1972-05-24

ROUTINE PROCEEDINGS


[Stage Direction]
Second report of Standing Committee on Privileges and Elections-Mr. Laflamme.
[Editor's Note: For text of above report, see today's Votes and Proceedings.]


Hon. P. M. Mahoney (Minister of State):: Mr. Speaker, pursuant to section 61 of the Financial Administration Act, and on behalf of the Minister of Finance, I should like to table copies in both official languages of the report of the Auditor General to the House of Commons for the fiscal year ended March 31, 1971.
The Auditor General has asked me to extend his apologies to the House for the lateness of this report which is due to circumstances of which the House is aware.


Some hon. Members:: Oh, oh!



IMMIGRATION


Mr. G. W. Baldwin (Peace River):: I am looking vainly for an Acting Prime Minister, Mr. Speaker; I think I see one opposite me now. In any event, I have a motion to propose under Standing Order 43. The urgent and pressing circumstances involved the alleged extraordinary use by the Canadian government of immigration regulations to arrange for one Pershing Gervais, at the instance of the United States government, to use Canada as a place of refuge after having charged Jim Garrison, former New Orleans district attorney, with involvement in a pinball racket. My motion, if I am allowed to put it, is as follows: That this House urges the government to immediately make a full inquiry into the circumstances of admission into Canada of Pershing Gervais, alias Paul Mason, and report to the House.


Mr. Speaker:: Hon. members have heard the motion proposed by the hon. member for Peace River. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent. The motion cannot be put.



REGIONAL ECONOMIC EXPANSION


Mr. lames A. McGrath (St. John's East):: Mr. Speaker, pursuant to Standing Order 43 I ask unanimous consent of the House to propose a motion on a matter of urgent and pressing necessity. This matter arises out of an independent study, presented to the Standing Committee on Regional Development yesterday, which shows that 11 out of 18 companies which received total commitments of $34 million in public funds under the Regional Development Incentives Act made no investment or location decisions because of the money but just reaped windfall gains. With consent, I therefore move, seconded by the hon. member for Peace River (Mr. Baldwin):
That this House resolves that the government should immediately appoint an independent authority to investigate the performance records of companies which have received or may receive grants under the Regional Development Incentives Act at the discretion of the Minister of Regional Economic Expansion and to make recommendations with respect to the continuance or repudiation of each such commitment and, where justified, the recovery of public moneys and such further and other recommendations as the authority may consider proper.


Mr. Speaker:: The hon. member's motion is proposed under the terms of Standing Order 43 and requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent and the motion cannot be put.

Questions



QUESTIONS ON THE ORDER PAPER

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

Mr. MacLean: 1.	What is the ratio of the total native Indian and Eskimo population to the total population of Canada?
2.	What is the ratio of the total Indian and Eskimo population who hold a postgraduate degree at the doctorate level to the total number of Canadians who hold such degrees?
3.	What is the ratio of (a) the total native Indian and Eskimo university graduates to the total number of university graduates in Canada (b) the total native Indian and Eskimo population who are students at the secondary school level to the total number of such students in Canada?
4.	What is the ratio of medical doctors serving the total native Indian and Eskimo population to the total number of medical doctors in Canada?
5.	How many (a) medical doctors (b) dentists (c) nurses are employed by the government to serve the native Indian and Eskimo population?
6.	How many of the above employees, in each category, are native Indian and Eskimo?


Mr. J. A. Jerome (Parliamentary Secretary to President of the Privy Council):: I am informed by Statistics Canada, the Departments of Indian Affairs and Northern Development and National Health and Welfare as follows: 1. The ratio of the total native Indian and Eskimo population to the total population of Canada is 0.012 according to the 1961 Census of Canada.
2.	No data available.
3.	(a) 130 Indian and Eskimo university graduates, (b) In the 1969-70 school year, there were 7,749 Indian students at the secondary school level. This figure represents registered Indian students only. The ratios requested are not available.
4.	The ratios requested cannot be provided accurately. Most of the native Indian and Eskimo population is now provided medical care by medical practitioners who render the same service to all Canadians. Where local medical services are not available to these specific groups, federal or federally sponsored services, i.e., university personnel, are provided where possible. In the Territories, native Canadians may be serviced by Public Service physicians initially, but possible referral to treatment centres in more southerly areas routinely involves any number of physicians or specialists. The overall active Canadian physician: population ratio is about 1:700.
5.	(a) 150 medical doctors (this includes all categories of physicians, most of which serve in multiple functions.) (b) 27 dentists (most dental work is performed at federal expense by private dentists), (c) Approximately 820 nurses.
6.	Doctors nil. Dentists nil. 11 nurses are native Indians.


EXPORTS OF RESOURCES AND FOREIGN INVESTMENT
Mr. Yewchuk: 1.	To date, what consideration has the government given to allow the Province of Alberta to communicate with the Government of each of these countries (a) United States (b) USSR (c) People's Republic of China over matters concerning (i) oil (ii) gas (iii) water?
2.	What kind of representation is being made in each of those countries by the government, in relation to the export of (a) oil (b) gas (c) water from the Province of Alberta?
3.	Have any projections been prepared by the government which would forecast gains and/or losses in terms of production and standard of living in Canada, if American ownership of oil and gas resources would be limited to 49 per cent control or less?


James Alexander Jerome: 1. Formal communications with the Governments of the USA, USSR and the People's Republic of China are the responsibility of the federal government and these are normally channeled through the Canadian Embassies in those three countries or through their respective Embassies in Ottawa. The federal government is, at the same time, in touch with the government of Alberta as well as the governments of other provinces, and vice versa, regarding questions of mutual interest which have an international dimension, including when appropriate, oil, gas and water.
2.	It would not be appropriate to indicate publicly at this stage what precise representations might be involved since this disclosure might adversely affect Canada's bargaining position.
3.	No such projections have been completed to date; however, such questions are under consideration in the government's general review of energy policy.


TEST RUN OF A UNIT TRAIN OF WHEAT
Mr. Southam: 1.	Was a test run of a unit train of wheat made early in December between Saskatoon and Vancouver and, if so (a) what was the number of bushels of wheat involved (b) what was the grade of wheat involved (c) how many hopper cars made up the train (d) what was the time involved in moving this unit train between Saskatchewan and Vancouver (e) how long did it require to load the train (f) how long did it require to unload the train (g) who was the purchaser of the wheat and at what price (h) was there a net saving per bushel in moving this amount of wheat under this experiment and (i) if so, what was the saving per bushel and will the saving be reflected in the net return to the producer through the Pool Account (ii) if not, will the loss be deducted from the Pool Account?
2.	Are further test runs to be made with wheat or other grains in the near future?


James Alexander Jerome: I am informed by the Department of Agriculture and the Canadian Wheat Board as follows: 1 Yes. (a) 278,868 bushels; (b) No. 2 Manitoba Northern, (c) 90 hopper cars; (d) Total time from beginning of loading at Saskatoon December 3 at 6:00 a.m. to completion of loading to vessel December 6 at 4:00 p.m. -82 hours; (e) 10 working hours; (f) 8 hours; (g) As a matter of good commercial practice, it is not the policy of the Canadian Wheat Board to divulge sales information which is deemed to be confidential between the Board, as seller, and the buyer, (h) (i) and (ii) There was no saving realized


as a result of this experiment. There were some additional expenses involved which would not have been incurred had the same grain been moved in the usual way to its normal destination. At the present time it is known that approximately $4,000 in additional transit charges have accrued but a final accounting cannot be made until all the facts are known. It was understood from the outset that no monetary benefit would result from the experiment and the Canadian Wheat Board participated in it on the understanding that any unusual expenses which would be involved would not be a charge on producers but would be met by the Canadian Grain Commission.
2 No, there are no positive plans at this time for further test runs.


GRAIN TRAFFIC-VANCOUVER
Mr. Korchinski: 1.	How many box cars of grain were unloaded in Vancouver in each day from November 1,1971 to date?
2.	What is the capacity of the terminal elevators at Vancouver?
3.	What was the maximum amount of grain held at these terminals in each week since November 1,1971?


Mr. Marcel Lessard (Parliamentary Secretary to Minister of Agriculture):: 1.	Daily Traffic Report-Vancouver
November 1, 1971-March 3, 1972
No.	No.	No.	No.	No.Date	Cars	Date	Cars	Date	Cars	Date	Cars	Date	CarsNov.	Dec.	Jan.	Feb.	March	1	425	i	471	i	33	1	221	i	3242	622	2	494	4	308	2	289	2	2673	597	3	601	5	575	3	186	3	1634	555	4	369	6	551	4	190	5	518	6	467	7	443	5	101	6	263	7	687	8	163	7	215	8	455	8	676	10	417	8	485	9	616	9	613	11	478	9	624	10	626	10	643	12	380	10	558	11	143	11	335	13	435	11	504	12	496	13	459	14	431	12	415	13	509	14	586	15	108	14	404	15	484	15	555	17	312	15	587	16	671	16	557	18	575	16	661	17	613	17	522	19	538	17	592	18	497	18	66	20	365	18	606	19	520	20	393	21	264	19	489	20	228	21	474	22	55	21	375	22	431	22	441	24	120	22	625	23	583	23	382	25	177	23	599	24	607	24	381	26	125	24	539	25	543	25	32	27	77	25	557	26	531	28	118	28	106	26	448	27	326	29	349	29	7	28	424	29	423	30	449	31	160	29	559	30	440	31	427	Total	Cars	12,722	11,547	7,203	11,313	754
Total No. of Cars 43,539.
2.	Vancouver = 25,028,500 bushels.
Questions
3.	Visible Stocks at Vancouver
November 1, 1971-March 1, 1972
Week Ending	Amount
(in 000's bu.)
Nov. 3	 12,972
Nov. 10	 12,573
Nov. 17	   12,021
Nov. 24	 13,017
Dec. 1	 12,268
Dec. 8	 12,505
Dec. 15	   14,130
Dec. 22	   14,060
Dec. 29	 14,689
Jan. 5	   14,135
Jan. 12	   12,178
Jan. 19	   9,712
Jan. 26	 8,101
Feb. 2	   7,081
Feb. 9	 7,384
Feb. 16	 8,733
Feb. 23	 9,359
Mar. 1	 10,416
Above figures include wheat, oats, barley, rye, flaxseed and rapeseed.


NATIONAL ARTS CENTRE-RECEPTION, MARCH 4, 1972
Mr. McIntosh: 1.	What was the purpose of the reception, concert, dinner and dance hosted by the Secretary of State for External Affairs at the National Arts Centre the evening of March 4,1972?
2.	Of the guests, how many were (a) diplomats (b) others?
3.	What was the cost of the National Arts Centre Orchestra's special concert staged for the occasion?
4.	what was the cost of (a) the liquor (b) the wines (c) the champagne (d) the liqueurs?
5.	What was the cost of the dinner?
6.	What was the cost of the orchestra engaged for the dancing?
7.	What was the rental fee for the Arts Centre facilities, accommodation and staff?
8.	Is entertaining on this scale a routine practice for the Department of External Affairs?
9.	What is the total departmental annual cost of entertaining (a) in Ottawa (b) in Canadian missions overseas?
10.	Did the Minister or any of his departmental officers request or order the Arts Centre Management to permit minimal or no publicity in the media of the event?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: 1. For a number of years, at least since the late 1950's, it has been the custom for the Secretary of State for External Affairs to provide an annual occasion to enable foreign diplomatic representatives and their wives to meet socially as a group with a number of distinguished Canadians in appropriate Canadian surroundings. An occasion of this nature serves as an expression of appreciation of the courtesies and hospitality extended to Canadian representatives in and visitors to the countries of the foreign Heads of Mission concerned and also to a great many of our fellow citizens here in Canada by those diplomatic representatives. It serves also as a gesture of hospitality on the part of the Canadian Government towards the distinguished diplomatic representatives of the friendly governments accredited to Canada. The importance of such occasions has long been recognized by governments of many other countries where official


Questions
entertainment in honour of Heads of Foreign Diplomatic Missions is an established practice.
2.	(a) 134; (b) 138.
3.	$3,500.
4.	(a), (b), (c) and (d): liquor and liqueurs: $900; wines including champagne: $1,400.
5.	$3,655.
6.	$220.
7.	No rental fee for facilities and accommodation. Staff $800.
8.	This year it was possible to organize one single social event rather than a series of smaller ones, as in the past, by making use of the excellent facilities of the National Arts Centre. It was also the first time that a concert by the prestigious National Arts Centre Orchestra was made part of the event. In view of the success of the evening, it is hoped that similar social events with emphasis on Canadian culture, may be held annually in honour of Heads of Foreign Diplomatic Missions and their wives.
9.	(a) The annual Departmental hospitality costs in Ottawa during 1971-72 amounted to $24,579. Other hospitality expenditures controlled by Departmental headquarters in Ottawa: (1) hospitality in connection with international conferences amounted to $36,636; (2) hospitality in connection with the Government's cultural and information programs amounted to $6,509; (3) hospitality extended by the Government of Canada to visiting Heads of State and dignitaries amounted to $327,574. (b) The direct costs of entertaining at Canadian posts abroad for the fiscal year 1971-72 were $706,504.
10.	No. Indeed, special effort was made to invite a diverse group of Canadians including newspaper editors from Ottawa and other Canadian cities, many of whom attended the evening function.


LE DAIN COMMISSION REPORT
Mr. Robinson: 1.	How many copies of the Le Dain Commission Report on the Non-Medical use of Drugs have been printed, where are they sold and what is the price per copy?
2.	How many copies must be sold in order to make the publication profitable and what, if anything, is the government doing to avoid loss on the publication?


Hon. Martin P. O'Connell (Minister of Labour):: 1. 5,339 French copies and 24,960 English copies have been printed of the Interim Report of the Commission of Inquiry into the Non-Medical Use of Drugs. Copies are sold through Information Canada's Centres (Bookshops), commercial booksellers which have asked for them and by mail order from Information Canada. The Report sells for $2 per copy.
2.	The publication became profitable after the sale of 4,270 copies of the French edition and 19,960 copies of the English edition. Copies of the Report are nearly sold out and a revised second edition is presently under consideration.


GENERAL ADJUSTMENT ASSISTANCE BOARD
Mr. Robinson: 1.	How many manufacturers have been helped to take advantage of export opportunities arising from the Kennedy Round by the General Adjustment Assistance Board since it was established in 1968?
2.	How much money has been saved or expended by manufacturers as a result of the establishment of the General Adjustment Assistance Board?
3.	What is the yearly cost of maintaining the General Adjustment Assistance Board?


Mr. Bruce Howard (Parliamentary Secretary to Minister of Industry. Trade and Commerce):: 1. A total of 76 manufacturers have been assisted.
2.	(a) The amount that manufacturers have saved is not available, (b) As a result of the establishment of GAAP, manufacturers have expended or committed to expend $77,914,000 on restructuring programs.
3.	For fiscal year 1971/72, a total of $11,000.


SENATE COMMITTEE REPORT ON POVERTY
Mr. Robinson: 1.	How many copies of the Senate Committee Report on Poverty have been produced?
2.	Where are they sold and what is the price per copy?
3.	How many copies must be sold in order to make production profitable or break even?
4.	What, if anything, will the government do to avoid any possible loss on the publication of the Senate Commmittee Report on Poverty?


Abram Ernest Epp: 1. 2,500 French copies and 11,544 English copies have been printed of the Senate Committee Report on Poverty.
2.	Copies are sold through Information Canada's Centres (Bookshops), commercial booksellers which have asked for them and by mail order from Information Canada. The Report sells for $2 per copy.
3.	Sales must reach 8,772 copies of the English edition and 1,676 copies of the French edition in order to recover printing costs. Sales of the English edition have exceeded the break even point and the French edition is within 100 copies of that level.


FEDERAL ASSISTANCE TO STATE OF BANGLA DESH
Mr. Robinson: Has the government extended recognition of the independent State of Bangla Desh and, if so, what assistance is planned by the government for this nation at the present time?


Mitchell William Sharp: The Government of Canada recognized the state of Bangla Desh on February 14, 1972. A Canadian mission headed by Mr. Gerin-Lajoie, President of CIDA, recently visited Bangla Desh and assessed the humanitarian and rehabilitation requirements. As a result of the mission's findings and in co-ordination with the United Nations Relief Organization Dacca (UNROD), a Canadian aid program is being discussed with Bangla Desh officials. The prospective breakdown is as follows: food aid $20 million; railway track material $7 million; tubewell project $5 mil-



lion; commodities $5 million; shallow draft vessels $2.5 million; electrical transmission spare parts $1 million; and $5 million unallocated.


FAMILY ALLOWANCE PROGRAM
Mr. Robinson: Under the new family allowance program, what is the estimated amount of money that will be saved that would formerly have been paid to recipients who would not fall within the eligibility criteria?


Hon. John C. Munro (Minister of National Health and Welfare):: There will be no savings experienced because of the cancellation of benefits to families with income above eligible Family Income Security Plan levels, but rather a transfer to low income families of the sums involved. Those families who will not qualify for Family Income Security Plan benefits now receive an estimated $180 million under the Family, Youth and Quebec Schooling Allowances programs.


OPPORTUNITIES FOR YOUTH PROGRAM
Mr. Ryan: 1.	What amount has the Secretary of State spent on advertising the Opportunities for Youth Program, and in what ways has the Program been advertised?
2.	Where are application forms for OFY grants being made available?


Hon. Gerard Pelletier (Secretary of State):: 1. The following expenditures can be clearly assigned to advertising publicity given to the Opportunities for Youth Program to date: (i) sums spent by regional offices for local radio spots: $5,000; (ii) a campaign on radio and in student newspapers to remind students of the March 8 deadline: $28,000; (iii) printing and distribution of pamphlets and posters used by field officers and other officials: $30,200; Total: $63,200. The Program was publicized through a press conference by the Secretary of State January 13, by hundreds of press articles and interviews given by 75 field officers on campuses and elsewhere to citizen and student groups throughout the country.
2. Before the cut-off date of March 8, the main points of distribution for the 500,000 application forms were the regional and field offices of the Opportunities for Youth Program, some 600 Canada Manpower Centres throughout the country, 18 regional offices of the Citizenship Branch of the Secretary of State Department, Summer '72 information officers, Information Canada Inquiry Centres and the operational headquarters of the Opportunities for Youth Program in Ottawa.


AMOUNT DEBITED BY CANADIAN WHEAT BOARD UNDER TEMPORARY WHEAT RESERVES ACT
Mr. Horner: How much did the Canadian Wheat Board bill the Department of Finance under the Temporary Wheat Reserves Act for each month beginning March 1, 1968 until March 1, 1972?
Questions


Hon. Otto E. Lang (Minister of Justice):: Payments under the Temporary Wheat Reserves Act are paid monthly on the basis of a calculation submitted by the Canadian Wheat Board at the beginning of each crop year. Subject to the final determination of the Canadian Wheat Board stocks of wheat on August 1 the basis for the monthly payments may be revised during the course of the crop year. The Canadian Wheat Board does not bill the Government on a monthly basis.


CANADIAN PARTICIPATION IN INTERNATIONAL UNIONS
Mr. Robinson: 1.	To the government's knowledge, how much money did Canadians pay into international unions in each of the years 1965 to 1971 respectively?
2.	How much money was paid to Canadian union members belonging to international unions in each of the years 1965 to 1971 respectively?


Bruce Andrew Thomas Howard: Statistics Canada reports that: 1. Net dues and assessments paid by Canadian members to international union headquarters: (1969 is the latest year for which figures are available.)

1965	28,297,000
1966	30,987,000
1967	35,154,000
1968	41,514,000
1969	41,377,000
177,329,000
2. The following table presents details of payments to Canadian union members under the three specific categories of expenditures in Canada which international unions are required to report under the Corporations and Labour Unions Returns Act and Regulations: (1969 is the latest year for which figures are available.)
1965	1966	1967	1968	1969$,000	$,000	$,000	$,000	$,000Strike benefits	8,755	8,702	5,015	14,547	16,683Pension and Welfare Pay	ments to Beneficiaries	2,715	2,827	2,758	3,077	3,369Gross salaries, wages and	other remuneration to	officers and employees	8,821	9,828	10,343	11,920	11,462


PORTNEUF CONSTITUENCY-BENEFITS UNDER THE ON-THE-JOB TRAINING PROGRAM
Mr. Godin: For the winter of 1971-72, have companies in the constituency of Portneuf applied for benefits from the Department of Manpower and Immigration under the on-the-job training program and, if so (a) how many applications were made (b) how many projects were accepted (c) what is the average duration of the agreements and how many workers will benefit from them (d) how much will be spent by the government in this constituency under this program?
2506


Questions


Hon. Bryce Mackasey (Minister of Manpower and Immigration):: Statistical records for the Canada Manpower Training on-the-job Program are maintained on the basis of each Canada Manpower Centre and census geographic code but not by electoral district. The Portneuf constituency is serviced by the following CMCs: Quebec East- except villages of Montauban and Notre-Dame-des-Anges; rural municipalities of Notre-Dame-des-Anges-de-Mon-tauban, Riviere-a-Pierre and St-Remi; the unorganized. Grand'Mere-the villages of Montauban and Notre-Dame-des-Anges; rural municipalities of Notre-Dame-des-Anges-de-Montauban, Riviere-a-Pierre and St-Remi; the unorganized.
Following are the responses applicable to these two CMCs as at May 10, 1972: (a) number of applications: Quebec East, 157; Grand'Mere, 34; Total, 191. (b) Number of projects accepted: Quebec East, 128; Grand'Mere, 22; Total, 150. (c) Average duration per trainee: Quebec East, 18 weeks; Grand'Mere, 13 weeks; Average, 16 weeks. Number of trainees: Quebec East, 341; Grand'Mere, 189; Total 530. (d) Total training on-the-job expenditures committed: Quebec East, $474,982.23; Grand'Mere, $133,248.38; Total, $608,230.61.


DEVELOPMENT OF PHARMACEUTICAL PRODUCTS
Mr. Rowland: 1.	What is the amount spent by the government, through grants or otherwise, on the development of pharmaceutical products?
2.	In the past five years, how many pharmaceutical products have been developed with the assistance of the government?
3.	Of the pharmaceutical products referred to in part 2, how many were eventually manufactured and marketed by Canadian-owned drug manufacturing companies in each of the past five years?
4.	Does the government require that pharmaceutical products developed with the assistance of federal research grants or other federal assistance be produced and marketed by Canadian-owned drug manufacturing companies and, if not, for what reasons?


Bruce Andrew Thomas Howard: 1. The Department of Industry Trade and Commerce, through its Industrial Research and Development Incentives Act, granted $2,-
064,000	to drug companies for research on pharmaceutical products during the years 1967 to 1972. In addition during the same period $1,309,000 was loaned to pharmaceutical companies through the Pharmaceutical Industry Development Assistance Program to assist them in expanding and improving their operations, which includes their product development capabilities. Direct research grants under the Department of Industry, Trade and Commerce Program for Advancement of Industrial Technology to pharmaceutical manufacturers to date has amounted to $217,127.
2.	In total, 17 new products have been developed which include products licensed by Canadian-owned companies under the provisions of Bill C-102 and hitherto not available from sources other than the patent holder. In addition six new products are presently under development.
3.	Twelve new pharmaceutical products developed in part with federal funds, and available through licensing

resultant from changes in the Patent Act incorporated under Bill C-102 have been made available by Canadian-owned companies to the Canadian public in the last five years, eight of them during 1970 and four during 1971.
4.	Recipients of grants under IRDIA are required to sign a statement that they are free to exploit the results of their new product developments abroad in most world markets. It is understood that in certifying this statement the applicants will endeavour to build plants for the manufacture of these products in Canada and do as much in the way of export development from Canada as is commercially feasible. Similarly under the PAIT program recipients of grants must show that should a new product be developed they will undertake its manufacture in Canada to the maximum extent commercially possible without prejudicing their financial position. These programs do not make a distinction between Canadian-owned companies and non Canadian-owned companies. All companies which are incorporated federally or in a province in Canada are eligible for assistance. The nationality of their shareholders or officers is not a condition. To restrict the assistance to Canadian-owned companies would be to fail to utilize the very considerable technological and worldwide marketing capabilities of the foreign-owned companies in Canada, some of which have made considerable investment in Canada and account for a major portion of Canadian drug exports.


BORDEN-CAPE TORMENTINE FERRY SERVICE-MV JOHN HAMILTON GRAY
Mr. Macquarrie: 1.	Will the MV John Hamilton Gray be returned to the Borden-Cape Tormentine ferry service and, if so, on what date? .
2.	What new ships are being constructed for this service?
3.	When are such ships to be ready for service?
4.	What improvements are being made on the facilities of the Vacationland and Holiday Island?


Mr. Gerard Duquet (Parliamentary Secretary to Minister of Transport):: 1. The MV John Hamilton Gray is currently on the Borden-Cape Tormentine service and will be remaining there until May 23 when she will be withdrawn from service for refit.
2.	No new ships are being constructed for this service at the present time. However, sufficient capacity to meet the anticipated demands is being assured through the interchange of vessels between the Gulf service and the PEI service and through the addition of two new vessels last year.
3.	Not applicable in view of the answer to No. 2.
4.	Washrooms are being installed on the lower car deck of each of these vessels and these will be ready in time for the return of the vessels to service this spring.


PAYMENTS MADE TO MANITOBA UNDER NATIONAL HEALTH AND WELFARE PROGRAMS
Mr. Murta: What were the total contributions and payments made to the Province of Manitoba under Department of National Health and Welfare programs during the past fiscal year?


John Carr Munro: Under the Medical Services Branch: (including hospitalization and medical care services for Indians); $666,096.65. Under the Health Programs Branch: (including medicare and hospital insurance payments, the Health Resources Fund and Health Grants); $83,171,452.88. Under the Social Allowances and Services Branch: (including assistance and services under the Canada Assistance Plan, Blind and Disabled Persons Allowances); $36,559,552.00. Making a total of $120,397,101.53.


'ARMENIAN INDEPENDENCE
Mr. Macquarrie: 1.	In 1971, did the government receive a memorandum from the Canadian Committee for the Independence of Armenia regarding the Armenian independence and, if so, on what date?
2.	What reply was given?
3.	What, if any, representations were made to governments of other countries by the Government of Canada on the question and, on what dates?
4.	What response was received?
5.	What further action is contemplated by the Government of Canada?


Mr. Paul St. Pierre (Parliamentary Secretary to Secretary of State for External Affairs):: 1. Yes, on April 24, 1971. This memorandum asks the support of all nations for the creation of a free and independent Armenia.
2.	The memorandum was acknowledged on May 3, 1971 and has been given serious consideration.
3.	No representations have been made to governments of other countries on the question. No other country has made representations to Canada to support the creation of a free and independent Armenia as proposed in the memorandum. There have been no resolutions on the question before the United Nations or any of its agencies in recent years.
4.	Not applicable.
5.	The Secretary of State for External Affairs, by letter of April 21, 1972, indicated a willingness to meet with representatives of the Armenian Community in Toronto in keeping with his general policy of maintaining contact with leaders of Canadian ethnic groups.


NIHON NOSAN KOGYO COMPANY, JAPAN
Mr. Mazankowski: Is the government involved in any way, or aware of, a proposal by Nihon Nosan Kogyo Co., the largest compound feed maker in Japan, to develop a wholly-capitalized feed lot operation in Alberta in co-operation with Mitsubishi Corporation, which would run beef cattle and hogs destined for distribution to Canadian, American and Japanese markets?


Bruce Andrew Thomas Howard: The Department of Industry, Trade and Commerce is aware of the interests of many Japanese companies in developing a Canadian source of beef, as well as a number of other agricultural commodities. There is no involvement by the Department, however, in the specific project referred to.
25316-35!
Questions


BEAUCE CONSTITUENCY-NUMBER OF PERSONS ACCEPTED FOR TRAINING COURSES
Mr. Rodrigue: 1.	During the years 1969-70. 1970-71 and 1971-72, how many persons in the constituency of Beauce were accepted for training courses given by the Department of Manpower and Immigration?
2.	What amounts were paid to the students?
3.	What were the training costs?


Bryce Stuart Mackasey: Training information is not available on a constituency basis. The following relates to training provided in the area served by the Canada Manpower Centre at Ville St. Georges: 1. Number of trainees commencing training1: Fiscal Year: 1969-70; Full Time: 872; Part Time: 483. Fiscal Year: 1970-71; Full Time: 899; Part Time: 767. Fiscal Year: 1971-722; Full Time: 1,231; Part Time: 388.
2.	Training Allowance costs (including trainee travel
grants):	1969-70, $625,201; 1970-71, $740,651; 1971-722,

3.	Training Costs: 1969-70, $582,104; 1970-71, $563,878; 1971-722, $680,529.
'Does not include Training-in-Industry Program.
Preliminary and subject to revision.


ASSOCIATION OF AFRICAN UNIVERSITIES- REQUIREMENT OF STUDENTS WHO BENEFIT UNDER CIDA
Mr. Robinson: Are the African students who will benefit under the CIDA contribution toward the university scholarship fund administered by the Association of African Universities of Accra, Ghana, required to return to work in their own country after their educational pursuit and (a) if so, for how long (b) if not, are they allowed to immigrate to Canada or other countries after finishing their education?


Mitchell William Sharp: The Canadian contribution towards the university scholarship fund of the Association of African Universities is an extension of an existing program supported by other donor countries. Selected students do not sign contracts with the AAU to return to their homeland although it is expected of them. Many students are sponsored by their own governments and have jobs ready for them on their return and it could be that these have signed undertakings to return. However, the signing of such agreements is not a requirement by Canada for students nominated under this program. To answer the second part of the question the graduates may apply for immigration permits to any country in the world; however, there are reasons to expect that many of them will remain in Africa. The education the students receive is regionally oriented and fits them for work in Africa rather than in Europe or North America. This is particularly true in such disciplines as agriculture and tropical medicine. The Canadian project is just beginning and until students graduate it is not possible to report on their actions; however, the Government believes that the pattern will be in accordance with its aims and objectives in assisting developing countries.


Questions


OIL DRILLING IN BRITISH COLUMBIA COASTAL WATERS
Mr. Douglas: 1.	How many oil wells have been drilled to date in the coastal waters of British Columbia?
2.	How many of these oil wells are (a) abandoned (b) in production?
3.	How many oil wells were drilled in this area during the calendar year 1971?
4.	In how many locations is oil drilling proceeding in British Columbia coastal waters at the present time and what are the permit numbers of these locations?


Mr. Jack Cullen (Parliamentary Secretary to Minister of Energy, Mines and Resources):: 1. Fourteen.
2.	(a) 14; (b) Not applicable.
3.	None.
4.	No wells are currently being drilled offshore in British Columbia coastal waters.


PORTNEUF CONSTITUENCY-NUMBER OF PERSONS ADMITTED TO TRAINING COURSES
Mr. Godin: During the years 1970-71 and 1971-72, how many persons in the constituency of Portneuf were admitted to training courses offered by and paid for by the Department of Manpower and Immigration?


Bryce Stuart Mackasey: Training information is not available on a constituency basis. The following relates to training provided in the areas served by the Canada Manpower Centres at Quebec and Grand'Mere. 1. Number of trainees commencing training1. Fiscal Year: 1970-71; Full Time: 5,303; Part Time: 3,687. Fiscal Year: 1971-722; Full Time 4,217; Part Time; 2,539.
'Does not include Training-in-Industry Program.
Preliminary and subject to revision.


MANPOWER STRENGTHS-MEMBER ELIGIBLE FOR VETERANS' LAND ACT
Mr. Foster: How many members of the permanent Canadian Forces are currently serving whose compulsory retirement age (i.e. expiration of service) extends past the deadline of March 31, 1974, for assistance under the Veterans' Land Act?


Mr.   J.-R. Comtois@Parliamentary Secretary to Minister of National Defence: On April 30, 1972, there were 61,953 personnel serving in the Canadian Forces whose compulsory retirement age or expiration of service is scheduled to extend beyond March 31, 1974. However, records are not maintained by the Department of National Defence in a manner which would permit the number still in the Canadian Forces, eligible for assistance under the Veterans' Land Act, to be identified. The Act is administered by the Department of Veterans Affairs and it is the responsibility of individuals to make application to that Department to determine their eligibility and apply for assistance if they so desire.


CANADIAN FORCES-NAMES OF REGIMENTS
Mr. Diefenbaker: What is the present name for the former branches of the Armed Forces known as (a) Royal Canadian Engineers (b) Royal Canadian Artillery?


Hon. C. M. Drury (Acting Minister of National Defence):: These units are now part of the land element of the Canadian Armed Forces but they have retained their individual unit identities as follows: (a) Royal Canadian Engineers: 1 Field Squadron; 2 Field Squadron; 3 Field Squadron; and 4 Field Squadron, (b) Royal Canadian Artillery: 1st Regiment, Royal Canadian Horse Artillery; 2nd Regiment, Royal Canadian Horse Artillery; and 3rd Regiment, Royal Canadian Horse Artillery.


NUMBER OF PERSONNEL IN ARMED FORCES
Mr. Diefenbaker: 1.	How many (a) men (b) women are there in the Armed Forces as of this, or the nearest date?
2.	Of the personnel, how many are (a) commissioned officers (b) non-commissioned officers (c) privates?


James Alexander Jerome: The answer to Part 1 of this question is as follows: paid strength as of April 30, 1972 (a) 82,541; (b) 1,626.
The answer to Part 2 of this question is as follows:
(a)	Male	FemaleOfficers	13,158	496Officer Cadets	1,729	7(b) Supervisory Non-Commissioned Officers Chief Warrant Officer	884	Master Warrant Officer	2,418	2Warrant Officer	4,762	11Sergeant	10,349	52Master Corporal	5,924	53(c) Privates and Non-Supervisory Corporals	43,317	1,005


SALES TAX EXEMPTION FOR SOFT DRINK INDUSTRY
Mr. Rynard: Does the government propose to remove the 12 per cent federal sales tax applicable to the soft drink industry as recommended by the Royal Commission on Taxation 1966 (The Carter Commission) and the Ontario Committee on Taxation 1967 (The Smith Commission) and, if so, on what date?


Patrick Morgan Mahoney: If the Government should decide to propose an amendment to the Excise Tax Act to exempt the soft drink industry from sales tax it would be announced at the appopriate time.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Harding: 1. What amount was spent by each federal department and agency, including the Prime Minister's office, on travelling expenses of their staffs in each of the past three fiscal years?


2. What amount was spent by each on entertainment in each of the past three fiscal years?
Return tabled.


PURCHASES AND INSTALLATION OF OFFICE FURNISHINGS FOR GOVERNMENT DEPARTMENTS
Mr. Harding: 1.	(a) How many pieces of the following office equipment were purchased by each federal department and agency in each of the past three fiscal years and what were the costs for each category (i) typewriters (ii) dictaphones (iii) tape recorders (iv) adding machines (v) calculating machines (b) what was the total stock of this equipment in each federal department and agency for each of the five categories as of March 31, 1971?
2.	What was the total cost of purchases and installation of office furnishings for (a) furniture (b) carpets and carpeting (c) draperies and blinds (d) others, in each federal department and agency in each of the past three fiscal years?
Return tabled.


NATIONAL PARKS
Mr. Stewart (Okanagan-Kootenay): 1.	What is the area in square miles and the population of (a) Prince Edward Island (b) Vancouver Island (c) the federal constituency of Okanagan-Kootenay?
2.	What were the investment expenditures of the Department of Indian Affairs and Northern Development, over the past ten years, for national parks (a) in total (b) for each park?
3.	What is the amount of the development and maintenance expenditures made by the Department of Indian Affairs and Northern Development for national parks over the past five years (a) in total (b) for each park?
4.	Do the above amounts include departmental expenditures for the construction of principal highways traversing national parks and, if not, what is this cost over the past five years?
5.	Will departmental hearings on the provisional master plans for Glacier and Mount Revelstoke National Parks be held and, if so (a) when (b) in what place?
6.	What is the area in square miles of each of Canada's national parks?
Return tabled.


UNION DUES AND ASSESSMENTS PAID BY CANADIAN WORKERS TO INTERNATIONAL UNIONS
Mr. Stewart (Okanagan-Kootenay): 1.	To the government's knowledge, what has been the amount of union dues and assessments paid by Canadian workers to international unions over the past five years?
2.	What Canadian trade unions are affiliated with and mainly controlled by American parents?
Return tabled.
1971 CENSUS-NAMES OF CENSUS COMMISSIONERS IN ABITIBI CONSTITUENCY

Question No. 372-Mr. Laprise:
1.	What are the names and addresses of the census commissioners and representatives hired by the government in the constituency of Abitibi for the 1971 Census? *
2.	What salary was paid to each?
Return tabled.
Motions for Papers



MOTIONS FOR PAPERS

James Alexander Jerome: Mr. Speaker, notice of motion No. 18 is acceptable to the government subject to the usual reservations concerning confidential documents.



COPY OF ALL CORRESPONDENCE REGARDING SALE OF LAND BY CITY OF REGINA TO DEPARTMENT OF TRANSPORT

[Stage Direction]
Motion No. 18-Mr. Burton:
That an humble Address be presented to His Excellency praying that he will cause to be laid before this House a copy of all correspondence and other documents concerning the recent sale of land owned by the City of Regina at the Regina Airport to the Department of Transport.
Motion agreed to.
James Alexander Jerome: Mr. Speaker, would you be so kind as to call notices of motions Nos. 11, 27 and 28.



COPY OF CORRESPONDENCE BETWEEN MR. JOHN CARSON AND HON. JOHN TURNER REGARDING BILINGUALISM IN THE PUBLIC SERVICE

[Stage Direction]
Motion No. 11-Mr. Orlikow:
That an Order of the House do issue for a copy of all correspondence between Mr. John Carson, Chairman of the Public Service Commission and the Honourable John Turner, Minister of Justice, regarding bilingualism in the Public Service and its application under the terms of the Public Service Employment Act.
Mr. Knowles (Winnipeg North Centre):: Stand.


Mr. Judd Buchanan (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, this correspondence in general cannot be identified as government papers as such but rather should be identified as correspondence between the Minister of Finance (Mr. Turner), as a member of parliament, and one of the established institutions of government. In addition, some of the correspondence reflects on the personal competence or character of individuals-


Mr. Speaker:: Order, please. I have some doubt whether the hon. member's remarks are acceptable under the terms of the Standing Order and the practice of the House. The hon. parliamentary secretary should indicate immediately whether it is proposed to table the documents.


Stanley Howard Knowles: Mr. Speaker, in the absence of the hon. member in whose name this motion appears I suggested that it stand.


Mr. Speaker:: Stand.


Motions for Papers



COPY OF REPORT BY GASTON G. CHAMAILLARD FOR DEPARTMENT OF ENERGY, MINES AND RESOURCES RELATING TO WATER RESOURCES AND WATER POLLUTION

[Stage Direction]
Motion No. 27-Mr. Skoberg:
That an Order of the House do issue for a copy of the consultant report by Gaston G. Chamaillard, undertaken for the Department of Energy, Mines and Resources, regarding a Canada-wide survey of public information, educational activities relating to water resources and water pollution, as mentioned in answer to Question Number 1,323 of the 1st Session of this Parliament.
Stanley Howard Knowles: Mr. Speaker, I move this motion on the hon. member's behalf.


James Alexander Jerome: Mr. Speaker, this motion is the same as motion for the production of papers No. 84 of the last session. As stated at that time, this report was prepared for internal working purposes. It contains information obtained on a confidential basis and must, therefore, be treated as privileged. I would therefore request that the hon. member withdraw his motion.


Stanley Howard Knowles: Question.


James Alexander Jerome: Transfer for debate.


Mr. Speaker:: Transferred for debate.



COPY OF REPORT BY OPERATION RESEARCH INDUSTRIES-QUANTITATIVE ASSESSMENT OF THE POLICY AND PLANNING BRANCH

[Stage Direction]
Motion No. 28-Mr. Skoberg:
That an Order of the House do issue for a copy of the consultant report by Operation Research Industries Limited undertaken for the Department of Energy, Mines and Resources regarding a quantitative assessment of the Policy and Planning Branch as mentioned in answer to Question Number 2,452 of the 1st Session of this Parliament.
Stanley Howard Knowles: Mr. Speaker, I move this motion on the hon. member's behalf.


James Alexander Jerome: Mr. Speaker, this motion is the same as motion for the production of papers No. 90 of the last session. As stated at that time, the report is an internal working document which was prepared to assist unit management in determining what organizational changes might be required to increase efficiency of operations, and its release is not considered to be in the public interest. Under these circumstances, it is requested that the hon. member withdraw his motion.


Stanley Howard Knowles: Question.


James Alexander Jerome: Transfer for debate.


Mr. Speaker:: Transferred for debate. Shall the remaining notices of motions stand?


Some hon. Members:: Agreed.



ORAL QUESTION PERIOD


Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce, but in his absence I will address it to the Acting Prime Minister. Has the government given consideration to holding meetings with the government of the United States with the aim in mind of persuading that government to permit the Ford Motor Company to distribute 1973 model cars to its agencies with the proviso that these 1973 models not be sold until the completion of the new tests being carried out by the United States Environmental Protection Agency?


Charles Mills (Bud) Drury: This is quite an interesting suggestion, Mr. Speaker, and I will see that it is passed on to the Minister of Industry, Trade and Commerce.


George Harris Hees: Mr. Speaker, has the government also considered holding meetings with the United States government with the object of avoiding a dislocation of the production of the Ford Motor Company both in Canada and in the United States because of the very serious effects such dislocations will have on the economies of both countries?


Charles Mills (Bud) Drury: Mr. Speaker, I think the hon. gentleman is aware that the government of Canada is meeting fairly continuously on a number of trade matters with the United States, and that preoccupation with avoiding dislocation of the motor car industry is of just as great concern to them as to us.


George Harris Hees: In view of that very general non-answer, and because of the great seriousness of the dislocation which can result from the Ford Motor Company having to stop production, will the government make it a very special point with the government of the United States to avoid such dislocation?


Mr. Speaker:: Order, please.



FORD MOTOR COMPANY-POSSIBILITY OF SHUTDOWN BECAUSE OF U.S. POLLUTION CONTROLS-CO-ORDINATION OF DEPARTMENTAL ACTIVITIES TO MINIMIZE EFFECTS

Mr. Max Saltsman (Waterloo):: Mr. Speaker, my supplementary question is addressed to the Acting Prime Minister. In view of the fact the Minister of Transport seems to be charged with the responsibility of looking after safety matters, and the Minister of Industry, Trade and Commerce seems to be ducking the question because his responsibility is in the area of production-


Mr. Speaker:: Order, please. Perhaps we might attempt to ask questions this afternoon rather than make statements. We will probably make better progress that way.


Max Saltsman: Thank you, Mr. Speaker. Will the Acting Prime Minister see that the activities of these two departments are co-ordinated and that the production losses are anticipated in order to make sure that unemployment does not result in Canada?


Charles Mills (Bud) Drury: Mr. Speaker, the assumption behind the question, namely, that the activities of the two departments are not co-ordinated, is quite unsubstantiated.



AUTOMOBILKS-POSSIBLE TARIFF AMENDMENT BECAUSE OF CHANGES IN U.S. APPROACH TO AUTO PACT

Mr. W. M. Howe (Wellington-Grey-Dufferin-Waterloo):: Mr. Speaker, I have a question for the President of the Treasury Board as Acting Prime Minister. When the automotive trade pact was signed some years ago there was a great deal of concern over the loss of millions of dollars in tariffs. The explanation given was that this would be compensated for by the number of new jobs. If, as it would appear, many main and supporting plants could be closed down as a result of changes in the United States approach, does the government have in mind any change in the tariff structure to compensate for the loss of employment opportunities for Canadians?


Charles Mills (Bud) Drury: Mr. Speaker, I think the hon. gentleman will be aware that as a consequence of this particular arrangement there have been and will continue to be created many new jobs in Canada in the automotive field.


Mr. Speaker:: Is the hon. member for Spadina rising on a supplementary?


Mr. Ryan:: No, Mr. Speaker. It is another question.



REGIONAL ECONOMIC EXPANSION


Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Regional Economic Expansion. In view of the fact that according to the findings of Dr. D. Springate, who appeared before the Standing Committee on Regional Development yesterday, 11 of 18 companies that received DREE grants totalling $34 million reaped windfall profits from these grants, would the minister undertake to make a statement to the House by the end of this week explaining how this was possible in terms of the act and what action he, as the responsible minister, intends to take to avoid a repetition?
Inquiries of the Ministry


Hon. Jean Marchand (Minister of Regional Economic Expansion):: Mr. Speaker, I shall be appearing before the committee this afternoon where I can give more details. The basis of Dr. Springate's thesis is extremely narrow. No one with a slightly scientific mind can draw sure conclusions from it. Yesterday, Dr. Springate himself stated in answer to a question put to him before the committee that he was dissatisfied with his own conclusions, and I agree with him.


John Edward Broadbent: Mr. Speaker, I asked the minister to deal with the specific instances cited by Dr. Springate. In view of the meeting this afternoon I should like to go on to a second related question. Inasmuch as Dr. Springate's study clearly indicates what I would regard as corporate cheating on the part of certain corporations, would the minister indicate whether any companies receiving DREE grants have been prosecuted, whether any legal action of any sort has been taken against any companies up to the present time and, whether or not something of this nature has taken place in the past, if any legal action is being contemplated?


Jean Marchand: Mr. Speaker, Dr. Springate has never claimed that his study was an objective analysis of the financial situation of those companies and of the reasons for their applications. He has merely held personal interviews and drawn his conclusions therefrom. I fail to see how legal action can be taken as a result of interviews with people whose names and circumstances the interviewer himself refuses to reveal.


John Edward Broadbent: Mr. Speaker, it is unfortunate that the minister should attempt to smear a serious study in this way.


Mr. Speaker:: Order, please. I really do not think we should embark on a debate on this matter which obviously is of interest to many hon. members. We should try to limit contributions at this stage to straightforward questions and perhaps straightforward answers.


John Edward Broadbent: I will try for a straightforward answer to this question, Mr. Speaker. In view of the fact Dr. Springate asserted in his study that officials in the minister's department are working in clear contravention of the stated purposes of the Regional Development Incentives Act and provides documentary evidence of this in his written thesis, would the minister inform the House whether he has personally authorized such departures from the stated purposes of the act?
tTranslation]


Jean Marchand: Mr. Speaker, there are dozens of officials in my department highly specialized in the same field as Dr. Springate. They carried out case studies and were in possession of complete data, which was not the case for Dr. Springate, and their findings were not the same as his.


Inquiries of the Ministry



INCENTIVE GRANTS-ALLEGED MISUSE BY CERTAIN COMPANIES-REQUEST FOR INVESTIGATION

James Aloysius McGrath: Mr. Speaker, in view of the seriousness of the charges raised by Dr. Sprin-gate which concern 11 companies and involve over $34 million in public funds, and as these grants were made under the discretionary powers of the minister under RDIA, will the minister undertake an investigation into these charges?


Jean Marchand: Mr. Speaker, each application is thoroughly examined together with financial statements. For existing companies, we study not only the balance sheet for the current year, but for the three previous years, something which Dr. Springate never did, having himself recognized that in all cases, he interviewed only about-


Mr. Speaker:: Order, please.


James Aloysius McGrath: I have a further supplementary question, Mr. Speaker. In view of the charges that some of the applications were falsified, will the minister now undertake an investigation, or at least undertake to talk to Dr. Springate?


Jean Marchand: Mr. Speaker, if Dr. Springate or the member for St. John's East wish to tell us what company has admitted having falsified the applications, we are ready to lodge proceedings tomorrow morning.


James Aloysius McGrath: He will tell you.


Mr. Speaker:: Order, please. We are obviously getting into a debate. The Chair will recognize the hon. member for Notre-Dame-de-Grace and then a representative of the group to my extreme left.


Mr. Allmand:: Mr. Speaker, I have a question for the Minister of Communications. Considering the recent ruling of the Canadian Transport Commission authorizing increases in Bell telephone rates, will the minister-


Mr. Speaker:: Order, please. My impression was that the hon. member was rising on a supplementary question. Obviously I was wrong. I think we should complete the first round of questioning before going to another matter.



INDIAN AFFAIRS


Mr. Henry Latulippe (Compton):: Mr. Speaker, I should like to put a question to the Minister of Indian Affairs and Northern Development.

Could he tell us whether he has met the Quebec premier in connection with the James Bay Indians and what have been the results of that meeting?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I expect to meet Mr. Bourassa tomorrow afternoon in Quebec City.



JAMES BAY HYDROELECTRIC PROJECT-ASSISTANCE TO INDIANS OPPOSED TO DEVELOPMENT-CO-OPERATION BETWEEN OTTAWA AND QUEBEC

Mr. Roch La Salle (Joliette):: Mr. Speaker, as the Prime Minister invited me to do last Friday, I would like to direct a supplementary question to the Minister of Indian Affairs and Northern Development.
Recently, a group of Indians from Northern Quebec requested the support of the federal government in order to stop the work on the James Bay project. Can the minister tell the House today whether the government intends to answer this request in the affirmative? If not, can he confirm again that his government is still prepared to co-operate in this project within authorized limits while giving adequate guarantees to the groups concerned?


Joseph Jacques Jean Chrétien: To the first part of the question, Mr. Speaker, I shall answer that I have, since then, met with the Indians in my office where we had discussions. They are not at this time asking that the work be stopped altogether; they would prefer a negotiated settlement. That is why I shall meet with Mr. Bourassa tomorrow in order to make sure that the interests of the James Bay Indians are well protected.


Mr. Speaker:: The right hon. member for Prince Albert.


Mr. Rock:: I have a supplementary question, Mr. Speaker.


Mr. Speaker:: The right hon. member for Prince Albert has the floor.



THE CANADIAN ECONOMY


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, my question is directed to the Acting Prime Minister. As I look at the serried ranks of the cabinet, with only 40 per cent of its members present, I have to direct this question to him. I wish to ask him whether or not the government will table the findings of a study into the causes of inflation from 1965 to 1970 said to have been placed on the desk of Mr. John Young, chairman of the Prices and Incomes Commission, some months ago?


Charles Mills (Bud) Drury: Mr. Speaker, I have no knowledge of this report placed on the desk of


Dr. John Young some time ago, but I will make inquiries as to its appropriateness for tabling.


John George Diefenbaker: Mr. Speaker, because it was of such importance I am sure it came before the cabinet. Did the researchers find that the government's rapid escalation of spending, at an average annual rate of 14 per cent between 1965 and 1970, was the principal cause of inflation during that period rather than wage increases?


Charles Mills (Bud) Drury: Mr. Speaker, as a member of the cabinet I am still unaware of this report, so I do not know what it said.


John George Diefenbaker: That speaks very badly of a cabinet that does not know what is going on in connection with inflation. Would the minister look into this now because the House would like to know, the Prime Minister having stated in December, 1970, that inflation was licked?


Mr. Speaker:: Order, please. I believe the hon. member for Regina East has a supplementary to the previous question. Perhaps we might try to have a few supplemen-taries and then go to the next questioner.



REGIONAL ECONOMIC EXPANSION


Mr. John Burton (Regina East):: Mr. Speaker, I wish to direct a supplementary question to the Minister of Regional Economic Expansion. In view of the startling findings of Dr. Springate, which were made as the result of a study of specific cases involving 18 out of 25 large companies in receipt of grants, could the minister indicate whether he is going to undertake an overhaul of the designated regions and the special area programs when these come up for renewal in the very near future?


Jean Marchand: Mr. Speaker, I can hardly see the relation between the first and second parts of the question but I think that the second one is really the root of the matter. Now, in the very near future, I will make a statement in the House on the designated and special areas.


Mr. Speaker:: Hon. members will have noted that there are a few supplementaries sought on this subject. We have to make an attempt to move on. For the moment the Chair will recognize the hon. member for Yorkton-Melville and then the hon. member for Lachine.



INCENTIVE GRANTS-ALLEGED MISUSE BY CERTAIN COMPANIES-REQUEST FOR INVESTIGATION BY NON-PARTISAN BODY

Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I wish to direct a supplementary question to the Minister of Regional Economic Expansion. In view of the seriousness ofi the charges made yesterday in the committee by Dr. 25316-36
Inquiries of the Ministry
Springate, would the minister undertake to appoint a non-partisan committee or authority to investigate these charges in order to see what is really happening?


Jean Marchand: Mr. Speaker, I have great respect for Dr. Springate's academic skill. He made a study on my department and I think this can be very useful. He refused himself to identify any company or person he interviewed; he did not examine the financial statement of any company or any document on which our decisions are based. Therefore I regard his study as a serious one-


Mr. Speaker:: Order, please. I regret having to interrupt the hon. minister but-

Obviously this is debate. I think we should try to move on to the next question. I will recognize first the hon. member for Lachine and then the hon. member for Peace River.



INDIAN AFFAIRS


Raymond Rock: Mr. Speaker, I would like to direct a question to the Minister of Indian Affairs and Northern Development in regard to his meeting with Premier Bourassa. Would he ask the Premier of Quebec to allow Indians and Eskimos in the James Bay area to vote provincially in the future? They do not have this franchise at present.


Joseph Jacques Jean Chrétien: Mr. Speaker, I am glad to inform the hon. member that the right to vote was granted to the Indians and Eskimos in Quebec for the last elections, before 1970.


Raymond Rock: Mr. Speaker, I understand they have not even a constituency in that area at present.


Mr. Speaker:: Order, please.



IMMIGRATION


Gerald William Baldwin: Mr. Speaker, I have a question for the Acting Prime Minister or, rather, for the Prime Minister who is just entering the chamber. I knew the right hon. gentleman could not resist me. Would the Prime Minister or a member of his government make a statement on motions tomorrow or before the end of this week regarding the case of Pershing Gervais, alias Paul


Inquiries of the Ministry
Mason, who is alleged to be in this country on a minister's permit from January, 1972, to January, 1973, as a result of special arrangements between the United States Department of Justice and officers of the Canadian government?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I must say I never heard of the gentleman, but I will be very glad to take notice of the question and see if a statement is called for in a case like this.


Gerald William Baldwin: Would the Prime Minister also be good enough to investigate and report on the further allegation that Mr. Pershing Gervais is in this country partly as a result of statements made to him by a Canadian government official that there would be no problems with the Canadian government over immigration, entry, work permits and other regulations?


Pierre Elliott Trudeau: Mr. Speaker, I will be very glad to look into the matter. Perhaps the hon. member could jot down the name on a piece of paper so I would be able to trace it.


Gerald William Baldwin: He is already on record.



PRESENCE IN SPEAKER'S GALLEY OF SECRETARY GENERAL OF UNITED NATIONS

Mr. Speaker:: Order. Perhaps the House will allow me to interrupt the question period for a moment in order to draw attention to the presence in the Speaker's Gallery of a distinguished visitor in the person of the Secretary-General of the United Nations, Mr. Kurt Waldheim.
As hon. members know, Mr. Waldheim is not a newcomer in our country. He was first minister plenipotentiary and later ambassador of Austria to Canada from 1956 to 1960. So, it is an old friend that we welcome today.

Mr. Waldheim was appointed Secretary General of the United Nations in succession to U Thant. He is the fourth incumbent of an office described as the highest to which a diplomat can aspire, and also as the most impossible job in the world.
Mr. Waldheim emphasized at the time of his appointment that the United Nations was an instrument of peace and that it was up to the member states to ensure that it fulfilled this role. The Secretary General, who has already been honoured and decorated by numerous countries, knows that he enjoys the confidence of a body representative of most of the nations of the world. We pray that under Mr. Waldheim's guiding hand the world organization will successfully fulfil the role for which it was destined.


Some hon. Members:: Hear, hear!



COMMUNICATIONS


William Warren Allmand: Mr. Speaker, I have a question for the Minister of Communications. Considering the recent ruling of the Canadian Transport Commission authorizing increases in Bell Telephone rates, would the minister contact the Bell Telephone Company and the Canadian Transport Commission to see if they could not arrange special reduced rates for pensioners similar to those which now apply on trains and aircraft?


Hon. Robert Stanbury (Minister of Communications):: Mr. Speaker, this is an interesting idea which I have discussed with Bell officials informally on occasion, but it does appear that the law now prevents discrimination among customers. Therefore this is something which might be further discussed in the House, if the hon. member would like to do so.



BELL CANADA RATE INCREASES-GOVERNMENT ACTION RESPECTING TRANSPORT COMMISSION DECISION

Mr. David Lewis (York South):: Mr. Speaker, may I ask the Minister of Communications some questions which I addressed to the Prime Minister yesterday arising out of the decision of the Canadian Transport Commission to grant the application for rate increases by Bell Canada totalling, as I mentioned yesterday, over $47 million a year. May I ask the minister whether he and his department are studying the matter with a view to taking action with respect to the decision of the Canadian Transport Commission?


Robert Douglas George Stanbury: Mr. Speaker, I have asked my departmental officials to study the matter and they are doing so.


David Lewis: May I draw the minister's attention, as I did with the Prime Minister yesterday, to the fact that both under a section of the Railway Act, section 335(4) if I remember correctly, and under a section of the Natural Transportation Act-


Mr. Speaker:: Order, please. I have some reservations about the hon. member drawing sections of statutes to the attention of the minister. Perhaps the hon. member might like to ask the question. It might be easier for the Chair.


David Lewis: Let me put it this way, Mr. Speaker. In view of the fact that under both the Railway Act and the National Transportation Act the government has authority (a) to demand all information in the possession of both the company and the commission and (b) to rescind or vary any order or decision made by the commission, is the minister giving consideration to rescinding the order of the commission so that Bell customers in Canada do not have to provide interest-free capital to this large corporation?


Robert Douglas George Stanbury: Mr. Speaker, the Minister of Communications has no authority under either of these acts to rescind the decision of the Canadian Transport Commission.


David Lewis: I did not say the minister, I said the government.


Robert Douglas George Stanbury: I listened carefully to the hon. member. The fact is that there are many channels for seeking review of this decision open to any citizen as well as by the parties before the commission. There has been no suggestion made by any of these parties or any citizen yet to the government or to the commission for such review. When the study by my department, to which I referred a few minutes ago, is completed we will certainly consider whether or not any action by the government is warranted.


David Lewis: Mr. Speaker, in view of the fact that the section of the National Transportation Act to which I have referred gives the Governor in Council authority, of his own motion, to rescind or vary any decision of the commission, may I ask the minister whether he will see to it that the government will consider rescinding this totally unjustified third increase in Bell Telephone rates in the last two or three years?


Mr. Speaker:: Order, please. The hon. member for Calgary North.



MARIJUANA-ALLEGED STATEMENT BY HEALTH MINISTER OPPOSING LEGALIZATION OF POSSESSION AND USE-GOVERNMENT POLICY

Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to put a question to the Minister of National Health and Welfare. I have already put this question to the Prime Minister yesterday. When the Minister of National Health and Welfare was speaking in Hamilton over the weekend, 1 believe, he stated to a group of students that he was opposed to the legalization of marijuana and hashish. Was he speaking for the government and is that the government's policy?


Mr. Speaker:: Order, please. The hon. member knows that he can ask only the Prime Minister, or somebody answering on behalf of the Prime Minister, to say whether a statement represents government policy.


Eldon Mattison Woolliams: Then I direct the question to the Prime Minister who took notice of it yesterday.


Pierre Elliott Trudeau: Mr. Speaker, I heard the Minister of National Health and Welfare say that he did not make the statement which the hon. member attributes to him.


Eldon Mattison Woolliams: Then possibly I can now put this question to the Minister of National Health and Welfare. After listening to the answer given by the Prime Minister, does he say that he was misquoted in the Montreal Star which carried the headline, "Munro Opposes Legalizing Posses-
Inquiries of the Ministry
sion Of Pot"? He is alleged to have said that in a speech to students in Hamilton. Does he take the position that he was misquoted?


John Carr Munro: Mr. Speaker, I am taking no position on being misquoted or otherwise, knowing the free way in which the hon. member quotes. What I said in Hamilton was that we would study the Le Dain Commission report and on the basis of that study come to a conclusion on whether we would adopt the recommendation with reference to removing the offence of simple possession of marijuana. I also reiterated the concern of the Le Dain Commission about the effects of marijuana on adolescents.


Eldon Mattison Woolliams: I have a further supplementary, and before I put it may I suggest that I was not quoting myself but was quoting from a newspaper clipping. May I ask the minister whether he has now placed the report before cabinet and has he made recommendations to cabinet with reference to the report of the Le Dain Commission, particularly with reference to the legalization of marijuana and hashish?


John Carr Munro: No, Mr. Speaker. The report has just been in the possession of my department for a matter of days. We are studying it and preparing recommendations to cabinet, but this will take a little while yet.



LE DAIN COMMISSION RECOMMENDATION RESPECTING MARIJUANA-INQUIRY AS TO INSTRUCTIONS TO CROWN AGENTS

Eldon Mattison Woolliams: Mr. Speaker, may I put a supplementary to the Minister of Justice. In light of the recommendations made by Mr. Le Dain, have any instructions gone forward to the special agents representing the Department of Justice in reference to prosecutions for the use and possession of marijuana?


Otto Emil Lang: Mr. Speaker, I would want to check whether any action of any sort has been taken by the department so far on the basis of the report. So far as I know none has been taken.



SOCIAL SECURITY


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I wish to direct my question to the Minister of National Health and Welfare. Can the minister indicate to the House whether discussions have taken place for the past few days at the minister level with the minister of social affairs of Quebec with respect to Bill C-170 concerning family allowances so that certain amendments suggested by Quebec can be made?


John Carr Munro: Yes, Mr. Speaker. Discussions at the official


Inquiries of the Ministry
level have been going on for some time with respect to family allowances.



AIRPORTS


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, my question is for the Minister of Transport and is further to a previous question concerning the expansion of Vancouver International Airport. Has the minister given final approval to an agreement to acquire the area known as the Cora Brown property?


Hon. Donald C. Jamieson (Minister of Transport):: No,
Mr. Speaker. Final approval to that effect has not been given. There have been continuing discussions with the residents concerned, but they have not been finalized as of this moment so far as I know.


Gordon Harvey Aiken: May I ask the minister whether he has approved a grant of funds to study the future use of the Burkeville area?


Donald Campbell Jamieson: Mr. Speaker, I am not sure I can identify the Burkeville area precisely as such. What I have done is to indicate that we will prepare over-all plans for the future use of the whole of Sea Island and I presume that would include this area.



URBAN AFFAIRS


Sylvester Perry Ryan: Mr. Speaker, I have a question for the Prime Minister. In light of the statement by Quebec's Minister of Intergovernmental Affairs, the Honourable Gerard Levesque, that federal urban spending hurts more than it helps, is it the intention of the government to review its urban spending with a view to closer co-operation with the aims of provincial and municipal governments?


Pierre Elliott Trudeau: Mr. Speaker, without admitting in any way the veracity of the allegations of the so-called minister-I mean the so-called allegations of the minister-


Some hon. Members:: Oh, oh!


George Harris Hees: You have done it again!


Pierre Elliott Trudeau: -the House does know that arrangements have been proposed for a tri-level meeting where representatives of the federal, provincial and municipal governments would come together to discuss this very problem. The House knows that the federal government has been interested for many months now in finding a process

whereby we would be able to discuss these problems with the municipalities. It appears that such a process has been discovered and it was referred to in the House just a few days ago by way of an announcement.


Gerald William Baldwin: Will Paul Hellyer sit in on it?



GOVERNMENT POSITION RESPECTING TRI-LEVEL CONFERENCE OR NATIONAL URBAN COUNCIL

Sylvester Perry Ryan: As a result of the meeting of the Canadian Federation of Mayors and Municipalities has the government abandoned its objective of a national urban council in favour of an annual tri-level conference only?


Pierre Elliott Trudeau: Mr. Speaker, the government has abandoned nothing. It is looking jointly with the provincial and municipal administrations for ways in which they can come together to discuss the very problem which concerns the hon. member. I repeat that a decision has been made and a report has been made by the working group to me and to the other first ministers recommending such a meeting for later this year-in the fall presumably. It has not been decided yet whether it would be an annual meeting, whether it would be ongoing or otherwise. It is the first coming together of these three levels of government.


Mr. Speaker:: Order, please. There are just ten minutes before the end of the question period. If each hon. member asks one question and two or three supplemen-taries we will fast reach the end before we can give an opportunity to other members to ask questions. I would recognize the hon. member for Spadina for a last supplementary.



SUBJECTS FOR DISCUSSION AT TRI-LEVEL CONFERENCE

Sylvester Perry Ryan: Is the Prime Minister in a position to indicate whether federal-municipal tax-sharing agreements will be a subject of discussion at the forthcoming tri-level urban conference in November and, if so, would he indicate what the federal government's position on the matter will be?


Mr. Speaker:: Order, please. I have very serious doubts about the question. Certainly the first part of the question could very well be placed on the order paper. The second part would invite a rather lengthy statement which should be made on motions. However, if the Prime Minister can reply briefly he will be allowed to do so and then the Chair will recognize the hon. member for Greenwood.


Pierre Elliott Trudeau: Mr. Speaker, at this time various authorities are still involved in setting up this consultative process, and I hope it will be successful. The federal government has been pressing for it, but at this stage it is too early to talk about the details of an agenda or the position of the government on this hypothetical agenda.



EXTERNAL AFFAIRS


Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is to the Secretary of State for External Affairs. He was good enough to send us a copy of a statement made by him on the subject of Canadian policy toward Rhodesia following the Pearce commission report. Does he propose to make that statement in the House?


Mitchell William Sharp: Mr. Speaker, it had been my intention to do so. If at the end of the question period hon. members will agree to revert to motions, I will be happy to do so. Otherwise, it will be published.


STRATEGIC ARMS LIMITATION-REPORTED AGREEMENT BETWEEN UNITED STATES AND SOVIET UNION-PRIOR ADVICE TO CANADA ON CONTENTS
Mr. Murray McBride (Lanark-Renfrew-Carleton):: Mr. Speaker, my question is for the Secretary of State for External Affairs. It is further to one I raised on May 5 concerning strategic arms limitation and the talks that have been going on between the U.S.A. and the U.S.S.R. In view of reports that such an agreement has been signed in Moscow today, will the minister advise whether Canada was informed as to the contents of this agreement prior to the signing?


Mitchell William Sharp: Mr. Speaker, the United States government kept all members of NATO, including Canada, generally informed. I hope that the report the hon. member has received is true because we have been very much interested in success for the SALT talks. I know the House will join with me in congratulating the two super powers on having agreed to some limitation of these weapons.


Some hon. Members:: Hear, hear!


DANISH POSITION ON HIGH SEAS SALMON FISHING-SUGGESTED STRONG STAND BY CANADA
Mr. Thomas M. Bell (Saint ]ohn-Lancaster):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. In view of the continuing leaks from the Danish government about their selfish position with regard to high seas salmon fishing, is the minister now, the day before the conference in Washington begins, prepared to really take the gloves off and get tough in regard to our position on such fishing?


Mitchell William Sharp: Mr. Speaker, my purpose is not to get tough. My purpose is to achieve results. I think that the kind of attitude we have been taking, which has been a reasonable one and one that will appeal to all nations, is the best way of getting the Danish government to change its mind.
Inquiries of the Ministry HEALTH


SUGGESTED INCREASE IN HEALTH RESOURCES FUND TO ENABLE TRAINING OF MORE GENERAL MEDICAL PRACTITIONERS
Mr. P. B. Rynard (Simcoe North):: Mr. Speaker, my question is for the Minister of National Health and Welfare. In view of the very serious and increasing shortage of general practitioners in Canada, 25,000 short in the next 20 years as indicated by the Canadian Medical Association, has the minister any plans to increase the health resources fund to help provide training facilities at universities?


John Carr Munro: Mr. Speaker, the hon. member should be aware that there are considerable moneys left unexpended in the health resources fund. That is the first point. The second point is that there is a good deal of controversy about whether there is a shortage of physicians, either now or in the long term, as the hon. member also knows.



AIR TRANSPORT


Hon. J. A. MacLean (Malpeque):: Mr. Speaker, I wish to address a question to the Minister of Transport. Is the minister in a position to report what Canada's response has been to France and Great Britain with regard to their request that supersonic aircraft be allowed to fly through certain designated corridors over Canada at supersonic speeds?


Donald Campbell Jamieson: Mr. Speaker, we have made no response to either of the countries concerned in relation to this request. Our policy remains what it has been, that flight at supersonic speed is not permitted over any Canadian air space.



EXTERNAL AFFAIRS


Mr. Mark Rose (Fraser Valley West):: Mr. Speaker, my question may be supplementary in a way to the earlier question about strategic arms limitation directed to the Secretary of State for External Affairs. In view of the fact that the policy of the government of Canada is one of opposition to further nuclear proliferation, and in view of the fact that the government of Canada has directed a note to the government of France protesting the proposed Pacific nuclear atmospheric tests, is the government considering making any kind of grant to the fund-short Greenpeace III voyage so the work of this foundation can be continued and enhanced?


Inquiries of the Ministry


Mitchell William Sharp: No, Mr. Speaker. I do not think it would be in the interests of either the Greenpeace men or the Canadian government to do that. I spoke to the sponsors of this project some time ago. I said that the best help they can give to this kind of protest is voluntary help which is not associated with the government.


Mark Willson Rose: I have a supplementary question for the Prime Minister. Does the Prime Minister plan to take a similar initiative and wire the good wishes of the government to Greenpeace III as he did on the Amchitka voyage of Greenpeace lit


Pierre Elliott Trudeau: Mr. Speaker, I will send the hon. member a copy of the telegram that I sent to the Greenpeace II mission and the hon. member may want to consider whether it is to be interpreted in the way his question was posed.


REGIONAL ECONOMIC EXPANSION
Hon. Martial Asselin (Charlevoix):: Mr. Speaker, I wish to ask the Minister of Regional Economic Expansion a question.
The citizens of Cabano are quite worried following the news yesterday that the federal government would not grant $8 million for the construction of a cardboard factory in Cabano. Would the minister reassure the people of Cabano by stating that the government will indeed grant the funds necessary for the realization of this project of utmost importance?


Jean Marchand: Mr. Speaker, the population need neither worry nor rejoice because the case is not closed and no decision has been reached as yet. As soon as it is, all those concerned will be advised accordingly.


AIR TRANSPORT
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I should like to direct a question to the Minister of Transport. Can the minister advise as to the result of the negotiations for the establishment of air service between Canada and the Peoples' Republic of China, in particular with reference to the designated carrier and the appropriate landing rights in Japan?


Donald Campbell Jamieson: Mr. Speaker, I can only advise on the first part of the hon. member's question. Talks were held in Peking which were quite successful in terms of resolving a number of techni-

cal and related questions. There will have to be a second round of talks. Of course, any relationship to any other country in regard to landing rights is not yet resolved. In partial answer, I might say we will have negotiations with Japan, as I recall, in June of this year.


TRANSPORT
Mr. P. V. Noble (Grey-Simcoe):: Mr. Speaker, my question is for the Minister of Transport. Can the minister advise the House when we may expect something definite with regard to improved ferry service between Tobermory and South Bay?


Donald Campbell Jamieson: Falling back on the standard answer, Mr. Speaker, soon, and I mean within a few days.


SHIPPING
Mr. Barry Mather (Surrey-White Rock):: Mr. Speaker, I have a question I would like to ask the Minister of Transport. It has to do with a vessel now loading part of Canada's gift of food to Bangladesh in Vancouver harbour. The name of the vessel is the Philippine Admiral. Will the minister give consideration to looking into the complaints of 50 longshoremen working on that vessel as to the alleged dirty condition of this food ship?


Donald Campbell Jamieson: Mr. Speaker, whenever it is called to my attention that an "Admiral" is dirty or otherwise, I am glad to look into it.


CANADIAN BROADCASTING CORPORATION
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, my question is for the Minister of Labour. It concerns a question I asked him the other day regarding a telegram sent to him by the NABET people asking the minister to review the negotiating process and the discussions between the CBC and NABET. The minister said he had the matter under study. In view of the importance of an early decision being reached for obvious reasons, has the minister come to any definite conclusion as to what the next move will be as far as his department is concerned?


Abram Ernest Epp: Mr. Speaker, I had the opportunity this week of meeting informally with representatives of NABET. The federal mediation service is at the disposal of both parties to this dis-


pute. I am hopeful they will make use of this mediation service and that some significant progress will be made quickly.


Lincoln MacCauley Alexander: Will the minister tell us whether the proposal submitted by him has been accepted by both parties, or is this still up in the air?


Mr. O'Connell:: Mr. Speaker, I am not making proposals to the parties. I am not acting as a mediator in this dispute. The officers of the department are available as mediators. Both parties know that the federal government is prepared to make a mediator available over a longer period of time after a settlement has been reached. We stand by that offer.
.


WHEAT-INQUIRY AS TO MEASURES TO PRESERVE UNITED KINGDOM MARKET
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the minister in charge of the Wheat Board. Having regard to the widespread concern which has been expressed that Canada will find increasing difficulty in selling wheat to the United Kingdom, has the minister instituted any new measures to preserve our market in that country.


Otto Emil Lang: I can assure the hon. member that the Wheat Board is in constant touch with our buyers and takes all logical steps to assure that market as well as markets in all other countries.


POLLUTION
Mr. Doug Rowland (Selkirk):: Mr. Speaker, my question is addressed to the Minister of Indian Affairs and Northern Development. On May 1 I asked him a question on a matter of some urgency in light of recent oil finds in the Arctic, namely, when the regulations under the Northern Inland Waters Act would be completed and published. The hon. gentleman took the question as notice and undertook to look into the matter. I wonder whether he is now in a position to reply?


Joseph Jacques Jean Chrétien: Mr. Speaker, the act has been proclaimed and I understand that the regulations are being considered by the two councils which have been established in order to implement them. I think that a meeting has been held last week and as soon as the report is submitted, we shall be able to proclaim these regulations. Meanwhile, officials of my department have advised the companies that they should abide by the regulations as if they were actually in force.
Inquiries of the Ministry


INTENTION RESPECTING PROCLAMATION OF ARCTIC WATERS POLLUTION PREVENTION ACT
Mr. Erik Nielsen (Yukon):: I have a supplementary question for the minister. Is it the intention of the government to proclaim the Arctic Waters Pollution Prevention Act? If not, why not; and if so, when?


Joseph Jacques Jean Chrétien: Mr. Speaker, I have advised this House that we could not proclaim it right now because if we did we would have, in the present context, to delay the activities in the port of Churchill. But we think that we have found a solution to the legal problem which had developed following the passing of this new legislation, and we should be able to proclaim the act for the next navigation season in the north.


VOTE AT UNITED NATIONS ON LEGALIZING POSSESSION AND USE OF MARIJUANA-REASON FOR CANADIAN ABSTENTION
Mitchell William Sharp: Mr. Speaker, may I have permission to answer a question which was put to me by the hon. member for Calgary North?


Mr. Speaker:: Order, please. We have gone beyond the end of the question period, but with unanimous consent the minister might be allowed to reply. Is it agreed?


Some hon. Members:: Agreed.


Mitchell William Sharp: The hon. member asked me whether a vote had been taken in the United Nations with respect to the legalization of marijuana. Then he asked if I was able to inform the House whether all other nations had voted against the proposition while Canada abstained.
On May 17 a vote was taken in the social committee of the Economic and Social Council on a resolution entitled "Abuse of Cannabis and Multiple Drug Abuse." This resolution was adopted by the social committee with 41 members in favour, none opposed, and three abstentions, namely, Canada, the Netherlands and Trinidad-Tobago. The Canadian delegation explained, as it did when a similar vote was taken earlier on the narcotics convention at Geneva, that it abstained from voting because the subject matter of the resolution formed part of the mandate of the commission of inquiry into the non-medical use of drugs whose report had not yet been given governmental consideration.


Mr. Speaker:: Orders of the day.


Mitchell William Sharp: Mr. Speaker, as I indicated earlier in reply to a question, I would be happy to make a statement on Rhodesia if there is agreement to revert to motions for that purpose, but if there is not disposition to grant this permission perhaps I might at least have the privilege of


The Budget-Mr. Fortin
tabling the statement which I think would be of interest to hon. members.


Gerald William Baldwin: Mr. Speaker, we would prefer that the hon. gentleman table it. I am sure that hon. members who are interested in it would be ingenious enough to find an opportunity in the unabridged question period outside the House to make their views known.


Stanley Howard Knowles: Mr. Speaker, as the Secretary of State for External Affairs distributed copies of this statement earlier so that it might be made here rather than outside to the press, we would prefer to revert to motions so he can make the statement now and other members can comment on it.


Mr. Speaker:: It appears there is not unanimous consent. [Translation]
The hon. member for Lotbiniere realizes that he would need the unanimous consent and the House has already indicated that there is not unanimous consent.

In the circumstances, the Chair will have to call orders of the day.


Gerald William Baldwin: There is unanimous consent to revert to motions for the purpose of tabling the document, if that is agreeable.


Mr. Speaker:: Does the minister have leave of the House to table the document to which he has referred?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tuesday, May 23, consideration of the motion of Hon. John N. Turner (Minister of Finance), that this House approves in general the budgetary policy of the government, and the amendment thereto of Mr. Lambert (Edmonton West), (page 2178).
Mr. Andre Fortin (Lotbiniere):: Mr. Speaker, I should like to resume and conclude the remarks on the budget which I started yesterday.
In April 1972, the new Minister of Finance (Mr. Turner) tabled an Economic Review designed to restore the fortunes of the government of the Prime Minister (Mr. Trudeau). In the first paragraph, on page 7, one can read that even if "demand and production in the Canadian economy have been advancing at a strong space since 1970- higher than in any year since 1966-yet, and I quote:
-in spite of this, the unemployment rate remained high.
This is a clear recognition of the administrative failure of this government. Apparently, it does not understand that the consumers' purchasing power must be increased,

considering Canada's huge power of production. As a comprehensive proof of this assertion, I shall quote another excerpt of this report, to be found at page 7:
A principle source of strength in demand during 1971 as compared to 1970, was in a category of expenditures that may be described as postponable consumer spending. This includes expenditures on durable goods (such as new cars and home furnishings), semi-durable goods (which include clothing and household items like linens and draperies) and new residential construction. Postponable consumer spending increased by $1.4 billion or almost 12 per cent in 1971.
Mr. Speaker this shows how huge are the consumers' needs and how limited is their purchasing power. It happens that the Canadian people get into debt in proportion. There lies the problem, and nowhere else! Obviously, the purchasing power of consumers must be increased if the national production is to be disposed of. Otherwise, pover-. ty will increase in the midst of plenty.
Mr. Speaker, I should like to remind the right hon. Prime Minister that on his visit to Victoriaville he stated that the main right of the individual is not the right to work but the right to live decently in his country and that, in any event, machine is replacing man more and more. That means, and this is logical, that the government will have to find the financial mechanism required to ensure a guaranteed income to every Canadian, according to the economic situation, to make up for the inconveniences inflicted by progress.
I find the study of the monetary system fascinating and my colleagues of the other parties should also be fascinated by it. I find it very satisfying as I feel that I am participating actively in a field that is intrinsically related to the common good. It is interesting to see all the intellectual contorsions bankers go through to make us accept straight away their monetary system, which is really a clever utopia.
Their intellectual fervor does not keep them from recognizing the existence of a very eloquent situation. Thus, in a brief recently published by the Bank of Canada, the admission is made in a style that is unbelievably technical and monetary, and I quote:
The economic policy of public powers (including the monetary policy) must therefore, to some extent, be applied by trial and error on the basis of insufficient data.
That is the most surprising standard of management in a field as important as that of currency, the economic blood of this country. No wonder that such disorder causes such calamities, including inflation.
The only suitable explanation is that the government is a counterfeiter. I will try to point out the causes of the inflationary upsurge which seems to have taken responsible people by surprise, especially on account of its persistence, and the more so since the fight against inflation in which the government has been engaged for four years was a total failure, and was done at the expense of the small wage earners, the poor and the unemployed.
It is obvious that it will not recognize the real causes of inflation, which seems to have become chronic. It would rather use it as a Trojan horse to win elections. There was a time when one could foresee inflation through an analysis of certain distinctive conditions. It was the lack of


consumer goods as against strong purchasing power. Today, we find that products are in abundance while there are human needs that the purchasing power is not great enough to meet. Such a situation dumbfounds the intellectuals in banking circles.
I will allow myself to describe the inflationary situation as I see it.
First, the real cause of that calamity, inflation, is the upholding by the state of an unaccountable privilege granted to the chartered banks. Society reacts in its own ways but its reactions are rather quiet and hard to detect. One may resort to clever propaganda, but the individual always gives way under the dictatorial power.
Secondly, the bank has absolute and unquestioned control over Canada's common good, with its privilege to control credit and, indirectly, currency. As the bank has the power to charge interest on its loans, it therefore requires a larger repayment than the amount it liberates. That is another cause of the unrest exerting such a great influence on prices. At the beginning, we had a deficit monetary system.
Thirdly, our current accounting system makes prices more consistent with economic reality. Also prices are more scientifically computed and take all circumstances into consideration. Accounting takes into account mainly two basic factors that influence prices: investment and distribution of buying power. I do not think that a bank can add any value to money. It can only be an inflation factor.
Fourthly, this is a time of specialization. Our economic experts in monetary science are certainly playing a major role, but it cannot be considered efficient. The state of confusion of our economy is indicative of the lack of a sense of responsibility on the part of our government in the monetary field. Its bad influence can be seen in the professional defence organizations.
I have no time to determine the reasons for this fact, but we should admit that the experts are refusing to analyze the factors that influence prices. They fail to see that two parallel forces contribute to the establishment of prices, namely investment and buying power. Presently, the consumer is suffering from the impact of those two forces which are crushing him. Actually, the buying power should be used only to pay the very product consumed. The investment portion will never become the consumer's property. It will always be the producer's property and this is not bad. However, we should balance the buying power to meet the consumer's needs. Our banking system cannot take this technique into account and the government is doing nothing to eliminate this absurdity. It is its slave. In the past, the individuals picked up the tab, because they lost some money. Presently, with the power of defence organizations and accounting, the whole burden of production costs is reflected in prices and so is degenerating into continuing inflation at the expense of the average or small taxpayers.
Mr. Speaker, in conclusion I would like to repeat what I said yesterday, namely that the succeeding governments- Grits or Tories-have created shameless poverty in Canada, a country which ranks second in the world in wealth.
The Budget-Mr. Fortin
Mr. Speaker, this is an obvious paradox which is being willfully maintained. Still more serious, poverty and richness exist side by side in Canada.
Mr. Speaker, if the government fails to take immediate action in order to set up a financial mechanism known as social credit, that is socialization of credit, so as to enable every member of our society to have enough economic blood to participate fully in the economic, social and political life of his country and so as to respect both the freedom and the security of the individual, that will soon be the end of Canada, which is already in progress.
We need only look at the events occurring in Quebec: unions are clamouring for job security. But why? To work? Do we work for the fun of it or to secure at the same time a minimum adequate income? Obviously, the two go together and most often very few workers are willing to work 45 hours a week unless they can be sure of a suitable income.
It is ridiculous that with progress and automation people should lose their jobs through illness or old age or else because they have too many diplomas or not enough, for lack of experience or too much of it.
It means, Mr. Speaker, that within a maximum of five years the government will have to find some financial system allowing those who are leading marginal lives to live fully and build their country, failing which our society will collapse, and we will not build the country.
I am surprised to note that since I have been in the House, whenever I speak of the constitution, of abortion, of homosexuality, of the flag, of federal-provincial relations, of social or external policy, we have lively debates, everyone participates and benefits, everything goes smoothly but when I speak of monetary problems, of people's purchasing power, then all those Grits and Tories who were flying at each other's throats suddenly unite to fight the Social Credit doctrine.


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


André-Gilles Fortin: Mr. Speaker, I only need two more minutes.


The Acting Speaker (Mr. Boulanger):: Order, please. Does the House agree to allow the hon. member for Lot-biniere to go on with his speech?


Some Hon. Members:: Agreed.


André-Gilles Fortin: Thank you, Mr. Speaker, and I also thank my colleagues for their kindness; I can assure them that I will not abuse this privilege.
Mr. Speaker, I end my speech with these questions and I would advise my colleagues to ponder seriously over them.


The Acting Speaker (Mr. Boulanger):: Is the hon. member rising on a point of order?


Mr. Deachman:: Mr. Speaker, I heard some noes in the chamber. There are on the list members of the House who


The Budget-Mr. Fortin
want to speak today. If we decide to extend time there will be members who would like to speak today but will be denied the privilege. I think we should stay within the rules.


The Acting Speaker (Mr. Boulanger):: Order. It seems that there is no unanimous consent.


André-Gilles Fortin: Mr. Speaker, on a point of privilege.


The Acting Speaker (Mr. Boulanger):: The hon. member for Lotbiniere on a point of privilege.


André-Gilles Fortin: Mr. Speaker, I understand that unanimous consent was given a moment ago and the House cannot revert it. Besides, I wish to point out to the previous speaker that the remark that he has just made is very ungracious in view of the fact that yesterday we gave unanimous consent to allow the Minister of Agriculture (Mr. Olson) to continue his remarks. I suggest that my hon. colleague should show the same consideration to us as we did to a member of his party.


The Acting Speaker (Mr. Boulanger):: Order. I must admit that there was unanimous consent, in the first place, to allow the hon. member to go on with his sppech for a few more minutes. Therefore, if the hon. member for Vancouver Quadra (Mr. Deachman) agreed, I think we might overcome this difficulty, since it is a matter of only one or two more minutes.


Grant Deachman: I agree to grant him two more minutes.


The Acting Speaker (Mr. Boulanger):: Order. The hon. member has quite understood that the House agrees to grant him two more minutes.


André-Gilles Fortin: Mr. Speaker, when one wants to understand, two minutes are enough. One can do more in two minutes than in two hours, if one wants to.
Mr. Speaker, I simply ask these two questions to my colleagues. How is it that we have, in this House, the authority to undertake numerous reforms and inquiries to have reports made which will be consigned to oblivion, on any subject matter but one, which is very important: the banking and monetary system? How is it that no hon. member finds it important to attack this golden calf known as high finance in Canada?
How is it, Mr. Speaker, that every member of this House recognizes that every Canadian's problem relates to money. They all admit that money is insignificant, but when you do not have it, you cannot administer anything. While this problem affects every province, every municipality and every school board, how can we accept to undertake reforms in all these areas, to look fully into these subjects for hours, at the cost of several million dollars, when we refuse to deal with the basic problem, namely the monetary system?
During the last 20 seconds remaining to me, Mr. Speaker, I shall suggest that it is high time we enabled each Canadian to get his share of the national production, so that he can really live in his country and develop in

self-respect, in freedom and security. That is the only way to build Canada in peace, in mutual respect, otherwise- and I regret having to repeat it-the structures will collapse and violence v/ill erupt. This has already started, and those responsible will be those who have maintained the system in the pay of high finance.


Patrick Morgan Mahoney: Mr. Speaker, it is not inappropriate for me to follow a spokesman for the Social Credit party in taking part in this budget debate, inasmuch as I intend to devote a good deal of my allotted time to a discussion of the Stanfield "constant dollar" plan. Lest I be charged with being unparliamentary in using the name of the Leader of the Official Opposition (Mr. Stanfield), let me hasten to say that I have derived the designation from a Progressive Conservative press release dated May 18. I assume, therefore, that the leader of the opposition approves of the designation. It is not inappropriate that this discussion should follow along in the context of a Social Credit exposition, because many commentators have noted that it is a sort of "funny money" exercise without, however, benefiting from the respectability that a measure of antiquity has given Social Credit.
In his speech in the House on May 15, the Opposition leader observed that unemployment "constitutes the principal challenge which faces the government in 1972". I agree with him, so does the Minister of Finance (Mr. Turner) and so does the government. That is what the May 8 budget was all about-jobs, jobs and more jobs. Having identified the principal challenge, however, the opposition leader advanced two ideas neither of which, whatever their merit otherwise, would contribute significantly to creating jobs for Canadians. He suggested an increase in old age security payments, the payments made to our senior citizens regardless of need, in precisely the same amounts that the budget proposed to increase the guaranteed income supplement, payments made to our senior citizens who are in most need.
Looked at in the context of a measure to create jobs, this proposal falls flat on its face. The Conservative press release calls it the Stanfield pension alternative and estimates its net cost at $102 million over and above the cost of the government's proposal. The Stanfield pension alternative would have had the effect of putting an extra $100 million in the hands of our senior citizens, those not in the greatest need. No doubt a good portion of this would be spent on consumer goods, but the leader of the opposition must be aware that slow consumer spending is not a problem in Canada and has not been for a long time.
Total retail sales increased by 12.6 per cent in April, 1972, over April, 1971. Even the most casual observer of the Canadian economic scene, such perhaps as the Leader of the Opposition, should recognize that further direct stimulus to consumer spending is far more likely to be counterproductive because of its inflationary effect than of value in creating jobs.
Then, too, there is the principle of the thing. I do not think Canadians feel that the government is better able than they are to manage their personal financial affairs. The day is past in Canada when our citizens will sit cheerfully by and pay taxes at a level necessary to main-


tain adequate levels of social assistance on a universal basis regardless of need. Canadians do not begrudge adequate social assistance payments to their fellow citizens who are in need, and in fact that is what we have done in the budget for our senior citizens in need, for our veterans and their dependants. These proposals of May 8 assure a continuation of the most generous of such programs in the world. They are perhaps not as generous as we would like, but they are as generous as we can presently afford and the best available in the world. We can, and we will, do better as we are able to afford it. The record of this and preceding Liberal governments is a firm testimonial to that.
In 1963 there was no guaranteed income supplement and old age security payments stood at $65 per month for senior citizens aged 70 or more. In 1964 the old age security was raised to $75 and in 1965 the age of eligibility was reduced to 65. A $30 guaranteed income supplement was introduced in 1966 and a cost of living escalation with a 2 per cent ceiling was introduced. In 1970 the old age supplement was fixed at $80 and the escalation applicable to it alone was removed. The guaranteed income supplement was increased to $55 for single persons and $95 for married couples and, of course, the escalation with the 2 per cent ceiling on combined old age supplement and the guaranteed income supplement payments continued.
In the past few days parliament has, at the government's initiative, amended the Old Age Security Act to provide for cost of living escalation, without a ceiling, for both old age supplements alone and combined old age supplements and guaranteed income supplements. It also increased the guaranteed income supplement to $70 per month for single persons and $125 for married couples. In summary, during a decade of Liberal governments our most needy senior citizens have seen their pensions increase by over 130 per cent, from $65 to $150 per month if single and by almost 120 per cent, from $130 to $285 per month, if a married couple.
The other proposal to meet the challenge of unemployment is the Stanfield "constant dollar" plan. Again, whatever its possible merits, it does nothing about jobs. Rather, it is a bit of fiscal sleight of hand designed to achieve one thing and one thing only. It is designed to prevent the inflationary element in an increase in income from moving a taxpayer into a higher tax bracket. The opposition leader claims that it would also give parliament greater control over government spending, but this point is entirely fatuous.
Parliament controls government spending through its review of budgetary proposals on the revenue side and a review of estimates on the expenditure side. Nothing in the Stanfield "constant dollar" plan would change that. All that would happen is that the government would have to provide for the revenue lost through the plan in its budgets either by increasing its deficits, increasing taxes or a combination of both. There is simply nothing magic in the plan that would either enhance or impair parliamentary control of either spending or revenue.
The plan presents a number of difficulties, some formidable. It would present an administrative challenge in determining proper payroll deductions. Its application to capital gains accumulated over a period of years, but
The Budget-Mr. Mahoney
included in the tax return for the year of realization, would seem to call for clarification to say the least. That sort of problem can doubtless in this age of computers be overcome somehow, and I want to make it clear that I do not regard administrative convenience or inconvenience as a determining factor in doing or refraining from doing something otherwise desirable. That is and will continue to be among the criteria that I will apply in the ongoing review of tax policy. Nevertheless, administrative difficulties must be solved and the opposition leader has given us no clue as to how he would cope with them.
The progressive personal income tax is generally regarded as our fairest tax. It is also a fair and effective fiscal tool. Elimination of the inflationary element from it would weaken it as a fiscal tool. Then, too, government expenditures are met with current, not constant, dollars. For both of these reasons, to strengthen its fiscal policy and to make up eroded revenues, the government would inevitably be required from time to time to increase some tax or other.
If the increase were applied to some other tax, the sales tax for example, the price paid to avoid inflationary increases moving taxpayers into higher tax brackets will be an increased burden of a less fair tax. If the increase were applied to the fairest tax available, the whole exercise would prove illusory, undoing what the Stanfield "constant dollar" plan set out to do, nothing more than a gimmicky bit of fiscal sleight of hand. We could refrain from doing anything, see deficits increase ad infinitum and accept a weakened fiscal stance. None of these results seems worth the benefit.
Then there is the matter of provincial revenues. The leader of the opposition acknowledged this particular problem. Under the reformed tax law we have achieved uniformity of our personal income tax system across Canada. Even Quebec, by accepting the federal revenue guarantee, has conformed its personal tax system to the new federal system. This in itself is a major achievement.
I have used the revenue estimates contained in the Conservative press release where available. Oddly enough, while scrupulously giving detailed estimates and examples in other areas, the press release is silent on the revenue implications of the piece de resistance, the constant dollar proposal. However, the Department of Finance estimates that the federal revenue cost would come up to $375 million the first year. The full provincial revenue cost over and above that would aggregate in the area of $120 million. These totals would obviously increase annually in the absence of increases in tax rates and, if the balance of the system achieved by the tax reform is to be preserved, in the absence of revisions of exemptions and deductions on an ongoing basis.
I am convinced that our provincial governments are as anxious as we to do the right thing. They will want to preserve the taxpayers from a tax jungle. If they see $120 million as a proper initial price for them to pay for not permitting inflation to bump taxpayers into higher tax brackets, they will be beating a path to the finance minister's door urging acceptance of the Stanfield "constant dollar" plan. No doubt they will be led by the Tory pre-


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miers of Newfoundland, New Brunswick, Ontario and Alberta. The federal government, for its part, must decide whether in a period when unemployment is our principal challenge, identified by the Leader of the Opposition, acknowledged by the government and confronted in a meaningful way by the budget, forgoing revenue initially by his own estimates-almost $500 million a year in total- for a scheme that regardless of whatever else may recommend it does absolutely nothing to create or maintain employment, is the best way to utilize that kind of money.
The Leader of the Opposition has talked about the increase in OAS as a result of the escalation brought in in the budget and recently enacted by parliament, in a very disparaging way. Certainly it must be small, given the perspective he displays in the May 18 press release. It is not in it with the $30.67 per month tax reduction he wants to give the $40,000 a year man for the current year, although it is not far off the $3.33 per month reduction he has in mind for the $10,000 a year man and the $2.42 per month reduction for the $8,000 taxpayer. Then there is $2.17 a month in it for his $6,000 a year specimen and a magnificent $7 per year, or 58 cents a month, for the $5,000 a year man. One has to wonder if he will more likely be remembered as "30-buck Bob" by the $40,000 a year fellow or "58-cent Bob" by the $5,000 a year man.
The inflationary push involved in the total proposal of the Leader of the Opposition is an important ground for criticism of his plan. The first whole fiscal year in which it would be in effect would be the year 1973-74. That year would reflect the cost over a full year of the constant dollar method and the cost for nine months of the extension of the 3 per cent surtax. In contrast, 1972-73 includes only a quarter cost for these measures. Our estimates suggest that when allowance is made for this fact, the total revenue cost to the federal government of the $380 million in 1972-73 would rise to $750 million in 1973-74. It may be noted that this increase occurs despite the termination of his 2 per cent tax cut which he estimates would cost $134 million in 1972-73.
These estimates break down as follows:	pension
changes for the year 1973-74, $107 million; 3 per cent tax cut extension, $255 million; use of constant dollar method, $375 million. To add almost three-quarters of a billion dollars to the cash requirements of the government for 1973-74, over and above those which would emerge from the existing budgetary structure, would almost certainly be strongly inflationary. The proposal of the Leader of the Opposition would thus have the effect of increasing the rate of inflation or, alternatively, would have to be accompanied by other tax increases or by expenditure reductions i'l other programs.
These proposals appear to stem from the belief that the government sector of the economy has a stake in inflation in the sense that the higher revenues which result from inflation permit governments to finance new expenditure programs. This, of course, is extremely inconsistent from a man who has been complaining for the past months, indeed years, about the energy with which the government has attacked inflation. The Carter commission dealt at length and in detail with the constant dollar idea. The commission, as recorded at page 33 of volume 2 of its report, concluded as follows:
[Mr. Mahoney.j
We are convinced that it would be a serious error to relate transfer payments and tax credits to a price index so that they increased automatically with inflation. To do so would seriously weaken, if not destroy, one of the basic defences against inflation, the automatic stabilizers that are built into the present tax-expenditure system.
Later it states:
The corollary of this position is that the tax structure generally should not be adjusted automatically to take into account changes in the general level of prices. Taxes must be based on current dollar income, including increases in the market value of assets, and no attempt should be made to adjust automatically for changes in the purchasing power of money. To develop a tax system that taxed only increases in "real" purchasing power would irreparably damage the built-in stability of the system.
Employment is the priority and that is what the budget is all about. For 1971 as a whole, the real growth in the Canadian economy ran to 5j per cent; for the last half it grew rapidly and probably exceeded 6 per cent. I would refer hon. members to the October, 1971, report of the Economic Council of Canada entitled "Performance in Perspective" at pages 52 and 53 where the following appears:
We have estimated that a rate of growth of over 6 per cent per year over a three-year period from the middle of 1971 would be required to move the economy back reasonably close to potential output-that is to reduce unemployment to 3.8 per cent of the labour force.
Without adopting their criteria, it is obvious that the various measures taken by this government in the management of the economy has brought us within shooting distance of the objectives that the Economic Council has established.
The rapidly improving performance of our economy was largely responsible for the fact that the Minister of Finance had a lot of room, almost $1 billion worth, to move within the constraints of fiscal responsibility in bringing down his May 8 budget. He used almost all of this room to achieve two things: about $350 million went to improve the lot of those whose bargaining position in our society is weakest, the aged and the disabled, and about $500 million was committed to the creation of jobs in the private sector.
The most significant of the corporate tax changes were limited to manufacturing and processing activities although there was the important extension to the mining industry of both fast write-off and eligibility for depletion allowance of the cost of equipment acquired to refine ore up to the primary metal stage. This government has taken the position that by and large our resource industries now have available tax incentives sufficient to maintain a satisfactory level of exploration and development.
Our service industries also are performing well at present. By their very nature they are not as prone to suffer from outside competition as either the manufacturing or resource sectors. The best thing that can be done for them is to enhance the demand upon them by other sectors.
I believe there is a very positive and key advantage for western Canada in the special treatment directed by the budget to processing and manufacturing. One of the very fundamental concerns of thinking western Canadians has


been our inordinate dependence upon raw material exports. This concern has been articulated by responsible provincial leaders. For example, the Premier of Alberta made the following statement to the federal-provincial conference of first ministers last November:
The future growth of our province will be determined by our ability to guide the province through the transition from a primary industry economy to a balanced economy equally based on natural resources and secondary and manufacturing industries.
Speaking in his budget debate this March, the Premier of Saskatchewan indicated that, while continuing to support resource development, his government-
-will put new emphasis on those projects which involve further processing of our agricultural products and other raw materials.
This applies with equal validity to the Atlantic provinces. The Premier of New Brunswick, at last February's first ministers conference, said:
There is an urgent need to get manufacturing on a growth pattern if job opportunities are to improve.
The corporate tax cuts on processing and manufacturing profits and the two year write-off permitted for newly acquired processing and manufacturing equipment and machinery will substantially reinforce these very desirable provincial objectives and contribute tangibly to their attainment.
The May 8 budget constitutes a massive act of faith in the free enterprise system. Free enterprise has served Canada well. We are confident that it can and will continue to serve Canada well. We are confronted by many serious problems and right now the main one is unemployment; but we are confident that we can solve these problems as well as the unemployment problem specifically within the context of the free enterprise system.
We expect that the 20 per cent corporate tax reduction and other capital investment incentives offered manufacturing and processing activities will lead to substantial improvement in the ability of Canadian products to compete at home and abroad and hence to a large increase in employment opportunities in Canada. We are confident that with the certainty of this tax reduction as an ongoing measure, corporations can convert plans to action quickly and have a substantial and relatively immediate impact on jobs for Canadians. We are confident that our confidence in private enterprise is well founded.


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, in rising to participate in this budget debate I wish first to congratulate the Minister of Finance (Mr. Turner) on his maiden budget. It is not an enviable position in which he found himself, having been conscripted to it in the first place and then having to follow the tragedy of the budgets which preceded this one. I would also like to congratulate the hon. member for Calgary South (Mr. Mahoney) who has just finished reading a questionable speech. There was a day when speeches in the House were supposed to be made for the purpose of debate, and not read, but that day has long since gone, particularly when ministers of the Crown, albeit fledgling ministers, have every single word written out for them. Of course, that pattern is followed by the Prime Minister (Mr. Trudeau) so we should not really be too critical of the Minister of State.
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The minister said that the government has come within shooting distance of bringing inflation and unemployment under control. I say to him that he must have a very strong telescopic-sight and a very long-range rifle, because I certainly do not see the target within sight at all. I say to him, also, that it is not the system that he has been talking about that is wrong; it is the management of that system. We heard him spend the full time of his speech condemning my leader who made a particular suggestion in relation to one alternative. However, there is not very much he can say about his own budget, although voters in Calgary South might have obtained more benefit from explanations of some parts of the budget for which I have not been able to find any answer or rational explanation.
My basic objections to the budget are threefold. First, it is wrong and it makes little sense to treat different sectors of the economy in diverse ways. What has happened in this budget is that the manufacturing and processing aspects of the economy have been given some incentive and encouragement while the other aspects of the economy have been neglected altogether. It seems to me that if we really want to bring the economy of this country back to what it ought to be and where it could be, we will have to deal with the general problem of taxation and inflation in a consistent way that is equitable to all sectors.
Another criticism I have of the budget is that it innovates yet another approach to the problem of financing the cost of government in attempting to create jobs, as the Minister of Finance said. A great deal has been said about the 20 per cent corporate tax cut-this matter was mentioned by the previous speaker-but the fine print in the budget does not even say that there is a current 7 per cent tax cut incentive for corporations which will automatically disappear at the end of this year simply because the reduction which was given a few months ago for a specific period of time is not reactivated. I have not heard one speaker on the other side mention the fact that there is presently a tax reduction that will be no longer effective. So if they want to talk honestly and with integrity about what the corporate tax reduction is, they should be using the figure of 13 per cent instead of 20 per cent.
Another point I should like to make is that while this budget does very little for the middle income earner, and does nothing for the low income earner, the fact is that income tax goes up 3 per cent at the end of the year for everybody. Again, nothing was said about this in the budget, not even in the fine print. The fact remains that Canadians will pay 3 per cent more personal income tax after the end of this year because in the mini-budget that the previous Minister of Finance brought in last October the highlight was the 3 per cent tax reduction across the board which, however, was implemented only until December 31, 1972. Because nothing is done to erase or amend that time limit every taxpayer will be paying 3 per cent more income tax at the end of the year as a result.
In addition to this deceitfulness-certainly the fact that it was concealed, that it was not mentioned, means it can be classified as exactly that-my complaint is that we try one thing one year and another thing the next year, and as


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a result the whole business community and tax paying community becomes confused. It is impossible to plan ahead on such a basis.
Another criticism I have of the budget is that tax reductions for corporations are inappropriate at this time. Government speaker after government speaker talks about the priority of creating jobs. But nothing is done in this budget to create any new jobs; in fact, the opposite will be true. Even if we wait for another winter and another year, the situation will not be better; in fact, it will be worse than it is because we are not dealing with the core of the problem of unemployment. Frequent shifts in tax rates such as these are literally counterproductive.
A third point which I make in regard to my contention that a reduction in corporate tax rates is wrong at this time is that the government disregards the fact that our main deficiency today is consumer demand. Consumer demand depends upon purchasing power in the hands of the consumers. Until consumption catches up with investment in a significant range of industries, the tax reductions for corporations will bring forth little additional capital investment and very few new jobs.
In fact, one of the real problems today so far as attracting capital from outside is concerned does not even relate to the private sector. No mention has been made of that. It relates to the public sector, Mr. Speaker, because provincial government after provincial government has to go outside the country to find the necessary finances for development within its own jurisdiction. The federal government has done nothing to correct that situation.
It seems to me that the government's decision to cut taxes for corporations, many of them foreign owned, means that we are transferring dividends to the foreign owners. In fact, our whole industrial incentives program has done more to assist the takeover of Canadian companies and to strengthen the hold of foreign investment on Canadian companies than it has to help Canadian industry or Canadian companies. Combine that with the 3 per cent tax increase for individuals and it will be seen that we are not meeting the issue at all.
It seems to me that the Canadian government has become increasingly dependent upon personal income taxes as a source of revenue over the past two decades. I will illustrate this with a few statistics in a moment. This has had a curtailing effect on consumer demand and also on the supply of savings which is the ultimate source of investment and growth. The increase in direct taxes on individuals over the past 15 years has been almost twice as great as the increase in taxes on corporations during the same period.
This brings me to another point which the government overlooked completely. It relates to those who have jobs now but who do not pay taxes. I am speaking of the working poor. There are over five million of them in Canada today, people who have jobs earning all the way from $60 to $70, $80 and even up to $90 and $100 a month, after deductions their take-home pay is considerably less than that. They don't earn enough to pay income tax. With the cost of living as it is today, how can they have any reasonable standard of living? They are locked in, working their 40 hours a week but not getting enough to provide a decent standard of living. Nothing is done to help

these people or make it easier for them to face their problems. This is why I am very concerned about mismanagement of the system which causes such conditions to continue.
The government's attitude should have been directed toward employment and investment stimulus. Jobs are created by increasing demand, which means increasing production. You only increase investment stimulus by providing a stimulus. Why didn't the government come up with something like allowing a tax deduction of $1,000 for every family in Canada which actually invests in the development of the country, using that exemption for risk capital development? Allowing families a deduction on this basis would give them a reason to invest in Canadian companies. Don't worry about the loss of this income as tax income: tax the profits that come as a result of it. That is the kind of stimulus we want to encourage investment by Canadians in Canadian business and industry. There should also be more effective assistance for the labourintensive and export sectors most damaged by recent national and international events. This would truly stimulate production and jobs.
Nothing has been done for industries affected most adversely by the American DISC program. There should have been greater equity provisions for Canadian investment in Canadian corporations. I do not see this budget creating new jobs or even solving the problem of foreign ownership of Canadian industry. The budget entirely ignores those manufacturing and processing firms which suffered most because of the DISC program, from appreciation of the Canadian dollar and other recent trade impediments. Firms that are without profit or are making marginal profits will not be helped by corporate tax cuts or fast write-offs. If a firm has no profits, little capital and dubious markets, these measures provide no assistance and meagre incentive to expand or even to maintain employment. Recognition must be given to the fact that business can expand its activities only when it has confidence in the future, when the economy is stimulated by adequate consumer demand. Only then will job producing economic expansion be assured.
Similar criticisms may be made of the introduction of a new class of capital cost allowance entitling a taxpayer to claim as depreciation up to 50 per cent of the cost of an asset in the year it was purchased or acquired and the unclaimed balance in any year following. Even though this is to be used for machinery and equipment to be used for the purposes of manufacturing or processing, it is open to major criticism. The machinery that will be brought in may in fact replace present workers. The same machinery may have a high non-Canadian labour content, and unfortunately this is the case simply because of the high taxes placed on that kind of equipment. The machinery may even displace less skilled operators who are particularly susceptible to prolonged periods of unemployment. The form of the incentive does nothing to favour the disadvantaged regions with pockets of particularly high unemployment. The employment effects of tax incentives for business are slow to appear in comparison with the effects of a comparable personal or sales tax reduction.


The true philosophy of the government is clearly revealed when we compare the personal and corporate income tax sources of budgetary revenue for the fiscal year ending March 31, 1971, with the expectations for the fiscal year ending March 31, 1973. The budget measure will provide no direct assistance or incentive to many of the labour-intensive and other important sectors of the economy. What has been done for the service industries? Nothing. What has been done for the construction industry? Nothing. What has been done for the farming industry? Nothing. Not only does the budget not provide the farmers with the same accelerated write-off that is given to other production industries, but it does nothing to help them with their other problems.
The budget does nothing to help provide farmers with the capital that is essential to most of our agricultural industry today. Literally nothing was done for the farmers. But worse than that, the policy of the government seems to penalize the farmers. Let me give an illustration, Mr. Speaker. A few years ago the minister and the Department of Agriculture were pleading with western grain farmers to diversify, to get out of wheat and barley. They were telling the farmers that there were markets and demand for other types of crops which would provide the necessary cash for farmers caught in the cost-price squeeze.
Many farmers went into diversified crops such as flax and rapeseed, but then last year the government brought in legislation to amend the Canadian Wheat Board Act which placed flax and rapeseed under the jurisdiction of the Wheat Board. The farmers had not asked for this and had already set up their own marketing and processing arrangements because there was a market in the United States and in other foreign areas for vegetable oil. This particular aspect of diversification has been rather profitable, so why the government insisted on bringing it under the Canadian Wheat Board Act is something I do not understand. The minister in charge of the Wheat Board (Mr. Lang), in reply to criticisms from this side of the House last year and again this year, made a very clear statement on May 11 last year to the effect that there is no intention to bring rapeseed, flaxseed and rye under the control of the Canadian Wheat Board in the near future. A press release from his office reads:
Changes proposed in the Canadian Wheat Board Act would enable the extension of board marketing to these crops, but these sections may never be used and certainly will not be used except after full support of the move is received from producers based on a thorough discussion of the issues.
He went on to say:
The situation is the same with regard to the Prairie Grain Advance Payments Act.
He said that these amendments to the act would not be required unless at some future date these crops were brought under the Canadian Wheat Board Act. The press release concluded with the statement:
I repeat, the government has no immediate plan to change the marketing system for these grains. And I assure producers that before any such change is contemplated there will be thorough discussions with everyone involved.
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Mr. Speaker, the government has now authorized the inclusion of these grains in the Canadian Wheat Board Act without any consultation with farmers, and it has moved to convict farmers who may have oversold the quotas established under the act. There is a case in my constituency of a farmer who was given a 60-acre quota. At 20 bushels per acre that means he should have sold 1,200 bushels of rapeseed. He had a delivery contract with the seed processors in Lethbridge for a greater quantity than that, and in March of this year he was issued an additional 900 bushels delivery authorization. They seized his permit book. It was found that the amount he had sold previously had not been entered and his records did not indicate it, so he shared a truckload with a neighbouring farmer and 388 bushels were delivered to the plant in Lethbridge 200 miles away. It turned out that he had delivered 104 bushels more than the Canadian Wheat Board said he could, in spite of more than 500 bushels remaining under his authorized delivery contract, and now he has been taken to court.
When the minister responsible for the Wheat Board makes a statement in May of one year and contradicts it in May the next year, it completely undermines the confidence of the farmers and the processing industry. This is not just one farmer, Mr. Speaker; 1,400 of them are in the same situation. This is the tragedy of the policies being implemented by the bureaucracy on the other side of the House.
When the Minister of Agriculture (Mr. Olson), the Minister of State from Calgary South and the minister in charge of the Wheat Board attempt to justify their position or to rationalize the budget, they are not dealing with the issues really faced by the Canadian people. What about the fishing industry? There is nothing for that industry. What about the logging industry? There is nothing for it. Since these industries, the service industry, the construction industry, farming, fishing and logging are excluded from the tax and incentive measures, they will be placed in a more difficult position because their relative capacity to compete for available capital will be reduced. This is a discriminatory policy.
Generous corporate income tax cuts do not make firms more profitable or productive because they in no way affect the cost of manufacturing and processing inputs. A realistic budget would gear its policies to consumption rather than production. Perhaps if that were done something would be accomplished as far as eliminating the problem of unemployment is concerned. It seems to me, Mr. Speaker, that we are not dealing with the issue as it should be dealt with.
As an indication of the policy of this government during the last five years, its budgets have placed emphasis on increasing personal income tax and decreasing corporation tax. In 1968-69, 34 per cent of taxes came from personal incomes and 20 per cent from corporations. For 1972-73, 44 per cent will come from personal incomes and 15 per cent from corporations. In my opinion this creates more unemployment and does nothing to solve the problem of inflation. This is the just society that the Prime Minister spoke about four years ago but about which we hear less today.


The Budget-Mr. Thompson
Another problem that I mentioned in criticism of the budget concerns the increased flow of Canadian equity capital to the American market. This runs counter to Canada's interests at a time when this country's energy interests are confronted with high capital outlays according to the Minister of Energy, Mines and Resources (Mr. Macdonald). In a recent address he said that an important contributing factor in the southward flow of capital has been lack of diversity of the Canadian capital market competing with the high percentage of direct investment in the United States. He estimated that the energy industry's capital outlays alone would total between $50 billion and $70 billion in the 1970s. Where is this money to come from, Mr. Speaker? The answer is-from outside sources!
The minister has correctly pointed out that equity capital run-off to the New York market runs counter to the interests of Canadians. He has also stated that the energy industry would require capital of $50 billion to $70 billion during the 1970s. Yet the minister is wrong in assuming that merely restricting foreign investment to 10 per cent of assets in pension and retirement savings plans will encourage Canadian investment. It will limit foreign investment but will not encourage domestic investment. This is where the budget is so very wrong.
There is another aspect of these budget proposals which cannot be passed by. It seems to me that the government's arrogant and insensitive approach is one of the reasons we are in difficulty. The increased income tax deductions for the blind, the disabled and pensioners are notable, but why was this not done five years ago when the program was developed? Inflation was just as rampant then. If aid is needed by the unfortunate individuals in these groups, it should be given in a more direct way and it should go to those who need it most, those who cannot work or who are locked into low incomes.
I should like to spend my last few minutes speaking about the energy situation that exists in the provinces of Alberta, Manitoba, Saskatchewan and British Columbia. At the present time the rate of increased production in the petroleum industry is lower than in other energy industries because exploration and development in western Canada and in the north has been slowed down by government policies which inhibit rather than stimulate.
The fact that the federal government could enter into a so-called secret agreement with the United States back in 1967, placing a number of restrictions on the exporting of oil from Canada without consulting the provinces, bears testimony of the need for greater participation between the two levels of government. More important is the fact that there should be more co-operation between the federal and provincial governments so that a clear energy policy for Canada can be established. The fact that Premier Lougheed has stated that Alberta will not participate in any future constitutional talks indicates the low level of regard which the federal government has for the rights of the provinces.
A few weeks ago the Prime Minister said in Edmonton he was going to build a new highway to the Arctic and this would also be an energy corridor through which the pipeline could pass. That is, if it is feasible: we have not found

out whether it is or not. We have not seen anything in government statements that would encourage private industry to investigate or conduct its own research in this regard. In a few weeks there will be an energy corridor conference in Calgary: it is being planned by the Alberta mines and minerals minister, who said:
-objectives of the government-industry meeting will include pipeline plans for crude oil and natural gas, detailed examination of the all-weather road proposal across the northern mainland, and listing of individual opinions on the multiple transportation systems from all parties for individual projects.
When making this glorious statement in Edmonton, why did the Prime Minister not invite the province of Alberta to participate in such a conference, as well as any other province which is concerned about this matter? I have placed some questions on the order paper in this regard. I cannot even find out whether the federal government has enough interest to ascertain what the province of Alberta is doing in this regard or to say if it even intends to participate in the conference. The conference, which is planned for the third week in June, ought to have been initiated by the federal government in their attempts to meet the needs of the whole nation with regard to energy production and transportation.
I wish to make one other point before my allotted time comes to an end. We will never have the investment of Canadian people in the development of Canadian resources and industry unless we provide incentives that are at least equal to those which citizens of the United States can get in their own country. The tremendous drain of capital to the south indicates that Canadians have more confidence in the investment policies of the government of the United States than those of the government of Canada. Why cannot we provide incentives that will encourage Canadian people, at whatever level and at whatever amounts they wish, to invest in our own resources which today almost completely depend upon outside sources of finance? This question involves a depletion allowance approach which should be completely changed. It involves a major expansion of the policy of Canada to develop and process its own resources as it relates not only to mines, but also the petroleum industry.
While the north is very important to us as far as energy is concerned, and the west is important as well, we will never develop the resources of this country until we have a policy of incentives for Canadians and a policy of cooperation for the different levels of government. If this budget had done something about that problem, the claims the government had made for it might have been justified. As they are not, I see little validity in the government's policies as enunciated in the budget.


Mr. E. B. Osier (Winnipeg South Centre):: Mr. Speaker, it gives me a great deal of pleasure to follow the hon. member for Red Deer (Mr. Thompson), who speaks so well even when he has nothing to say. It is interesting to hear him.


Robert Norman Thompson: I cannot help it if you do not have enough ability to understand it.


Edmund Boyd Osler: Perhaps on occasion he does have something to say, but I have not been fortunate enough to be here at those times. I wish to compliment the Minister of Finance


(Mr. Turner) on his budget. I think it is a good budget, a very realistic budget and one that shows where the heart and the mind of this government is.


Mr. Dinsdale:: On the election.


Edmund Boyd Osler: First, it shows that it wants to help people within the ability of the country to do so. Second, it shows that it realizes the country must pay its own way if anyone is to be helped at all. Those are two pretty humane and realistic thoughts to possess in the mind of any government. Recently this government has made two important policy statements, one the budget and the other the matter of foreign takeovers. Both of these have far reaching implications for all parts of the country, but in particular for western Canada which needs all the capital it can get and requires the build-up of its manufacturing and processing capabilities.
As for its statement on foreign takeovers, the government has served notice that Canadians who enjoy a controlling ownership position in a company will no longer be allowed to sell or transfer this control to foreigners unless such action seems to be in the national interest. I find no fault with this attitude.
As for the budgetary measures, the government has taken steps within the country's means to allocate additional benefits for senior citizens and those who are disabled. Unlike some of the "pie in the sky" dreamers we run into in one small corner of this House, it has at the same time taken measures to ensure that the source of tax revenue on which all benefits depend will continue to expand. People are the only thing that count, Mr. Speaker. To do things for people, be it our senior citizens, those who are ill, those who for a variety of reasons need a helping hand, be it for housing, welfare, urban renewal or a host of other problems, this is the primary task of government today.
I only have one small quarrel with the measure proposed in the budget for old and disabled people. I will not bore the House with my observation. This was very adequately expressed yesterday by my colleague, the hon. member for St. Paul's (Mr. Wahn). He said that to go so far for some people on incomes fixed to the cost of living index is inconsistent if you do not go the whole way. He said he hoped the day would soon arrive when the Canada Pension Plan and the Quebec Pension Plan can both have similar treatment and be tied to the actual cost of living index rather than the 2 per cent escalation. And he requested the Minister of Finance and the Minister of National Revenue (Mr. Gray) to do something about the law which does not allow private pension plans to have more than a 2 per cent escalation built into them and still be deductible for tax purposes. That is an area that can be looked into to round out the very good measures that were taken for older and disabled people in this budget.
In a sense, Canada is like a great internal combustion engine coupled to a dynamo that creates power. If you overload that dynamo by making undue demands for electricity, you will burn it out and complete darkness will surely follow. If, on the other hand, you tamper with the supply of fuel, nothing will work at all and again darkness will be the result. The very necessary public sector in Canada is attached to the dynamo end of this power
The Budget-Mr.Osier
generating machine. The private sector supplies the fuel. If we want more power for the benefit of more people in this expanding Canada of ours, we must secure our source of fuel. Thus, I commend the government for setting aside half a billion dollars in its latest budget to create lasting jobs in the private sector.
By and large, Canada's resource industries now have available tax incentives sufficient to maintain a satisfactory level of exploration and development; and the service industries are performing well too. Thus, within this $500 million for the private sector the most significant of the measures taken are the corporate tax changes affecting manufacturing and processing activities.
Moreover, this action is entirely consistent with the government's action over the past decade to encourage an ever increasing degree of "finishing" activities in Canada. I did not have time to look up the figures, but the proportion of our manufactured products as against raw material exports has continually risen. Speaking from memory, I would say it has risen from 12 per cent to something like 40 per cent in the last decade. The budget proposal implies a consistent attempt to follow this trend and encourage it, bearing in mind that to finish more of our products in Canada means more jobs. In other words, we must make conscious efforts to combine skilled people with our resource development and we must add to this a third vital ingredient, salesmanship, if we are not forever to remain hewers of wood and drawers of water until all our resources are used up.
Let us turn now to western Canada. One of the fundamental concerns of all thinking western Canadians has been our very large dependence upon raw material exports. The Premier of Alberta has declared that the future growth of his province will depend upon the success with which it is guided through the transition from a primary industry economy to a balanced economy equally based on natural resources and secondary and manufacturing industries. The Premier of Saskatchewan has indicated that his government will put new emphasis on projects involving further processing of agricultural products and other raw materials. The Premier of British Columbia has moved to assure an increasing degree of in-province processing of forest product exports.
Even in my own province, Manitoba, attempts have been made to grapple with this problem. These attempts have often been successful, despite the boobs of the former Tory government, which sank approximately $100 million into the so far unsuccessful industrial complex at The Pas and despite the tax policies of the present NDP government there-I must admit I cannot fully understand them-which reputedly is now in the process of attempting to tax the very air which Manitobans breathe. As you know, Mr. Speaker, Manitoba stretches across one of the great flyways which geese and ducks use in their annual migrations. Very soon, I think, there will be a move to tax the geese and ducks which use this air space twice a year. Wait for it: it will happen. If they could find a way of putting a meter on them, they would even tax the ultimate pleasures of life.


The Budget-Mr.Osler
If all the western provinces are agreed that they need industrial growth in order to ensure meaningful lives for those who choose to live in the west, then surely the recent corporate tax cut on processing and manufacturing profits, plus the two-year write-off permitted for newly acquired processing and manufacturing equipment and machinery, will substantially reinforce these very desirable provincial aims.
I have said on many occasions, Mr. Speaker, that very few of the regional problems to be found in Canada can be solved by unilateral regional action. The government of Canada, by harnessing the resources of all the Canadian people, can help Canadians of any particular locality in a truly effective way. This budgetary measure is an apt illustration of what I mean. With the opening up of the Mackenzie River corridor to the north, with the development of trade to Asia and the countries of the Pacific rim, western Canada is at last in a position to take its rightful place in confederation. It could not do this without the help of Canada as a whole, any more than Canada as a whole could exploit its present and potential capabilities if western Canada were not a part of it. This being the case, we who live in western Canada are fortunate indeed to have a government here in Ottawa which understands these things, however imperfectly, and brings forward measures like those to be found in the recent budget.
During the debate on the government's policy toward foreign takeovers, the Leader of the Official Opposition (Mr. Stanfield) said:
We must have policies aimed at ensuring that Canadian industries, big and small, have access to capital for expansion and markets for the sale of their products and their services.
Anyone who wishes to take the measures proposed in the present budget, add to them a dash of the tax amendments passed by this House last December, then a handful of goodies from the bag containing all the measures that have been introduced to help the western farmer sell and deliver his grain, plus a good ladleful of seasoning from the Department of Regional Economic Expansion, can easily find that the resulting brew tastes mighty like the sort of policies for which the Leader of the Official Opposition is obviously aiming. Of course, it is not a perfect brew, Mr. Speaker. A government's job is to govern: it cannot always wait upon perfection; it must act on the basis of what it has near at hand. I think these measures are good measures but, as I have said, they cannot be considered to be perfect.
The hon. member for Sault Ste. Marie (Mr. Murphy) made several observations yesterday which I found interesting. He said we could not expect governments which were perfect; we could only expect governments which did the best they knew how. He said, as recorded on page 2471 of Hansard:
Should we compare ourselves with the United Kingdom where at the moment the unemployment rate is about 6 per cent, the inflationary rate about 10 per cent and the growth rate over the past 15 years has been only 4 per cent compared with our own huge growth rate? . .. Should we compare Canada with Sweden? There is probably more unrest in Sweden today than in any other country in Europe. The tax burden is so high that people are rebelling. That country has a socialist government. Should we be compared with the United States where inflation is running between 6 per cent and 7 per cent even with price and wage controls? Unemployment in that country is running at 6 per cent.

Nobody in this governement has ever claimed perfection. Nobody in this government has ever claimed it was doing an optimum job, the very best that could possibly be done. All that was ever promised was that we would try hard, and I submit that compared with other countries our record is good.
The hon. member for Dauphin (Mr. Ritchie) spoke yesterday. He is a man I admire greatly but I do not know that I agree with what he had to say. He said that the government's strategy of making tax cuts available to manufacturing and processing firms will not be of much value. I quote from his speech as reported in Hansard at page 2481:
These introduce a new measure of distortion into the function of the marketing system and substitute the judgment of the Minister of Finance as to what types of tax relief make for growth in our competitive system.
If that statement means anything, it surely means that the system was functioning perfectly, or much better, before the Minister of Finance made his recent budget statement. Well, he and his party have spent the last four years telling everyone how badly the system was functioning. I would say the hon. member cannot have it both ways, If the system was functioning well before the budget, and the budget has caused it to function badly, then what he said before was meaningless. If, on the other hand, it is functioning well now, his criticism of the budget is meaningless. He should decide out of which side of his mouth he wants to talk.
The hon. member for Sault Ste. Marie spoke about inflation and how regrettable it was, as did the hon. member for St. Paul's. I join with that view, as I suppose everyone in Canada would who shares concern for inflation. But I agree with both hon. members that our inflation is not as bad as that of other western industrialized nations.
Although we all regret inflation, few on this side of the House are woolly-minded enough to think that it will be cured by the application of simplistic proposals such as the one recently advanced by the Leader of the Official Opposition. Speaking in the budget debate on May 15, he pledged himself to a proposal whereby the calculation of personal income tax would be based on constant 1971 dollars. This proposal does not include a reduction in the level of any government services, but it does call for a reduction in the revenue from personal income tax. The gap that would result would have to be met by additional personal income taxes or increases in other taxes, such as in the sales tax; but he does not talk about that.
The leader of the opposition admits that his proposal would affect provincial revenues from personal income tax. In any year the consumer price index rose, the revenue of the provinces which base their tax on federal tax would drop and they would be forced to impose an additional amount of tax to maintain their revenues. If he thinks that this government has had problems with the provincial governments, just wait and see what would happen if anyone tried to put this dream into effect. Talk about balkanization!


The proposal would confer greater benefits on high income taxpayers than on low income taxpayers, but he does not talk about that either. It militates in favour of those with a strong bargaining position in society; yet out of the other corner of his mouth he talks of the overbearing strength of labour unions and other organized members of society relative to those who are unorganized. I should like to hear him talk out of the middle of this mouth so that I might be able to understand what it is that he is saying. A uniform deflation of incomes for tax purposes, as proposed by the Leader of the Opposition, would not be equitable for the reasons I have stated. Moreover, such a proposal would deprive the government of Canada of one of its most effective and equitable fiscal tools and would itself contribute significantly to inflation.
The proposal to deflate personal tax liabilities for changes in the price level would weaken the capacity of personal income tax for automatic stabilization. The result would therefore be a stronger inflationary pressure than that which would be experienced with the present tax system, or increases in taxes to offset the deflation of personal tax liabilities. To raise personal income taxes would merely undo the Leader of the Opposition's proposal, while no other tax which could be raised is as equitable as the personal income tax. Of course, he said, it would force the government to bring its tax proposals before Parliament. I have only been in the parliamentary system for four years but it is my understanding, based on observation, that that is exactly what the government has to do every year or whenever it brings in a budget. So I do not see what outstanding help it would be to force the government to do something it is already forced to do, and has been for years.
The amount of a taxpayer's tax for one year would be uncertain until the price index was fixed. And this from a man who for the last 21 to three years has been going around the country lighting little brush fires with his little cigarette lighter, or whatever it is he uses, telling everyone that the uncertainties created by the present government have caused the so-called trouble that he sees at every hand! If there have been uncertainties before, this proposal would merely add more. Obviously, it is inconsistent to determine personal income tax in constant dollars while other taxes, such as the general sales tax, remain unadjusted.
I do not always agree with the Winnipeg Free Press but occasionally they see the light on a clear day. With regard to the proposal made by the Leader of the Opposition they have this to say:
If Mr. Turner had taken Mr. Stanfield's advice . .. the borrowings would increase also. The government would extract more than $2 billion out of the nation's savings-money that otherwise would be available for job-creating investments.
Again they say:
The difference between Mr. Turner and Mr. Stanfield is that the former will use the old device of crude monetary inflation as little as he thinks possible, while the latter would use it recklessly on a far larger and unspecified scale.
And again:
-if Mr. Turner is desperately trying to make the best of a bad job-
The Budget-Mr. Dinsdale
That is, vis-a-vis inflation.
-Mr. Stanfield goes much further and would make it still worse by piling monetary on top of cost-push inflation.
And finally:
Without the responsibility of office, he is simply trying to win an election with popular but irresponsible promises.
I do not know how anyone could put the position better than that. It is almost like the good old days of Dafoe, the way it rings. I am glad to see they have at last been stirred to pungent writing; they have needed it for some time.
So much for the Progressive Conservative party's platform. If that is their platform, I rejoice that an election cannot be too far ahead, because this spells "progressive" increases in taxation and "conservative" hard times, all wrapped into one neat little blue ball. If you do not mind, Mr. Speaker, I will stick to the Turner budget and the Trudeau government. I am confident that when the time comes to test their judgment, the vast majority of the Canadian people will decide to do the same.


Walter Gilbert Dinsdale: Mr. Speaker, the budget debate is one of the important debates of the parliamentary session and many valuable contributions have been made to this discussion thus far. Actually the budget, as it is brought down each session by the government in power, is the fiscal instrument by which the government stabilizes the economy and announces the growth policies that are going to be implemented. It is interesting that the debate on the budget as it resumes this week is somewhat different in its approach from that taken last week. Usually in a parliamentary program the budget debate proceeds undisturbed and uninterrupted. Then you get continuity in the debate and a little more vigorous give and take. I have been listening to the debate for most of this afternoon and it seems that as each speaker succeeds another there is a lack of communication and dialogue. Each speaker is operating in a vacuum.
I suppose this has been caused by the interruption of the proceedings to deal with what the government regarded as a matter of great public importance and urgency, namely, the implementation of the nominal increases in old age security, veterans benefits, disability pensions, and so forth. The legislation was rushed through, to the extent that the other place was called together for an unusual Friday sitting so that everything could be in place for what was anticipated to be the calling of an election prior to last weekend. That election did not come and as a result we find a remarkable change in the mood of this House and in the attitude of the government as this renewed debate on the budget takes place at this time.
Because the budget was planned as an election budget it does not deal with the fundamental purposes of budgets which I have already outlined, namely, the use of fiscal instruments by the government to deal with problems in the economy. This budget does not come to grips with the fundamental economic problems of Canada as they confront us at the moment. It is more in line with what might be described as the "ad hocracy" approach to basic issues. I shall be dealing with "ad hocracy" as it applies to other


The Budget-Mr. Dinsdale
actions by the government before I conclude my remarks this afternoon, particularly those in reference to its approach to one of the major problems in the Canadian economy, that of regular winter unemployment resulting from the severity of Canadian winters.
Applying this term to the electioneering type of budget brought down by the Minister of Finance (Mr. Turner) as his first attempt at budgeteering, he made many fine statements many of which I could quote. On February 24, as recorded in Hansard at page 217, the minister said:
-I see our first priority to be to provide good jobs for Canadians who are seeking work.
As reported at page 215 for the same date, the minister said:
I fully recognize that statistics are no substitute for jobs.
Again, in the same speech he said:
My first and most urgent priority is to provide continuing and well paying jobs for those Canadians seeking work.
I think there has been sufficient said on this side of the House to point out that the budget brought down by the minister negates those fine words. There is ambivalence as between coping with the dual problems of inflation and unemployment because the Minister of Finance is recorded at page 1998 of Hansard for May 8 as saying:
I am hoping to achieve industrial growth at a pace that will not aggravate the inflationary impulses in the economy and escalate the cost of living. This government is committed to reasonable price stability.
I point out that the budget does not deal with what the minister laid down as the number one priority, namely, dealing in an adequate and comprehensive way with unemployment. Other members have spoken in this vein today so I shall abbreviate my remarks accordingly. The main emphasis in stimulating the economy has been placed upon reduction in corporate taxes. This is fine as a long-term measure to deal with long-term economic problems, but Canada requires solutions to present day problems. The Leader of the Opposition has, in season and out of season, travelled across the country hammering away at the essential problem, bringing before the people of Canada, not only in this House but on the hustings the solutions he thinks are required to deal adequately with this problem. I noticed that the hon. member for Winnipeg South Centre (Mr. Osier) paid considerable attention to the activities of that hon. gentleman in this regard.
It is interesting that the Leader of the Opposition has had considerable impact in the west, as recent public opinion polls indicate. The problem surrounding the slowdown in the economy as it affects corporations, manufacturing and processing businesses represents only one aspect of the difficulty. I should think if we are going to have a budget to deal with the first priority as outlined by the Minister of Finance, to provide good jobs for Canadians seeking work, we must immediately stimulate the purchasing power of the Canadian public.
Certain spokesmen for the government have referred to the bugbear or bugaboo of inflation. I say in this regard that the extravagant expenditures of this government have been a greater contributor to the fires of inflation than any excessive demand on the part of the Canadian public at this time. This is not the occasion to outline in

any great detail how the government has so boosted its expenditures that inflation was an inevitable by-product of government fiscal mismanagement.
There has to be a reduction in personal taxes at this time. The Leader of the Opposition has been consistent in presenting this proposal to the Canadian people, hence the attack at some length by the hon. member for Winnipeg South Centre, with no particular impact. The hon. member for Red Deer (Mr. Thompson) spoke on this subject, pointing out that since 1968 the present government has been trying to cope with the problem of underemployment and underproduction in the Canadian economy by favouring the corporate taxpayer rather than the personal income taxpayer. He put figures on the record, but some hon. members here now were not in the House at that time.
From 1968 to 1969 personal income tax revenue rose from 34 per cent of total income to 44 per cent, whereas corporate tax went down from 20 per cent in 1968-69 to 15 per cent in 1972-73. Again the government is resorting to the same formula to deal with what the Minister of Finance has described as the number one problem in the Canadian economy. I suggest it will have exactly the same effect: it will increase unemployment in the long term, and I think the figures over the next few months will demonstrate this point, rather than increase employment opportunities.
There are many fine, new, shiny factories lying idle across the nation because of low demand on the part of the Canadian consumer. From the standpoint of a western member of parliament, I should like to say that the rapid depreciation on machinery will not have a helpful effect in dealing with the problems of western Canada, that part which can be referred to as a comparatively underdeveloped segment of Canada's economic area. As has been pointed out, if you encourage accelerated depreciation on machinery used in manufacturing and processing industries, you get a situation in which machinery "dll tend to replace workers.
I am sure, also, that it is almost axiomatic to point out that this creates a situation in which there is a high degree of non-Canadian labour content because a good deal of the machinery used in the manufacturing process is built outside Canada. Obviously an increased use of machinery in the manufacturing process is a part of automation which is one of the major difficulties in the growing problem of unemployment. The government has not even started to deal with this whole complex problem of automation. It will be found that machinery displaces the less skilled operator in the first instance. This is the area of the Canadian economy in which chronic unemployment tends to be most persistent. Obviously, in areas of Canada such as western Canada where there is lack of manufacturing and processing industries, this provision for accelerated depreciation of machinery will not help solve the special problems in the west to any great degree.
The hon. member for Winnipeg South Centre, the Minister of Agriculture (Mr. Olson) and other spokesmen such as the Minister of State (Mr. Mahoney) who spoke earlier this afternoon have all tried to paint a picture that all is


well in the western part of Canada. It is not so long ago that some of these gentlemen were using the phrase which has become one of the popular phrases used by pundits, "western alienation".
Now we have a budget designed as an election budget because everybody thought we were on the eve of an election. No doubt there would have been an election had the Prime Minister (Mr. Trudeau) not had information from western Canada and other parts of Canada, particularly the province of British Columbia, that was somewhat negative in terms of the government's prospects. So today-and I suppose we will hear this theme during the rest of the budget debate although it is no longer pertinent in terms of an election budget-we will have paeans of praise in respect of how good things are in western Canada at this time and how much better they will be once the budget which is being debated is implemented.
I suggest that if this is the attitude of these spokesmen on the government side from the west, then there is complete lack of understanding, complete insensitivity and even lack of concern on their part for our continuing problems. Obviously, a budget of this kind will do nothing to overcome the fundamental disparities between western Canada and the central part of Canada in particular.
The Minister of Supply and Services (Mr. Richardson) is in the House this afternoon. He has been one of the most eloquent spokesmen in the past in pointing out that there is a fundamental problem of neglect by the national government. Last February in the city of Brandon, which I represent in this parliament, a meeting took place at the agricultural study centre. It was a small meeting, attended by some 60 leaders in the agricultural community, largely from Manitoba, who went there to discuss the special problems of western agriculture.
As I say, it was not really a representative gathering, with only 60 persons in attendance, but apparently it was from that conference that the Minister of Supply and Services came forward with the thesis of the western fact as a separate entity and separate problem which requires the special attention of the government. There is not one provision in this budget which comes to grips with the problems which were discussed on that occasion. I trust that the Minister of Supply and Services will be making a speech during the course of the budget debate in which he will elucidate some of the conclusions reached at that very important conference. I was not privileged to be present. It was rather an exclusive conference, apparently. I had to obtain all my information second-hand.


Mr. Richardson:: I will be glad to send you the notes.


Walter Gilbert Dinsdale: The minister has indicated he will send me the notes. I believe it would be much more appropriate if he would make a speech during the course of this budget debate as a spokesman for the province of Manitoba. We have had two spokesmen from the cabinet who represent the province of Alberta, the Minister of Agriculture and this afternoon the Minister of State who has some responsibility for fiscal matters. However, we have not heard from the province of Manitoba in this regard.
I trust that the Minister of Supply and Services, when he makes his statement on these important matters, will do a much better job than the Minister of Agriculture
The Budget-Mr. Dinsdale
whose speech was an apologia for the government's inadequacies in respect of agricultural policies. For example, he compared the total income of farmers in 1971 with 1970, which was the worst year western agriculture experienced. The contribution of the Minister of Agriculture and his counterpart from the province of Saskatchewan, the Minister responsible for the Wheat Board (Mr. Lang), has been to support the government's policies. I cannot understand how a westerner could possibly initiate these policies, but they have had to be the sponsors and spokesmen for policies which have accelerated the movement of farmers off the land.
Statistics have been placed on the record already, but I would quote briefly one or two examples. In 1966 there were 39,747 farmers in the province of Manitoba. In 1971, only five years later, after three or four years of the present Liberal administration, there were 34,981 farmers. This is a decrease of some 5,000 farmers.


The Acting Speaker (Mr. Boulanger):: Order. The hon. member for Winnipeg South Centre (Mr. Osier) wishes to ask a question.


Edmund Boyd Osler: Mr. Speaker, would the hon. member permit a question?


Walter Gilbert Dinsdale: I will accept a question.


Edmund Boyd Osler: I do not have the statistics with me, but I wonder whether the hon. member can give us the statistics in respect of the decrease in farms in the prairie provinces over, say, the last 20 years in order to give us a comparative setting.


Walter Gilbert Dinsdale: I do not have that answer, and I am sure the hon. member can do the research himself. I have the figures put out by the Dominion Bureau of Statistics on Monday, May 1, 1972. They deal with the five-year period to which I have referred.


Edmund Boyd Osler: The only point of the question was to see whether the hon. member was trying to establish that there had been an increased depletion of farms under the present government that was extraordinary in historical terms, or whether this was a progressive process.


Walter Gilbert Dinsdale: I can understand why the hon. member for Winnipeg South Centre has a slightly guilty conscience in this regard.


Edmund Boyd Osler: I have a curious mind, that is all.


Walter Gilbert Dinsdale: In the speech which he just completed, he pointed out that all was well in the west. All is not well in the west, and the figures I am quoting apply to the period 1966 to 1971. The same figures apply to Saskatchewan. There is a decrease from some 85,000 to 76,000.1 think it is doing a disservice to the people they represent when members of parliament who now find themselves in the cabinet, where they should have some influence on these matters, instead of acting as strong spokesmen for the west act as apologists. If they do it in public, what must they do in private, in the secrecy of the Privy Council? They must be completely silent.


The Budget-Mr. Dinsdale


Edmund Boyd Osler: Give us the figures for the time you were a cabinet minister and then we will believe you.


Walter Gilbert Dinsdale: I am dealing with 1966 to 1971. The Minister of Supply and Services has not yet spoken in this debate. I hope that he will. I would point out that what has happened in Manitoba in recent years has not helped to solve the fundamental problems that the hon. gentleman has described in speeches across western Canada. There is still inequity with respect to freight rates. The tariff is still stacked against us, and DREE is now stacked against us because it is actually luring away from the province the new industries which we have been establishing in recent years, because of the more attractive offers in terms of capital resources that are made available to them to relocate in other parts of Canada.
I know the minister has been proud of the fact that we are getting a new Mint in Manitoba. Also, no less than three federal ministers were present-there was a picture in the paper to prove it-at a stone-laying ceremony the other day in the city of Winnipeg with respect to the new Canada Grains Council building. There were three ministers present.


Edmund Boyd Osler: Four ministers, one NDP and three Liberals.


Walter Gilbert Dinsdale: I was referring to federal cabinet ministers. That might be good public relations.


Edmund Boyd Osler: If we could have found Tory ministers, they would have been there.


Walter Gilbert Dinsdale: There were no ministers present when the air bases were closed at Gimli and Rivers. As the hon. member for Marquette (Mr. Stewart) pointed out in a question the other day, this resulted in a loss of some 3,000 jobs. I do not think that that slack will be taken up at the Mint.


Mr. Orlikow:: What about the overhaul base in Winnipeg? You forgot about that.


Walter Gilbert Dinsdale: I would point out that this sort of tokenism is not good enough and I hope a strong government spokesman will speak out on behalf of this neglected area of Canada before the debate is concluded. We sometimes forget about the great developments that took place during the period about which my friend, the hon. member for Winnipeg South Centre, wants me to talk, such as the development at Whiteshell which was a really positive development largely initiated by the then member for Winnipeg South Centre who at that time was on the treasury benches. He encouraged the location of the atomic reactor there which has been the basis of the establishment of a new community.
This is the sort of positive development which we would like to see encouraged by the ministers who represent western Canada, not the tokenism of a Mint which has not too much to offer in terms of employment and opportunity. We could talk about the development in Thompson, Manitoba. The hon. member for Winnipeg South Centre wants me to refer to those days because he wants to talk about the development at the Pas-


Edmund Boyd Osler: Yes, talk about The Pas.


Walter Gilbert Dinsdale: I was present at the opening of the Thompson community in 1960, and from a standing start in that year it has developed to a thriving community of some 18,000 citizens. This is the sort of development we want to see encouraged by the present government. Perhaps the Minister of Supply and Services will enlighten us on this point.
I should like to make a brief reference to the defence by the Minister of Agriculture who spoke about all the wonderful things that have recently taken place in the agricultural economy. This government gave us LIFT, the program that was supposed to stabilize the prairie grain economy because there were no markets available and we were producing too much and had to reduce our cereal crop production potential. The farmers named the program "lower income for tomorrow" even though the government of the day called it Lower inventory For Tomorrow.


The Acting Speaker (Mr. Laniel):: Order, please. I regret to interrupt the hon. member, but he has gone beyond his time. Unless the hon. member has the unanimous consent of the House, he will not be able to continue. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Marcel Roy (Laval):: Mr. Speaker, the temptation to enter the debate on the budget tabled on May 8 last by the Minister of Finance (Mr. Turner) was too great for me to resist any longer.
I should like first of all to congratulate the minister for his great understanding of the problems which are of concern for the Canadian people and for putting such a humane philosophy as the basis for this budget. The Minister of Finance has been the architect of our time when he brought forward a budget to reinforce the Canadian economy, provide incentives that will enable Canadian industries to grow, to be competitive and provide steadier employment. I therefore wish to join with other hon. members in congratulating the minister on his masterpiece, which is realistic and corresponds to Canadian aspirations.
Mr. Speaker, I listened a while ago to the comments of the previous speaker, the hon. member for Brandon-Sou-ris (Mr. Dinsdale), on agriculture as well as on the speech delivered last night in this House by the hon. Minister of Agriculture (Mr. Olson). I doubt that he was here when the minister delivered his speech and that doubt is being confirmed because I am sure that he did not even read the speech of the Minister of Agriculture. I will quote from page 2485 of Hansard:
The performance of 1970-1971, when we sold 706 million bushels of grain, was an all-time record. This year we will exceed it by a great amount.
Those are good news as far as agriculture is concerned and as Canadians, when we sat on the committee on agriculture, we were happy to hear about the establishment of a two-price system for grains used in domestic


consumption and we were twice as happy to learn that the federal government was investing $60 million for the Prairie producers. About 175,000 western farmers will benefit by that two-price system.
Now, Mr. Speaker. I would ask the hon. member for Brandon-Souris, if he claims that he is knowledgeable in agricultural matters, as he did a moment ago, to at least come to the meetings of the Committee on Agriculture. I have often chaired that committee, I am its vice-chairman since 1968, and I challenge the hon. member to prove that he came at least once to its meetings to outline his proposals for the improvement of the lot of western producers.
Now, Mr. Speaker, what are the major budget measures which will promote the growth of our manufacturing and processing industries? Such measures have been considered within the framework of a new industrial policy. The creation of new jobs will be directly proportionate to the growth of our Canadian industry and to-


Walter Gilbert Dinsdale: Mr. Speaker, I rise on a question of privilege. I was not aware that the hon. member was addressing remarks to me in the first instance. He has asked me to say whether I have been present at the agricultural committee's meetings. I would inform the hon. gentleman that for 15 years I was a member of the agricultural committee. I am not at the present time a member of that committee, but I am devoting my time to three other committees. I think even he, as a comparatively new member of the House, would agree that a member who sits on three committees is doing all he can with respect to committee responsibilities.


The Acting Speaker (Mr. Laniel):: I am sure the hon. member will understand, although an invitation was issued to him by the hon. member for Laval (Mr. Roy), that he cannot take up too much time during the hon. member's speech. The point he has raised may not be a point of order but it is a fair answer to the request that was made.


Marcel-Claude Roy: So, I go on to say that the creation of new jobs will be directly proportionate to the growth of our Canadian industry and to the involvement of the business community.
Among those measures, let us point out, first, that the cost of all machinery and equipment bought by a taxpayer as of May 9, 1972 and used for the manufacturing or processing of goods to be sold, will be written off in two years. It is therefore a tax deduction of the order of 50 per cent of the cost of the asset during the year of acquisition.
Furthermore, effective January 1, 1973, the highest corporation tax rate applicable to profits earned in Canada, in manufacturing or processing, will be reduced to 40 per cent. This represents a decrease of the order of 10 per cent.
Likewise the small manufacturing or processing concerns will have their income tax reduced from 25 to 20 per cent. The fiscal treatment given to such companies will now compare quite favourably with that existing in other countries, especially the United States and the extended common market.
The Budget-Mr. M. Roy
So it is to be expected that such measures will lead to substantial incentives for the establishment of new manufacturing plants in Canada and for the development of those now existing, by increasing the income which the investments will finally produce.
This budget also gives justice to elderly people and to veterans who suffer deeply from inflation and who unfortunately have no means of protecting themselves against this calamity. Elderly people as well as veterans will no longer have to suffer the hardship of a diminishing standard of living thanks to the increased old age security pensions. In other words, we eliminate the current yearly escalation ceiling of 2 per cent so that on April 1 next year, the maximum benefits will be consistent with the total increase in the cost of living; 1,800,000 Canadians will benefit from this new policy which will cost $120 million.
In addition to escalating the old age pension to take into account the rising cost of living, we have two other measures in favour of senior citizens. Starting January 1, 1972, the monthly maximum benefits under old age security and the guaranteed income supplement will go from $135 to $150 for single people and from $155 to $285 for married couples. One million people will benefit from this new policy at a cost of $180 million.
Moreover, the income tax social exemption granted to those aged 65 and more which the government recently boosted from $500 to $650, will now be $1,000. This exemption will also be granted to taxpayers confined to bed or wheelchair and to the blind.
This year is quite important for the senior citizens residing in Canada. Exactly 20 years ago, the right hon. Louis St-Laurent, Prime Minister of Canada, presented to this House a bill on old age security pensions. This program has been modified and is now considered as second to none in the world.
No country in the world can compare advantageously with Canada as to the way we are treating our retired citizens. In fact, in January 1952, the Liberal government introduced in this House a bill granting to those aged 70 or more a monthly pension of $40. Now, 20 years later, the government has reviewed this program and is granting to those 65 or more a monthly income of $150 or $1,800 a year and to married couples a monthly income of $285 or $3,420 a year through the old age security plan and income supplement.
It is noted that more than 50 per cent of improvements to old age security pensions have been implemented under the present government headed by the right hon. Prime Minister (Mr. Trudeau).
Older citizens living in Ville de Laval will have access to a home for the aged. The federal government will earmark $2,137,500 for a centre called Manoir des lies on Paton Drive in Chomedey, Ville de Laval. This construction, the total cost of which is $2,250,000, is administered by the government of Quebec under an agreement between the Central Mortgage and Housing Corporation and the Quebec Housing Corporation.
In the process of contributing to a more just society, the main changes to various welfare policies have been the implementation of a selective rather than universal


The Budget-Mr. M. Roy
approach in the field of family allowances and income security. Selective benefits, that is to say benefits payable to lower income people, are being increased so as to better reflect the needs of families who shoulder heavy family responsibilities but whose income is unfortunately not commensurate with their burden.
As regards veterans, their pensions and allowances will also be increased yearly in accordance with the cost of living index; 333,000 Canadians will benefit from this new measure which will cost $25 million a year.
Thirdly, another measure will be of help to students: it is a new deduction related to the cost of obtaining education which will be in addition to the existing deduction for tuition fees. This new measure will be a deduction of $50 per month per student for each month in the year during which the student is in full-time attendance at certain institutions. This measure will benefit 600,000 students and will amount to $50 million.
Fully aware that our young people are an important natural asset, the government has not spared any efforts to help them through job creating opportunities during the summer months and by granting $85 million to create jobs in various federal departments.
The original Opportunities for Youth Program has been implemented. This program aims at developing the creative spirit of our young people who are asked to submit such projects as would improve the life of Canadians. This very imaginative program has met with tremendous acceptance from students who have submitted 19,000 projects.
In order not to further "bureaucratize" this initiative, full freedom has been given by the government to a youth committee to make a selection from these projects. I am very happy to learn that the government will review the implementation and approval criteria of these projects so that their execution would have some permanent effect on the well-being of the community.
Moreover, and in order to encourage industrialists to employ students in the summer months, a vote of $262,000 has been earmarked towards a national advertising program.
Wishing to contribute to the success of the Operation Placement Program, the Department of Manpower and Immigration has set up for the benefit of students 137 employment centres to be added to the 390 manpower centres disseminated across Canada.
On May 15 last, I had the privilege of presiding at the opening of the employment centre for students in Laval. That centre is located at 127 des Prairies Boulevard, at Laval-des-Rapides.
These various projects show to what extent we are concerned with the training of our leaders for tomorrow, who today, are more prone to imitate than to judge, to execute than to advise, to launch new projects than to pursue old ones.
Mr. Speaker, since Confederation, it is easy to recognize the years during which the Liberal party has ruled, since it respects the individual and his freedom. The Liberal Party is aware of the potential of each citizen. Improving

the life style of Canadians is a priority objective of this Liberal government. Improving the life style of old people, of low-income Canadians, developing the potential of our youth by challenging their creativity, facilitating access to universities through interest-free loans during the academic period, those are the things that mark the difference between the Liberal party and other parties.
In closing my remarks on the study of the budget, I am bearing in mind the image of the society constantly before us, the image of a world where all are striving to retain their livelihood, sell their products, their work, their talents and their ideas.
In the first place, a well-organized economy must provide a job for those who can and want to work, and such task is not as easy as it seems.
Through last year's Local Initiatives Program, the federal government contributed to create 92,577 jobs during winter, but what impresses me even more, Mr. Speaker, is that as a member representing the province of Quebec I note that 40 per cent of these jobs, that is 38,473, were created in this province, which represents an amount of nearly $64 million.
I think that this is a feature that proves to what extent federalism spells profits for the province of Quebec.
About the Local Initiatives Program, Mr. Speaker, I should like to state that all the projects of Laval which were presented in last November were approved, for an amount of $886,000. I shall only quote some of the main grants which are very significant, for instance, $295,000 to improve the Chomedey filtering plant, which shall have an added capacity of 25 million gallons daily. Thus, we shall ensure a better pressure during peak hours, and avoid the water shortage during summer in Chomedey.
Another federal grant to Laval amounted to some $166,725 for a sewage and water system in the area of Sainte-Dorothee. Another contribution which is quite appreciated at this time in the riding of Laval, is the $80,613 allocated for building a tunnel on Concorde boulevard, under the CP tracks. This tunnel will facilitate the east-west traffic flow which at the present time, is only possible over two main roads, Cartier and Saint-Martin boulevards.
Which means, Mr. Speaker, that last year, through the Local Initiatives Program, the government granted the City of Laval $886,847, which is equivalent to the creation of 471 new jobs. In addition to this, an amount of $318,000 was invested in the City of Laval, in the private sector, under the Local Initiatives Program, following the presentation of projects by non-profit organizations.
I could talk on and on about the many departments that are unceasingly striving to create new jobs. One of them is the Department of Regional Economic Expansion which invests in various under-privileged areas in order to foster employment there.
From 1965 to 1970, even if we have created in Canada twelve times more jobs in absolute number than in the whole of France, Germany, Italy, Belgium, the Netherlands, Sweden and Great Britain put together, there is still in this country a certain level of unemployment. Even if in March 1972 there were 8,016,000 people-that is, 336,000 people or 4.3 p. 100 more than last year-employed and


paid considerably higher salaries, the unemployment level here is still too high. However, our rate of development, at 4.3 p. 100, is by far the highest of the industrialized nations of the western world. This excellent performance was the subject of an article in the most prestigious English paper, the London Times, which awarded Canada the highest distinction for the best all around economic evolution of all the industrialized countries in the western world.
According to the latest figures published by Statistics Canada, the seasonally adjusted unemployment rate dropped from 6.7 per cent in April 1971 to 5.8 per cent in April 1972. During the same period, the number of unemployed decreased by 67,000.
This means that, in Canada, millions of workers are engaged in various occupations; each and every morning, these millions of workers leave for work as if they were moved by a mechanism which nobody can see, nor is aware of, and all the jobs they do are tied together like so many links of a chain with multiple branches, or like so many gears of a gigantic watch. This balance of the economy can only be attained if there is a close co-operation between the various industrial sectors in a free enterprise system, the trade unions and the state with its various levels of government.
Mr. Speaker, in view of all the measures put forward by the government, I fail to see any justification or seriousness in the amendment moved by the honourable member for Edmonton West Mr. Lambert) which reads as follows: This House regrets the failure of the government to bring forth effective measures to relieve unemployment, to provide incentive for Canadian investment in Canadian development or to propose personal tax relief for stimulation of the economy.
Mr. Speaker, considering all the projects put forward by the federal government, I shall have to vote against the amendment.


David Orlikow: Mr. Speaker, we have been told by the Minister of Finance (Mr. Turner) that the major purpose of his budget presentation was to deal with unemployment. I believe the government will fail in its objective of dealing with unemployment, as it has since the year it was elected.
Before dealing with that matter, I want to say that I do not believe it was the major purpose of this budget. I think it was to placate the business community of this country which was dissatisfied with the Liberal government. That is why tax cuts of $500 million are being given to the corporate sector of our economy. At the same time as the government refuses to give personal income tax cuts, it proposes to permit an increase of 3 per cent at the end of the year on personal income taxes. That is the real purpose of this budget. We in this party intend to make that the major point in the election campaign whether it comes this fall or in the spring of 1973. 1 refer to the government so favourably and one-sidedly dealing with the corporate sector of this country.
We have been told by the Minister of Finance, the hon. member for Winnipeg South Centre (Mr. Osier) and the hon. member for Laval (Mr. Roy) how successfully the government is dealing with unemployment. The fact is 25316-37
The Budget-Mr. Orlikow
that with the exception of two months, for two years we have consistently had 6 per cent or more unemployment on a seasonally adjusted basis. It is true that in April, 1972, the seasonally adjusted rate dropped to 5.8 per cent, but that was still the highest rate of unemployment in any country in the western world.
I see that the hon. member for Laval is leaving the chamber. I wish he would stay for another few moments. I want to remind him that 216,000 people in the province of Quebec were unemployed in April, 1972. He may be satisfied with that record. I am not surprised that the Parti Quebecois, the party which wants to separate, divide and destroy this country, in a recent drive had the greatest financial success it has had in its history. When there are
216,000	people unemployed in the province of Quebec it is not surprising that the people of that province are dissatisfied with federalism, Canada and the Liberal government.


An hon. Member:: Are you happy about that?


David Orlikow: No, I am not happy about it. I wish you people would do something about it instead of saying that everything is great. Let us look at the unemployment figures. In April, 1972, there were 250,000 people between the ages of 14 and 24 who were unemployed. These are the best educated young people this country has ever seen. Because I do not like to talk in round figures, let me tell hon. members about a visit to my office yesterday afternoon by one of my constituents.
This young lady received her BA at the University of Manitoba in May, 1970. She spent a year in the faculty of education at the University of Manitoba and completed teacher's training in May, 1971, one year ago. She was not able to get a teaching job in the province of Manitoba, and came to Ottawa. The only work she has been able to get is as a substitute teacher on very few occasions. She told me yesterday that one of her mistakes is that she has not lied to prospective employers. She told them how well educated she is. For most jobs she is over-educated. She feels that the only thing she can do now is try to get a job as a cashier in one of the supermarkets in this city.
This is a sad commentary for a society which has spent tens of thousands of dollars to train a young woman to be a teacher and she cannot get any job except possibly as a cashier in a supermarket. In spite of this, members opposite are happy about the state of our economy.
Let us look at what the Minister of Finance proposes with his budget. If you bring in a budget with the hope of expanding the economy and providing employment, you have two choices. First, you can cut personal income taxes. Is there any member of this House who doubts that personal income tax cuts, particularly for those in the low and middle income brackets, would mean an immediate expenditure of virtually all that money for goods and services which these people need? Anything given in the form of a tax cut for those who earn $12,000 a year or less-and that is the vast majority of the people in this country-would be spent. These people cannot afford to save money. Did the minister do that? Of course not. What he did was cut the rate of corporation taxes to 40 per cent and provided for another round of fast writeoffs on machinery purchases.


The Budget-Mr. Orlikow
The minister suggested that kind of program will encourage manufacturing plants to invest in new machinery, be come more efficient and hire more workers. I suggest that it will do nothing of the kind. Manufacturing plants that are now working on short time with one shift will not invest in new machinery which they do not need to meet their present demands. If there is more demand, they will bring in more workers. They will not do what General Motors plans to do on July 1, when there will be a complete shutdown for one month or more so that all of its employees will not be working.
The minister's tax cut for corporations of $500 million will mean a substantial increase in their profits. The minister has provided a gold plated carrot for the corporations of this country, one which they do not need. The fact is that corporation profits are up very substantially. I realize some hon. members may say I am partisan, that I am unfair. They may be right. Let me, therefore, prove my contention that corporation profits are moving up substantially and that corporations do not need this carrot which the Minister of Finance is providing. I quote from the Financial Times of May 8, 1972: under the heading "Profits are looking better" we read the following:
Canadian corporate profits are continuing the recovery which began last spring, helped by tax cuts and a liberated consumer. First quarter earnings make exceptional reading. One first quarter survey in Canada, taking in 93 public companies, found that profits were 27 per cent ahead of the same period last year. Profits from both private and public companies were up 18 per cent from 1970.
The article goes on to list some examples. Steel Company of Canada Limited's first quarter profits were up 55 per cent, Royal Trust Company's first quarter earnings were up by 60 per cent, and Traders' Group Limited's by 30 per cent. Imperial Oil was ahead 33 per cent in the first quarter, Dupont of Canada's first quarter profits rose sharply, and the first quarter earnings of the Ford Motor Company of Canada were up by 60 per cent.
It is against this background that the Minister has proposed, and government backbenchers will support, this rape of the public which will give the corporations another $500 million. Keep in mind that what the minister is proposing is that beginning January 1, 1973, the 3 per cent cut in personal income tax which was instituted in the fall of 1971 as a temporary measure will cease. So in fact the ordinary citizens of Canada will experience, not a tax cut such as the corporations will receive but a 3 per cent increase in income tax.
It is true there have been increases in payments to old age pensioners and veterans, but those increases were demanded by members of the opposition in all parties for two or three years and were refused time and time again by the government. Why has action been taken now? It is because the government has been watching the public opinion polls. The government's stock has been dropping, so an attempt is being made to buy the old age pensioners. I suggest that old age pensioners have better memories than the government gives them credit for. They know what the government has done; they know it refused for three years to grant necessary increases.

Why is the government following such a stupid budget policy? It does so because it is wedded to the idea that the only good which can be done in the economy is by the private sector. Whatever the private sector does is good. If they want to build another filling station or another supermarket, that is good, even though we do not need them. But if the government spends money on pollution control, on housing or community centres, that is bad, that is inflationary. That is why the government places all the emphasis on the private sector; and not on the whole of the private sector, either, but on the 95 big corporations which supply the campaign funds for the Liberal party.


The Acting Speaker (Mr. Boulanger):: Order. It being 5.45 o'clock p.m., it is my duty, pursuant to Standing Order 60 (7), to interrupt the proceedings and forthwith put the question on the amendment before the House.


The Acting Speaker (Mr. Laniel):: I declare the amendment lost.



BUSINESS OF THE HOUSE

Gerald William Baldwin: Mr. Speaker, what are the great expectations of the government for tomorrow's business?


Mr. MacEachen:: The same as Thursday last, Mr. Speaker.


Thomas Miller Bell: Mr. Speaker, I see an hon. member sitting at the back who would like to be recognized.


The Acting Speaker (Mr. Laniel):: Order. It being after six o'clock, unless the hon. member has a point of order-


Thomas Miller Bell: It is just to adjourn the debate.


Mr. MacKay:: I should like to call it six o'clock, Mr. Speaker.
At 6.10 p.m. the House adjourned, without question put, pursuant to Standing Order.
Stewart (Cochrane) Stewart
(Okanagan-Kootenay)
Sullivan
Thomas
(Maisonneuve-
Rosemont)
Trudeau
Trudel
Turner (London East)
Walker
Watson
Whelan
Whiting
Yanakis-113.
2541

Thursday. May 25. 1972