an honest endeavour on the part of the government to do something, albeit belatedly, with regard to the petrochemical industry which has been in trouble for a long time. I recall my remarks in the budget debate of June in regard to the changes being made in the duties on petrochemical feedstock and other related provisions, and I still think that the government has given this industry a terrible knock

December^!, 1971
Ways and Means
on the head. This may be in expiation to some degree, but the proof of the pudding will be in the eating.
In his reply to these remarks I look to the parliamentary secretary to state what the reaction of the petrochemical industry had been to these changes, as it is now six months and three days since the tariffs were lowered. After all, they were effective on the night of June 18.
I return to my original theme. I am very sorry that my colleague from Halifax-East Hants is not here to assist me, because I think these changes would give his skills in doggerel verse unlimited scope. As I look at the first item I wonder, even though I know the government is able to escape payment of customs duties on its own purchases, whether the Minister of Finance (Mr. Benson) is not trying to show industry and commerce how to decorate offices in the new style. The committee on miscellaneous estimates had something to say about the expenditure of $75,000 for imported tropical plants which were to be used in the new offices of the Minister of Finance. That minister is not bothered by any customs regulations, because the government of Canada can import any type of commodity free of customs duty. When we look at the first item under schedule A, item No 7801-1, what do we see? The item reads:
Palms, ferns, rubber plants (Ficus), cannas, dahlias, paeonias, rhododendrons including azaleas-


Mr. Barnett:: In British Columbia we put the accent on the first part of the word, not on the last.


Marcel Joseph Aimé Lambert: I have never been sure how to pronounce that word correctly. I have always it pronounced it "azalea", with the German pronunciation.


An hon. Member:: That is not how it is pronounced in British Columbia.


Marcel Joseph Aimé Lambert: All right, that is not how
it is pronounced in British Columbia. But in the country that grows these plants in great profusion, Belgium, the word is pronounced as I pronounced it. I have cousins living in a suburb of Antwerp, on Azalea Strasse. I shall stick to my ancestral pronunciation.


An hon. Member:: In British Columbia we call them azaleas.


Marcel Joseph Aimé Lambert: The hon. member calls them azaleas his way. That is fine. But why is the change respecting azaleas in there? Is the plant included because it has become a favourite of the Minister of Finance and is to be used for purposes of office decoration? If so, he should be emulated across the country. I have dealt with the first item. The second item will bring me benefits. I have a reputation among my colleagues as being somewhat of a gardener, and I like it.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: So for greater clarity may I say that gladiolus bulbs may be imported into the country as corms, duty free. I will take advantage of this item because I love gladiolus and I am grateful for this change. Then we come to item 7804-1, which has been

changed. It covers hydrangeas and other pot-grown plants.


Leslie Gordon Benjamin: Male or female?


Marcel Joseph Aimé Lambert: Are we to go into a pot growing campaign for the growing of pot? I don't know. Mr. Speaker, listen to what it says at the end of that item:
All the foregoing imported or purchased in bond in Canada by florists or nurserymen for bona fide forcing-
What interest has the government in bona fide forcing? I know the government tries to force things through the House, but that is not bona fide forcing. What is bona fide forcing with regard to hydrangeas and other pot-grown plants? Those are some of the things we are concerned about in these changes in Bill C-261.
Then I turn to item 7915-1, which covers flowers and foliage, natural, cut, whether or not in designs or bouquets and-listen to this-"whether or not coloured by osmosis, not otherwise provided for." There is a tariff change in regard to that item.


Leslie Gordon Benjamin: And it must be put through before Christmas.


Marcel Joseph Aimé Lambert: The next item I shall deal with is 19947-1. I invite hon. members who know the English language to tell me what "macerated paper pads" are. What does "macerated" mean? I do not know. Whatever it means, macerated paper pads must be terribly important because they are "for use exclusively in the packaging of fresh fruit". They are to be admitted to Canada duty free.
The next item I refer to is 23800-1, rice hulls. I do not know about this. I suppose, since this is such a "hull" of a government, this item appeals to them. In any event, they are to be admitted free of duty. Next I come to something serious. The queries I put to the parliamentary secretary originally were serious. I am referring to the reduction from three-quarters of one cent per gallon to one-third of a cent per gallon. Why the government has to hang on to that one-third of one cent, I do not know. Does it want to help the petrochemical industry?
I see sitting across from me the Minister of Labour (Mr. Mackasey) who represents the constituency of Verdun. I am interested in that constituency because I have acquired a daughter-in-law who is in the minister's constituency.


Leslie Gordon Benjamin: A daughter-in-law won or lost?


Marcel Joseph Aimé Lambert: Round, and that caused grave problems within the industry. Then about 18 months ago Canada decided to float its dollar. This immediately caused an 8 per cent increase in the export price of petrochemicals and chemical derivatives from Canada. These commodities are sold in highly competitive world markets.
I see the Minister of Labour before me. Behind him sits the Minister of Manpower and Immigration (Mr. Lang) and the Minister of State responsible for information in Toronto.


Mr. Stanbury:: He is not here.


Marcel Joseph Aimé Lambert: My city of Edmonton is much concerned about the petrochemical industry; and may I say here that the Liberal member for one constituency in Edmonton in which is situated about 90 per cent of the petrochemical industry of the area has failed to appear in this House since September 6. This is the degree of interest the hon. member shows in the Parliament of Canada and representations made on behalf of his constituents.


Richard J. Stanbury: He is looking after his constituents.


Marcel Joseph Aimé Lambert: He is, like blazes, looking after his constituents. All I say is that this is a measure-


An hon. Member:: How do you know he hasn't been sick?


Marcel Joseph Aimé Lambert: Sick? He is sick in his mind if, as a member of this House, he does not appear here. He looks after his personal business. He says that he refunds part of his salary. He was never elected a Member of Parliament to refund his salary to the treasury in whatever measure he does.


Mr. Mackasey:: Be charitable. After all, it is the Christmas season.


Marcel Joseph Aimé Lambert: I feel as charitable this evening as this bill does in so far as the petrochemical industry is concerned. It gives minute quantities, less than crumbs, to an industry that has had to lay off hundreds of highly skilled people. At least 80 per cent of this industry's production goes to the export markets. The government has draped this industry over a sawhorse and has proceeded to belabour, knock and expose it to the forces and the whims of world markets and world conditions as a sacrificial lamb.
I appeal to the Minister of Manpower and Immigration. One of the particular skills Which we developed in our western universities was gained by people who today are walking the streets. The minister can shrug his shoulders. Many of my contemporaries at universities of western Canada, including my own University of Alberta, in Edmonton, and many younger than I went into the petrochemical industry as chemical engineers. Others, as we expected, obtained lucrative jobs. Today they are seeking employment. Why? Because this government, in a terribly misguided policy with regard to that industry, which was one of the aces we had up our sleeve, one of the bright hopes for Canada to compete in the world market, cut if
Ways and Means
off not only at the ankles but at the knees. They have now given it the knife at the throat.
This is the answer, a paltry cutback of petrochemical feedstocks that are imported into this country. As far as the Alberta petrochemical industry is concerned, this is meaningless because we do not import any feedstock. It is domestically produced. For the petrochemical feedstock producers in this country, this does not mean a thing. I would like the Minister of Labour to speak to his colleagues-


Leslie Gordon Benjamin: Not tonight.


Marcel Joseph Aimé Lambert: No, not here. I would like them to "get with it" on this tragic situation that faces the petrochemical industry in this country. It does not necessarily employ hundreds of thousands or twenties of thousands of people. However, this industry represents thousands of highly skilled people, including their sales organizations. This government's answer to the competitive situation facing this industry from world forces is to further create difficulties. All I can say is that items 26906-1 and 26910-1, particularly the latter which only goes for a limited period, are frankly of little assistance compared to the problems they are facing.
I now turn to item 41098. This item has its origin in spraying and dusting machines and attachments therefor. It moves over to pruning hooks, pruning shears and dehorning instruments. That is a long way from spraying and dusting machines. Now we are going to admit duty free, electric bird-scaring devices but not including recorders. They have to be bona fide. They do not include recorders or reproducers using magnetic tape as a recording medium.


Bryce Stuart Mackasey: We do not want any stuffed bird-scarers.


Marcel Joseph Aimé Lambert: What is an electric birdscaring device that does not use a tape? You may have some sort of a raucous artificial noise, but you cannot have a bird call or bird-scaring device on a tape.


Gerald William Baldwin: Why bother with a device? Just get the Minister of Finance (Mr. Benson). He will scare away any bird.


Marcel Joseph Aimé Lambert: I wonder how the Minister of National Revenue (Mr. Gray) will interpret this. Some of his colleagues in the cabinet might be substituted for some of these things. Remember this, they are to be used exclusively for scaring birds by producing sounds simulating their natural alarm cries. In this period of an election we can expect all sorts of sounds to come from cabinet ministers. They will not only scare birds; they will scare small children and maiden ladies. Of all things, electric bird-scaring devices are to be admitted duty free into this country.


Bryce Stuart Mackasey: You should all have one.


Leslie Gordon Benjamin: And this has to be done before Christmas.


Marcel Joseph Aimé Lambert: Yes, this has to be done before Christmas. I ask the little clutter of three ministers opposite who in Hades made these representations.

December 21, 1971
Ways and Means


Bryce Stuart Mackasey: The birdwatchers.


Marcel Joseph Aimé Lambert: Under no circumstances would it have been the birdwatchers, because this would scare the birds.


Bryce Stuart Mackasey: Yes, away from the airports.


Patrick Morgan Mahoney: Mr. Speaker, since the hon. member has specifically asked, this particular item was requested by the Canadian Federation of Agriculture. I am sure they will be interested in his remarks.


Marcel Joseph Aimé Lambert: That is fine. But the fact that the Canadian Federation of Agriculture requested it and the parliamentary secretary sententiously informed us of this particular point, I am wondering what on earth is its purpose. After all, if we wanted bird-scaring devices we would just trot out some of the cabinet ministers and parliamentary secretaries. They would even scare the crows from barbed wire fences.
There is one further item which affects the logging industry in British Columbia. The Machinery Advisory Board is now to be given power to advise the cabinet to remit duty on certain types of machinery used for the sawing of lumber and other operations in the logging industry. This is just to allow a little flexibility in particular cases. I would remind hon. members that at the time the Machinery Advisory Board was set up I drew attention to some of the difficulties which could arise through giving the board power to counsel the Minister of Industry, Trade and Commerce to cause an Order in Council to be passed exempting a particular type of machine from duty. This lends itself to a particular type of representation.
I have had experience in the administration of customs duties. I was very privileged to work under a minister who sought to repel every type of personal pressure. He always said this was an area in which the sausage-slicing machine would operate. It would operate first on one slice of the sausage, then on the next and then on the next. If a minister were to allow relaxation in one particular area he could not easily resist further pressures from friends of the government. The taxpayers of this country are extremely adept at smelling out friends of the government. These people appear regularly with their advocates.


Leslie Gordon Benjamin: Wait till we get our turn.


Marcel Joseph Aimé Lambert: Yes, you will have your friends and you will act in the same way. That is why I find your stand on these occasions is even more than hypocritical. It is sanctimonious. I say it is even more than sanctimonious. In any event, I have not heard hon. members of that party from logging constituencies speak on this item. They know what will happen. This will provide some help. It will help an industry which has been hard hit by the government's tax bill. It is going to get crumbs in return.
Then, again, will the parliamentary secretary tell me how many more times we shall be faced with item 440431? This item appeared on the list when I was a freshman member of this House and in every budget since then,

without fail, it has appeared as an extension. It has to do with certain types of aircraft which are prescribed by weight. The item does not include the engine. Mr. Speaker, no Minister of Finance, and I knew some very well, could ever give me a strict definition to cover this item or satisfactorily explain its appearance year after year.
If the government intends to help those producing small aircraft in this country, why do it on a year to year basis? Why not simply say it intends to protect producers of this type of aircraft, including or not including engines, depending on what the policy might be? This would apply to aircraft not exceeding a certain number of pounds, whatever the weight might be, and then they could leave us alone instead of asking us to approve this extension every blessed budget.
Then we come to item 44210-1:
Rotors, blade diaphragms, spindle discs, shafts and blades, wholly or in chief part of metal, of a class or kind not made in Canada, when imported for use by turbine manufacturers in the repair or remanufacture of gas or steam turbines and parts thereof entitled to entry under tariff item 42805-1.
We want an explanation of this item. The definition is a long one and there is no doubt a particular purpose in mind. Does this relate to a particular type of contract for aircraft repair? Does it relate to any defence sharing production agreement? I shall pass over the item which admits duty free the professional productions of artists when valued at not less than $75 each. Every genuine artist would be insulted if his productions were not valued at $75. Then there is reference to original paintings, seri-graphs and photographic or photo-mechanical representations, and so on, and an extension of free entry to hand-made appliques suitable only for use as wall hangings. Are these intended for the office of the Minister of Finance or for some other minister's office? They have to be produced by artists domiciled in Canada but residing temporarily abroad. What is the real reason for which we are asked to make this particular change?
There are two other items to which I should like to draw attention. In this modern day and age, in this modern culture, we shall now be able to import glass beads free of duty if they are hand-made articles. Does the "now generation" have to get special dispensation in order that the bead bands worn across their foreheads are brought in duty free?
The next item is 71115, which is pots or compressed pellets, but not of hash; these are made of peat.


John Gilbert: Canadians, for the use of.


Marcel Joseph Aimé Lambert: As a gardener I will benefit from those. These are for use exclusively in growing plants for transplanting purposes, or for protecting plants while growing. We shall have to pay 10 per cent duty on those. The last item I want to mention requires an interpretation. It is item 99208. I apologize to the House for making a little fun of the bill this evening, but this item under schedule C, to which reference is made in clause 3, relates to metallic trading checks in circular form-in other words, trading discs-"unless in any particular case or class of cases exempted from the provisions of this item by a regulation of the Governor in
December 21L 1971

Council". What on earth are we up to here? These metallic trading checks come under certain customs regulations and I suppose I could find them in the Customs Tariff.


Bryce Stuart Mackasey: I have one in my hand. It is round and metallic.


Marcel Joseph Aimé Lambert: Incidentally, I see these round, metallic trading discs are prohibited goods; they cannot be imported. The Minister of Labour should put his away, if he has one, because they are prohibited. However, under this amendment the minister, as a member of Her Majesty's Privy Council, is asking us to deliberate on an Order in Council exempting them from this prohibition so they may be allowed in-perhaps in order to legitimize his possession of one. The Minister of Finance is now in the House and perhaps he would advise us why he is introducing this exception, and on the basis of the representations of whom? These metallic trading discs have been prohibited for some time, so why are they being allowed in now under an Order in Council?
My hon. friend from Halifax-East Hants, with his ability to write doggerel poetry, would have been in a far better position to give hon. members an entertaining dissertation this evening. I have gone through a list that I think frankly defies anybody's imagination. Outside of it being a sop to the petrochemical industry-and here the Minister of Finance has a good deal to answer for-and also offering some assistance of a questionable nature to the lumbering industry particularly of British Columbia, the rest of the bill simply adds bits and pieces of no consequence, yet we are being asked to pass it. We require an explanation, Mr. Speaker, either from the Minister of Finance or his parliamentary secretary.


Max Saltsman: Mr. Speaker, I do not have too much time this evening and perhaps I can do little more than congratulate my hon. friend from Edmonton West (Mr. Lambert) for his most interesting examination of the bill. When I first looked at it I thought it was a serious matter, but I have been dissuaded from that view having listened to his remarks. I always suspected that beneath that stern exterior dwelt a western Pagliacci, and we saw a great demonstration of that tonight.
I also thought that perhaps the censor who looked over this bill was like the censor looking at questionable pictures and literature as he carefully rolled over some of the salacious portions of the bill. It seems to me there are some ridiculous aspects to the bill, but I also think there are some serious matters in it and if I may call it ten o'clock I should like to discuss them on another occasion.



BUSINESS OF THE HOUSE

Gerald William Baldwin: Mr. Speaker, may I ask the government House leader whether we will be pursuing this business tomorrow, and whether the Minister of Finance has any more budget bills to be dealt with tomorrow.


Allan Joseph MacEachen: Mr. Speaker, we will continue this most interesting debate tomorrow. Following that we will consider the budget bill emanating from the October so-
Proceedings on Adjournment Motion
called budget statement. Following that we will consider Bill C-176.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Douglas Charles Rowland: Mr. Speaker, on December 15 I asked the Minister of Fisheries (Mr. Davis) whether he could shed any light on the rumours that the Selkirk processing plant of the Freshwater Fish Marketing Corporation would be closed. He replied, as reported at page 10491 of Hansard, as follows:
Mr. Speaker, the 70-year old fish plant at Selkirk does not meet our standards for inspection. It is being phased out. However, we are hoping to develop new supplies of fish and to have a plant operating at Selkirk in the not too distant future.
I do not mind admitting that I am having a considerable amount of difficulty maintaining any degree of good temper and reasonableness in pursuing this question this evening. The first problem I had to deal with after my election to this House in the spring of 1970 was the location of the Freshwater Fish Marketing Corporation's processing plant, whether it would remain in Selkirk or be located in a suburb of Winnipeg. During the months of May and June, 1970, the Minister of Fisheries and myself engaged in a number of exchanges on the subject in this House.
The question was, I then thought, finally resolved, in a manner not wholly unsatisfactory to myself and the people of the Interlake region but nevertheless in a way we could live with, when the minister on June 25, 1971, made the following statements during his reply to representations that I had made in an adjournment debate. The minister said at that time:
My own forecast now is that we will have at least two big processing plants in Manitoba. In other words, we will have one at Transcona and continue to have one at Selkirk.
Then he said:
We believe the plant now operating at Selkirk will be operating at or near capacity for a number of years to come.
Later he said:
My own forecast is that there will be two plants, an old one and a new one. The old one at Selkirk needs to be rehabilitated and this will take place beginning next year. I also expect employment in Selkirk will probably increase and not decrease in so far as fish processing is concerned.
Imagine, after having heard that kind of statement from the minister on the subject, my reaction, the reaction of the employees of the Freshwater Fish Processing Plant and the reaction of the people of the Interlake when it was announced by the FFMC last week that the Selkirk plant would cease to process fish within the month and close its doors entirely in five months, taking away from Selkirk in
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the neighbourhood of 150 jobs. It was a reaction of shocked disbelief, succeeded by rage. After the assurances the minister had given us we felt, and justifiably in my opinion, that we had been betrayed.
Just a little more than a year after the minister had assured us that there would be two plants in Manitoba, one in Transcona and one in Selkirk, that the Selkirk plant would be refurbished and that employment in fish processing in Selkirk was more likely to increase than to decrease, it was announced that the plant would be closed. What circumstances have changed in the interim to make the FFMC and the minister change their minds? Local production of fish has not declined. Rather, it has gone up because when the minister made his statement, Lake Winnipeg was completely closed to fishing because of mercury pollution whereas now it is again being fished on a controlled basis. Moreover, at the time the minister made his statement, stocks of fish in Lake Winnipeg had been depleted due to overfishing, whereas now the stocks have had two years to begin a recovery.
When the minister made his statement in June, 1970, the prospect of a lucrative rough fish fishery was just a gleam in his eye, whereas only recently in this House he assured me, when replying to some remarks I had made about the need for an income support program for fishermen, that the investigations of his department into a rough fish fishery were progressing extremely well and held out the prospect of substantial employment in the future.
After looking at these facts one is hard-pressed not to believe that the minister's statement of June, 1970, was not simply designed to slap the lid on some extremely effective pressure being applied by residents of Selkirk and the Interlake. I am not about to suggest that the minister was a knowing party to deception, but I do know that if I was the minister and someone had given me information with which to reply to a parliamentary inquiry, and the reply I gave was afterwards demonstrated to be false, today I would be engaged in some head-hunting.
With that as background I wish to ask three very simple and direct questions to which the employees of the Selkirk processing plant, the citizens of Selkirk and the residents of Manitoba's Interlake are demanding answers. I hope the parliamentary secretary who will reply on behalf of the minister this evening will have the answers ready because they are obvious questions to ask. First, is it the intention of the minister to make the FFMC live up to the undertaking which he gave to me and to this House on June 25, 1970? Second, if he is not prepared to do that, why is he not prepared to do it? Third, if the best the people of Selkirk can now hope for is the new plant alluded to by the minister in his answer to my question on December 15, when will the construction of that plant begin, what will be its function, what will it cost and how many people will it employ?


Eymard G. Corbin: Mr. Speaker, the Minister of Fisheries has repeatedly stated his position regarding the Selkirk plant. He has, in the past, indicated to the House that his forecast was that the Selkirk plant could remain in operation after completion of the Transcona plant. How-

ever, the minister has never made a commitment to the effect that the Selkirk plant would never be closed down.
The operation of a fish processing plant in Selkirk remains possible. It hinges mainly on the development of a coarse fish industry, that is certain species which up to now had not been considered as being marketable.
During the summer of 1971, the federal fisheries service spent $413,000 on a research program directed toward improving the harvesting techniques used for coarse fish and, in the long run, the management of the production potential of Manitoba waters. This program, I might add, has employed 127 fishermen who would otherwise have remained idle. According to the data obtained, the potential of coarse fish seems promising. There remains a good number of problems to overcome particularly in relation to marketing. Research related to harvesting and processing will continue and the marketing aspect will be looked at with care. If all goes well a new plant in Selkirk could become economically feasible.
For now the Selkirk plant must close. With new inspection standards imposed on our American clients by their government, rehabilitation is not economically possible. We must accept that, after some 70 years of existence, that plant has become a victim of obsolescence. The new plant is Transcona takes over. Because the two plants are a mere 30 minutes away from each other by car, all employees of Selkirk have been offered jobs in Transcona. A good number of them have accepted this offer. They have received adequate training in the use of new techniques implemented in Transcona. The training program was carried out at no loss of income for the employees.
In short, Mr. Speaker, the government to date has improved fish processing, worked to put on a sounder base the management of Manitoba's fish resources, researched the possibility of creating a new industry with coarse fish, and protected the jobs of the Selkirk employees as much as possible. The establishment of a new plant in Selkirk will depend on the results of studies relating to the coarse fish industry. These studies are already under way and partly completed.



YOUTH-OPPORTUNITIES FOR YOUTH PROGRAM-WRITING OF EVALUATION REPORT BY PRIVATE CONSULTING FIRM-SELECTION OF PROJECT FOR ANALYSIS

Lorne Edmund Nystrom: Mr. Speaker, on December 9 I asked the Secretary of State (Mr. Pelletier) two questions regarding the evaluation report relating to the Opportunities for Youth program. The first question was:
In view of the fact that the evaluation report on the Opportunities for Youth program recently tabled in the House was carried out by a departmental task force, would the minister inform the House why the report itself was written by a private consulting firm?
Then I asked the minister the following supplementary question:
Would the Secretary of State inform the House how the sample of 356 projects analysed in the report was selected by his departmental task force?
December 21, 1971

I considered the reply that I received at that time from the minister to be inadequate partly because the report itself was long overdue. If you go through Hansard you will find the minister promised that the report would be ready by the beginning or the middle of October. On September 9, for example, he said in answer to a question in the House that in all likelihood the report would be ready at the beginning or the middle of October. On September 30, in answer to a question that I put to him, he said:
I estimated the assessment report on the project would be ready by mid-October, and I do not think there will be any considerable delay.
On November 22, when the report still had not been received, he said in answer to a question:
As for the report, I apologize to the House for the delay in tabling it, but this is a matter of data processing and the task force responsible for producing the report is working very hard at this . . . sand was hoping to be able to table this report as soon as possible.
We have had the report since the first part of December and in it we find that the conclusion is a glowing analysis of what happened to the Opportunities for Youth program and that things had gone very well indeed. Another reason I am not satisfied with the answer given by the minister, besides the fact that the report was long overdue, is that I question the validity of the report itself due to the fact that the analysis and evaluation are based on only a sample of all the projects in the country. And the minister said he did not know what kind of sample it was. We do not find anywhere in the report an indication of what sort of sample the evaluation is based upon. We have to know this if we are to know what type of credence to give to this evaluation of the Opportunities for Youth program.
We know that some months ago the department established a task force to evaluate Opportunities for Youth projects across the country, and after a period of several months of work it was decided that its report should be written by an outside consultant group called Systems Research Group Inc. They wrote the report on the basis of the data gathered by the task force established by the Department of the Secretary of State.
I want to know why the government decided to hire this firm after all the research had been done by the department itself. Was it because the task force members could not agree on the conclusions they were receiving from their research? Was this the reason that they called in an outside consultant firm to write the evaluation report itself? I think the long delay in presenting the report to the House lends credence to this possibility, because the report itself could have been written in two or three days once all the data had been gathered. It is only about 25 pages long. I think that an outside group writing a report for a government department should also do all the research and data processing. These are some of the reasons some of us are concerned that an outside group was called in to write the report.
Second, Mr. Speaker, I want to know how the sample of projects was chosen. Nowhere in the report does it say how the 300-odd projects were chosen, whether they con-
Proceedings on Adjournment Motion
stituted a representative sample, a random sample or what have you. The last sentence in the report reads:
In terms of the programs explicit objectives and within its budgetary constraints, OFY appears to have been very successful in the light of information now available.
What do they mean by "in the light of the information now available"? What information? This is what we must know if we are to judge this report on its merits. I think that any firm which had regard for its reputation would include a phrase like "on the basis of the information now available." I ask again, what kind of sample was it? Was it a representative sample, or was it not? You could make a report sound any way you wanted it to, if you carefully selected 300-odd projects out of the entire summer's program. Next year's program, it is hoped, will be announced by January 15, and before the end of this month we are to have a more thorough evaluation report on last year's program.
Many of the ideas in the Opportunities for Youth program are exciting. I hope that before next year's program is introduced we can clear up a few of the questions that I have tried to raise tonight, so that we will have a clear evaluation of last year's program. What type of sample formed the basis of the evaluation? Why was an outside firm brought in to write the report after the data had been gathered by a task force working within the department?


Mr. J. A. Jerome (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, I will make my answer very brief. The hon. member has put two questions before the House. In both instances he requested that they be given special consideration during the adjournment debate. The one he has dealt with this evening concerns the reason why an outside group of consultants was chosen to compile the results of the evaluation study of the Opportunities for Youth program, and he also inquired about how the sample was chosen.
His other question, while on the same subject, was directed to the President of the Privy Council (Mr. MacEachen) and had to do with whether or not a special committee or a standing committee on youth and youth problems would be established and, if such a committee would not be established, whether the question of youth and youth employment would be referred to one of the standing committees.
Both questions touch on the general matter of the problems of youth, the special problems of the young people of this country and what the government is doing about them. These bear directly on the functions of the Secretary of State (Mr. Pelletier), who is responsible for the Opportunities for Youth program. The questions the hon. member has asked are legitimate ones, but at the same time, bearing in mind the length of time and the terms of reference of last year's program, we all know now that some of the difficulties we experienced last year in the Opportunities for Youth program arose as a result of the rather foreshortened time period in which the program was put together.
The hon. member has made reference to the fact that the program for next summer is being prepared now. We think this is an improvement as it will give us an opportunity to get ready in plenty of time, and will also give members of this chamber a full opportunity to ask their
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questions now rather than being caught as we were last year with the program being rushed into effect before members of the opposition had an opportunity to examine it.
I want to assure the hon. member and others here that through the regular parliamentary devices in committee, the estimates of the Secretary of State as they go to the standing committee when we return after the Christmas break in the ordinary course, in regard to any legislation that would have to be tabled and any other opportunities that hon. members have to put questions to the Secretary of State through oral questions, written questions on the order paper or perhaps through the use of allotted days if
the opposition sees fit, we hope hon. members will be reassured.
There will be many opportunities to question the Secretary of State about all these things and the plans that are going to be put into effect for next year's program so we can be sure to have a clearer understanding of it in view of our experience last year. The use of an outside group was hardly necessary and perhaps next year when the evaluation is done, and now that we have gained the experience, we will not need such a group. I conclude by saying that I hope the hon. member will take advantage of all these opportunities to ask questions about this matter as we develop next year's program.
Motion agreed to and the House adjourned at 10.21 p.m.

Wednesday. December 22. 1971