1971-03-04

ORAL QUESTION PERIOD


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. In light of the minister's answer yesterday to the question put by the hon. member for South Western Nova, has the government now received a formal response from the United States government to the request for formal consultations on the TAPS route and, if not, can the minister reveal any concrete information to allay fears that the decision has already been made without consultation?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, I can certainly answer the second part of the question. Obviously no decision has been made since the hearings of the committee that has been established to examine into the ecology and the economics of this pipeline; the matter is still under way.


Gordon Harvey Aiken: I have a supplementary question, Mr. Speaker, arising out of statements made on a two-hour television program last night by the Minister of Energy, Mines and Resources and the Minister of Indian Affairs and Northern Development indicating that they are taking a rather casual attitude to the transportation of northern oil. Can we expect a statement soon on government policy regarding the transportation of oil from the northern parts of Canada?


Mitchell William Sharp: Mr. Speaker, a number of answers were given yesterday to these questions and there is really very little I can add to what was said on that occasion. I believe it is most important that a decision about the building of the trans-Alaska pipeline system be made in light of the great risks and dangers that exist to the Pacific coast. This is a matter of supreme importance not only to the people of Canada but to the people of the United States. From our point of view, a decision adverse to the building of that pipeline would leave us in the position of looking at the problems of alternative routes free of any prejudice.


Gordon Harvey Aiken: Can the minister give any indication as to when the government intends to make a decision on its stand in connection with the transportation of oil?


Mitchell William Sharp: Mr. Speaker, what we are talking about now is the transportation of Alaska oil. The United States has the problem of finding some safe and economic way of transporting this oil from the state of Alaska to other states of the union. The question as to which is the better route is, first of all, one to be considered in the United States. I have expressed the view of the Canadian government that it would be very risky to transport that oil down the Pacific coast to Bellingham. I have urged the people of Canada and the United States to express their views quite clearly on that question so that a decision can be made with a clear understanding of the great risks that are involved. That is the question at the moment. The question of whether United States companies want to apply to transport their oil through Canada is a separate question. They have not yet applied.



POSSIBLE MACKENZIE VALLEY PIPELINE-HOUSE DEBATE BEFORE FINAL DECISION

Mr. David Orlikow (Winnipeg Norlh):: Mr. Speaker, I should like to ask the Acting Prime Minister this question. If serious discussions about the movement of oil or gas through Canada down the Mackenzie Valley are undertaken, will the government give the assurance that before any final decision is made there will be adequate time set aside for discussion of the whole question in the House in view of the very great possibility of serious damage to the ecology of Canada as a result of such a decision?


Mitchell William Sharp: There are a great many preliminaries that would have to be satisfied before any such decision could be made. There would have to be an application to the National Energy Board for permission. At such a hearing there would be a complete examination before the board in public of all the considerations involved. At that time Members of Parliament could express their views on this matter. There could be debates in the House of Commons at that time. So far this is a hypothetical question because no application has yet been made.


David Orlikow: Will the minister look into the question of whether the National Energy Board has the technical staff required to make an in-depth study of the possible dangers to the ecology of Canada if such an application were approved?



ENERGY POLICY AND ECOLOGICAL PROBLEMS OF OIL TRANSPORTATION

Mr. Louis-Roland Comeau (Soulh Western Nova):: have a supplementary question, Mr. Speaker, for the Acting Prime Minister. In the government's present

March 4, 1971
Inquiries of the Ministry
efforts to formulate an over-all energy policy for Canada, is it considering the ecological problems of transporting energy such as oil, and will a policy statement be made along these lines?


Mitchell William Sharp: Mr. Speaker, it is my understanding that the Minister of Energy, Mines and Resources is now in the process of developing an energy policy for presentation to the government which eventually will be the subject of a public release. I am not certain in what form that will be made-perhaps a white paper or in the form of statement of another kind. Certainly the government is working on the problem now.


Mr. Speaker:: The Chair will recognize one additional supplementary question by the hon. member for Athabasca and I suggest we might then go to the next subject.



POSSIBLE MACKENZIE VALLEY PIPELINE-DISCUSSIONS WITH NATIVES

Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, my supplementary question is directed to the Acting Prime Minister or the Minister of Indian Affairs and Northern Development, whichever wants to answer. Have sufficient consultations been held with the native people of the Mackenzie Valley, since this is the route the government is favouring, and has any agreement been obtained from the local residents that this is in fact the best route?


Mitchell William Sharp: Mr. Speaker, I expect the minister will be here tomorrow and I will see that this question is brought to his attention. Perhaps he will give an answer at that time.



FINANCE


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, may I direct a question to the Minister of Finance arising out of press reports from Washington. Has the Canadian government made representations to the government of the United States requesting that the exemption under the interest equalization provision which has been enjoyed by Canada up until now shall be continued?


Hon. E. J. Benson (Minister of Finance):: Mr. Speaker, as I understand the situation, the President of the United States has requested an extension of the interest equalization tax, including a continuation of the exemption for Canada. I believe this has been approved by the house committee and is presently before the senate committee in the United States and will be considered by it. The question of Canada's exemption was not raised in the house committee. In respect of representations, official representations have not been made because the intention indicated was to seek the continuation of the legislation and the exemption. There have been, of course, discussions between officials of Canada and the United States in which we indicated our interest in an extension.
[Whereupon there was an interruption from the gallery.]


Mr. Speaker:: Order. The hon. member for Nanaimo-Cowichan-The Islands.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I am used to being -


Mr. Speaker:: Will the hon. member kindly ask his question. The Chair is able to hear him.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I am used to being interrupted. I have been married a long time. In view of the fact that when Canada was granted this exemption originally it was on condition that we maintain a certain ceiling on our reserves of United States currency, may I ask whether there has been any condition attached in this case? Is there a ceiling on the reserves of United States currency or has Canada agreed to maintain the Canadian dollar below parity with the United States dollar?


Edgar John Benson: Mr. Speaker, as I indicated in the House several times in the past, almost ever since I have been Minister of Finance, there was no such undertaking by the Canadian government. In order to reinforce this statement there was an exchange of letters between myself and the former Secretary of the Treasury, Mr. Kennedy, indicating there was no such ceiling, and there is none.


Thomas Clement (Tommy) Douglas: Mr. Speaker, the minister probably did not catch the second part of my question. Is there any understanding that Canada will maintain the Canadian dollar at or below parity? If not, why did the Canadian government or the governor of the Bank of Canada acquire, as he did, over $50 million of United States currency in the month of February?


Mr. Speaker:: Order, please. The minister might reply briefly, but I think we are getting into the sphere of debate at this point.


Edgar John Benson: There is no such requirement or agreement. The reason for acquiring relatively small amounts of exchange by the Bank of Canada from time to time is to smooth out changes in the Canadian exchange rate.



MANPOWER


Mr. Andre Forlin (Lotbiniere):: Mr. Speaker, I should like to put a question to the hon. Minister of Manpower and Immigration.

March 4, 1971

Given the very high level of unemployment among university graduates and the inaccuracy of statistics established by the Department of Manpower and Immigration in relation to the problem, alleged by the Globe and Mail of March 3, 1971, is the minister considering the establishment of a bureau to collect statistics in this field in order to co-ordinate demand and offer of highly qualified personnel?


Hon. Otto E. Lang (Minister of Manpower and Immigration):: We do have examinations of the problem of people seeking employment in every range. We are at all times trying to improve our facilities, and the case of those with university degrees or other significant amount of training are no exception. We will continue to look at our facilities and attempt to improve them in every way.


André-Gilles Fortin: Mr. Speaker, I have a supplementary question.
Considering what the minister has just said and considering also that, according to the Canadian Association of Universities and Colleges, there is no co-operation between the federal and provincial governments for the purpose of providing university graduates with jobs compatible with their education, does the minister intend to convene a conference of education ministers in order to establish the basis of a co-ordination policy?


Otto Emil Lang: Mr. Speaker, there are a number of fronts on which co-ordination can certainly be improved, not only between the provinces and the federal government but perhaps, in addition, with the universities themselves. I think, as some of my colleagues have recently mentioned, there are some problems in this regard, not only with regard to the length of the term but perhaps also with regard to the direction in which that training goes. This will receive increasing attention from the government, perhaps from one or two of my colleagues rather than from myself, but also from all of us jointly.


André-Gilles Fortin: Mr. Speaker, I should like to put a supplementary question.
As a result of the minister's statement and the scope of the problem, could he tell us whether he intends to call a meeting with provincial representatives, in order to consider this problem and solve it?


Otto Emil Lang: I am not sure that a conference immediately would be the best way to deal with the problem, but certainly consultations would be useful and these are going on with regard to different aspects of the problem. When it is appropriate to have a meeting, we will have one, of course.


André-Gilles Fortin: Mr. Speaker, I should like to ask the minister-
Inquiries of the Ministry


Mr. Speaker:: Order. I have allowed the hon. member to ask a third supplementary question, but I feel that four questions in a row is going a bit too far. We could perhaps now change the subject.


André-Gilles Fortin: Mr. Speaker, do the minister's statements mean that the federal government wants to be the only one to be blamed for that problem-


Mr. Speaker:: Order. The hon. member for Charlevoix.



ROYAL CANADIAN MOUNTED POLICE


Hon. Martial Asselin (Charlevoix):: Mr. Speaker, last Tuesday, as will be seen on page 3869 of Hansard, I asked the Solicitor General a question relating to the possible infiltration of the Parti Quebecois by federal agents, and he replied that members of the Royal Canadian Mounted Police were free to join the party.
Now, since he felt it desirable to correct his statement outside the House, could he tell us why he did so?


Mr. Speaker:: I do not think it is in order for the hon. member to ask the minister why he made a correction. Should the hon. member want information, he could well ask the minister directly, and I think that in putting this question the hon. member would like to initiate a debate.
I suggest to the hon. member that he might rephrase his question.


Martial Asselin: Thank you, Mr. Speaker.
In accordance with your advice, I ask the minister if it is true that members of the RCMP are free to belong to any political party.


Hon. Jean-Pierre Goyer (Solicitor General):: Mr. Speaker, Canadian political parties cannot be infiltrated by members of the RCMP, because an internal administrative rule forbids its members to belong to a political party. However, if anything, it seems that a political party has begun police activities as mention is made of spies, informers-


Mr. Speaker:: Order please.


Martial Asselin: Mr. Speaker, I have a supplementary question for the minister.
The minister always makes long statements, but he should obviously be given a chance to state his argument. Therefore, I repeat my question: Can the hon. minister tell us if the Royal Canadian Mounted Police regulations allow for membership in a political party?


Jean-Pierre Goyer: Regulations forbid it, Mr. Speaker.
3942

March 4, 1971
Inquiries of the Ministry NATIONAL SECURITY



COMPENSATION OF PERSONS UNJUSTLY DETAINED

Martial Asselin: I wish to ask a supplementary question of the hon. minister, Mr. Speaker.
Lately, I asked the hon. minister to inquire from the Quebec Attorney General whether monetary compensation had been provided for persons arrested without justification, under the War Measures Act.


Jean-Pierre Goyer: I am
informed, Mr. Speaker, that the Quebec Minister of Justice is awaiting a report from the ombudsman in this regard.



NATIONAL DEFENCE


Hon. J. A. MacLean (Malpeque):: I wish to direct a question to the Minister of National Defence with regard to the announcement three or four days ago of the purchase of an additional 707 aircraft. Was this aircraft purchased at the same relative cost and on the same basis as the previous four? Also, does it have the capacity to be used as a refueling tanker or will it be equipped with that capability?


Hon. Donald S. Macdonald (Minister of National Defence):: Mr. Speaker, the final purchase price of the aircraft is being negotiated between the Department of Supply and Services and the Boeing Aircraft Company. I think I would be correct in saying it is in the same general area of cost as the four acquired last year. Two of the four aircraft now have in-flight refueling capability. Subject to examination, I do not believe this one will have.


John Angus MacLean: Is it expected that this fifth aircraft will be in service by the end of next month when the Yukon aircraft are due to be taken out of service?


Donald Stovel Macdonald: We would hope to have it in service perhaps a little later in the spring. I doubt whether we can make it by the end of next month.


Mr. A. D. Hales (Wellington):: I have a supplementary question for the Minister of National Defence. Can the minister advise the House why the five were not ordered at one time?


Donald Stovel Macdonald: Yes, Mr. Speaker. Actually the requirement, as identified in the defence department, was for six, but in view of the limitations on the department budget it was not possible within the confines of the last fiscal year to obtain more than the four, nor within the confines of the present fiscal year to obtain more than this fifth one.


John Angus MacLean: Is it the intention of the department to purchase the sixth aircraft in the next fiscal year?


Donald Stovel Macdonald: Mr. Speaker, if the funds are there we will certainly give it very earnest consideration.



REPLACEMENT FOR ARGUS MARITIME PATROL AIRCRAFT

Mr. Doug Rowland (Selkirk):: I have a supplementary question for the Minister of National Defence. Is the government considering the purchase of a derivative of the Boeing 707 as a replacement for the Argus maritime patrol aircraft, as reported in the press?


Donald Stovel Macdonald: We have had a very interesting submission along those lines, but there are a number of technical difficulties on which we would have to be satisfied before we take that into direct consideration.



ACCESS TO CONSTITUENTS AT BMEWS SITES BY NORTHWEST TERRITORIES COUNCILLORS

Mr.  R. Gordon L. Fairweather@Fundy-Royal: I have a question for the Minister of National Defence. Is it the policy of the government to deny access to constituents at BMEWS sites in the Arctic to the duly elected councillors of the Northwest Territories?


Donald Stovel Macdonald: Subject to correction, Mr. Speaker, it is my understanding there are no BMEWS sites in Canada.



THE CENSUS


Mr. Max Saltsman (Waterloo):: My question is for the
Minister of Industry, Trade and Commerce. In view of the 1971 census which will commence on June 1 of this year and the high level of student unemployment, is the minister giving consideration to employing students in the taking of the census this year?


Hon. Jean-Luc Pepin (Minister of Industry, Trade and Commerce):: I have already looked into that idea, Mr. Speaker, at the request, among others, of the hon. member for Davenport. Canada-Statistics found that it would be extremely difficult to use students for the census because they would have to be trained prior to June 1 and apparently they would not be free at that time being still in school.


Some hon. Members:: Oh, oh!


Mr. Horner:: So you get political hacks.


Jean-Luc Pepin: I am giving an honest answer. If anyone has a better one I will listen to it.


Some hon. Members:: Hear, hear!

March 4, 1971


Jean-Luc Pepin: I was going to add, before being so rudely interrupted, that a number of students will be needed for work here in Ottawa on the census results during the summer months, and special attention will be given to students for these particular jobs.


Max Saltsman: In view of the fact that many students will be leaving school in April, or shortly after that, and could start making preparations even at this time for training to take the census, will the minister give serious consideration to using students rather than political hacks such as have often been used in the past?


Mr. Speaker:: Order, please. The question, asked in those terms, is out of order.



ADVICE TO PEOPLE CONCERNING THEIR RIGHTS

['Mr. Speaker, this matter has been under discussion in the government. I think the hon. member will have to wait', 'March 4, 1971\nInquiries of the Ministry\nuntil the statement of policy that I referred to yesterday is made.']
Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, I would like to direct a supplementary question to the Minister of Industry, Trade and Commerce who is in charge of the census. In view of the fact that there are 80 questions for urban residents and 200-odd questions for rural residents, since the two basic laws of census-taking are that the census-taker must be seen and identified before questions are answered, and as only about five of the questions are compulsory, that is, name, address, occupation and ethnic origin, does the minister plan to advise the Canadian people of their rights, and is the minister aware that the Dominion Bureau of Statistics has decided to do this census by telephone rather than in the regular door to door fashion?


Jean-Luc Pepin: Mr. Speaker, I am afraid I will need the advice of Canada-Statistics in order to understand the question.


Steve Eugene Paproski: Then would the minister check with his deputy minister who is head of the Bureau of Statistics as Dominion Statistician-


Mr. Speaker:: Order, please.


Steve Eugene Paproski: and advise the House that there will be no partisan hiring of people-


Mr. Speaker:: Order, please. We are running short of time and I must bring to the attention of hon. members the fact that we have covered only two or three subjects. I suggest we should try to get on to another subject.



Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, as the Secretary of State for External Affairs is about to depart for Africa I am sure the House will wish him well.


Some hon. Members:: Hear, hear!
Inquiries of the Ministry


John George Diefenbaker: Mr. Speaker, there was not as much applause as I had expected the minister to get.


Some hon. Members:: Hear, hear!


John George Diefenbaker: Has any determination been made yet as to the identity of our ambassador to Communist China, or will there be an announcement of that appointment during the minister's absence?


Mitchell William Sharp: Mr. Speaker, the cabinet has made a decision as to the ambassador that we would like to have accepted by the People's Republic of China. We are now seeking the agreement of that government.


John George Diefenbaker: May I ask the minister whether Professor Paul Lin-


Some hon. Members:: Oh, oh!


John George Diefenbaker: -whose name is a dirty word to the Prime Minister and who is now in Communist China has any authority from the Department of External Affairs to visit and discuss matters of international importance with those who today occupy a locum tenens position on behalf of Canada in the Canadian embassy there?


Mitchell William Sharp: Mr. Speaker, the right hon. member for Prince Albert has an advantage over me. He apparently knows Professor Lin. I do not know him and I do not know what he is doing. However, I can assure the right hon. member that he has nothing to do with the Department of External Affairs.


Mr. Lome Nystrom (Yorklon-Melville):: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. In view of the defence department's opposition to the use of armouries as hostels for transient young people this summer, can the minister indicate whether or not the government has made a decision regarding the use of these armouries and, if so, what is that decision?


Otto Emil Lang: Mr. Speaker, I am slightly curious as to why the question was directed to me. I am sure there are others in the House who might be able to confirm or deny that story. I personally do not know anything about it.


Lorne Edmund Nystrom: Mr. Speaker, may I direct the question to the Acting Prime Minister. Can he say whether or not a decision has been made respecting the use of armouries this summer as hostels for transient youth?


Mitchell William Sharp: Mr. Speaker, this matter has been under discussion in the government. I think the hon. member will have to wait

March 4, 1971
Inquiries of the Ministry
until the statement of policy that I referred to yesterday is made.



FINANCE


Mr. Robert P. Kaplan (Don Valley):: Mr. Speaker, I wish to direct a question to the Minister of Finance. As four months have passed since the budget of last November, has the province of Ontario yet taken up any part of the $160 million offered to provinces and municipalities to assist in capital works projects to combat unemployment?


Edgar John Benson: No, Mr. Speaker, not to my knowledge.


Robert Phillip Kaplan: Have any provinces taken up any part of that fund?


Edgar John Benson: Yes, Mr. Speaker, but I would have to look up the details as to which provinces have taken part of it.


EXTERNAL AFFAIRS
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I should like to direct a question to the Secretary of State for External Affairs. I crave the indulgence of Your Honour and of the House to wish him, on behalf of my party, infinite wisdom and unaccustomed success as he goes abroad.


John George Diefenbaker: You mean unaccustomed wisdom.


Heath Nelson Macquarrie: In reference to the Middle East situation, potentially terribly explosive, and in particular in reference to the statement of the British Secretary of State yesterday regarding the Egyptian commitment and the non-commitment on the part of Israel, can the minister advise whether he and the government are taking advantage of the great friendship they have with the state of Israel to urge that country and that government to do everything possible to enlarge and continue the scope and the period of the negotiations, and diminish the areas of confrontation and conflict in this terribly explosive situation?


Mr. Peters:: Amen!


Mitchell William Sharp: Mr. Speaker, to the sentiments expressed so eloquently by the hon. member I too say amen.



INDUSTRY


Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I have a question which I would like to direct to the Minister of Industry, Trade and Commerce. In light of the minister's assurance as recorded at page 1315 of Hansard of November 19, 1970, that companies severely affected by the unpegging of the dollar may receive "assistance on a very practical basis", is the government considering or is it going to provide such assistance to Chemcell Ltd., which is forced to lay off approximately 320 people at its Edmonton and Two Hills plants largely because of the unpegging of the dollar? If so, when will such an announcement be made?


Jean-Luc Pepin: The unpegging of the dollar has indeed been a cause of that. But if one looks at the reasons given by the company itself unpegging is only one of them. The most important one the company gives is the lack of size of this plant and the limited possibilities in Canada in comparison with what is possible elsewhere.


Mr. Maclnnis:: Is that an honest answer?


Mr. Speaker:: Order, please.


Donald Frank Mazankowski: Mr. Speaker, in view of the fact
that the minister has indicated that the government has not accepted the position of Chemcell that these lay-offs have been necessitated to a large degree by the unpegging of the dollar and the current financial condition of this country, would the minister indicate whether officials of his department are consulting with officials of the company with a view to averting this wide-scale lay-off?


Jean-Luc Pepin: Mr. Speaker, my officials have been consulting with the company. I have here a statement by the company giving all the reasons for closing part of this plant. There are about ten of them. The most important one, however is "the size of chemical production capacities throughout the world".


Mr. Speaker:: Order, please.



FINANCE


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I wish to direct a question to the Minister of Finance.
Does the government intend to proceed further with its plan to create a National Securities Commission, in spite of the objection expressed recently by the province of Quebec?

March 4, 1971


Edgar John Benson: Mr. Speaker, this question was raised yesterday. It is applicable to the Department of Consumer and Corporate Affairs, and I referred it to that minister.


Gilbert F. Rondeau: Mr. Speaker, I want to ask a supplementary question.
Does the minister intend to reimburse part of the damages caused yesterday in Toronto by the Prime Minister's visit?



ADMINISTRATION OF JUSTICE


Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I would like to ask the Minister of Justice if he is any more knowledgeable today than he was yesterday in reference to the seven people arrested under the Public Order (Temporary Measures) Act which replaced the War Measures Act? There were no court proceedings, and that seemed to be his excuse for not answering whether he would give a detailed statement of the reasons for this Act being used, which the government of the province of Quebec said would not be used except under very exceptional circumstances.


Hon. John N. Turner (Minister of Justice):: Mr. Speaker, I have been advised today, after looking into the matter, that the arrests had nothing to do with the Public Order (Temporary Measures) Act.


Eldon Mattison Woolliams: Mr. Speaker, the Minister of Justice said yesterday, and I should like some clarification, that the Public Order (Temporary Measures) Act would be withdrawn when it was acceptable to do so, or when the atmosphere was such that it would be safe to do so. May I ask what shadows are now lurking in Quebec society that require this Act to be kept in force?


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, my question is for the Minister of Justice. It is in connection with the detention of seven people in Montreal on Monday, when the police stated that they were acting under the provisions of the Public Order (Temporary Measures) Act and, even though they had warrants, did not use them. Could the minister clear up this matter in view of the conflicting statements of the Quebec government, the Prime Minister of that province, and of the minister himself?


John Napier Turner: Mr. Speaker, I thought I was fairly specific when replying to the hon. member for Calgary North. I was advised by our people in Montreal that the Montreal police obtained an ordinary search warrant and went to an apartment where some docu-
Inquiries of the Ministry
ments were found and that several persons were arrested. Those persons were subsequently released a few hours later after it was decided that there was not sufficient evidence to charge them. I am advised also that the arrests had nothing to do with the Public Order (Temporary Measures) Act, as I have just told the hon. member for Calgary North and the House, although the newspaper Le Devoir apparently quoted a Montreal policeman who said that the raid took place under the provisions of the Act.


Eldon Mattison Woolliams: Mr. Speaker, I think that we should have this point cleared up. Could the Minister of Justice tell us where he got his information, since more than one police officer, and they were the ones doing the job, said that they were searching for documents under the authority of the Public Order (Temporary Measures) Act?


John Napier Turner: Mr. Speaker, I got my information from the director of the office of the federal Department of Justice in Montreal, who inquired of the Montreal police.


John George Diefenbaker: Mr. Speaker, I think this is something that has to be cleared up. May I ask the Solicitor General whether he will communicate with the RCMP and ascertain what the facts are and what was the nature of the allegations contained in the search warrant, because this leaves a shadow on the RCMP that ought not to be permitted? This Act under no circumstances should be used today.


John Napier Turner: On a point of order, Mr. Speaker, not once did I mention the RCMP. The RCMP had nothing to do with that situation. The implication in the right hon. gentleman's statement that I in any way misled the House or tried to confuse it should not remain unchallenged on the record.


Some hon. Members:: Hear, hear!


John George Diefenbaker: Mr. Speaker, the hon. gentleman would not be so touchy unless there were some reason to be.


Some hon. Members:: Oh, oh!


John George Diefenbaker: Mr. Speaker, these prospective
appointees as parliamentary secretaries apparently are trying to make themselves known.
In view of the report that the mounted police had stated that what had taken place was under the provisions of this Act, would the Solicitor General, who is responsible for the RCMP, look into this matter and report to the House?


Jean-Pierre Goyer: Mr. Speaker, the arm of justice cannot go against justice.

March 4, 1971
Inquiries of the Ministry


Mr. Speaker:: Order, please. I understand that only a few minutes remain before the end of the question period. I realize that this is an important matter.


John George Diefenbaker: Mr. Speaker, I did not hear what that ejaculation was on the part of the Solicitor General. I ask him to look into this matter and not to try to shove it aside, because it cannot be done.



POSSIBLE MACKENZIE VALLEY PIPELINE-PROTECTION AGAINST TRANS-SHIPMENT OF OIL DOWN WEST COAST

Mr. Robert Simpson (Churchill):: Mr. Speaker, I have a question for the Acting Prime Minister on the subject of the licensing of am oil pipeline down the Mackenzie Valley. Does the government intend, if this pipeline is substantially in the interests of the United States, to make any approval of the licensing contingent upon an agreement that no trans-shipment of oil will take place down our west coast in order that pollution and damage to the ecology will not result in two areas?


Mitchell William Sharp: Mr. Speaker, the question put by the hon. gentleman illustrates the great complexities of this situation. I think it is highly desirable, and I am sure the hon. member thinks so as well, that each decision should be made separately and that we should not bargain the one against the other. I am sure that the national interests of Canada and of the United States would be best served if a decision were made not to build the trans-Alaska pipeline system and then go down the Pacific coast to Bellingham.



REPORTED BRITISH OFFER OF ALTERNATIVE AGRICULTURAL CONCESSIONS IN LIEU OF FREE MARKET FOR WHEAT

['Mr. Speaker, may I direct a question to the Secretary of State for External Affairs?\nCan the minister tell us whether the Canadian representative on the International Control Commission in Viet Nam has received a report that the Republic of Viet Nam was to present to the Commission, and will the minister make a statement in connection with the inspections made by the Commission on the events of the past few weeks at the border of Viet Nam and Laos?', 'Hon. Miichell Sharp (Secreiary of Siaie for External\nAffairs): Mr. Speaker, we are still endeavouring to have the International Control Commission in Laos undertake an investigation of complaints made over recent months. So far we have been unsuccessful.\nsjs ^\t*']
Mr. A. P. Gleave (Saskaloon-Biggar):: Mr. Speaker, may I direct my question to the Minister of Industry, Trade and Commerce. In view of recent reports of negotiations between Canada and Britain in regard to future exports of wheat to that country under Britain's new grain import policy and in view of the fact that Britain is reported to have offered to Canada alternative agricultural concessions in lieu of a free market for wheat, can the minister inform the House what is the nature of the British offer?


Jean-Luc Pepin: Mr. Speaker, I cannot do so. I can only say that this subject has been discussed with the British for a number of weeks now. I can also state that Mr. Rippon, the British negotiator on the EEC enlargement, will be here this evening and we will be meeting him tomorrow and this will be one of the points on the agenda.


Alfred Pullen Gleave: Mr. Speaker, can the minister indicate to the House the probable extent by which the import levies on grain going into the United Kingdom market will affect our exports to that market?


Jean-Luc Pepin: Mr. Speaker, it is difficult to do so without knowing what will be the final amounts that the British will decide upon. I do not think this has been announced and consequently I do not think I can comment.



Mr. Gerard Laprise (Abitibi):: Mr. Speaker, may I direct a question to the Secretary of State for External Affairs?
Can the minister tell us whether the Canadian representative on the International Control Commission in Viet Nam has received a report that the Republic of Viet Nam was to present to the Commission, and will the minister make a statement in connection with the inspections made by the Commission on the events of the past few weeks at the border of Viet Nam and Laos?

Hon. Miichell Sharp (Secreiary of Siaie for External
Affairs): Mr. Speaker, we are still endeavouring to have the International Control Commission in Laos undertake an investigation of complaints made over recent months. So far we have been unsuccessful.
sjs ^	*



CRIMINAL CODE


Mr. Georges Valade (Sainle-Marie):: Mr. Speaker, I would like to direct a question to the Minister of National Health and Welfare.
Can he tell us whether the research now being undertaken by the Food and Drug Directorate of his department on the prostaglandine group indicate that the government intends to relax the law governing abortion in the near future?

Hon. John C. Munro (Minister of National Health and
Welfare): No, Mr. Speaker, it has no implications in that direction at all. It is, however, a drug being tested in a controlled situation in a hospital in Canada. It is only being administered by a duly appointed hospital committee in accordance with the law of Canada.

March 4, 1971



NATIONAL DEFENCE


Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, my question is for the President of the Treasury Board. Will there be further negotiations between the board and the 2,900 plus employees in the ship repair groups at the east and west coast dockyards before the strike deadline set for Sunday?


Hon. C. M. Drury (President of the Treasury Board):: Mr. Speaker, we expect to be officially notified on this strike deadline, but we have not been informed of it yet. This should lead to further discussions.


Thomas Clement (Tommy) Douglas: A supplementary question, Mr. Speaker-


Mr. Speaker:: Order, please. The question period has now expired. Perhaps we might allow one or two supplementary questions on the matter raised by the hon. member for Halifax-East Hants. The hon. member for Nanaimo-Cowichan-The Islands.



DOCKYARD EMPLOYEES WAGE DISPUTE-WIDENING OF DISPARITY BETWEEN EAST AND WEST COAST BY GOVERNMENT OFFER

Thomas Clement (Tommy) Douglas: Mr. Speaker, my question arises from the fact that the conciliation board recommended an increase of 42 cents on the Pacific coast and 37 cents on the Atlantic coast, which would have still retained the disparity but would not have increased it. Why is the government offering only 27 cents to the ship repair workers on the east coast, thereby widening the disparity from 85 cents an hour to a dollar an hour?


Charles Mills (Bud) Drury: It
has been the policy in approaching these collective labour agreements, as I think the hon. member knows, to achieve the closest possible relativity between workers in the Public Service and those in the private sectors in each region of Canada. The offer in the minority report of the conciliation board came much closer to achieving this degree of relativity than did the proposal in the majority report.


Thomas Clement (Tommy) Douglas: Does this mean that the government has decided on a policy of not paying men equal pay for equal work by taking advantage of a depressed area to pay a dollar an hour less?


Mr. Speaker:: Order. May I suggest to the hon. member that he is putting forward an argument rather than a question.
Inquiries of the Ministry BUSINESS OF THE HOUSE



WEEKLY STATEMENT

John Angus MacLean: I should like to ask the President of the Privy Council to make a statement concerning the business of the House for a period as far into the future as he can predict.


Mr. MacEachen:: Today we shall continue with the debate on the budget bill which was before the House last evening. If it is completed before the end of the day we shall consider the legislation dealing with statutory instruments until the House rises. In any events, we shall begin tomorrow with the Yukon minerals bill, followed by the textile legislation and the packaging and labelling measure, if we reach that point. I should like to mention that Tuesday and Friday of next week will be opposition days. I cannot go further than that.


Mr. Knowles (Winnipeg North Centre):: Since the minister has been good enough to give us this forecast and announce that Tuesday will be an opposition day, may I say that on that day we shall be moving a motion concerning the report of the Royal Commission on the Status of Women.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: We suspect that our caucus room was bugged yesterday morning.


Mr. Speaker:: Order, please.


Stanley Howard Knowles: I wonder whether the minister will take up with the Prime Minister the possibility of his designating a minister to be responsible for legislation respecting the status of women before our motion is called on Tuesday.


Mr. Speaker:: I believe the President of the Treasury Board is attempting to catch the Speaker's eye to request that we revert to motions, and I also believe the hon. member for Joliette has an urgent supplementary question.



POSSIBLE INCREASE IN MEMBERS' INDEMNITIES- INCREASE IN JUDGES' SALARIES

Mr. Roch La Salle (Joliette):: I think my question is urgent, Mr. Speaker, all the more since it concerns all members of Parliament.
Since some questions dealt with legislation that will eventually be adopted, I would like to put a question to the President of the Privy Council.
Considering the possibility that a bill will be introduced in the House to raise the salary of federal judges, is he in a position to assure the House that no such raise will be granted before the government has taken a deci-

March 4, 1971
Inquiries of the Ministry
sion regarding the increase of allowances of the representatives of the people?


Allan Joseph MacEachen: I will bear in mind the representations made by the hon. member.


Mr. Speaker:: Order! Is it agreed that we revert to motions for the purpose of hearing a statement from the President of the Treasury Board?


Some hon. Members:: Agreed.
And the House having reverted to motions:



SUPPLEMENTARY ESTIMATES (C). 1970-71

[Stage Direction]
A Message from His Excellency the Governor General transmitting Supplementary Estimates (C) for the financial year ending March 31, 1971 was presented by Hon. C. M. Drury (President of the Treasury Board) and read by Mr. Speaker to the House.

Allan Joseph MacEachen: Pursuant to Standing Order 59 I should like to move, seconded by my colleague the President of the Treasury Board:
That Supplementary Estimates (C) tabled this day be referred to the Standing Committee on Miscellaneous Estimates.


Stanley Howard Knowles: I rise on a point of order, Mr. Speaker. As a matter of fact, I have two points of order with regard to this proposed motion. I should like to suggest that the motion be allowed to stand until tomorrow morning and brought up under Motions at that time. If not, I am prepared to proceed with my points of order.


Mr. Speaker:: Is it agreed that the motion stand, or does the House prefer to hear the hon. member's point of order at this time?


Allan Joseph MacEachen: I am quite agreeable to having the motion stand until tomorrow. We can deal with it then.



FISHERIES


Mr. Jack Marshall (Humber-Sf. George's-St. Barbe):: Mr. Speaker, on a point of order, in view of the urgent situation which has arisen off the southwest coast of Newfoundland because of the presence of foreign drag-gers, would this not be a good opportunity for the minister to give us the latest information in order to clear up this situation?


Mr. Speaker:: I, of course, have no objection to the question being asked but, as hon. members realize, the question period expired a full ten minutes ago. I appreciate that the matter is important and that the House might well feel that the minister should be given an opportunity to reply. I also appreciate that perhaps the hon. member should have been allowed an opportunity to ask his question earlier, but I did caution hon. members throughout the question period that we were probably spending too much time on the original questions. When there are too many supplementaries, important questions such as the one raised by the hon. member, questions which should normally be considered during the question period, fall by the wayside. My suggestion is that the question be allowed and that the minister be allowed to reply. Perhaps the hon. member might repeat his question.


Jack Marshall: Since we are on motions-


Mr. Speaker:: Order. We are not on motions. I distinctly asked whether there was unanimous consent of the House for the purpose of hearing the minister. This was done, and now we are not on motions. However, the hon. member might seek the unanimous consent of the House to revert to motions for the purpose of hearing a statement along the lines he has just suggested.


Some hon. Members:: Agreed.


Some hon. Members:: No.


Jack Marshall: If that is agreed, I would ask the minister to take this opportunity on motions-


Mr. Speaker:: Order. Let us try to be clear. There was not consent to return to motions. What the hon. member is now asking is whether the minister would consider making a statement on motions.


Jack Marshall: I will ask the question. In view of the fact that at least four draggers are still fishing off the southern coast of Newfoundland within the twelve-mile limit and even within three-mile limit-I was there yesterday and saw it-would the minister clarify the situation with regard to the limits and what action is being taken to make these restrictions stick?


Hon. Jack Davis (Minister of Fisheries and Forestry):: My answer is the same as it was yesterday. The answer is yes.


Some hon. Members:: Yes what?


Jack Marshall: A supplementary question-


Mr. Speaker:: Order. I suggest to hon. members that we are now going beyond the terms of reference given to the Chair a few moments ago. Is the House prepared to hear a supplementary from the hon. member?


Some hon. Members:: No.


Mr. Speaker:: There is no agreement. I will make it a point to recognize the hon. member early in the question

March 4, 1971

period tomorrow, perhaps at the opening of the question period to give him an opportunity to ask the question.


Donald MacInnis: On a point of order, I realize that a minister is not required to answer a question, but surely if a minister takes it upon himself to say "yes" in answer to a question he ought to tell the House what the "yes" refers to. Does he intend to take the action requested by my hon. friend?


Mr. Speaker:: Orders of the day. Is the hon. member for Gander-Twillingate rising on a point of order?


Mr. Lundrigan:: Mr. Speaker, before the Secretary of State for External Affairs leaves the House-I have no point of order.


Mr. Speaker:: Order. I recognize the importance of the matter raised by the hon. member but it seems to me we would serve the purpose intended by both hon. members if tomorrow, when there is good feeling in the House, we allowed them to ask their questions immediately at the beginning of the question period so they can get the information they require. At the same time I see the minister is here. Perhaps the hon. member for Gander-Twillingate might be allowed a supplementary.


John Howard Lundrigan: Mr. Speaker, I want to be very responsible and indicate the urgency of the problem, which is amplified by the fact that 40 draggers were reported yesterday within five miles of our coast in our territorial waters. So, this problem is serious and urgent. I should like to ask the Secretary of State for External Affairs whether he would be prepared to seek the unanimous consent of the House, in view of the fact that unanimous consent was not granted my colleague, to return to motions in order to make some kind of clarifying statement on what Canada has done, which countries have been alerted to the declaration of the Minister of Fisheries, what has been the response, and how soon we can get application of the fisheries declaration made two days ago before we run into a serious international incident?


Mitchell William Sharp: Mr. Speaker, I can say on behalf of the minister of Fisheries and Forestry and myself that we will both be in the House tomorrow, that we both have notice of the questions we have to answer and we undertake to do so.


Jack Marshall: Mr. Speaker, a point of order, since both ministers will be in the House, would they ask the Minister of National Defence to give an indication of what air surveillance-


Mr. Speaker:: Order. That is not a point of order. I suggest that both hon. members have been given quite a bit of leeway to make statements and to ask questions. I have co-operated with them far beyond the requirements of the usual practice of the House. I will now call orders of the day.
Income Tax Act



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, March 3, consideration of the motion of Mr. MacEachen (for Mr. Benson) that Bill C-225, to amend the Income Tax Act and to amend an act to amend that act, be read the second time and referred to a Committee of the Whole.
Mr. C. A. Gauthier (Roberval):: Mr. Speaker, last night during my speech I witnessed a spectacle unique in its way when I rose a few minutes before six to express my opinion on the matter before the House, namely Bill C-225, to extend the application of the 3 per cent surtax. I felt a tide of protests rise from every corner of the House as if I did not have the right to oppose strange agreements, to say the least, whereby the bill would be put to the vote before six o'clock in order to have it referred to the committee of the whole.
I wish to be believed, Mr. Speaker. I was not aware of those tacit agreements, if indeed there were any, and even if I had been aware of them I would not have approved of them because-and I said so yesterday evening before the adjournment-we cannot accept to extend for another year a surtax which we have always denounced as unfair and against which we had decided in 1968. We do not even want the bill to reach the stage of the committee of the House.
That is why we object right from second reading, not for the sole purpose of uselessly extending the debate but to let the people of Canada know not only where their taxes go but also how they are taxed.
Here, Mr. Speaker, I call the attention of the House quite especially on a remark, unkind to say the least, made last night by the Acting Speaker while he probably commented on my speech.
Mr. Speaker, I wanted to make this the subject of a question of privilege but in order not to delay the proceedings of the House, I thought it would be better to call your attention on that during my speech because I knew that I would have the floor as soon as the debate resumes.
Hon. members may read on page 3937 of yesterday's Hansard what was said by the Chair. I cannot let such odd go unnoticed. When the House adjourned, here is what the Acting Speaker (Mr. Richard) said, and I quote:
I must say that this House today reminds me of my family motto, "Sat seto si sat bene"-which roughly translated means "let us proceed slowly, but surely".
Mr. Speaker, 1 strongly protest because if it had been a member of the Liberal Party who had been speaking at that moment, the member for Ottawa East would probably not have made this comment. This is why-


Mr. Speaker:: Order, please. I believe that the remarks of the hon. member probably go beyond his thoughts. I am aware of the incident he mentions and I can assure him that the hon. member who sat in the Chair certainly

March 4, 1971
Income Tax Act
had no ill intentions and I am certain that the motto he quoted was in no way directed at the hon. member for Roberval.
I believe that in quoting his family's motto, the hon. member for Ottawa East wanted to refer to the business of the House in general rather than the contribution of the hon. member. As a matter of fact, I am convinced that he did not intend in any way to say anything of an offensive nature to the hon. member for Roberval.
Moreover, the hon. member for Roberval knows that the hon. member for Ottawa East who is one of the most respected parliamentarians, would be the last to say unkind things to any of his colleagues. I want to assure him that the hon. member for Ottawa East had no such intentions, and if the hon. member for Roberval has construed his words in such way, I would like to apologize on behalf of the Chair.


Charles-Arthur Gauthier: Thank you ever so much, Mr. Speaker, for your kind words and you may be assured that I have always had the greatest respect for the Chair. I would not want to be forced to entertain a regrettable opinion contrary to the one I have always had regarding the Chair. Let us say that the matter is now closed but I definitely had to raise this point which was on the record. It is said that the spoken word is forgotten but that the written one stays. Then, that being written I could not read the innermost thoughts of he who was the Chair. However, I wish to thank you most sincerely and you may rest assured that I shall continue as always to have faith in the Chair.
When this so-called social development surtax was applied, the government promised it would be in effect for only two years, just long enough to fight inflation, as we were told then. And now a continuation of its application is being sought for another year, that is until 1972.
Just for another year, and another year, and another year. The population just have to swallow those increasing taxes, mouthful after mouthful. We know the old party line and what an Indian would so aptly call their forked tongue.
The most striking demonstration of this fraud was given us during the Second World War. As everyone remembers, the government seized this golden opportunity to borrow from the provinces three of their fields of taxation, thus robbing them of all revenues, of course, formally promising to return it all at the end of the war.
The Liberal government, like the one we now have, committed a breach of trust against the provinces. More than 30 years have elapsed since that momentous promise, and the provinces are still waiting for the government to return their tax fields. Not only that, but they continue repeating every five years what is being asked of us today, an extension designed to bring the false promises, making the provinces even more dependent on the federal government.
What is most alarming and most unexplainable, is the practically approving silence of the Progressive Conservatives and of members of the New Democratic Party. That is why I hope they will take the floor today and explain their attitude. When it comes to levying a new tax or extending its application, I wonder what keeps them in their seats. They probably think about the government. They have been told so many times that there were only two ways in which to govern a country, that is to say through taxes and loans, that they feel powerless in front of this myth, entirely invented by financiers in order to get us under better control.
As for us, Creditistes, we do know that this should be the last recourse for a sound and logical government. Consequently, we understand the existence of taxes and loans for a poor country like India; but we cannot do so for a rich one like Canada. There is no accounting for it, unless it should be a patent robbery of our heritage, with the complicity of the government.
Indeed, we can compare a country to a family farm, to simplify things. If the family farm yields fair profits, its owner and the whole family take advantage of it, provided that a thief should not find its way inside and take off with the whole production. Canada is the third most productive country in the world and it has the lowest population in relation to its size. Its owners which should be the people of Canada, must benefit from those resources. But it happens that a burglar, that is high finance, gains entry into the country and takes over the best sources of income. The people must therefore resort to taxes and loans to carry on their administration. That results in deprivation for our people, indebtedness, unemployment, and all its consequences.
We pay $2 billion per year for interest alone on a fictional national debt because the Bank of Canada has never fulfilled its function. We pay social development taxes, unemployment taxes, social insurance taxes, national administration taxes, and we continue to let ourselves be robbed by a "supergovernment", which is antisocial and which will bring about our social and economic ruin.
I wonder if our good old parties will finally realize the monstrous character of our false financial system, which allows those who control the economy to loan more and more at unlimited rates, as the government has removed cealings in the last few years, thus authorizing colossal interest rates affecting mostly low-income people. In fact, I had discussions with important financial institutions in order to find out the reason for the difference in rates, as each of these companies has a separate rate scale. I was told that the greater the risk, the higher the interest rate, which means that the borrower who is least able to pay has to be charged the highest interest rate. And I was stupefied to see that the low-income worker unable to supply much collateral had to pay 10, 15 or 20 per cent more than people highly rated by big financiers.
9 (3:20 p.m.)
And when it comes to taxes, such as the one it is intended to extend, the average wage-earner is once again the most hard hit. When will the government be humane enough to recognize that the average citizen is unfairly treated? When will it decide to withdraw once

March 4, 1971

and for all those taxes which take away the required purchasing power from our Canadian families?
The government should refrain from taxing the necessities of life and to this end, it should raise the tax exemption for married people to $6,000 and for single persons to $3,500. It should abolish the 11 per cent sales tax on building materials, to enable low income families to own their home too. In addition, it should not extend its temporary taxes.
I ask the government and the other opposition parties to put a stop to this constant extension from year to year of a tax which is permanent, even if it is referred to as being temporary.
At this condition only will we give the population justice and this is the only way to allow the average Canadian to participate also in the economic recovery so desired by the government by investing in our Canadian companies instead of having to sell them to Americans because the people are too much in debt.
There is evidence that we hold the world record for indebtedness for the simple reason that our financial system is based upon indebtedness and our so-called money is debt money. The more we develop, the more debts we create and as evidence of this, I shall quote an article published in La Presse on June 29, 1969 under the title: "Les Canadiens sont deux fois plus endettes qu'en 1960". The same thing could be said for each year. Here is a part of that article:
Some $9,200,000,000. That is the total indebtedness of Canadians as at the end of 1968, excluding mortgages.
It is an increase of almost $700,000,000 over the preceding year and double that of 1960.
Neither bankers, nor finance companies, nor economists can yet see a limit to the Canadian credit upsurge. They do not even discern any sign of it levelling off.
Far from it, Mr. Speaker.
I was reading in a financial publication yesterday that banks had made unprecedented profits in 1970. I think this success is due to the protection the government has extended to them through removal of the ceiling on interest rates. In fact, the money these banks are lending is altogether created since they are entitled to lend 14 times the equivalent of their actual assets at interest rates of 10 or 11 per cent.
Mr. Speaker, is it any wonder that ours is the most indebted people in the world?
Can the economy be stimulated through new taxes slapped on the back of the workers? Or is it feared that the worker, unless he is saturated with taxes as he is today, might yet lift his head to pit himself against the giants of Canadian and American finance?
Can the government at least give us a logical reason for those taxes that the people cannot digest any longer? But no! The Minister of Finance (Mr. Benson), in all his arrogance, so ordained, and the people must pay. The government, strong in its absolute parliamentary majority, blinded by its victories over the people, cannot feel the tremors under its feet.
Income Tax Act
We keep giving warnings. There is a limit to everything, but our voice gets lost because they are high on power.
In olden days, serfs where whipped or men were chained. Today, they are squeezed under the steam-roller of taxes and surtaxes. It is more sophisticated, but all the more cruel because human beings are thus very often led to commit suicide.
Mr. Speaker, I need not repeat that we are against that extension, that we no longer want those ridiculous extensions, and we insist that the government simply withdraw this bill, and not refer it to the standing committee for consideration. Now what is there to consider in this bill? Nothing at all. It is at most a formality which will allow this bill to be enacted.
Yesterday, I met a member from the official opposition who told me: We are not going to speak on second reading, we are going to let the bill go to committee and are going to speak on third reading. Well, it will be too late. It is being discussed on second reading as a joke, because there is absolutely nothing to discuss in it.
And what shall we do on third reading? As always, the government will call the vote and the bill will be passed and the people will once again be the victims.
Mr. Speaker, I do not want to be party to these taxes and surtaxes, and I ask the government to keep for once, if it never did, its promise and to drop this legislation which was to stay in effect for only two years. Let us be assured that the people, the workers-because this legislation again affects only the average worker-have had enough of paying the surtax for two years and will not allow it to be extended.


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, Bill C-225 purports to extend for another year the 3 p. 100 temporary surtax imposed in 1968.
Ever since then, the government has tabled each year a similar bill, which leads me to believe that they are not acting fairly towards the Canadian taxpayer; this procedure is tantamount to making a permanent tax out of a temporary one.
In my opinion, if matters were dealt with in a like manner by municipal governments, of which I was a member for a part of my life especially at the rural level, no taxpayer would trust the administrators at all.
When the Minister of Finance (Mr. Benson) brought down his supplementary budget in December last, he clearly stated and I quote:
In order to meet our cash requirements for the coming year, without resorting to excessive borrowing on the market, the government proposes that the 3 per cent surtax on personal and corporate incomes be extended for another year. The receipts from this tax are estimated at $245 million for the 1971 calendar year.
This means that individuals will have $245 million less in purchasing power, as well as corporations, to further develop industries and give employment, if possible, to Canadian workers.

have refrigerators. This is not going on in China, but in the province of Quebec in Canada.
The real thieves should be sought and one should leave alone the poor people who are constantly worried and wonder if they will be able to continue to pay their taxes, their insurance premiums, their school and municipal taxes. I witness such cases every day and every weekend I get more than I can handle. It is my duty to look after them and to raise the matter in order to draw the attention of the government and convince it to do something for those people.
The poor are often called underprivileged. They have been disinherited. They are denied their status of joint heirs to the national wealth we possess in Canada, a right equally shared by all citizens of the country. They should co-inherit the progress that is the main factor of modem production and be entitled to a share of the production resulting from that progress.
If the returns of production are distributed only among financial backers and employees, that means that the share of the underprivileged went to financiers and wage-earners. By taking from these through taxes to assist the underprivileged one does not reinstate these underprivileged in their rights; these allowances leave them with their status of underprivileged and welfare recipients, whereas they should be recognized as joint heirs and joint social capitalists, receiving a social dividend, not as assistance to indigents, but as money due to capitalists. This would be an "operation dignity" ensuring every member of society some degree of economic security, a standard of life proportional to the volume of production, without suppressing the remuneration of those producers who develop the community's capital.
Technical advance would no longer be detrimental if it did away with jobs. On the contrary, the social dividend, ensuring to all a certain standard of living geared to production, and not only to employment, increased mechanization and automation, would free the people and enable them to pursue activities other than the economic function of man, instead of creating new material needs and maintaining work as the sole source of revenue.
Mr. Speaker, this is not the first time that we have asked in this House for a financial reform with a view to freeing the government from the bondage of credit controllers. But the government always refuses to act.
To my knowledge, since 1968, four motions asking for the passage of legislation to guarantee all citizens a minimum income have come before the House. On four occasions, the old-line parties leagued together to vote against those motions which, some day or other, will have to be passed. And the sooner the better. The more there are delays, the worse the problem gets; the more the people are dissatisfied, and the more we witness situations which become more and more nerve-wracking.
The situation is worsening from day to day, as I said earlier. We now have 142,000 unemployed graduates, for whom the state spent considerable sums of money, and whose parents made sacrifices to keep them in school, often by working late at night.
Income Tax Act
Because of a derelict financial system that is out of line with modern activities and opportunities of 1971, our Canada is now depriving itself of the advantages brought about by the activity and know-how of those 142,000 graduates not mentioning 400,000 other healthy persons who are unable to be of service to their country.
In addition, we are informed that the situation might possibly deteriorate during summer or autumn when waves of new graduates from universities, trade schools and CEGEPs will swell the ranks of educated unemployed. And yet, in December 1970, we had tabled a motion in the House and initiated a debate on the grave subject of the unemployed in the 18-25 age bracket. What did the House do? We played around, as we are doing today, we are not interested in this fundamental matter. This is a small two page bill, but none the less a bill that involves $245 million over the next fiscal year.
Mr. Speaker, where are the people's representatives? I am convinced that the ministers are acting in good faith. But, I wonder about one thing: during the war the administrators were efficient and in spite of numerous material difficulties, lack of manpower and lack of supplies, they succeeded in administering Canada and in allowing every Canadian to pull through. We lived then through a boom period.
These same administrators, once war was over, have become incompetent. When we talk about the unemployment problem, they say: Wait, we have magic formulas on the way. Wait, we will soon have solutions!
o0p.m.)
As recently as yesterday I asked the Prime Minister (Mr. Trudeau) about it and he answered: When the time comes, we shall state our position.
Like serious people and sincere Canadians we should take the necessary steps right now to put finance at the service of men so that the government may stand up to credit controllers and give better service to the people. Let us not forget it is time to act. Let us not wait until somebody hits us on the head to make a decision, for as early as 1936, an eminent sociologist said in a lecture he was delivering here at the University of Ottawa: Lastly, if you do not want Communism, take to Social Credit. You will thus have a terrific arm against those enemies.
Mr. Speaker, that is truer in 1971 than in 1936. We have gone a long way since then but not far enough to free ourselves from the financial control over governments that prevents men of good will, not only in government but also in industry, business, external or internal trade, in short in all fields where men of good will give their best, from contributing to Canada's development and helping free Canada from that financial influence.
The more Canada grows, the richer it gets, the more Canadian people are told: Deprive yourselves, live like the poor. And there are more poor people all the time. That is not normal and it is for that reason that I am taking a firm stand today by opposing with all my might the extension of that 3 per cent tax that will make the problem more serious instead of solving it.

March 4, 1971
Income Tax Act


Hon. Theogene Ricard (Sainl-Hyacinlhe):: Mr. Speaker,
I cannot miss this opportunity to make a few brief remarks on this bill.
We are now considering a bill respecting the 3 per cent surtax, the so-called "social development tax", which had been introduced on a temporary basis only.
When the present Secretary of State for External Affairs (Mr. Sharp) was Minister of Finance, he assured the House when proposing this tax that it would be applied for a limited period of time. This is what is hateful about this tax: it is becoming more and more permanent.
If I remember well, when this measure was introduced by the Minister of Finance I suggested that this tax would become permanent. As the months and the years go by, I think the events are proving me right.
And here what is worse: this social development surtax, a designation that makes it all the more hateful, has made it possible to take about $200 million from the Quebec taxpayers.
It was argued that this was to facilitate the implementation of the medicare legislation and we know that the adherence of Quebec was delayed by one year.
This tax is the reason why they took $200 millions in Quebecers' pockets. The then provincial government, as well as ourselves in the opposition, asked the Minister of Finance to make good to the province of Quebec this amount collected I would not say in an illegal manner, but in an irregular one. But the government ignored our representations and those of the provincial government, and one may wonder whether it was not because the latter was of a political allegiance which failed to please those individuals who rule the country.
At any rate, Mr. Speaker, I say that in imposing this 3 per cent surtax, this government has been far from straightforward, for they stressed the temporary nature of what is now considered to be a permanent surtax. With this kind of action on the government's part, there is deception in the general public as well as a tendency to mistrust the nation's leaders.
Measures and positions like the ones now before us are largely responsible for the lack of confidence in the country's government which prevails within the population.
This legislation is also impeding the economic expansion of our country. Every once in a while the government, through the Prime Minister, the Minister of Finance (Mr. Benson) or some other minister tells us that there are programs being implemented to solve the unemployment problem. However, a measure like the one now before the House will only serve to increase unemployment and I think the government should drop this arrogance, this impression which it is giving to the whole population that he knows everything. Instead of that, he should follow the advice of opposition members who are somewhat closer to the people than those now running the country.
I therefore urge the government not only to postpone the tax, but to eliminate it immediately. By so doing it will have taken some concrete action toward creating
[Mr. Lambert (Bellechasse) .1
real employment opportunities because, with unemployment increasing at the present rate, it can be feared that the coming months hold in store a situation even more alarming than the one we now face.
On behalf of all moderate income citizens and workers of my riding, I therefore urge the government to assume its responsibilities and stop deceiving the population, to whom the assurance had been given that this 3 per cent surtax would be temporary. Let the government find ways and means of meeting its commitments and eliminate this tax within the shortest possible delay.


Mr. Romuald Rodrigue (Beauce):: Mr. Speaker, Bill C-225, now before us, is to amend the Income Tax Act and, in practice, its aim is to extend for one more year the 3 per cent surtax.
Hon. members will recall that when this surtax was imposed, it had been mentioned that it would be temporary only and that it would be recalled at the end of the year. And here we have its third renewal! It is the third time that Ministers of Finance ask the House to renew this so-called temporary tax. It is to be wondered whether it is the only possible and valid step in the circumstances. A temporary legislation has been turned into a permanent one.
It will be recalled that, when he brought down his supplementary budget on December 3, the Minister of Finance (Mr. Benson) indicated that he intended to ask for an extension of this 3 per cent surtax on individual and corporation taxes.
Although this bill is not very elaborate, it includes, in my view, two important features which are in conflict with one another. On the one hand, the Minister of Finance would like to use taxation to stimulate the economy and, on the other hand, he proposes a measure that not only has the opposite effect, but will, to some extent, reduce the purchasing power of Canadian taxpayers.
I seriously wonder whether, in making this choice, the minister was motivated by political or economic reasons. If I have doubts it is because the bill under study includes two different decisions that lead us into completely opposite directions.
On the one hand, the minister proposes tax exemptions to stimulate investment and, on the other hand, he asks for the extension of the 3 per cent surtax. Those are two completely contradictory decisions. I wonder if in taking this decision the minister did not only consider the increase in tax revenue that this measure will bring in for the current year and which may reach $245 million. Obviously it is emphasized that tax exemptions of $25 million will be granted to companies and individuals that will increase their capital investments for the manufacturing processing of goods. But who will benefit by this measure besides big companies which invest continually and do not have to postpone projects for lack of available funds? How many taxpayers will really benefit by the increase in depreciation rate proposed in this bill? Very few. Only privileged people.
March 4, 1971

Moreover, the effect of this measure will be to increase further company reserves which are already too high in my estimation. I think that I can detect in the minister's decision his true choice which has a political rather than an economic character. By this decision, he enables large corporations to deduct $25 million from their income tax.
At a time when it would have been advisable to increase the total purchasing power of the people, the minister has made the wrong choice in extending the 3 per cent surtax thus depriving the people of $245 million.
I do not think that it is necessary to quote statistics on employment conditions in order to prove that the situation has not improved since December 3 last.
Even if the hon. minister declared recently that the number of unemployed should start declining after March, he certainly meant that the return of milder weather would be more efficient than the measures taken by the government to solve the unemployment problem.
To realize the situation one has only to check newspapers every day and one will learn about numerous layoffs in all sectors of industry. Nobody knows whether he or any member of his family will be unemployed tomorrow or next week.
There is no need to compare statistics or to play with figures to be able to say that things will be better tomorrow or worse in a week. We only know that too many people have lost their jobs and that unemployment has tremendous social and economic consequences.
I feel that the solution to an economic ill must be economic in nature and not political. To my mind, the minister chose a political solution.
The 3 per cent surtax we are asked to extend would remove an amount of money that should remain in the economic circuit, to sustain the demand for consumer goods. By sustaining it, at the same time we allow industries to continue producing, and service industries to pursue their economic activities, the result of which is to maintain or increase employment.
The taxpayer who lacks purchasing power buys less. The manufacturer produces less and, as a result of lower production, he lays off workers, and the cycle continues.
Such are the effects of the legislation proposed in Bill C-255 and other simliar ones. And one wonders how it is that results different from those anticipated are brought about. The present results, that is unemployment and underemployment, are not due to chance, but to a series of unconsidered decisions like that which is now proposed.
All taxes, whatever they are called, take away purchasing power from those who are hit by them. In particular, this tax will take $245 million from the taxpayers this year. That represents $245 million, at a time when it would have been necessary to inject supplementary capital in the economy in order to get it going again and to give new confidence to the people. With one hand, the minister collects a certain amount of money under the pretext that he must meet Treasury needs, and with the other, he allows an increase in the capital cost allowances on the purchase of equipment or production assets. Once
Income Tax Act
again, the citizen is forgotten to the benefit of companies. If this choice is not political, I wonder what it is!
We have been repeating for a long time, in this House, that the real problem is not at the production level, but at the consumer level. Our production system is without doubt able to supply all the goods needed for the welfare of the population, but the same cannot be said about the ability of the population to control production.
The minister still has time to withdraw Bill C-225 and to give up the extension of the 3 per cent surtax for another year.
I am sure that this decision would be well received by all Canadians. It would renew confidence in the economy of the country. We might see, during the following months, an economic recovery. Employment conditions would improve, and the minister would easily recover the $245 million, because he would not have to increase the government outlays for social welfare. Furthermore, the people returning to work would contribute to the tax receipts through income tax and various other taxes.
When the economic activity slows down, the government's tax receipts decrease also, and this is normal. The measure brought before the House by the Minister of Finance will contribute to increase taxes.
It seems to me we have had enough tax increases in Canada during the last ten years. The Canadian people are already overtaxed. From 1955 to 1965, tax increases at all government levels reached 41.4 per cent in Canada. There is no need to look far for an answer to the employment problem.
Whether we like it or not, all taxes are finally included in prices. That is why we must face constant and unreasonable price increases.
Who must pay for those price increases if not all consumers? Workers, people with a fixed income, low income groups are those who suffer the most from such increases, because every time prices go up, they have to do without some necessities.
Those who have an above average income are practically not affected by those increases, because they hold influential positions or operate at the management level. Those people often hold positions in manufacturing and trade. They can thus simply increase the price of their products or services. When they increase their prices, they improve the occasion sometimes by killing two birds with one stone, that is, by availing themselves of the latest price increases to increase their profits.
Who would not be tempted to do the same since our economical system is a jungle where the strongest makes its own law and is an absolute master? If the minister had taken some other course than to extend the 3 per cent surtax through Bill C-225, I would have been very surprised, because there is nothing he would not do to fight inflation.
For two years, the government deliberately restricted the Canadian economy and this led to a recession. Overnight the government, through the Prime Minister (Mr. COMMONS DEBATES
March 4, 1971
Income Tax Act
Trudeau) and the Minister of Finance (Mr. Benson), asserted that inflation had disappeared. However, during January, food prices in Quebec increased by about 2 per cent.
How is it that on December 3 they said that inflation had been checked and the aim was now to have unemployment disappear? It would have been more sensible to make sure what the genuine causes were before taking steps that led us to a dead end.
What about the fight against unemployment? It would have been better for them to keep silent, because since it was referred to, the number of unemployed increased by 200,000 and a considerable number of plants have closed their doors or reduced their business operations to such a level that they lose money every day.
This bill should be withdrawn immediately. This is hardly the time to impose new taxes. I believe that measures aiming at an injection of additional purchasing power should replace Bill C-225 now before the House. The measures taken should not slow down the economy but restart business.
Repeal of the 3 per cent surtax and of the 11 per cent tax on building materials was requested by all the representatives of the labour force and the expert spokesmen for the industrial, commercial and financial quarters.
Again I ask the Minister of Finance to withdraw his bill aimed at extending the duration of the 3 per cent surtax.


Max Saltsman: Mr. Speaker, some days the Commons chamber seems a little unreal. Outside in the country almost three quarters of a million Canadians are looking for work and experiencing the frustration of not being able to find employment. Inside this chamber, men of reason are gathered together to discuss a tax bill which is supposed to deal with this situation. Although the House can get angry and bitter on occasions, very little anger or bitterness is apparent today. In no way does the anger and bitterness felt outside the House permeate these walls.
We, as members of the opposition, appeal to the government to recognize what is happening and bring in measures which will be effective in reducing unemployment. Up to this moment, regretfully, we have not been successful. The Minister of Finance (Mr. Benson) is in his place most of the time. Perhaps he is behind the curtain now; I saw him only a little while ago. I am sure he says to himself: Oh, the opposition always talks, and no matter what we do they always complain. Thus, he lulls himself into a sense of complacency.
We are honoured today by the presence of a former minister of finance, the Secretary of State for External Affairs (Mr. Sharp). So, in a way, there are two ministers of finance present in the House today while we debate one of the most crucial issues of our time. Yet, there is no response from across the way. They are quite convinced in their own minds that what they are doing is the best of all possible courses. They get very angry
when we on the opposition benches say the government has deliberately set out to create unemployment. The Prime Minister (Mr. Trudeau), and other ministers, have said to the Canadian people on various occasions; how could anyone believe that we would deliberately create unemployment? They have worked out a little drill. They say they have done what they have done in order to avoid unemployment. In other words, they are throwing people out of work so that they will not be out of work. Well, they may be able to understand this reasoning but I find it difficult to do so. They say: If we had not done these things, conditions would have been worse. Of course, we have no way of knowing whether or not this is true.
The fact of the matter is that the government has made one of the most fantastic economic errors in the history of this country. They have failed to understand what is happening, and three quarters of a million Canadians are paying the price of their folly. The other day the Prime Minister had to admit before the Canadian Labour Congress, that had he known some of the things he knew later he might have brought in somewhat different policies. Perhaps anger is out of place here. We are reasonable men who come together to debate. After all, Parliament is a substitute for anger, a way of avoiding warfare and violence. This is the place where we can discuss these questions and, hopefully, come up with reasonable answers. Despite the fact that it has admitted making a mistake, the government puts forward no proposals designed to repair the damage, to get the economy going again. Hon. members opposite cannot make up for the hardship they have caused, the loss of human dignity. But at least they ought not to perpetuate it. They could take measures to get the economy going again. They have brought in measures which, they say, will move us in the right direction. Well, there is something to be said for not moving backward. Even a small step forward has to be appreciated. But we cannot be satisfied, faced with a problem of this magnitude and the suffering which is going on.
For a moment I want to leave recrimination aside. History will pass judgment as to whether the government deliberately created unemployment or not, or whether it simply goofed. The point is, what shall we do as a Parliament for the three quarters of a million Canadians who are out of work? The government points with pride to its export position, to the fact that we are exporting more than ever before. This is true, but what good is it when so many of our people are out of work? The fact that we are exporting at the present rate has raised the value of our dollar and hurt our manufacturing industry where most employment is concentrated. We have the worst record of employment in the western world, as well as the slowest growth. As a return for having created this situation, we have somewhat reduced the threat of inflation below the level it might have been.
To combat this unemployment, the government is proposing a measure to increase depreciation allowances from 100 to 115 per cent. I want to deal with that matter

March 4, 1971

in particular since it does cast a great deal of light on how the government views the situation and sees its priorities. What the government is really saying is that with an increase in depreciation allowances the road to recovery will be paved with increased profits for business, because that is really the effect of increasing depreciation allowances. There is the thought on the other side that if we are going to recover, slow though that recovery may be, the way to do so is to increase business profits and to show businessmen that more money is to be made. This, therefore, will stimulate capital expenditure, which in turn will stimulate the economy and employment will result. The point is there is no evidence that indicates that this in fact is going to happen, or that this particular kind of economic reasoning is any less disastrous than the economic policies that put us into this bind in the first place.
I should like to give the House some of my reasons for feeling as I do about this matter. First of all, if we look back to our periods of prosperity and examine the circumstances that motivated business, we will almost certainly find that the real stimulus to employment has always been increased purchasing power on the part of the consumer. Business is not going to expand even if you give business increased capital allowances. Some businesses are going to expand anyway, and it is a nice bonanza for them. We can kid ourselves later on that this expansion might not have taken place if we had not taken that step. The same can be said of the designated area program. Industry went into these areas, but we will never know whether industry went there because they were going there anyway or because of the giant hand-outs that we gave them.
As I say, there is no real evidence that these policies are effective. What we do know is that if people have needs that must be filled and have the means whereby they can pay for their needs, then businessmen will respond as they always have. After all, that is what business is all about. It is there to understand the demands made by society, and to provide the goods and services that arise as a result of those demands. Business cannot respond to those demands unless consumers have purchasing power.
It is for that reason that the members of this party, and I think this view is held also by all opposition parties, feel that it is purchasing power that has to be increased, not profits. My hon. friends to my left in the Creditistes have their own way of increasing purchasing power. I may not agree with that way, but they understand the problem, and in a way that the government does not. They know that the key to this problem lies in increasing the purchasing power of the people in one way or another. This is how you generate employment, and as business responds so you have business expansion.


Gilbert F. Rondeau: There is no other way.


Max Saltsman: The other way that business responds, particularly in Canada, is in meeting needs that do not arise in our own country but in foreign lands. Unfortunately, too much business expansion has taken place in
Income Tax Act
this direction. For instance, much of the mining resource expansion takes place not because it is particularly good for Canada but because other countries desperately need our raw materials. This is a rather disastrous kind of development, one that is going to be accelerated and encouraged by the increased depreciation that is being proposed.
Let us look at some figures that appeared in the newspaper a few days ago. The Iron Ore Company of Canada is trying to justify the expenditure of $2 billion to develop an iron ore mine. They have pointed with pride to the fact that something like 9,000 jobs will be directly created. By a rough and ready rapid calculation this works out to $300,000 per job. It is true that additional jobs are created at the secondary and tertiary levels, but this is true of all industries, not just the mining industry. If it costs $300,000 to create one job, then how is this country ever going to be able to create sufficient employment for the estimated 200,000 people who enter the labour force every year? There is not that much money available to this country to create those jobs. I suggest the argument that we do not have enough capital in this country to provide jobs for our people is not true; not only do we not have enough capital in this country but no country in the world has enough capital to create jobs that cost $300,000 each. This is why we have to import capital.
Then the argument is made that this two billion dollars that is brought into the country results in purchases. Although a lot of this money does result in purchases in Canada, a lot of it is used to purchase foreign machinery. Much of it is used to make payments to foreign countries. With a rate of return on capital of only 10 per cent, we are talking about a figure of $200 million that has to be paid out to foreigners on an investment of $2 billion. This is a permanent drain on our resources resulting from capital that we should not have imported in the first place.
The difficulty is that the bill before the House is going to encourage this kind of development, a development that should have been discouraged a long time ago. The chief benefit being offered in this bill is an increase in capital investment. The mining industry is investing twice as much in capital development as the manufacturing industry. If we continue to pour money at this rate into industries which export raw materials from this country, then not only are we exporting jobs but we are exporting our future wealth.
Some economists might argue that the people who work for the Iron Ore Company of Canada earn higher wages than, let us say, people who work in the manufacturing industry in the city of Toronto. I understand the average wage with the Iron Ore Company is $9,000. What these economists do not say, of course, is that it costs a great deal more to live in that kind of environment and to provide the social services required in order to maintain production of raw materials.
If you listen to the economics purists, their conclusion is that Canada would be better off if we did not have to provide jobs for these 200,000 people coming into the labour force every year. In fact, 200,000 is a low estimate

manufacturing is increasing. What about the people in the provinces of Alberta, British Columbia and Saskatchewan? The problems in those provinces are different. In many cases we have not been able to share the wealth generated in Ontario with other provinces, and this has created some resentment. If these provinces are to develop they must promote the exploitation of natural resources. There are a number of ways to change the situation. By using the Canada Development Corporation, we can increase industrial development through Crown corporations and partnerships in all parts of Canada.
We must support industry throughout Canada wherever it is possible to develop viable entities. The industrial revenues secured by Ontario should be distributed throughout the entire country in order that production is shared equally. We believe there should be an equitable distribution of the riches generated. The advantages of one province should be shared by other provinces. As long as the fruits of an industry are shared equally across the country, resentment will disappear.
My remarks have been sketchy and our time is limited during this debate. I have appreciated the opportunity to participate. Despite the calmness of our tone and the quietness of this Chamber, there is anger here and discontent. I think this Parliament should recognize that fact. It is still not too late for the government to withdraw this bill and substitute something more suitable to meet the crisis of this time.


Mr. William Skoreyko (Edmonton East):: Mr. Speaker, I welcome the opportunity to say a few words on Bill C-225. This afternoon I listened with interest to the speeches made both by the members of the Ralliement Creditiste and by the last speaker for the New Democratic Party. At the outset, I should say I am not really surprised at some of the statements made by the hon. member for Waterloo (Mr. Saltsman). His party, consistently and persistently, has screamed at big, bad business. Obviously, some of the members of that party have not read Robert Tyres book which I believe is called "Douglas in Saskatchewan". This book would seem to indicate that there are none so righteous as reformed sinners.
I believe the bill before us should be referred to the committee as quickly as possible. If it can be referred to the committee this afternoon, there are a number of reasons why I believe that is exactly what should be done. I find little argument with the proposal of the minister and his parliamentary secretary that capital cost allowances should be extended into 1972. I intend to be one of those who welcomes such a proposal, particularly if it benefits business in any way.
I should like to see the bill go to committee because I believe business in this country should have an opportunity to appear before the committee to express either its objections or alternative proposals in respect of a capital cost allowance.


Stanley Howard Knowles: It is to go to
the committee of the whole.
Income Tax Act


Thomas Clement (Tommy) Douglas: He does not know that.


William Skoreyko: In extending the 115 per cent capital cost allowance into 1972, I think the government is being a little meagre. Normal industrial expansion or development takes place on a yearly basis, not merely because a particular corporation may want to take advantage of the 115 per cent capital cost allowance, so naturally this will more than offset any cost to the treasury as a result of this kind of concession. If the government really wants to assist business generally, and more particularly the construction business, it should immediately withdraw the tax on building materials. There is a chain reaction in respect of assistance to any business.
Some reference was made to the definition of businesses that will qualify under this program. Yesterday, as recorded at page 3924 of Hansard, the Parliamentary Secretary to the Minister of Finance (Mr. Mahoney) said:
I might mention that the definition of a manufacturing or processing business and the description of assets qualifying for the supplementary allowance will be contained in regulations to be adopted soon after approval of the legislation.
Over the years, Mr. Speaker, you and I have watched situations in which days and indeed weeks have been spent on debating the merits and demerits of a given piece of legislation only to find in the end that the regulations which were drafted to put the bill into effect were so far removed from what Parliament intended initially that many Members of Parliament were left in complete bewilderment.
I say again that when this bill comes before the committee, I hope the minister will give committee members an opportunity to peruse the regulations. Then, not only the merits and demerits of the bill will be analyzed by the committee but also the regulations. As I said earlier, I agree wholeheartedly with the principle of assistance to business, but it appears to me the government seems to be giving a little with one hand and, in respect of future proposals, taking something away with the other. This kind of thing hurts. I would hope that some of the extreme proposals in the white paper, in so far as they affect the business community of Canada, would be withdrawn or given very serious consideration before being put into the form of legislation. I see no justification for the removal of protective tariffs on the importation of chemicals in the Kennedy Round negotiations of two years ago. I see no justification for compounding the problems of the chemical industry by pegging the Canadian dollar.
Perhaps at this point I might say something about the Minister of Industry, Trade and Commerce (Mr. Pepin). To use a western term, the Minister "shafted" the wheat industry real well when he had the responsibility for that department. He has done an equally good job on the petro-chemical industry in Canada through what I think might be fairly called most inept negotiations in GATT. I think the net result of those negotiations was a loss for the Government of Canada and, indeed, for some of the industries in Canada. I wonder whether businessmen in this Chamber realize, notwithstanding what may be said

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Income Tax Act
by our friends to the left, the penalties which have been imposed on business. In the years I have been in this Chamber, I have seen the implementation of Medicare and I have seen the implementation of the Canada Pension Plan. Unemployment insurance has been with us. The Workmen's Compensation Board is another penalty, as are unrealistic corporation taxes, local business taxes and real estate taxes on corporate property. Yet our friends to the left say the government is giving too much.
I say that I welcome the opportunity to invite the parliamentary secretary to bring this measure before a committee as quickly as possible to give the business community the opportunity to comment on the adequacy of the measure and to determine whether the business community feels this is the kind of legislation that will assist them in their growth and in the provision of jobs for which every member in this chamber is clamouring daily. No one denies that there is a serious unemployment problem, and I think all but a few of us in this chamber recognize that jobs can only be provided by the industrial community of this nation. I think this is the area on which the government must lean a little more heavily, so when the minister proposes his next budget we can see what we can do to provide a little incentive for business to grow. I suggest we give business a decent break and a chance to survive under our system, then perhaps some of those jobs that we are awaiting so anxiously from day to day will be forthcoming.
I say again that if a system provides an incentive for business to grow, business will not in any way restrict the number of people whom it will employ for the sake of greed or money. Expansion is in the mind of every manager in the country, and if the proper kind of tax incentives are given, the answer for which the minister is looking will be forthcoming. I think that one need only look at newspaper articles in the city of Edmonton to find that Chemcell has laid off 325 members of its staff this year as a result of action taken by this government no less than two years ago. I am not saying that the Kennedy round negotiations are directly responsible for cut backs in operations here or in Hardieville, Alberta, or indeed in Montreal or Brockville. There will be many more lay-offs in the petro-chemical industry in Canada unless some of the conditions negotiated some years ago are renegotiated to favour the Canadian industries, and some favourable concessions are made in the budget to come to allow these businesses to exist in Canada.
I think it is all well and good to talk about economic nationalism. May I remind members of this House that Canada would not be nearly the nation it is today if it were not for foreign investment which came into this country at the turn of the century. I can see nothing wrong with a Canadian tax structure to encourage investment from abroad. At the same time, I think that that kind of a tax structure should give Canadians an incentive to invest in Canadian natural resource development or industry along with foreign capital, provided
that we as a government can allow these people to operate under acceptable controls. A former Liberal member of this House of Commons, once a finance minister and now out of politics, the Hon. Walter Gordon, made some suggestions a few years ago with reference to a withdrawal tax. I was one of those who sat on the opposite side of the House but who rather favoured that kind of an arrangement. The hon. member for Waterloo said that foreign investment should be discouraged. If that is the case, he did not tell this chamber who in Canada would make the investments. Certainly, I would remind him again that he is not asking the government to make the investments in industry because he knows full well that a government once tried that and it failed miserably.
I want to comment only briefly on the surtax. I think that my attitude toward this part of the bill will be somewhat different. I think that extending this particular aspect of the bill is a retrograde step. The parliamentary secretary was not in the chamber on one famous night in February of 1968 when the government of that day proposed such a measure and was defeated by a vote of 84 to 82. I know that he was generous when he said, as recorded in Hansard of yesterday, that no surtax is paid by a single person whose income is below $2,743. I bet that there are not very many single people within the parliamentary secretary's social circle who earn under $2,743. He went on to say that neither is the surtax paid by a married man with two children whose income is below $4,343. That is pretty generous. What the parliamentary secretary is really saying is that we are not hurting very many people in this country, only about 98 per cent of those people who pay taxes. That is not very many. On the one hand, we are trying to encourage our people to buy Canada back and to invest in Canadian shares, stocks and bonds, and at the same time impose punitive tax, initially for one year. This tax was extended for another year, and now we are extending it for a third year. We say it is difficult to impose a tax, but it is much more difficult to remove it. This still applies.
I say that this bill should indeed go to committee, not because I think there will be many questions on the first part of the measure having to do with capital cost allowance. I think that will be generally and favourably accepted. But I think it should go to committee to get an expression of feeling for or against this measure, much like the treatment accorded the white paper proposals of last spring. Those people who are penalized, and will be penalized in the future should be given the opportunity to approve or object to this measure. At a time of high unemployment, the government should be looking at increasing personal exemptions rather than extending a punitive tax for which I think there is no reasonable justification.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Speaker:: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised

March 4, 1971

tonight at the time of adjournment are as follows: The hon. member for Winnipeg North Centre (Mr. Knowles)-Veterans Affairs-Requirement that war veterans allowance recipients apply for guaranteed income supplement; the hon. member for Portneuf (Mr. Godin)- Income Tax-New assessments for 1968 and 1969; the hon. member for Don Valley (Mr. Kaplan)-Finance- Use by provinces of capital works loan fund to combat unemployment.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's Order Paper, namely, public bills, private bills and notices of motions for papers.



PRIVATE MEMBERS' BILLS


Mr. Rosaire Gendron (Temiscouaia) moved: that Bill S-10, An Act respecting La Societe des Artisans be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, the main object of this bill, as set forth in the explanatory notes of Bill S-10, is, and I quote:
-to withdraw from this Society the attributes of a fraternal benefit society and to vest it with the rights and powers of a mutual life insurance company, while maintaining its representative form of government and allowing it to retain its power to promote social and educational activities.
The present bill would change the name of La Societe des Artisans. The proposed name will reflect the cooperative features of this institution.
I will recall a bit of history to help understand this bill. The Societe des Artisans, as I have just said, is a fraternal society for mutual support which started operations in 1876 under a provincial charter and has operated since 1917 under a federal charter. It is nearly 100 years old, and at first it wanted to pursue fraternal activities of social assistance and welfare for its members, with insurance as an accessory.
But as the Societe des Artisans now has more than 350,000 members and as its equity is in excess of $24 million, it seeks approval for this legislation now before us in order to deal effectively with the major and main activities of this corporation.
Under the terms of this request, it asks to be transformed into a mutual life insurance company while keeping its representative form of government.
This bill would also change its name. By becoming a mutual life insurance company, the Societe des Artisans, while remaining the property of its members, namely, the people insured and the contractants, will be empowered however to extend its activities to the whole
La Societe des Artisans
field of life insurance. Thus it will be possible for it to issue insurance policies on the lives of persons who are not within the family circles of its members, or still to generally re-insure life insurance contracts issued by other insurance institutions.
Furthermore, in becoming a mutual life insurance company, the Society will be subjected to the same controls as any other insurance undertaking (mutual or with capital outlay) under the authority of the Department of Insurance, and will reach the level of prestige that is common to institutions subjected to this kind of control.
On the other hand, the Society wishes to preserve the main objectives of its activities, namely mutual benefit, a co-operative nature, a specially elective formula, while modernizing its framework in line with the very great importance that the various forms of insurance have achieved within this Society.
The representative form of governing body which the Societe des Artisans now has, and wants to preserve, while changing into a mutual insurance company is defined in clauses 7 to 13 of the bill before us.
Within this administrative set-up, the areas where the Society is doing business are divided into local jurisdictions which in turn are brought together into regional jurisdictions.
Each member of the Society belongs to a local jurisdiction (generally that of his residence). The member may attend the meetings of that jurisdiction, may vote, be elected officer and delegate to the regional jurisdiction to which his local jurisdiction belongs.
Each regional jurisdiction is therefore composed of delegates from its local jurisdictions, and elects its own officers and delegates at the General Meeting.
The General Meeting, composed of delegates and of each regional jurisdiction (or their alternates) as well as existing directors and former presidents of the Society, is the highest legislative authority thereof.
The General Meeting is held at least once a year.
In addition to its legislative powers, it elects, every four years, the board of directors of the Society, as well as its president and vice-presidents.
According to the by-laws of the Society, each of its directors is elected to represent a regional jurisdiction on the Board of Directors.
The Society also wishes to change its name. The Society has for a very long time been very active in the co-operative movement.
By becoming a mutual life insurance company, while keeping at the same time its representative form of administration as previously described and the right to promote social and educational activities, the Society will keep all the characteristics of a co-operative.
It is this co-operative aspect that it wishes to underline in the new name: "The Artisans, Life Insurance Cooperative Society".
I hope, Mr. Speaker, that the House will see fit to adopt this bill on second reading and that it will then

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La Societe des Artisans
be referred to the Standing Committee on Finance, Trade and Economic Affairs, which will be able to hear the officers of the Society as well as the Superintendant of Insurance who, by the way, has been heard by the Senate Committee and has said that he is in favour of this amendment to the Society and to the Act.
I thank the hon. members in advance for their cooperation.


Joseph Adrien Henri Lambert: Mr. Speaker, I read the bill a few minutes before entering the House, before five o'clock. In any case, I should like to put a few questions to the hon. member sponsoring the bill, asking him for clarification in the general interest.
First of all, I must say, and proudly, that I am a member of the Societe des Artisans and that the proposed change of name seems quite acceptable to me.
Investments are substantial enough in the Societe des Artisans to warrant the House giving the amendments put forward special consideration.
Now, will changing the name of the Society as well as some clauses authorizing it to enter into contracts with its members alter the character of existing contracts? Some contracts, for instance, are on the life of its members, while others do guarantee annuities to others.
This is what I want to know: Is the project now under study likely to alter in one way or other the contracts now in force?
Mr. Speaker, I believe that my question is in order because, normally we should get explanations enabling us to know whether this bill should be referred to the committee. We must know exactly the character of the proposed changes and the sponsor of the bill should be in a position to explain.


Rosaire Gendron: Mr. Speaker-


Mr. Speaker:: If the hon. member speaks now, he will close the debate. I recognize the hon. member for Saint-Hyacinthe.


J.-H.-Théogène Ricard: Mr. Speaker, I do not want to delay the referring of this measure to the committee, and the hon. member who has just asked a question will have to wait until this bill is considered in committee.
I would like to take this opportunity to commend my hon. friend from Riviere-du-Loup (Mr. Gendron) for piloting this bill. This mutual insurance corporation is a clear example of the results achieved by the abnegation and co-operation of people in our province. I am glad to see that today La Societe des artisans has 350,000 members and that its assets total about $80 million.
The current company's requirements are such that to expand operations improvements and changes are required. I think we should all co-operate and see to it that the officials of this insurance company are given the help they need to be able to improve their company's activities to meet the requirements of 1971.
I am heartily in favour of the views of the member from Riviere-du-Loup and I wish him the best of luck in his future negotiations.


Mr. Speaker:: The hon. member for Temiscouata (Mr. Gendron). If the hon. member takes the floor at this time, he will close the debate.


Rosaire Gendron: Mr. Speaker, the hon. member for Bellechasse (Mr. Lambert) asked the following question: What are the changes this new legislation will lead to in effective contracts in the insurance company? We must not forget that whenever a company operates on a fraternal society basis, since the main objective is not to sell insurance, insurance policies, the control, on the one hand, and the requirements on the part of the Superintendent of Insurance on the other hand, are greater, but this is due to the flexibility of operations in the fraternal society and to the risks that may to a certain extent be involved.
This means that a fraternal society may in the course of its operations, although it has never been done, change the contract and ask, for instance, that an additional sum be paid because the operating costs seem greater or the death rate exceeds the estimates, etc.
Therefore, whenever the society operates as a mutual company, it is impossible then to change the contracts and to call for new payments on premiums. And this becomes firm in that way.
I think those references do not minimize the present operations of La Societe des Artisans, because they have never changed the premiums during the run of a contract. But it was possible under the statute of a fraternal society while now, and because the society wants it, it is operating more on the basis of an insurance corporation and thus cannot change in any way the premium and the contracts.
It is obvious that all the policies being sold at the present time are not changed in any way and security is thus increased.
I should like to avail myself of this opportunity also to thank the hon. member for Saint-Hyacinthe (Mr. Ricard) for his kind words and of his reference to the success of one of our companies, of which we are rightly proud.
May I be allowed, Mr. Speaker, to congratulate you on your recovery. We are happy to see you in the Chair again and we wish you a long stay among us.


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.

March 4, 1971


Max Saltsman: That an order of the House do issue for a copy of all correspondence, memoranda, etc., between the government of Canada and industry in Canada since January 1, 1970, regarding regulations on the ownership and control of the uranium industry in Canada.
He said: Mr. Speaker, old buddy, my motion requests:
That an order of the House do issue for a copy of all correspondence, memoranda, etc., between the government of Canada and industry in Canada since January 1, 1970, regarding regulations on the ownership and control of the uranium industry in Canada.
On November 4, 1970, as recorded at page 867 of Hansard, the Parliamentary Secretary to the President of the Privy Council replied:
I am informed by the Department of Energy, Mines and Resources that correspondence received from uranium-producing and exploration companies contains information specifically requested by the government and given with the assurance that it would be treated as confidential. In view of this, I trust the hon. member will agree to withdraw his motion.
As recorded at page 868 of Hansard, I said that was not acceptable and the motion was transferred for debate. I did not ask for this information merely because I wanted the government to reveal information which is confidential. I think all hon. members of the House recognize that some correspondence between the government and other parties must be confidential. Actually, I wanted an explanation from the government of its actions with regard to the uranium industry. The negotiations that have gone on within the industry and the decisions taken by the government still remain a deep, dark mystery. We want to know why the government thought it necessary to issue these directives regarding the uranium industry and to assume this kind of control. We must remember that this was a most unusual action. We agree with that action, and I think the country generally supported it. Since this decision is significant in the area of foreign ownership affecting other industries, I think it is vitally important for us to know the reasoning behind the government's decision. What kind of information influenced it in that decision? We have been promised on various occasions that that information would be forthcoming. It has not yet been given to us, and the mystery remains.
One might think that the uranium industry, of all Canadian industries, would be least likely to be subject to regulations concerning foreign ownership. The industry is already heavily regulated. Little takes place in the industry that does not come under government security. Its exports are regulated. The use to which those exports are to be put is looked at. For instance, in the past the government has refused the industry permission to sell
Uranium Industry
uranium because there was no assurance that that uranium would be used for peaceful purposes. Since the regulations governing the industry are pretty extensive, why did the government feel it necessary, as well, to restrict the amount of foreign ownership in this industry. Perhaps the information in the government's possession should be made available to the public, so that the public could examine it. Perhaps, if we scrutinized the gover-ment's decision and the reasoning leading up to that decision, we could also deal with the question of foreign ownership in other areas and determine the direction that we should take regarding the question of foreign ownership in other areas.
At present the government's representatives say to us, "Trust us." I am not reluctant to trust them to a certain point. We have trusted them for a considerable time and have waited for them to give us a definitive statement which would spell out the regulations in more specific terms. We want to know what the government intends to do and how these regulations might apply to other industries. We brought this motion forward in an attempt to obtain this information. We should like to examine the kind of correspondence that has gone back and forth between the government and the industry. If the government feels that it cannot do this, the very least it owes the House is a complete explanation, as opposed to the usual, bland language the government members use when they tell us that these matters are confidential, that they cannot be revealed and that if they were revealed the government would break a trust. I feel it is most important for the government to explain its position in greater detail than it has so far. I think it owes that much to the House, and I hope that it is prepared to do so this afternoon. If the government cannot produce the papers for us and if it feels that they are too confidential, the very least it can do is explain to us the reasoning that led to the conclusion that the uranium industry of Canada ought to be limited in terms of its foreign ownership.


Mr. Lloyd Francis (Ottawa West):: Mr. Speaker, I listened with a great deal of interest to the hon. member who proposed this notice of motion. It is quite clear that, in terms of the wording of the motion before us, he has cast a broad net. He asks for a copy of all correspondence, memoranda, etc., between the government of Canada and industry in Canada since January 1, 1970, regarding regulations on the ownership and control of the uranium industry in Canada. The hon. member said that he and the members of the group to which he belongs approved the actions of the government in this regard. Then, in the next breath, he said he thought that it was an error that the government had started with these industries and these regulations concerning foreign ownership, because these industries were already so heavily regulated. Now, he asks in the broadest sense for all the documentation regarding this matter to be made public.
I have had certain difficulty in following the policies of the party to which the hon. member belongs, and never did I experience greater difficulty than this afternoon in

March 4, 1971
Uranium Industry
trying to add up the position of that party. If the hon. member's group approves the government's policy, then they must respect the government when it says that certain information was gathered in confidence and must be treated in confidence, because otherwise there cannot be any trust between industry and government. If, on the other hand, they do not approve of that policy, then the purpose of this motion is that the government shall lay out this information so that the hon. member's group can criticize it, challenge it, oppose it, and make suggestions about it. If that is so, that information this afternoon would have been welcome.
We have raised some pretty fundamental questions, Mr. Speaker, and the hon. member has used this motion as a vehicle for raising them today. He said that what he really wants to know is, what is the government's foreign ownership policy, what are the principles underlying it and how will they apply to other industries. With the greatest respect and with no little humility, we say that it is not easy to answer these things, because the policy is evolving. The government is studying it. The government has not taken a hard and fast position. The task force is in the course of preparing the report on the principles which will guide the policies of the government with regard to foreign ownership. The Minister of National Revenue (Mr. Gray) is the member of the cabinet entrusted with this responsibility.
In acting as it did, the government was fully aware that its actions to a certain extent were pragmatic. The government acted, as the hon. member conceded, in a responsible way and in response to widespread public opinion. Opinion within the hon. member's party is spread more widely than in other parties. The members of the waffle group want to go all the way in one direction, but the other members of the party are prepared to take a much broader line.


An hon. Member:: Why not read the newspapers?


Cyril Lloyd Francis: Actually, in taking measures to ensure Canadian ownership of industries, the government is trying hard to do what the public of Canada feels is right. At the same time the government is acutely aware that the rights of individuals are involved. The rights of industry are involved, as are the rights of individual Canadians. They have the right to deal with their own affairs logically and to look after their own interests. We assume, in our free enterprise society, that it is only fair that the parties involved in matters of this kind should have these rights.
What the government is saying today to this House very simply is this: the rules are being evolved. A full public document will be produced, and there will be a statement on policy. But, at this stage, it is premature to bring in this kind of notice of motion as a means of forcing a fuller and broader statement of policy by the government. This will take place; there is no question about it.
As I said at the beginning of my remarks, it is difficult to reconcile the series of statements that the hon.
member made. The hon. member agrees with what the government is doing: in general, he thinks it is right. But he wants the government to publish confidential documents, and to this end he has put down a broad, sweeping resolution that all correspondence since January 1, 1970, between the government and the industry in Canada concerning the whole question of the ownership and regulation of the industry be tabled. There is no way in which the government can accept such a motion, and I for one believe it would be a serious mistake to do so. I hope the government will not be placed in the position of betraying confidences explicitly given, and I trust the House will reject the motion which the hon. member has placed before us.


Max Saltsman: Would the hon. member be prepared to answer a question?


Cyril Lloyd Francis: I would be delighted to do my best.


Max Saltsman: The hon. member expressed some concern over the rules of the game. In this instance the rules of the game were obviously changed in midstream. When Mr. Roman became involved in the uranium industry there was no indication that the government's intention would be to prevent foreign ownership of that business. This is one of the complaints he is making. It is impossible for the public to know to what extent Mr. Roman's position is justifiable in the absence of the documents which are being sought. When the hon. member talks about changing the rules of the game with reference to the disclosure of confidential information, I say that in this instance the rules of the game have already been changed. Does he not agree that this is what has taken place? I should like to hear his opinion on this aspect of the matter.


Cyril Lloyd Francis: The hon. member is perfectly right. The rules of the game were changed. We are not trying to say they were not changed. We are saying that the motion before us is not one which would achieve the purpose which the hon. member is implying it would achieve. He is asking for the disclosure of a broad range of confidential documents. The issue of whether or not individual rights are adversely affected will have to be resolved in the proper way, that is, by discussions and attempts to reach an understanding.
Discussions have taken place and will continue to take place between the department and the individual concerned. The government has to balance the public interest and the private interest. It is a very delicate matter, and large sums of money are involved. The hon. member himself knows that this is not the kind of thing which premature publicity can resolve; it has to be resolved by discussion between the parties concerned and in light of the evolution of a national policy which the government is actively engaged in developing at this point.


Mr. R. J. Orange (Northwest Territories):: Mr. Speaker, like my hon. friend from Ottawa West (Mr. Francis), I cannot help expressing some doubt as to the principle implied in the motion before us. As my hon. friend pointed out, we are asked to approve the production of

March 4, 1971

private papers reflecting correspondence between the government and the uranium industry. In this case, the documents refer particularly to the position of Denison Mines and the government of Canada in light of Mr. Roman's announcement that he intended to sell his company to interests outside Canada.
The confidential nature of such documents is something which has to be established over a period of years. We cannot let it be destroyed unilaterally by one of the parties concerned simply because a motion has been put down requesting us to make those documents available. I am sure there is information contained in these documents which would benefit neither the government nor the individuals concerned. I need hardly point out that the interests of the shareholders of the company could be affected by such a disclosure.
We all remember the great excitement in the fifties when prospectors and others moved across the length and breadth of Canada searching for uranium deposits. We recall the establishment of such communities as Elliot Lake and Uranium City. Elliot Lake grew from being a spot in the bush to a modern, well equipped town. Then, as a result of a decision in the United States, the industry entered a period of decline. Mines were closed down and towns like Uranium City were seriously affected. We were unable to sell our product-though not the ore itself-in the markets of the world.
Sales by Atomic Energy of Canada Limited have been disappointing, to say the least. I remind hon. members that many years ago Canada decided that its approach to the use of atomic power was through heavy water process. Other countries took a different approach. Almost alone in the world, Canada depended on heavy water. Consequently, we found we were unable to convince other nations that this was the best way of developing nuclear energy.
Having gone through these ups and downs, the industry nevertheless looks forward to a bright future. This is what has been said for some time. Most of us wonder if that day will ever come. Nevertheless, we have kept a uranium industry in Canada by means of a combination of stockpiling on the part of the government and occasional sales of uranium ores to other countries, under certain restrictions. We have insisted on certain safeguards, specifying that whatever uranium we sold should not be used for military purposes. Canada has been a leader in the sale of uranium for peaceful purposes. On at least one occasion a major sale was not consummated simply because the other country concerned was unable or unwilling to guarantee that the product would be used for peaceful purposes and not for the manufacture of nuclear weapons.
As I say, we have retained the basis of an industry which will mean much to us in the future. There are still large deposits of uranium ore under the ground and many mining companies are anxious to get on with the work of developing their ore bodies whenever the market permits. In the meantime, the government determined that it was not in the national interest to permit the sale of a major company in this country to a foreign concern.
Uranium Industry
Having taken that approach, since that time there has been a period of negotiation and discussion between the government and the company concerned, much of which has been on a confidential basis and has been, I assume, an expression of ideas and opinions on the part of both. To make this kind of information available to the public through this House would not, I think, be in the best interests of the company or of the people of Canada.
To return to my original point, which was that confidence must be established, be it in the uranium industry or in any other industry, between government and the private sector, the principle involved is similar to the case where a man files an income tax return knowing that the return will not be distributed to other government agencies but will be kept within the revenue department. Similarly, a man who fills out a census form for the decennial census knows that the information he gives will be for the use of the Dominion Bureau of Statistics, and under penalty of fine or imprisonment the employees of DBS are required to ensure confidentiality of the information. The same principle applies in these particular cases as to all other cases involving such negotiations between government and the private sector.


Steve Eugene Paproski: Tell us a little bit about your area.


Robert John (Bud) Orange: The hon. member has a chance to speak if he wants, though he never says very much. Since it is obvious that the members on the other side of the House are perched, ready to launch into the parry and thrust of this exciting debate, with those few remarks and having enunciated my own personal view of the relationship that must be developed and retained between government and the private sector, I shall pass the debate on to my hon. friend on the other side.


Max Saltsman: Would the hon. member permit a question?


Robert John (Bud) Orange: I would be delighted.


Max Saltsman: During the course of his remarks the hon. member made the point that he was concerned with getting the consent of all parties. I appreciate the point; it is important that we have consent. My question is: Has the government asked Mr. Roman for his consent to releasing the document or the information contained in the document?


Robert John (Bud) Orange: Obviously, Mr. Speaker, I cannot answer that question. I do not know whether the government has made that approach; but it does occur to me that there are other vehicles for raising this question. I think our committee system, which has been so successful in the past, is one. Perhaps the committee on natural resources could involve itself in a study of this kind.


Max Saltsman: Mr. Speaker, I will take that suggestion under advisement. But could the hon. member tell me whether someone on his side of the House can speak for the government and answer that question, which I think is of particular importance? I am quite willing to agree

March 4, 1971
Uranium Industry
that consent is necessary, but I want to know whether that consent has been asked for and whether it has been refused.


Mr. Rod Thomson (Batileford-Kindersley):: Mr. Speaker, I should like to make a few comments in this debate. It seems to me that with the ever-increasing involvement of government in business affairs, the public should have some right to be made aware of some of the things that are going on. The hon. member for Northwest Territories (Mr. Orange) referred to the uranium policy of Canada and to dealings in uranium. While I can sympathize with the government's problem in dealing with private industry in this field, in view of the fact that Canada is in trouble in this area it seems to me some public dialogue should have been promoted sooner than it was. If we had had some advice or other people's opinions and taken the Canadian people more into our confidence, we might have found some solutions to the problem, or at least have had different reactions, than we have had up to the present time.
I think our uranium industry is locked in at the present time. As a Canadian I am hoping we will have the economic means to produce atomic energy, not only for ourselves but for sale to other countries. I cannot help but feel that any time we spend a large amount of money from the public treasury on helping the uranium industry, the grain farmers of Saskatchewan or other groups of that sort, the public who after all are paying the shot, have the right to have certain questions answered. Certainly, if I am to pay I want to know what I am to pay for and why I should pay.
There may be some instances, such as the preservation of a Canadian-owned uranium industry or the preservation of a Canadian-owned publishing company, where there is a sort of contract between the company concerned and civil service employees who are negotiating with the company. But if the Canadian people are putting up the money to preserve such undertakings, I feel they should have the right to know what is being done with their money, how much is involved and what promises have been made. It is for this reason that as a representative of the taxpayers of this country, I feel we should be entitled to this information.


Mr. Martin P. O'Connell (Parliamentary Secretary to Minister of Regional Economic Expansion):: Mr. Speaker, the hon. member for Waterloo (Mr. Saltsman) raises an important and continuing problem in this House, namely, the need for us all to get maximum information regarding government policies and intentions. To this proposition I fully subscribe. As we alter our rules of the House and build in research staffs for the various political parties in this chamber, we will have an increasing need for information. To that basic proposition I think most of us on this side of the House will agree with hon. members opposite. In this respect perhaps their need is even greater than ours; but I think we all recognize that there is a general need in this House for information.
In addition to that, the hon. member raises the point about essential information in a context now interesting all Canadians to an increasing extent, namely, the degree
of foreign ownership and control of Canadian resource industries. Those of us concerned with that matter doubly need information since this matter is currently being developed within the framework of new government policies. In this sense I am sympathetic to the request that is now before the House. However, I am prepared to say to the hon. member that even if that information were available I do not think this would be the right time to bring it forward. I think he himself was coming to this view, although he skirted away from it as he approached it. He recognized there is a need to trust the government when it says the information it has at a given time has been obtained on a confidential basis. He recognized the need to protect confidentiality. He went a little further and said there are times when information can and cannot be given. That is another matter which does not necessarily involve confidentiality.
Thus, there is a question of timing, and I raise this issue with the hon. member in attempting to respond to his motion. In the case of the uranium industry there is the matter of confidentiality added to the question of new foreign investment policy in its formative stages. Most of us will agree that the uranium industry is a special case. The hon. member for Waterloo drew our attention to the fact that this is a highly regulated industry in the resource field. It is probably the most highly sensitive and regulated resource industry in our country. We are entitled to a maximum amount of information, if for no other reason than the fact that this industry is of special concern to Canada and has special sensitivity.
The hon. member also asked if information could not be given now, then what sort of reasoning could be suggested to support regulation in respect of foreign ownership in this particular sector. We all recognize that this is the only sector of the resource industry, so far as I understand, which has regulations in respect of the degree of foreign ownership. One might say that the oil industry has ownership requirements, but this requirement in uranium is an innovation of some importance. No doubt the innovating regulations are there to control foreign ownership because of the special character of the uranium industry.
The hon. member also asked whether the president, or the owner of this firm, Denison Mines-this is why the whole question arose-had been asked his views as to whether correspondence ought to be published. Where as I cannot answer that question and would not pretend to speak with any authority on it, I would none the less be prepared to say that even if he agreed, this is not the time to bring forward the information. I still want to have tins information, but I think now is not the time to make it public. Why am I prepared to say that this is not the time, and why would I ask the hon. member to agree that timing is of the essence in this particular case? I think it is not the time because we are in the middle, I hope, further than the middle-let us say we are coming to the conclusion-of a study by one of the minister's of new governmental policies in respect of foreign ownership.

March 4, 1971

I for one do not think that the new policy, which has to be general, should be promoted or distorted or that influence or bias should be given to it by ad hoc regulations. Essentially, at the present time the uranium regulations are a holding operation. I do not think we should be making important general policy through ad hoc situations. I would go further and say I would be the first to recognize-and with this the hon. member will undoubtedly agree-that it is too bad the general policy is not yet in existence. The fact is that it is not yet ready. And so, on a practical basis, what is one to do when faced with this foreign ownership question of a dominant firm in a sensitive resource industry?


Max Saltsman: Mr. Speaker, I rise on a point of order.


Mr. O'Connell:: I will continue for just a moment. I will be glad to answer the hon. member's question in a minute or two. I should like to finish my thought, if the hon. member will indulge me in this way.
What we have here in respect of Denison is a dominant firm in an extremely sensitive industry. We also have the question of the whole strategy of Canadian participation in the science and technology of a nuclear age. This is a technology that we have not yet fully worked out. It is a technology in which Canadian policy is designed at present to move in one direction. In time we should reach the point where we have a broader policy in respect of Canadian technology taking us into the enriched uranium field for power production rather than concentrating solely on a heavy water system. If that proves to be the case, and even if it does not, we must have an assured supply of uranium, a commodity in a very sensitive area, to back up Canadian domestic and international policies. We must have an assured source of uranium supply. This supply must be located in Canada, under Canadian control and ownership.
It would be sheer folly, when faced with the prospect of going into the nuclear age, to not have control and ownership of the dominant firm in this country, particularly when other countries regulate and control the uranium industry so closely followed. There is world wide acceptance of governmental regulation. Technologies compete within this unusually comprehensive system of government influence. At this particular time we cannot permit these facts of competing technologies and government interest to escape us, particularly when we are faced with the question of foreign control of the major source of supply in Canada.
I do not think this is the time to disclose these regulations. They are therefore a holding operation, as I see it, and I repeat that I have no particular governmental knowledge. We should be prepared to alter the regulations if necessary to bring them into line with general policy when it emerges and therefore the confidentiality of the ad hoc regulations should be maintained.
I would be glad to accept the hon. member's question at this point.


Max Saltsman: The parliamentary secretary has today given us more information about the reason for keeping the uranium industry in Canadian hands than we have
Income Tax Act
received so far. In view of what the hon. member has said, I ask whether he is stating government policy, or is he speculating like the rest of us?


Martin Patrick O'Connell: Mr. Speaker, I am delighted to answer that question. I am glad the hon. member raised it because I wish to make it absolutely clear that I am not stating government policy. I am not privy to the regulations, and I am only speaking as a member of this House. I thank the hon. member for raising the question and helping me to clarify the position. I do not think one should call my reasoning speculation: surely my comments are a rational deduction in view of the situation. Again I go back to the hon. member's own point, that there are times when we have to respect the confidentiality of some information. There are other times when information should be disclosed. I think it should be disclosed when the general policy is available to all of us. At that time, any ad hoc policy ought to be brought into conformity with the general nature of things.
May I call it six o'clock, Mr. Speaker?


The Acting Speaker (Mr. Richard):: The hour appointed for private members' business having expired, I do now leave the chair. Last Monday, if hon. members will recall, signs of spring in the form of yellow daffodils were apparent. Today the white king of winter still reigns over us.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Benson that Bill C-225, to amend the Income Tax Act and to amend an act to amend that act, be read the second time and referred to a Committee of the Whole.
Mr. Roland Godin (Porlneuf):: Mr. Speaker, with the introduction of Bill C-225, I realize that in this government, it is becoming increasingly harder to find persons who can be categorical.
As a matter of fact, in introducing this bill, we are simply being asked to extend the application of a legislation introduced, a few years back, under the heading "temporary".
How can it be that the so-called enlightened people who are still holding important positions today had to beat around the bush to that extent in order to achieve their purpose?
The Minister of Finance (Mr. Benson) has succeeded in surrounding himself with first rate publicity men who
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March 4, 1971

Income Tax Act
try to do a good job, in other words, to show the minister as a man in the know who assumes his responsibilities.
In fact, the truth is just the opposite, since by this bill, the minister proves to us either his incompetence or his ill will.
Either he knew what would happen to the bill introduced two years ago, or he is not aware of the role he must now play at the head of the country.
The bill asking us to extend the act is, in my opinion, most unfair because, once again, it affects the poor and the average income citizen. These really bad formulas prove to us that the government always protects the strongest in the country, the big moneymen, in other words those who have countributed to the election fund in the past and who can still do it in the future. It is ridiculous to let the population believe that we intend to build a just society by such unfair methods.
The Economic Council of Canada has established that a family with an income under $5,000 lives in a state of poverty and a survey has shown that 75 per cent of families in Quebec earn less than $4,000 a year. Moreover, according to a survey conducted by one Scott Houde, of Dalhousie Institute, in Nova Scotia, it has been proven that 35 per cent of families in that province live in a state of poverty and earn salaries of less than $3,000 a year.
s (8:10p.m.)
Why, Mr. Speaker, does the government persist in wanting to collect money from this class of workers who already lack the bare essentials since it is known that personal debts of Canadians amount to $4,000 per home, not counting mortgages? Why must it tax low-income people who are not solvent in the eyes of the Central Mortgage and Housing Corporation?
So-called geniuses quite often blame Canadians for their lack of disposition for saving, but when you already lack the essential and in addition the government picks your pockets, how can you ever save anything? Stores and shops are packed with products of all sorts because Canadians have less and less purchasing power, and the government is introducing legislation to tax them further. It is really no wonder that some areas of the country are not developing much. In fact, it is recognized that even as taxes have increased, salaries have often remained at the same level. We know the results and, frankly speaking, one should not expect anything else.
So-called government experts work up projects aimed at eliminating regional disparities and in the same areas there are people who are required to pay more taxes. Truly, one must be utterly dishonest to believe that such a course of action is normal. As I said earlier, people who are considered insolvent by Central Mortgage and Housing Corporation when it comes to building a home are always considered solvent for income tax purposes by the Minister of Finance. We then realize that there is one law for the rich and another for the poor.
There are a number of public relations experts employed by the government who go around telling
people that they are being taken care of, and that solutions to their problems are being investigated.
With this Bill C-225, we realize that the government is genuinely concerned with the underprivileged, not in order to assist them, but to crush them more.
The surtax applied in the Spring of 1968 was only temporary and was supposed to produce $105 million for the Canadian government, collected from individuals for the fiscal year 1968-69. I repeat it was only a temporary scheme and we can read the statement made by the present Secretary of State for External Affairs, hon. Mitchell Sharp, who was then Minister of Finance, in Hansard for March 7, 1968, on page 7394, and I quote:
... this surtax will apply only for the taxation years 1968 and 1969.
Today, back comes the same bill, under Her Majesty's authority, with advice and consent of the Senate.
Can the Senate tell us whether the Minister of Finance's statement in the Spring of 1968 was due to insincerity or to lack of awareness. Whatever the reply, I believe we have there an explanation for some changes in the present government.
Officials in the department of Finance, very well paid officials, prepare high-sounding statements that are then made by parrot-type ministers, and as soon as the statement is made and the act becomes operative, those ministers are transferred to another department.
As the Secretary of State for External Affairs was a witness to today's debate, I wonder if he could tell us on what he based the promise he made to us in the spring of 1968 that the 3 per cent tax would be only temporary and would be in force in 1968-69 only.
I believe that the government had foreseen the present moment, that it was already thinking of maintaining this tax and that is one of the reasons why, I think, the Minister of Finance was given another department where he can wash his hands of the whole thing.
The bill also provides for the maintenance of a certain surtax imposed on corporations and small enterprises. One does not have to be an expert to know that those corporate taxes will finall ybe included in the prices of the products and the services sold by those companies. In short, with the extension of this tax, the workers will inevitably have to pay the piper once again because the companies always end up by including the cost of such taxes in their prices.
Once more, the consumer, who already lacks the necessaries of life, will bear the brunt of it.
If the government has not enough money to operate, there are other means to get some, and the Minister of Finance knows all about them. He should use these means to try and help to some extent those who could do with more than their salaries to meet their own needs and those of their families.
With Bill C-225, he is attacking not only the individual's income but also the bare minimum. He is taxing what is necessary to life and the minimum expected by Canadian people.

March 4, 1971

The head of a family who earns $4,000 a year receives the equivalent of welfare. And if people on welfare had to pay taxes, it would be of the utmost ridicule. When somebody with an income below $5,000 is taxed, the essential needs of a family are thus taxed. And even though the government is very strong presently, owing to its majority, I feel it is not a good enough reason for it to take the last nickel away from the Canadian people.
When we compare in the 1971-72 budget the amount of $558,300,000 paid in respect of family allowances to the amount of $1,994,685,000 for servicing the debt, we find ample reason to convince us that the present government does not at all reflect the image of the democratic government which had been expected following the coming to power of the Liberal party. By its action, the present government is in the process of proving that it does not at all administer the country according to the wishes of the people.
The minister who is supposed to sponsor this bill is not alone responsible for this state of affairs, as there is above the governments an anonymous body which includes very influential people who are being waited on by the old political parties. Whatever the color of the government, blue or red, it is always the same administration dictated by senior officials whose function is to execute the will of high financiers. Crises of all kinds follow one another. There are words to categorize them, they are even given names as for hurricanes: the monetary crisis, the October crisis, the unemployment crisis, the union crisis. It is easy enough to catalogue all those crises but when it comes to finding means to prevent them, nothing is done. The government is sustaining constant publicity about the poor; the number of poor people increases but there is no mention of change of any kind.
Mr. Speaker, precisely because I did not come here to protect any trust, because I am primarily concerned about the welfare of my constituents, I take the liberty of moving the following amendment, seconded by the hon. member for Shelford (Mr. Rondeau):
That the main motion be amended by deleting the word "now" and adding the words "in six months from today" at the end of the question.


Mr. Rene Matte (Champlain):: Mr. Speaker, it is easy to settle immediate problems with instant stop-gaps applicable at any time. The government, which was supposed to establish the just society, lost no time, right after taking office, in raising taxes through a 3 per cent surtax.
The new administration, under the spell of "Trudeau-mania", had already raised taxes by 2 per cent, affixing to the new tax the pretentious name of social development.
Ironically enough, never has Canada known such gloomy years! Unemployment, social deterioration and anarchy seemed to be the reaction to this half-concealed arrogance. The Canadian citizen is more and more aware of the fact that constant imposition of new taxes and surtaxes will fatally lead to a point of no return, where anarchy and dictatorship are bound to take over.
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Too often, and this should never have been tolerated, temporary schemes end up by being permanent. This illustrates the principle: let us create a precedent, let us enact a temporary legislation; in any case, it will become permanent.
We, particularly in Quebec, in the past, have greatly suffered the ill effects of such provisional agreements that later on became permanent. How many essential rights Quebec has lost temporarily and which are the cause of the accute constitutional conflicts we are experiencing today! How many promises of a return to normal as soon as the dangerous situation was controlled! In a word, Mr. Speaker, how many misrepresentations, at least at the intellectual level, aimed at improverishing the Canadian taxpayer to a greater extent!
Perhaps we could not talk this way if we had no other solutions to put forward than those constant tax increases. My colleagues had the opportunity to analyse scientifically and refute systematically the claims of the Minister of Finance (Mr. Benson).
Allow me to emphasize, in my own way, the disadvantages of this obsolete economic system which requires the whole population to follow the ups and downs of a staggering economy controlled by the whims of high finance. If at least the government, through its action, managed to restore some order within the economy, if it succeeded in improving everybody's welfare, and if finally, it succeeded in balancing once and for all the country's finances, we would not insist so much that this bill be withdrawn. But God knows that everybody is lost in this fiscal jungle. The government is groping its way day by day. Money is so scarce: it does not matter whether this is the result of bad administration or of a bad system, it keeps on levying more taxes to solve whatever problem arises.
And yet the means we are suggesting should at least be tried out. Let us stop empoverishing everybody by this dreadful bleeding from interest scattered to all winds, the North-South wind being the most efficient.
Why persist in requesting from senior bankers permission to issue social credit? Why reimburse two, three, four and even five times the capital amount? Why thus spoil the genuine power, that of the people, the monetary power that the people himself could exercise through his bank, the Bank of Canada?
Why not agree to interest-free loans? Why not reduce by all means available the tax burden and avoid all extravagance?
Mr. Speaker, we would very much like the government to succeed in making our economy healthier. We would like to help them do it. With all our heart we would like to be able to relax in this vast country of ours whose untold riches do not sufficiently contribute to the welfare of each and every one of us. We would so much like every Canadian to feel really responsible and to be able, having acquired his full development at all points of view, to contribute to international development, to inter-

March 4, 1971
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national peace. But one must admit that we must first organize our own affairs.
Finally, Mr. Speaker, we are always ready to co-operate closely with any government that will condescend to take a step towards the real solution which we advocate, which would spare us many hardships and which, in making financially possible what is physically achievable, would permit a better distribution of goods and give the individual the freedom necessary for his development.
Mr. Speaker, those are the reasons obliging us to insist vigorously against such government tactics of keeping on levying taxes that look most unfair to us. That in an affluent country such as ours no efforts were really made until now to solve the problems by exploiting our full potential of material riches, is unthinkable. Add to that the wealth of our labour-and again we know it is not lacking at the present, that there are at least 700,000 available and that we have the necessary talent-and we could set an example in the world by merely applying the principles inherent in an adequate economic system.
That is why the one and only solution the government always comes up with-increasing or extending taxes- constitutes the reason and the cause of the frustrations we have to go through at the present time.
We therefore have to defend the people themselves who have to cope with taxes and who want once for all to have other solutions considered instead of taxes.
They want at least that some steps be taken to study other methods which could lead to better understanding and to better living conditions for all.
One wants to eradicate poverty; we agree. One wants to improve the lot of everyone and we agree again. But we disagree when one does not use his intelligence or his imagination or any means to try to find another solution than a tax increase.
And those tax increases evidently and surely lead to a slackening of the economic development, a slackening which the small wage-earner who can hardly make ends meet, is obviously always the one who must suffer the consequences.
That is why we are here, to fight for the main interests of the weak, to fight for the main interests of the people, for it must be admitted, Mr. Speaker, the majority of Canadians are not now living absolutely freely, taken into account the great financial difficulties they encounter.
That is why-and I think that should be enough-we insist that the government revise its position and try- then we will give it all our support, all our help-to find solutions other than increasing taxes.
We hope we will at last be heard, that there will be a show of good will. In fact, we are sure, we have the support of the majority of the people.


Georges-J. Valade: Mr. Speaker, I will recall at the outset that the purpose of Bill C-225 which is before us this evening is to extend for a period of one year the 3 per cent surtax, which was unfortunately enacted in February 1968.
Indeed, Mr. Speaker, this bill brings in no change, except the extension of a legislation, of a surtax which was to be temporary, as have just mentioned some hon. members of the Ralliement creditiste.
The amendment moved by the creditiste member has in fact the effect of deferring to six months the consideration of the proposal, which for all practical purposes would amount to eliminate the effects of that legislation.
We will unquestionably-at least in so far as I am concerned-support the creditiste amendment since it tends to repeal that surtax, that additional burden imposed on taxpayers.
Mr. Speaker, what I would have wished this evening, before pursuing my remarks, would have been that the minister of Finance (Mr. Benson), who unfortunately is not here, withdraws that 3 per cent surtax enacted three years ago.
We will remember that this bill, which in short provides for the extension of the implementation of Bill C-193, introduced in February, and which originated in November 1967, had been proposed by the then minister of Finance, now Secretary of State for External Affairs (Mr. Sharp).
It is intended by this bill that an amount of $300 million be collected to provide for social welfare benefits and particularly old age pensions. I would appreciate it if the Minister of Finance or one of his officials would tell us whether the manimum amount that the government was seeking to collect by means of the 3 p. 100 surtax has been exceeded. It is quite possible that this surtax may have netted the government $500 million or $600 million which would confirm one again that this surtax is unjustified in as much as it has brought in more money than was required to meet these specific needs.
Now, Mr. Speaker, since it is impossible to obtain this information, I hope the minister will make it his duty to tell the House whether or not the government is actually collecting far more money than is needed to reach the goals set out in this bill.
Mr. Speaker, if, today, the taxpayers find that the government wants to extend the surtax for another year, they will have to pay it. When we speak of a surtax, we speak of a tax on a tax. It should however be noted that the present government is not the only one responsible for this situation. As a matter of fact, Bill C-225 is really a continuation of Bill C-193 of sad memory, and which caused some disquieting moments within this Parliament. We will remember it too easily and with too much bitterness. This bill plunged Parliament into one of the worst political crisis in the history of Canada.
February 19, 1968, will be well remembered, when a bill was put to a vote, a bill affecting the life-blood of the federal administration, i.e. the budget, and the way in which the government must spend public monies. In fact, it was a bill involving expenditures needed for the federal administation.
According to the whole parliamentary tradition, to the practices followed in all countries with a system similar to ours, this law was bourd to commit the liberal govern-

March 4, 1971

ment which introduced it on February 19, 1968, at the occasion of a vote in this chamber.
You will recall, Mr. Speaker, that on the night of February 19, the government was defeated by a vote of 84 against 82. On this first vote, all opposition parties had unanimously voted the government down, therefore condemning its proposals and rejecting a piece of legislation which aimed precisely at imposing upon Canadian taxpayers a direct tax on their income tax return.
Mr. Speaker, I was extremely surprised today to hear my good friends from the Ralliement Creditiste who time and again said that they were strongly opposed to this tax hike, state that they are the champions in this House of the laboring man, the low-earner, and that they are the true defenders of the Canadian nation.


Some hon. Members:: They are.


Georges-J. Valade: If my hon. friend maintains that they are, I must, to be fair, truthful and simply honest, straighten out the facts.
The Ralliement Creditiste had voted with all other opposition parties against the bill proposed by the government, causing the fall of the government-


An hon. Member:: This is not true.


Georges-J. Valade: -not of the Liberal Party in power but of the government of that time.
Before my hon. friend says this is not true, let him wait and I shall give him proof.
The liberal government had had a rebuttal on proposals to increase taxes for Canadian taxpayers in a precise legislation to this effect. When I hear our hon. friends the Creditistes today say that they hold the government responsible for this, I say this is not the whole truth, because those who are really responsible for the surtax we have had these past three years and for the extension that we shall have are the Creditistes themselves whose behaviour has given the lie to their leader's actions and statements in the House-


An hon. Member:: This is not true!


Georges-J. Valade: -and kept in office that party which had undertaken to increase personal income tax.


An hon. Member:: Tell the truth!


Georges-J. Valade: I appreciate the fact that my hon. friend wants me to speak the truth and this is exactly what I intend to do, Mr. Speaker. How unfortunate that in this House one should be forced to put-


Joseph Adrien Henri Lambert: It is a new bill.


Georges-J. Valade: It is not so. It is a continuation of Bill C-193. The members of the Ralliement Creditiste had said that they would vote against the government, that they had said so a thousand times in this House-


Joseph Adrien Henri Lambert: It was not the same bill.
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Georges-J. Valade: It is the same bill perpetuating itself; there is no difference whatsoever.
Mr. Speaker, I am tired of hearing in the House those self-styled defenders of the working class who really bear the main responsibility for a surtax applying to all Quebec taxpayers.
Mr. Speaker, I shall quote from the official report of the House of Commons. As far our honourable friends who are trying to refute self-evident truths, I should like to invite them, since they claim to be the sole defenders of the truth, to review conscientiously what was said in this house just three years ago.
On page 6905 of Hansard for February 21, 1968, when the house had just defeated the government by a majority vote, you can read the following:
If we believe that, in a democracy, parliament is the real sovereign of the country, we may say, in the present circumstances, that the government has been defeated by a parliamentary majority and that it should resign.
These were the very words spoken by the leader of the Ralliement Creditiste (Mr. Caouette).
Mr. Speaker, it is rather surprising that a few days later, that is to say on February 22, 1968, as recorded on page 6915 of Hansard, the leader of the Ralliement Creditiste (Mr. Caouette) had this to say, and I quote:
There was no agreement or collusion among opposition parties. The only thing that happened Monday evening was that the motion introduced by the government with regard to Bill C-193 was defeated.
Here, the leader of the Ralliement creditiste (Mr. Caouette) said:
[DOT]-was that the motion .. was defeated-
-while one day, not 20 years later, but the day before, the leader of the Ralliement creditiste stated:
-was that the motion ... was defeated-
And, on the following page, he goes further and says this,-and I invite the hon. members to read page 6905 carefully:
-was that the motion... was defeated-
It was not the motion, that was defeated, it was "the government".
-Under the circumstances,-
-says Mr. Caouette-


Mr. Speaker:: Order! I would invite the hon. member to refer to his hon. colleague from Temiscamingue as the representative for the Temiscamingue constituency. The hon. member will admit that it is a sound prac ice in this House to refer to a member by giving the name of his riding rather than his surname.


Georges-J. Valade: Mr. Speaker, I simply wanted to draw attention to the fact that I was quoting Mr. Caouette's words as recorded on page 6905 of Hansard. So I must mention Mr. Caouette's name. I recognize that he is

March 4, 1971
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member for Villeneuve, but I am quoting page 6905 of Hansard where the hon. member for Villeneuve, leader of the Ralliement creditiste, was stating as follows:
We voted and the government was defeated. Under the circumstances, there is but one way out, and that is to go to the people.
This was the statement by the leader of these honorable gentlemen to my left and I am trying to explain-


Gilbert F. Rondeau: I rise on a question of privilege, Mr. Speaker.


Mr. Speaker:: Order. The hon. member for Shefford (Mr. Rondeau) is rising on a question of privilege.


Gilbert F. Rondeau: Mr. Speaker, I have in hand the official report of the debates of the House mentioned by the hon. member for Sainte-Marie and I would like him to tell us on what page he finds the words "Under the circumstances, I see no other way out for the government than to go to the people" ascribed to the leader of the Ralliement creditiste (Mr. Caouette).


Georges-J. Valade: Mr. Speaker, I have just mentioned it. My hon. friend was nervous. It is on page 6905 (6-9-0-5). It is not a phone number, but the page number in the issue of February 21, 1968 (1-9-6-8) of the official report of the debates of the House of Commons which all hon. members receive at their office and which they collect or keep.
Mr. Speaker, I hope that my friends will not deny a statement appearing in Hansard and which was made by the leader of the Ralliement creditiste. I will quote another one to enable them to understand better. Since we are considering the bill concerning the surtax, may I quote from the same page 6905 (6-9-0-5)-it is not neither a bingo game, Mr. Speaker.-I want to be very clear for our friends. In the second column of this page, we fnd the following words of the hon. member for Villeneuve:
We objected to Bill No. C-193 at the resolution stage. We are still opposed to it, and if the motion for third reading has been rejected by a vote in the House, I see no other way out for the government than to go to the people and ask for their opinion on the way in which the business of the country is to be dealt with.
This, Mr. Speaker, was the final ultimatum, the position that the leader of the Ralliement Creditiste had taken in the House before subsequent consultations.
I do not quite understand. I could quote several other statements of the hon. leader of the Railliement Creditiste which puzzle me because I am sure the members of his party are honest representatives of the people. But I cannot understand that today, when we are discussing the very substance of Bill C-225 which is in fact the repetition of Bill C-193, we find so many contradictions in it that we could believe the words of some people who must represent the population with honesty and loyalty and who say to the House: We stand absolutely alone as protectors of the little man.
We are against the government continuing to impose this surtax on the people.
Mr. Speaker, I say it is not only my right but my duty in this House, especially as a representative of the working class, to protest against this systematic, gradual and repeated tax increase, at the expense of the small wage-earner, of the worker. The steadfastness of Conservative members was put to the test but we have never indulged in petty politics and time-serving as we have seen others do since yesterday on this question.
If the Ralliement creditiste had wanted to spare the population from the effects of a surtax, they should have taken the same stand in 1968, at the time of the vote against the Liberal government, and that same government would no longer be at the head of this country to extend the surtax and taxes against which the Creditistes today seem to stand as champions.
Mr. Speaker, if at that time, the Creditistes had not reversed their position ten times, the government would not have enjoyed the reprieve they owe us and we would have taken a specific honest and clear position. If today we have to stand up again and tell the government: We refuse that tax extension you propose, if we have to do so, it is because the Ralliement creditiste maintained and helped to maintain the Liberal administration under Mr. Pearson.
Mr. Speaker, I am not participating in this debate merely to attack without cause my colleagues in the House, but in order to show the facts as they are, so that such unacceptable and unexplainable contradictions may not be made without rebuttal.
Mr. Speaker, we have only to refer to some newspaper articles. I have here-


Gilbert F. Rondeau: Montreal-Matin.


Georges-J. Valade: -La Presse. My hon. friend was wrong once again. Ten mistakes so far, Mr. Speaker. There is nothing new in that. And now one more.
Mr. Speaker, I have here the front page of La Presse, dated February 24, 1968, with a big headline which, for our friends' information, reads:
Caouette Saves the Government.
Mr. Speaker, Mr. Caouette saved the government against a Progressive Conservative vote, in order to maintain in office a government that had then decided to impose a surtax on the taxpayers. This is what the newspapers wrote.
In another report published not by Montreal-Matin but by La Presse, February 24, 1968, on page 47, one could read this:
The Liberal Party owes a great deal to Real Caouette for his right-about face.
Those are not our comments, Mr. Speaker, but those of newspapermen who had examined the statement made by the leader of the Ralliement creditiste on February 21, along those lines: "The government has been defeated and must resign. It should go before the people". The day after, that is on February 22, he said: "We did not vote against the government we voted against the motion".

March 4, 1971

Mr. Speaker, this subtility of speech which becomes more and more reproachful (reprobatrice)-


Gilbert F. Rondeau: Reprobateur.


Georges-J. Valade: -this interpretation which becomes more and more difficult for our people to accept now, all the more so since it comes from those who claim to speak the only truth, if the expression is not too strong-


Gilbert F. Rondeau: It is strong.


Georges-J. Valade: for my Creditiste friends.
Mr. Speaker, if we are discussing today a bill which affects all Canadian taxpayers and, as explained by the minister, which states that the government's intention is to extend for another year the 3 per cent surtax, it is because the government has enjoyed and still enjoys a majority which it has gained democratically and when it could rely on the support of the Ralliement creditiste. This is why we are still in the same situation and asking the government to consider the situation of the small wage earners and to defer its decision in the present economic situation, when unemployment has raised to levels unequalled in the past, when the economic situation becomes more and more difficult, and when companies find it difficult to "have both ends meet in their administration." After all, all those who have intelligent and technical knowledge of economics say to the government: Stop taxing, because you are in the process of strangling small industry, of strangling the low-salaried worker, of strangling the economic future, the future of Canadian citizens.
Mr. Speaker, that is why we are engaged today in another debate which does not differ at all from that of 1968, which is an exact replica of the 1968 legislation. If at that time some hon. members had shown by their unequivocal attitude that they would never had supported the federal government had it persisted then in its intention to extend the 3 per cent surtax, I am sure that the Canadian taxpayers, the Quebecers and the workers in general, would not now have to dig deeper into their pockets to pay for the exaggerated, extravagant expenditures of the present liberal administration.
Mr. Speaker, I shall spare the House some of the comments I could add to those I have made already. I could quote the many testimonies of people who write to me blaming the liberal government for its policy of economic pressure, not on those who can pay, but on the small wage earner. The Minister of Finance says that the policy advocated in the white paper will result in taxing the rich to give to the poor, but the present bill taxes the poor to make the government grow even richer than it is now.
There is only one thing for the government to do if it needs funds to pay for social legislation and for the dificit caused by the old people pensions: it can cut down on its extravagances and reduce the amounts spent uselessly in some departments.
The government has all the means at its disposal, all the powers needed to impose on the taxpayers all the taxes it deems necessary and valid. The Liberal govern-
Income Tax Act
ment will have to remember that if it has all the powers once elected, it does not enjoy this power indefinitely. And if it does not consider the results of increasing taxes from day to day and thus aggravate the situation caused by this heavy burden of taxes accumulating from day to day, it will have to suffer the consequences.
Mr. Speaker, let us ask the members in good faith-as my hon. friend from Matane (Mr. DeBane), whom I want to congratulate publicly for the selfless, frank and loyal work he has done, for many months, to help the population of his constituency to go through very hard times- what they think about it. I want to congratulate the hon. member because he is the kind of public figure who makes a politician's life worth living and he is almost the only one of his kind. I believe that all the other members who represent the working class, the low-earners, must now realize that if they do not stop taxing the man who can no longer pay, one day, and that day may be soon, they will have to pay the price of their blind loyalty to a party, particularly those members who want to warp minds and act as gods, claiming to be the sole possessors of the truth and the sole defenders of the working class.
These irresponsible and unfounded attitudes and statements will only destroy public confidence in politicians and Parliament. I do not believe that this is the best way to serve the people. I therefore strongly urge the Minister of Finance to state, before we vote on Bill C-225, how much money the government has collected and is now collecting through this 3 per cent surtax and if these sums exceed the requirements of the government, let him promise to reduce taxes accordingly on low incomes.


André-Gilles Fortin: On a question of privilege, Mr. Speaker.


Mr. Deputy Speaker:: The hon. member for Lotbiniere.


André-Gilles Fortin: Mr. Speaker, having heard the speech of the member for Sainte-Marie (Mr. Valade), an insidious speech, with dishonest interpretations which reflect on our privileges as members of Parliament, I think it is my duty to set the facts in their true light. Last night again, the whip of the Conservative party asked one of my colleagues, the hon. member for Compton (Mr. Latu-lippe), who was the first Creditiste speaker on this tax bill, to shorten his speech to five minutes, ten minutes at the most, in the hope that this bill might pass unnoticed.
Mr. Speaker, we want to set the facts straight and what the member for Sainte-Marie said is false and reflects on our privileges. The fact that I have just disclosed can easily be substantiated by the testimony of the member for Compton who is far more honest than the member for Sainte-Marie.


Georges-J. Valade: On a question of privilege, Mr. Speaker.


Mr. Deputy Speaker:: I recognize the hon. member for Sainte-Marie.


Georges-J. Valade: Mr. Speaker, I have no intention of raising the question of privilege in respect of the nonsense we

March 4, 1971
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have heard from the hon. member for Lotbiniere (Mr. Fortin). But he has stated that I have made false, dishonest, seditious and libellous accusations or whatever. I would like to remind Your Honour that I have quoted extracts from Hansard, and the hon. member for Lotbiniere has no right therefore to accuse me of false statements since I was quoting from Hansard. And if such is the case, then the hon. member for Lotbiniere should withdraw his statement or else confine himself to the extracts from Hansard which I have quoted.


Mr. Deputy Speaker:: Order, please. It seems to the Chair that the hon. member is raising a point for debate rather than a question of privilege.


Georges-J. Valade: Not in the language used by the hon. member for Lotbiniere (Mr. Fortin), Mr. Speaker.


Mr. Cliff Downey (Battle River):: Mr. Speaker, Bill C-225 is another of these omnibus type bills that the government is in the habit of bringing in. It proposes an extension of the capital cost allowance to 115 per cent. I think that is all right, though I believe there are other tax concessions that could better improve the business climate and help get new industries off the ground. The fact that the surtax is being continued is, I believe, a deplorable step. It has caused untold trouble in the past, and will in the future. Taxes are creating a psychological depression in this country and are probably one of the main causes of unemployment, strikes and the general dissatisfaction that is so prevalent in the country. When I refer to taxes I refer to the oppressive taxes that are now with us and which are being proposed.
It is constantly being said that more demands are being made upon governments and that since the money to meet those demands has to come from somewhere, taxes must be increased. I suggest the solution is more a matter of priority and business judgment. I think this is no better illustrated than in an incident that occurred in the defence committee some time ago. I do not have the committee reports in front of me, but I refer to five warships for which Canada let a contract. These were dual-purpose ships playing an offensive and defensive role. I think the original estimate of cost for the five vessels was around $156 million-something like $31 million apiece.
These vessels have not yet been delivered because, since we want the latest in equipment, they have had to be upgraded and also we want them to be distinctly Canadian. For them to be distinctly Canadian entailed getting parts of the ships from about five different European countries: we got the guns from Italy, the firing-pins from Holland, and so on. Can you imagine the practicality of a situation like that in time of war? In fact, it went even further than that. Before we took delivery of the vessels we decided to change the engines. Changing the engines involved changing the hulls. The vessels still have not been delivered, and we have an open-ended contract for God knows how much money. I think the cost of these vessels today is something like $20

million each more than the original estimate. We keep talking about raising more and more taxes, Mr. Speaker; but with businessmen in this country making deals like that, there will be no end to increases in taxes.
Let me say something about priorities for this country. I was never enthusiastic about the priority given to bilingualism. Although it is important, it is not as important as funnelling large expenditures into solving the unemployment situation. Our bilingualism program reminds me of the story of the lifeguard at the swimming pool who, when told someone was drowning in the pool, replied, "I know. But I can't swim". When asked why, if he was a lifeguard, he could not swim, he replied, "Because I am bilingual".


Some hon. Members:: Shame!


Cliff Downey: I suggest that was his qualification, and priorities of this kind-


Mr. Deputy Speaker:: Order, please. I hesitate to interrupt the hon. member but I should remind him that the House is now considering an amendment to the main motion, that is, for a six months' hoist. The motion before the House is in respect of Bill C-225 which deals with two matters relating to the Income Tax Act. The first part provides for capital cost allowance and the other provides for a continuation of the surcharge. With respect, I ask that the hon. member confine his remarks to these areas of discussion.


Cliff Downey: Mr. Speaker, I was trying to relate my remarks to the reasons behind our tax structure. There has been a great deal of criticism of the Minister of Finance (Mr. Benson). He is only an agent of the Prime Minister (Mr. Trudeau). He has crippled this country with fear in respect of what the future may hold as a result of tax reform.
Let me now refer to the evidence given before the Committee on Finance, Trade and Economic Affairs, volume 80. This evidence was heard in Edmonton, Alberta. Mr. Mannix, of the corporation of that name, was testifying. He referred to his company as a wholly-owned Canadian company which does about $85 million worth of work per year, employing some 2,700 employees. He said:
I do not think that, at any time, Mannix or the Mannix family have to take a back seat or justify their position. I just want to make that absolutely clear. They have made a real contribution to this country, and I tell you categorically that we would still be dominated by the American organization, would still be restricted as we were being restricted from day to day then-that is why we bought our position back again-if the provisions of the white paper had been in effect then. We would not have been able to attract the talent that we needed.
In reference to talent he said:
Talent is our main consideration because without it, this country is going to go down. There are already prospects of this country not going to have the second highest standard of living. We are going to have the sixth. This is because our productivity is going down.
March 4, 1971

We must understand that talent is not captive. Talent is going to moye just like capital and it is going to go where the opportunity is. It is going to go out of this country-it is going out of this country-because of the uncertainties created first by the Carter report and, secondly, by the introduction of the white paper and the continuing reiteration of the leaders of our government today that, come hell or high water, we are going to have this act put into effect.
In relation to the high tax it is interesting to note that a brief was presented to this committee by the business class of Western University. It stated that out of 104 people in that business class at the Western University, 100 are going to the United States because after analyzing the white paper they could not see an opportunity to operate in this country in a proper manner. This is a direct result of taxation. I suggest we will be left with the drop-outs and those who cannot help themselves. Let me give some examples of this. The evidence given by Mr. Connelly to the committee, as recorded at page 38 of volume 80 of the committee's report, with regard to the city of Edmonton was as follows:
You all know In this city the case of Ron Banister-Ron Banister has said that I could mention his name. He has sold out his company to a computer organization in Pennsylvania because he is frightened of the implications of the white paper and the capital gains tax. They got into trouble like most computer organizations. He was asked if he would come back and be president of this company. He said he would if he could operate from the city of Edmonton. The employers of this company said that was all right but on examination found out that they would have to pay the key people $10,000 more a year to equate their salaries- not the living expenses, just their salaries in moving to Edmonton. The executive vice-president found out that if he moved down to Minneapolis he would have $7,000 more a year to spend after tax paid. The result was that there was no way this organization could stay in Edmonton, so it has moved to Minneapolis.
We hear a great deal of talk about nationalism today. I mentioned in the House the other day that it is very necessary that this government develop a plan to initiate a sound economic policy for our citizens. My reason was that for the most part today conservativeness is the result of the investment of capital rather than increased labour. If we are to find any solution to the problem of increased taxes and unemployment, with attendant welfare difficulties, we will have to come up with an economic plan to enable the workers of this country become shareholders in our industries.


Gilbert F. Rondeau: Mr. Speaker, it is most interesting tonight to speak on the amendment introduced by one of my colleagues a short while ago to the effect that the passing of this bill be delayed another six months.
Mr. Speaker, the Creditistes who have spoken before me today have perfectly well asserted their party's point of view in this House, as again they have had the opportunity of doing it previously.
The proposed amendment tends to delay for a period of six months the passing of a bill to continue the application of the tax proposed by the government in March 1968.
Income Tax Act
Mr. Speaker, if we remember well, this so-called "social development tax" was supposed to be a temporary measure.
And today we see that the government wants to make it a permanent tax. I believe the government's policy in this regard shows very clearly that it was not able to achieve social development through this tax within the period anticipated-by December 31, 1970. The government expected to establish social development in Canada through that tax. Today, because it has not been possible to achieve that goal the government wants to re-apply the tax, extend it for another year, but we know very well the tax will become permanent.
I want to use official records to place the House within the context of events which led to these taxes.
I should like to correct the innuendoes made by the hon. member for Sainte-Maire (Mr. Valade) about the Ralliement creditiste. He took advantage only of what interested him and he did not speak the whole truth in this House.
We know very well what was said in this House by reading Hansard not only for the one day which is of interest to us but for all the days when this subject was discussed.
On February 19, 1968, the government had brought before the House Bill C-193 to establish the so-called "social development tax".
We know that the vote on that day had brought on the defeat of the government, that a majority of the hon. members in the House had voted against that tax, and we can see from the vote that, as the hon. member for Sainte-Marie has said, the Creditistes, like other members of the opposition, had contributed to the defeat of the government.
And we can continue our reading of hansard. On February 21, 1968, as shown on page 6905,-the one quoted by the hon. member for Sainte-Marie-my chief, the hon. member for Temiscamingue (Mr. Caouette) stated, and I quote:
-There is but one way out, and that is to go to the people-
And before, also on the same page, the hon. leader of the Ralliement creditiste stated, and I quote:
If we believe that in a democracy, parliament is the real sovereign of the country, we may say, in the present circumstances,-
-that is the circumstances of February 21, 1968-
-that the government has been defeated by a parliamentary majority and that it should resign.
He was saying this on February 21, 1968!
On February 23, the present right hon. Prime Minister (Mr. Trudeau), then Minister of Justice, promised this House to rescind this bill and repay Canadian taxpayers the money that had been illegally collected through the bill that had been defeated the night before.
3976

March 4, 1971
Income Tax Act
I have here the text of the statement made by the then hon. Minister of Justice, as reported on page 7042, and I
quote:
I will even go further, and I will say that it is not only the government's intention not to reintroduce this legislation, but that it is firmly determined to credit the taxpayers with the money they have paid under the bill.
The government recognizes that it is the will of this house not to collect taxes this way.
Therefore, it is saying clearly and plainly to the taxpayers: The money you paid legally under this legislation, that money will be credited to you. It cannot be clearer than that.
The then Minister of Justice made that statement on February 27, 1968.
On the same day, as we were discussing the same bill, the members of the Ralliement creditiste were not yet convinced by the hon. Minister of Justice's promises. They wanted more and the hon. member for Kamouraska proposed an amendment, as one can see on page 7073 of the Hansard, and I quote:
That the motion be amended by adding immediately after the word "government" the following words: And that the government will not present again the said bill in this current session, and that it will credit the Canadian taxpayers with all the sums that have been collected since January 1, 1968, in anticipation of the provisions of Bill No. C-193.
That was not only a verbal guarantee given by the government but it was in the statutes, a garantee whereby the Ralliement Creditiste members had forced the government to accept this amendment. Consequently, the Canadian taxpayers have been relieved from all the taxes referred to in the bill and its amendments.
I have with me Le Petit Journal of March 3, 1968 which stated, and I quote:
Caouette wins. It is easy to say-*
-here is the parenthesis made by the member for Sainte-Marie (Mr. Valade) tonight-
It is easy to say that Real Caouette allowed himself to be bought by the government's ministers during the current Ottawa crisis. Only a blind partisanship, such as that of the conservative party, can inspire such statements. Mr. Caouette has always said that he was against the 5 per cent tax whatever the motion debated and whatever the party in power. In fact, this parliamentary impasse made the creditiste leader all the greater: He was the only one who thought of requiring from the government the promise that a rebate would be made on illegally collected taxes.
Mr. Speaker, I have also with me an article of Le Droit of February 28, 1968, signed by Gerard Alarie of the Canadian Press, who stated:
The 5 per cent surtax for the period from January 1, will amount by the end of March to about $25 million, and the members of the Ralliement creditiste demand that the taxpayers be reimbursed that money.
Mr. Speaker, tonight, the hon. member for Sainte-Marie misled the House when he quoted a statement from the then hon. member for Villeneuve, now the hon. member for Temiscamingue, who said that, in the circumstances, it was true. But the next day they had changed, and finally-


Georges-J. Valade: Mr. Speaker-


Mr. Deputy Speaker:: Order. The hon. member for Sainte-Marie (Mr. Valade).


Georges-J. Valade: Mr. Speaker, I rise on a question of privilege. I do not want to limit my hon. friend's diatribe, but I believe that the Standing Orders do not allow him to say that I have misled the House. I quoted from Hansard, giving the page numbers and the hon. member himself is not authorized to mislead the House while accusing another hon. member of doing precisely that. If he wants to tell lies, that is his own business, but I feel that Mr. Speaker should see to it that the remarks of the hon. member are put in their proper context.
* (9:30 p.m.)


Mr. Deputy Speaker:: Order, please. The Chair knows both hon. members well and realizes there is no intentional desire on their part to mislead the House. It is a matter of debate. Hon. members can have strong feelings on the matter of debate and the Chair respects that feeling.


Gilbert F. Rondeau: Mr. Speaker, I was in the process of proving my point, and not through my own statements, but through the statements of others. Moreover, the reimbursements were made effectively, as the Ralliement Creditiste because of its honest and positive attitude, intended to help the low-salaried, has saved the Canadian taxpayers $25 million, an amount that had already been collected, and also prevented the government from assessing the taxpayers for an amount of $125 million, an amount that they would have had to pay if this tax had not been abolished at the request of the Creditistes.
Mr. Speaker, when all these votes were over and the government had made promises to us as can be seen in Hansard, it should not have presented again a bill of this kind during the same session. We had faith in the word of the government, but we demanded at the time much more than promises. As a matter of fact, we had the House adopt the motion of the hon. member for Kamouraska asking for the withdrawal of the bill, but on March 15, 1968, the government introduced again in the House bill C-208 and it can be seen at page 7676 of Hansard of March 15, 1968, that the leader of the Ralliement Creditiste, the hon. member for Kamouraska, as well as the hon. members for Roberval, for Portneuf, for Lapointe, for Megantic, for Abitibi and for Compton all voted against it. They all voted against this tax which the government wanted to continue imposing, in spite of its promises, but they were Creditistes.
I notice that tonight, the one who wants to gloat about defending the poor, the hon. member for Sainte-Marie, was not in the House at that time and did not vote against the 5 per cent tax which was imposed by the government on March 15.
I also note, Mr. Speaker-
March 4, 1971


Some hon. Members:: Shame!


Gilbert F. Rondeau: Shame indeed! Not only the hon. member for Sainte-Marie, but also the hon. member for Charlevoix were absent. There might be some extenuating circumstances. The hon. member for Sainte-Marie is content to denounce the Creditistes, but he has never done what the Creditistes have done for the present poor, who are overtaxed by this government and also by the previous administration.
When we want to have the truth in this House, we must use official documents, study the background of the bill and record all the votes on such taxes.
This bill, which unfortunately we must discuss again, is a continuation of the bill of March 15, 1968, which was passed while the hon. member for Sainte-Marie was not here.
Mr. Speaker, we do not have to put up with any lecture from the hon. member for Sainte-Marie. We know full well what we have to do in the House and we are doing it.
And we need not be ashamed today of what happened in 1968, because if the present government wanted to withdraw the bill now before us, we should do the same because we are not here to indulge in petty politics and empty talk but to represent our constituents who are fed up with these farces and old political gimmicks, and with taxes.
In fact, when you are in the opposition, as the Conservatives are, you keep accusing the government but you have no financial solution to propose. We of the Rallie-ment creditiste have solutions concerning taxation, we do not tell the government: Call an election. We were elected here supposedly for five years, and if bills introduced by the government had to be withdrawn under special circumstances, because it did not have a majority, so much the better. This goes to show once again that the minority government in 1968 was more favourable to Canadians than the present administration which relies on its majority, conscious of the fact that it will thrust on the Canadian people the bill under consideration today.
A majority government like the one we now have is imposing on the people taxes which are too heavy to bear. But in 1968, the government had to listen to the voice of the opposition, of the Ralliement creditiste, and withdraw its bill. Our constituents have congratulated us ever since then. They never blamed us; on the contrary, they understood that the Ralliement creditiste had thought of all the taxpayers, of all the workers who would have to pay those taxes, who would have had to pay out $125 million and would never have collected the $25 million illegally obtained by the Liberal government. The government of the time was so sure that its bill would be adopted that it had already started to collect the taxes. And that is why our constituents were pleased with the attitude of the Ralliement creditiste in the House, and why we are not afraid to call for a vote tonight, tomorrow or in a few days, on this amendment. We are not afraid to vote against this 5 per cent tax that the government forces us to discuss presently.
Income Tax Act


An hon. Member:: 3 per cent.


Gilbert F. Rondeau: 3 per cent.
Mr. Speaker, we are anxious to vote against this tax, because our constituents are equally anxious to vote against this majority government which knows only how to levy new taxes.


Gérard Laprise: Mr. Speaker, this evening, I would like to thank my colleague from Portneuf (Mr. Godin) for his amendment which was intended, in some way, to cancel the effects of the bill. Why? Because we consider that this bill is a continuation, as has been said many times this afternoon, of an Act which was supposed to be temporary.
As is often said, there is nothing more permanent than the temporary. Tonight, we would like to deny the truth of that saying, so that the electors, the taxpayers, the Canadians who are crushed under the tax burden may obtain some relief.
In 1942, during one of the first federal-provincial conferences held here in Ottawa, a former conservative leader made a statement which I liked very much. This statement made in 1942 by Hon. John Bracken was true then, and it is also true today. The Premier of Manitoba at the time stated as follows:
Our present system of taxation seems to have been based on the Gospel promise: "For whosoever hath, to him shall be given, and he shall have more abundance: but whosoever hath not, from him shall be taken away even that he hath."
This is quite like our fiscal system, Mr. Speaker: taking from the Canadian workers, particularly from the taxpayers, rather than from the large companies. It is not the one who cashes in fat dividends each year that pays the highest taxes, but the workers. I call to witness the parliamentary secretary to the Minister of Finance (Mr. Mahoney) who, on March 3, said what follows about the bill before us, as recorded on page 3624 of Hansard:
While the cost to the treasury of this measure is estimated at $25 million for the 1971-72 fiscal year-
This means that the bill will allow large industries more depreciation on their equipment. This way, they will save $25 million this year, while if the bill before us is passed, it will cost the small taxpayers $245 million.
This prompted Mr. Bracken to say in the 40's:
This ill-balanced fiscal system transfers the income of those receiving a relatively low salary to those who have relatively high income. The return from indirect taxes levied by the federal government is to a large extent allocated to the payment of the interest on the national debt-
Mr. Speaker, that was the case in 1942, and that is more true still in 1971.
The premier of Manitoba went on to say:
Thus we see in this case the income of relatively poor persons go to those who are relatively rich. We will never build up a strong fiscal system in Canada by taxing those with a low income to the benefit of those with high income.

March 4, 1971
Division
Mr. Speaker, in connection with the 1971 budget, Information Canada has published a brochure entitled "How Your Tax Dollar Is Spent". That publication explains how a good part of the income of Canadian workers is spent by the government.
Under the item "Public Debt", it is indicated that Canada's debt amounted to $38 billion in 1970.
In 1971, the national debt is going to cost $1,995 million, that is almost $2 billion in interest. I am not speaking here of provincial, municipal and school debts, but of the federal debt: $1 billion in interest. And paid to whom? Not to lumberjacks, miners, farmers, construction workers, white collars, but to the rich financiers, those who can afford to buy huge quantities of Canadian bonds. Those are the people, the sharks, who will get those $2 billion in interest which Canadian workers will have to pay through general taxes, income tax, sales tax on building materials and manufactured goods of all kinds: indirect taxes, excise tax and many others, that cannot all be named.
And I forget to mention the few taxes that corporations or some businessmen must pay. We know very well, Mr. Speaker, that these taxes are included in production costs. The consumer is the one who must pay them eventually. So it is always the underdog who pays taxes.
We are fed up with this situation and we want to relieve the Canadian taxpayer of this 3 per cent surtax that would be extended by bill C-225.
This is why my colleague from Portneuf moved this amendment, this is why I support it and this is why my other colleagues of the Ralliement Creditiste also support it, so that this surtax not be levied again for fiscal year 1971-72.
We must take a stand on this and we must take the vote on this amendment so as to know who is in favour of Canadian workers and who is against them.


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


Some hon. Members:: Question.


Mr. Speaker:: I declare the amendment lost. It being ten o'clock, a motion to adjourn the House is deemed to have
March 4, 1971

been moved and seconded at this time. The question is therefore that this House do now adjourn.


Mr. Bell:: Mr. Speaker, on a point of order, I would like to bring to the attention of the House the fact that today is the Clerk Assistant's birthday. We hope he will have many more such happy occasions.


Some hon. Members:: Hear, hear!



PROCEEDINGS ON ADJOURNMENT MOTION

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

Stanley Howard Knowles: Mr. Speaker, I was hesitating for a moment in the hope that we might have a speech from the Clerk Assistant on this happy occasion.
On Tuesday, February 16, as recorded in Hansard at page 3428-


An hon. Member:: We are all leaving, Stanley.


Stanley Howard Knowles: -I put the following question to the Minister of Veterans Affairs (Mr. Dube):
In view of the anxiety expressed by many veterans 65 years of age or over who are receiving war veterans allowances because of a notice to the effect that they must apply for a guaranteed income supplement or be regarded as doing so, will the minister make a statement as to why this is being done and the authority for it?
In his reply the minister referred to the increases that are to take place in disability pensions and war veterans allowances in April. He also made reference to the relationship between these payments on the one hand and old age security and the guaranteed income supplement on the other. I then put to the minister the following supplementary question:
Will the minister check into the aspect of the notice which tells these veterans that they must so apply and that if they do not do so they will be regarded as having done so? That is the point on which we would like to have an explanation.
I thank the hon. Minister of Veterans Affairs for his attendance tonight to deal with this question. I recognize that he has been here two or three nights for this very purpose, but storms and votes and other incidents have washed out the "late show". Tonight, however, we are here-and in view of the storm we might be here all night.
Mr. Speaker, it is quite clear that when a veteran over 65 years of age is on the war veterans allowance it does not matter, in terms of the total dollars he will receive, whether or not he applies for and gets the guaranteed income supplement. It does not matter because of the
Proceedings on Adjournment Motion means test ceiling in the War Veterans Act. Thus, if a veteran is drawing old age security and war veterans allowance, the war veterans allowance will bring his total income up to the permissible ceiling. If he applies for and obtains the guaranteed income supplement on top of the old age security, the amount of his war veterans allowance will be reduced. But the total will be the same. We all recognize that and there is no argument about it.
It is also understood that if there are no hitches, the war veterans allowance rates will increase in April of this year. When these rates increase, so will the ceilings on total permissible income. The ceilings will become $161 a month for the single war veterans allowance recipient, and $271 a month for the married recipient. I have the figures in front of me, but it is not necessary to give them all tonight. The fact to which I alluded earlier stands, namely, that either a combination of old age security and war veterans allowance, or a combination of the three, old age security, guaranteed income supplement and war veterans allowance, will come out to the same total.
We are not arguing about the number of dollars that a veteran will receive, married or single, if he is 65 or over. But a great many of these veterans feel that it is unfair for them to be told that they must apply for a guaranteed income supplement. That is the word that has been given to them. They have been told that if they do not apply they will be regarded as having done so and their war veterans allowance will be cut back accordingly. It will be readily recognized why veterans do not like this.
Money received as war veterans allowance is not subject to income tax. Money received as old age security and guaranteed income supplement is subject to income tax. Veterans, therefore, between the ages of 65 and 70 who do not get the exemption level that they would get if they were over 70, could be subject to income tax if they were on the guaranteed income supplement in a way that would not be the case if they were on the war veterans allowance.
There is also some question about fringe benefits of one kind or another that go with being on the war veterans allowance. There is also some question of what happens if a veteran goes out of the country because a friend may invite him to go down south for the winter. The fact is that continuing to draw the guaranteed income supplement is more difficult than continuing to draw war veterans allowance. On top of all this, Mr. Speaker, there is something that I hope we in this House still respect, namely, the pride of the veteran-who likes to be treated first of all as a veteran. Therefore, I share in the objection that many veterans have been expressing. We have all been getting these letters as a result of the notice that the veterans have been sent, which has not told them that they must apply for the guaranteed income supplement but it is practically that. They have been told in this notice, "If you do not apply, you will be regarded as having done so."

March 4, 1971
Proceedings on Adjournment Motion
I hope that the minister will explain this question in a way that will be satisfactory to the veterans concerned and I hope, also, that he will tell us by what authority this has been done. Is it under the authority of the War Veterans Allowance Act? Where can we find that authority? Veterans have been told that if they do not apply for a guaranteed income supplement, they will be treated as if they have done so.
A great fuss and to-do was made when the guaranteed income supplement was brought in, and it was said that it would not be affected by moneys received by way of war veterans pension or war veterans allowance payments. Just the reverse actually happens. Once you get the guaranteed income supplement, that affects the war veterans allowance. Most of us in the House think that this is not fair treatment. The whole issue will come before us when we discuss the proposal to increase the war veterans allowance rates. I hope that tonight the minister will have for us an explanation that will be satisfactory to the veterans. They are concerned and they deserve an explanation.


Hon. Jean-Eudes Dube (Minister of Veterans Affairs):: Mr. Speaker, on December 2 last, when I had the pleasure of announcing a 10 per cent increase in the basic rate of veterans disability pension and a 15 per cent increase in war veterans allowance, both effective April 1 next, I also announced a change in procedure.
I pointed out that the regulations would be changed to provide that WVA recipients who are also eligible for old age security and the guaranteed income supplement would be deemed to be receiving the full amounts to which they are entitled under those programs. The allowances of these persons would then be adjusted to supplement their OAS and GIS payments to bring their incomes up to the new WVA ceilings. This use of funds available under the Old Age Security Act provides one of the means of financing the proposed increases in rates of war veterans allowances.
Accordingly, last month notices were sent to veterans affected and also to civilian war allowance recipients advising them to make application for benefits under the Old Age Security Act if they had not already done so. They were reminded of the importance of making this application in order to avoid a loss of income. The new procedure is to be effective as of April 1, the same date as the increases. Some details are still being worked out, but the change will be effected through amendments to the war veterans regulations and the civilian war allowance regulations, which will be available before the effective date.
May I add, Mr. Speaker, that the change in procedure will be handled in a humane and reasonable way and as flexibly as the circumstances permit. For example, in the case of a veteran who made application for GIS before April 1, but is not yet receiving it, the procedural change will be postponed until the Department of National Health and Welfare begins his GIS payments. These particular will be spelled out in the regulations. Furthermore, treatment rights of these veterans will be pre-

served through amendments to veterans treatment regulations. As to income tax, of course I cannot anticipate future government fiscal policy but past performance would indicate that this matter will be taken into account.
It is difficult to answer in three minutes all the questions the hon. member has raised, but I have done my best in the circumstances.



INCOME TAX-NEW ASSESSMENTS FOR 1968 AND 1969

Roland Godin: Mr. Speaker, the question I asked on February 17, which appears on page 3482 of Hansard, was based on a request from my constituents who wanted me to make their views known about the income tax return forms which were addressed to them recently.
If some thieves are notorious on account of their craftiness or cleverness, such is not the case with this government which shows a lack of imagination on the part of its Department of National Revenue.
In point of fact, Canadians are robbed in broad daylight by the Department of National Revenue. The minister with his relatively large staff recently decided that during the department's slack periods, some files would be reviewed, and I was told the following on that subject by a departmental officer in a letter dated February 15:
The control of claims for expenditures incurred away from home is part of our ordinary auditing. During the year, we expect to check 9,000 such claims for the whole of Canada.
Now, Mr. Speaker, the persons mostly affected in my riding of Portneuf up to now, because of this new procedure, are truck drivers. Once more, the government is after one of the most hard-working classes. Once more, the government is after an active and alert group to which we owe a great part of the economic activity in this country.
The government is getting after people who, apart from being away from home 95 hours a week, must very often sleep in their trucks. This class is at a disadvantage because under the new rules, the government forbids them to deduct the price of a meal a day, which they were allowed to do during the years 1968-69.
Among the dozens of persons who wrote to me to tell me of their problems, I shall mention the special case of a man who drives his truck between Portneuf and Montreal and back again.
Since the worker must leave home at three a.m. to come back at 9 p.m. on the same day, it often happens that he takes three meals daily outside home. Having travelled between Portneuf and Montreal during 265 days in 1968, he had given the approximate cost of his meals that is $1.15 for breakfast, $1.65 for dinner and $1.75 for supper, the total cost figured for his meals on his income tax return amounting to $760, an amount which had then been accepted. But in November 1970, the Income Tax Branch of the Department of National Revenue sent him the following letter:
March 4, 1971

As a result of the information obtained from your employer, we intend to amend your expenses as follows: Year 1968: Former expenses $760; Amended expenses $500.
Finally, Mr. Speaker, the department that had accepted the amount of $2.90 per day was simply reducing it to $1.70.
Mr. Speaker, I believe we are witnessing something very loathsome. We must not forget that at that time, a friend of the government such as Jean-Louis Gagnon who was vice-president of a commission was given a salary of $25,000 per year and $6,000 for expenses. Furthermore, Mr. Speaker, members of the Standing Committee on Public Accounts have seen hotel bills for $65-a-day rooms and $12 meals paid by the Canadian government for some CBC employees. To me, this is having one law for the rich and one for the poor.
CBC employees get $12 meals and $22-a-day rooms are provided for members of commissions that, finally, are not worth much to us, while truck drivers who work 95 hours a week are being refused an income tax deduction for meals totalling $2.90 a day.
If that is not fraud, I wonder what it is.
Some civil servants of the department with whom I discussed the matter recently told me they really questioned the honesty of that type of behaviour, but civil servants have family obligations and therefore cannot express their views. And so, to protect their jobs, even if their work does not make sense, they must crawl before their bosses.
In pointing out that shameless manipulation, I wish to draw the attention of the minister concerned, who has the necessary authority and can make his intentions known in this regard.
And frankly, Mr. Speaker, I would be pleased to know as well whether the truck drivers can hope to have the right to eat three times a day.


Mr. P. M. Mahoney (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, the Minister of National Revenue (Mr. Gray) regrets very much his inability to be in the House tonight and has asked me to respond to this question for him. T would also advice cue hon. member that a detailed response to the representations that he has made tonight will be sent to him personally at a very early date.
Meanwhile, the hon. member may be assured that the 9,000 audits referred to in the question he asked originally-and presumably the instance that he cited this evening was an example of one of those-are simply desk audits in the ordinary course of the department's 1970-71 reassessment program pertaining to the returns of taxpayers who have claimed deductions from taxable income of personal living expenses while away from their ordinary place of residence. This is part of the regular departmental procedure to assure that our self-assessing tax system works properly.
Proceedings on Adjournment Motion
Again I assure the hon. member that a detailed written answer will be delivered to him by mail in the very near future.



FINANCE-USE BY PROVINCES OF CAPITAL WORKS LOAN FUND TO COMBAT UNEMPLOYMENT

Robert Phillip Kaplan: Mr. Speaker, tonight represents two "firsts" for me. This is the first occasion on which I have spoken in the "late show", as we call it, and it is also the first occasion on which I have attended the late show. I should bke to thank all hon. members who have remained for providing me with a warm and interested audience.
I was not satisfied with the answer the Minister of Finance (Mr. Benson) gave when I asked a question in the House this afternoon-that he did not have at hand the information which I requested. I much regret that I was unable to give him prior notice of the question, because one would not have expected the information to be readily at hand. The real defendant, if I can put it that way, in the issue I am raising is not the federal government but in fact the government of the province of Ontario.
The matter arose when last December the government introduced a budget which was designed to stimulate the economy to provide an expansionary thrust, and in particular to provide a considerable amount of relief for unemployment across Canada. Involved was a fund, originally of $150 million, subsequently increased to $160 million, which the federal government was offering to the provinces of Canada to assist in capital works not otherwise planned to be carried out and which would immediately provide employment.
Hon. members will recall that at that time the seasonally adjusted unemployment figures were the highest of that bad period, higher than they are now. Some of the provinces of Canada responded seriously and immediately to that offer. The governments of British Columbia and Quebec have repeatedly indicated that they are interested, on behalf of the unemployed people of their provinces, in taking up the share which was made available to them.
Three months following the budget, the province of Ontario has not given any indication that it intends to use any part of the $17 million which has been made available by the federal government. In fact, it was not until February 4, two months after the budget debate, that the province of Ontario decided on the allocation to municipalities in Ontario in respect of this amount. I do not blame the municipal politicians in the city of Toronto for being discouraged: it was not their fault that the provincial government had not responded. Why did Queen's Park wait for three months to indicate the allocation of this money in so far as municipalities are concerned? Why have the people in Queen's Park waited three months, during which time this money has been working in other provinces, to do something about unemployment in the province?

March 4, 1971

Proceedings on Adjournment Motion
I know there has been a Progressive Conservative leadership convention in Ontario which has kept all members of the Ontario provincial cabinet busy. That leadership convention is now over and I think it is time Queen's Park turned its attention again to these problems. It is time the Ontario government responded to this offer by the federal government and made an effort to use the capital offered to assist the unemployed of this province, particularly those in the city of Toronto.


Patrick Morgan Mahoney: Mr. Speaker, I am sure that the hon. member for Winnipeg North Centre (Mr. Knowles) will join me in welcoming the hon. member for Don Valley (Mr. Kaplan) to the company that we usually keep at this hour in the House.


Stanley Howard Knowles: Hear, hear!


Patrick Morgan Mahoney: I am happy to report briefly upon how provincial governments have developed plans to employ funds provided by the special development loan program announced in the December budget. I should advise hon. members that statistical figures now available to us have resulted in a second formula for allocation of the funds, and the provinces have been invited to choose the more favourable of the two amounts indicated by the calculations. As a result, in the supplemental estimates tabled today we propose increasing the total of the program to $160 million from $150 million. We also propose, at the
provinces' request, to increase the period of repayment of the loans to 20 years from 15 years. The rate of interest charged on loans granted this month will be 6.79 per cent which is, of course, a lower rate than that at which the provinces could otherwise borrow money. In summary, agreements have been reached, or are imminent, for allocation of about $100 million of the total, and provinces have been able to proceed on this basis. We would expect approval of additional amounts soon. Any funds unused by one or more provinces will be reallocated to the others.
The province of Quebec has signed a letter of agreement for its entire $70.3 million share to construct sections of the autoroute through Montreal, part of the TransCanada Highway. Work has been under way for several weeks. Three Nova Scotia highways projects for the total allotment of $4 million are approved. Twenty-nine applications for projects, worth $7.8 million, in 13 British Columbia municipalities are being processed, and we are processing 11 Manitoba applications totalling $5.8 million. We have discussed projects with Alberta and Newfoundland and expect their formal applications within a week. We have discussed typical, but not specific projects with Ontario, whose share is $17 million. We await Ontario's applications. The Saskatchewan government has expressed doubt about its participation in the program, and we have no clear indication yet of the intentions of New Brunswick and Prince Edward Island.
Motion agreed to and the House adjourned at 11.01 p.m.

Friday, March 5, 1971