1972-03-20

OFFICIAL REPORT


[Stage Direction]
21 Elizabeth II

[Stage Direction]
Published under the authority oi the Speaker oi the House of Commons by the Queen's Printer for Canada
Available from Information Canada, Ottawa, Canada
[Stage Direction]
Monday. March 20, 1972


Hon. Alastair Gillespie (Minister of State for Science and Technology):: Mr. Speaker, I should like to table under the terms of Standing Order 41 copies in both official languages of the joint statement issued last Wednesday in Tokyo by the first Canadian science and technology mission, sponsored by the Minister of State for Science and Technology, and the Japanese government.
As I indicated, this was the first Canadian science and technology mission led by the new Minister of State for Science and Technology, and it represents an important Canadian initiative. The mission was described by the Japanese themselves as the most important one in the field of science and technology ever to be received by them. They accorded the Canadian group a high degree of co-operation.
The Canadians proposed collaboration with the Japanese with respect to exchanging information and personnel and advanced suggestions for consultation to clarify joint projects. The mission was successful in obtaining Japanese acceptance of these proposals. In my view this opens up a bright prospect for future relations between Canada and Japan in the science and technology field.
During ten days of intensive discussions with their Japanese counterparts, some 40 senior Canadians from industry, government and the universities spoke with well over 1,000 persons in key positions in Japan and visited many important centres of research and development in industry, universities and government departments and agencies. This intensive and in-depth consultation was achieved by the division of the mission into compact work groups, altogether 11 in number.
In our discussions and visits we were also looking for an explanation of the Japanese economic miracle of post-war expansion.
The joint statement touches on several important points. First, it marks the beginning of discussions which are expected to lead to some formal arrangement between Canada and Japan in the area of science and technology. Canada now has such arrangements with the Soviet Union, Germany and Belgium. In the meantime, additional discussions will be taking place at an early date to
identify possible joint Canadian-Japanese endeavours in the field of oceanographic research and environmental studies.
Canada and Japan separately and together have vital interests in the ocean; indeed, they are joined together by the Pacific Ocean. Both countries have agreed to consider proposals for joint projects related to new ocean technologies, such as ocean data buoys or, perhaps, the development of new kinds of underwater construction machinery, essential for harvesting the mineral riches of the ocean floor.
Our countries will exchange information in many areas-environmental technology and urban and regional planning, to mention only two. Consideration will be given to collaboration in technology assessment, the developing art of looking ahead for possible harmful effects of the applications of science.
Senior Japanese and Canadian officials expect to be meeting in the next few months and regularly thereafter to co-ordinate and promote bilateral co-operation in science and technology and its applications.
The understanding reached by Canada and Japan is that exchanges of information are expected to result in much greater flow of scientific and technical knowledge between the two countries. We have much to learn from each other and exchanges of information and of personnel will be important parts of the learning process.


Hon. J. A. MacLean (Malpeque):: Mr. Speaker, I take this opportunity to welcome the Minister of State for Science and Technology (Mr. Gillespie) back to the House from leading a Canadian scientific and technological mission to Japan. May I also thank him for making available an advance copy of the statement he has just made. I hope that future events will bear out the optimism expressed in the minister's statement and that reports of this kind will gradually take on more credibility.
I note with pleasure that this exchange is expected to lead to some formal arrangement between Canada and Japan in the area of science and technology, and that further talks will take place regarding possible Canadian-Japanese endeavours in the field of oceanographic research and environmental studies. It is recognized that the Japanese are leaders, if not pre-eminent, in these fields. It is also reassuring to note that the minister recognizes that harmful effects may possibly flow from the application of science and technology in certain fields.
This proposed exchange of information can only be successful to the degree that Canada is pre-eminent in some fields of scientific and technological application. This makes it urgent, I believe, for Canada to delineate policies in science and technology which will stimulate excellence. Therefore, in looking at the ever-broadening field of science and technology we must be increasingly

March 20, 1972
Science and Technology
selective not only with regard to possible harmful effects of technological applications but with regard to the benefits that may accrue from the money and effort expended.
I also hope that the minister will make a statement at an early date on science policy generally and on the government's position with regard to the second report of the Senate Committee on Science and Technology.
I note in closing, Mr. Speaker, that the mission also was looking for an explanation of the Japanese economic miracle. I would not be surprised if a lesser level of economic competence than shown by the Japanese would seem a miracle to this government.


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, every member of the House will agree that the fullest and freest exchange of scientific knowledge and know-how among all countries will be of value not merely to Canada but to the whole world. To the extent that Canada has initiated and participated in this kind of exchange with Japan and other countries we, of course, support the initiatives taken by the government.
I note, as did the spokesman for the official opposition, that in his statement the minister said the government was looking for an explanation of the Japanese economic miracle. The growth of the Japanese economy, its increased efficiency, the rapid expansion of the Japanese gross national product and the fantastic development of Japanese manufacturing industry have been one of the wonders of the world since world war II. Yet I hope we will learn from the Japanese how to avoid some of the mistakes they have made in their headlong rush in developing an urban industrial society. We certainly do not want in Canada the kind of environmental pollution which has been experienced in major cities of Japan. I hope we can learn from the mistakes they have made.
In the near future, Mr. Speaker, I hope we shall hear something more positive from the minister than the vague generalities he gave us in his statement. The Japanese have been singularly successful in expanding their industries and employment in manufacturing. They have developed products such as automobiles, scientific instruments, photographic equipment and so on which can compete with those of any other nation in the world.
I wonder whether the minister and his advisors will be looking at the steps the Japanese government took years ago to make certain that industry in Japan is controlled by the Japanese. Will the minister be looking at the difficulties we are experiencing in that many of our most important and largest industries are controlled by companies in the United States and other countries? These companies prefer to do their basic scientific research and apply the results to the development of industrial products in their own countries. Will the minister in the near future bring forward a policy that can be discussed in the House and outside, designed to induce Canadian industry to undertake the kind of research necessary to meet the problems of the 70's and 80's? That kind of research has not been undertaken so far.



BRITISH NORTH AMERICA ACT AND CANADA ELECTIONS ACT


Mr. John M. Reid (Kenora-Rainy River) moved: for leave to introduce Bill C-173, to amend the British North America Act and the Canada Elections Act (retirement age of members of the House of Commons).


Some hon. Members:: Explain.


John Mercer Reid: Mr. Speaker, the purpose of this bill is to provide for the retirement of parliamentarians at age 65. The reason is that since this parliament and other legislatures have seen fit to define age 65 as the age for retirement purposes for pension plans it seems appropriate that this should also apply to those who have made these laws.


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
Mr. Speaker:: Order, please. There are ten other notices of introduction of bills of which the Chair just received notice earlier today. There is some question concerning the procedural validity of some of these bills. While at the beginning of the session when we had well over 100 similar bills proposed it was difficult for the Chair to take the time to study them and to express an opinion then as to their validity for the purpose of having them presented for first reading, I believe that later in the session, when bills are presented individually or in a group of ten as we have today, the Chair ought to have an opportunity to look at these bills and express an opinion on whether they should be received for the purpose of introduction and first reading. I had a conversation with the hon. member for Skeena. I told him I had some doubt concerning the grammatical validity of the Latin included in the title of his bill, but that is really not the reason his bill is being stood today.



QUESTIONS ON THE ORDER PAPER

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(Questions answered orally are indicated by an asterisk.)

Mr. Marshall: What, records are kent at ManDower centres on the work history and educational and training qualifications of the unemployed?


Mr. Ray Perrault (Parliamentary Secretary to Minister of Manpower and Immigration):: The personal information forms used by Canada Manpower Centres for registering

March 20, 1972

persons seeking employment (including persons unemployed) include information on work history and educational and training qualifications.


NUMBER OF PERSONS IN RECEIPT OF OLD AGE
Mr. Knowles (Winnipeg North Centre): 1.	How many persons in Canada, by provinces, are in receipt of the Old Age Security pension?
2.	Of the recipients of the Old Age Security pension, how many persons in Canada, by provinces, are in receipt of the Guaranteed Income Supplement?
3.	Of those receiving the Guaranteed Income Supplement, how many persons in Canada, by provinces, are receiving the full amount?
4.	What is the average amount, in Canada, and by provinces, being received as a Guaranteed Income Supplement by recipients of the Old Age Security pension?
5.	Do the answers to the above questions take into consideration persons living outside of Canada who are in receipt of the Old Age Security pension and, if so, how many of such persons are there, and if they are considered as belonging to the various provinces what is the number for each province?


Hon. John C. Munro (Minister of National Health and Welfare):: 1. Newfoundland 32,692; Prince Edward Island 12,363; Nova Scotia 72,932; New Brunswick 54,797; Quebec 420,153; Ontario 646,485; Manitoba 96,937; Saskatchewan 94,984; Alberta 118,655; British Columbia 205,190; Northwest Territories 848; Yukon 512.
2.	Newfoundland 27,471; Prince Edward Island 9,502; Nova Scotia 48,854; New Brunswick 37,001; Quebec 258,614; Ontario 305,093; Manitoba 57,321; Saskatchewan 56,715; Alberta 69,186; British Columbia 107,255; Northwest Territories 742; Yukon 314.
3.	Newfoundland 6,470; Prince Edward Island 1,361; Nova Scotia 8,975; New Brunswick 5,792; Quebec 33,237; Ontario 24,097; Manitoba 6,161; Saskatchewan 6,372; Alberta 7,981; British Columbia 10,138; Northwest Territories 173; Yukon 48.
4.	Newfoundland $49; Prince Edward Island $46; Nova Scotia $47; New Brunswick $45; Quebec $47; Ontario $42; Manitoba $44; Saskatchewan $43; Alberta $45; British Columbia $43; Northwest Territories $55; Yukon $55; National $44.
N.B.-The figures given are on a monthly basis.
5.	Yes. As of December 1971, the latest month for which figures are available, there were 44,841 persons in receipt of the Old Age Security pension outside of Canada. Some of these pensioners would be absent temporarily, and others on a permanent basis. Some might be receiving a Guaranteed Income Supplement, which is payable for the first six months of absence following departure from Canada, but no figures are available. The breakdown by province of last residence is as follows; Newfoundland 321; Prince Edward Island 231; Nova Scotia 1,178; New Brunswick 1,276; Quebec 9,908; Ontario 17,425; Manitoba 1,954; Saskatchewan 1,706; Alberta 2,206; British Columbia 8,613; Northwest Territories 5; Yukon 18.
N.B. The figures above are as of December 1971.
[Editor's Note: See corrected answer page 1332.]
Questions


ROYAL CANADIAN MOUNTED POLICE-PENSIONS
Mr. Knowles (Winnipeg North Centre): 1.	How many retired Royal Canadian Mounted Police personnel are receiving pensions including their basic pensions and any supplement or supplements added thereto, of amounts within each of the following brackets (a) less than $20 per month (b) $20 to $29.99 per month (c) $30 to $39.99 per month (d) $40 to $49.99 per month (e) $50 to $59.99 per month (f) $60 to $69.99 per month (g) $70 to $79.99 per month (h) $80 to $89.99 per month (i) $90 to $99.99 per month (j) $100 to $149.99 per month (k) $150 to $199.99 per month (1) $200 to $249.99 per month (m) $250 to $299.99 per month (n) $300 per month and over?
2.	How many widows of R.C.M.P. personnel or of retired R.C.M.P. personnel are receiving pensions, including their basic pensions and any supplement or supplements added thereto, of amounts within each of the brackets indicated in the above question?
3.	What is the number of retired R.C.M.P. personnel and also the number of widows of R.C.M.P. personnel or of retired R.C.M.P. personnel presently residing in each province?
4.	In respect of how many orphans of R.C.M.P. personnel are pensions being paid and what is the average amount thereof?


Hon. Jean-Pierre Goyer (Solicitor General):: In regard to the Department of the Solicitor General: 1. (a) 19; (b) 14; (c) 10; (d) 14; (e) 14; (f) 15; (g) 19; (h) 18; (i) 23; (j) 197; (k) 352; (1) 374; (m) 343; (n) 1,201.
(a)	3; (b) 1; (c) 2; (d) 2; (e) 8; (f) 7; (g) 10; (h) 10; (i) 8; (j) 42; (k) 37; (1) 30; (m) 8; (n) 20.
3.	Retired	
Province	Personnel	WidowsNewfoundland	45	2Prince Edward Island	19	Nova Scotia	211	9New Brunswick	87	3Quebec	191	5Ontario	578	51Manitoba	138	7Saskatchewan	161	12Alberta	359	16British Columbia	737	77Northwest Territories	27	1Outside Canada	60	5
4. Sixty-eight, average monthly payment $49.95.


RCMP-SUPERANNUATION ACCOUNT
Mr. Knowles (Winnipeg North Centre): 1.	What was the total amount of money in the Royal Canadian Mounted Police Superannuation Account as at (a) March 31, 1969 (b) March 31, 1970 (c) March 31, 1971?
2.	What rate of interest has the Government paid for the use of this money during the fiscal years ending on the dates noted above?
3.	What amount of interest was credited to the Royal Canadian Mounted Police Superannuation Account during the fiscal years ending (a) March 31,1969 (b) March 31,1970 (c) March 31,1971?
4.	What was the total amount paid out of the Royal Canadian Mounted Police Superannuation Account during the fiscal years ending (a) March 31,1969 (b) March 31,1970 (c) March 31,1971?

March 20,1972
Questions
Hon. )ean-Pierre Goyer (Solicitor General): For the
Department of the Solicitor General of Canada: 1. (a) March 31, 1969, $130,811,253.12; (b) March 31, 1970, $165,764,567,44; (c) March 31, 1971, $199,716,533.74.
2.	March 31, 1969, 4 per cent; March 31, 1970, 4.7862 per cent; March 31,1971, 5.346 per cent.
3.	(a) March 31, 1969, $4,494,764.86; (b) March 31, 1970, $5,454,750.61; (c) March 31,1971, $6,908,425.99.
4.	(a) March 31, 1969, $1,101,036.09; (b) March 31, 1970, $1,315,474.24; (c) March 31, 1971, $1,525,344.69.


POLITICAL PARTICIPATION BY MEMBERS OF THE PUBLIC SERVICE
Mr. McBride: Is it the intention of the government to introduce appropriate legislation to extend to the members of the Public Service of Canada full rights of political participation?


Hon. Gerard Pelletier (Secretary of State):: No change in legislation is proposed at the present time.


ABITIBI CONSTITUENCY-ENTERPRISES SUBSIDIZED BY DREE
Mr. Laprise: Have any enterprises in the constituency of Abitibi been subsidized by the Department of Regional Economic Expansion since the Regional Development Incentives Act was passed anrl. if so (aj which ones (b) what was the amount paid to each (c) how many new jobs were created?


Hon. lean Marcnand (Minister of Regional Economic Expansion):: Yes.
(a)	(b) Estimated Amount of	(c) Estimated Number ofCompany	Incentive $ 647,613	New JobsJ. H. Normick Inc.	50Paradis & Sons Ltd.	110,314	16Abiex Inc.	352,588	53Camille Richard Inc. Les Industries Alarie	477,511	65de Malartic Ltee	365,808	78Imprimerie Berard Ltee	24,395	6Hitland Clay Products Inc.	31,083	13J. J. Cosette Inc.	71,630	18Roberge & Fils Inc.	14,658	6Auto-Confort (R) Inc.	41,100	51M & M Auto Parts Inc.	86,100	9
(English]


CBC-COST OF PRODUCTION OF TV JALNA SERIES
Mr. Mather: What is the total estimated cost of production of the CBC TV Jalna series?


Gérard Pelletier: I am
informed by the Canadian Broadcasting Corporation as follows: It has not been customary to require the CBC to disclose program costs as such information could adversely affect the Corporation in the competitive business in which it is engaged.


GRANTS UNDER FAMILY PLANNING PROGRAM
Mrs. Maclnnis: Since the initiation of the Family Planning Program by the Minister of National Health and Welfare on May 5,1971 (a) to what organizations were grants made and what was the amount in each case (b) what organizations have been refused grants and what was the amount of money requested in each case (c) what organizations have applications for grants still pending and what amounts of money are being requested in each case?


John Carr Munro: 1. Projects received and assisted in the field of family planning are as follows: National Health Grant Program: Family planning Federation of Canada, $60,000; Service de Regulation des Naissances, $25,000.
National Welfare Grant Program: Centre de Planning Familial du Quebec Inc. Montreal, $500; Ministere des Affaires Sociales du Quebec, $37,670; Planned Parenthood Society of Hamilton, $17,540; United Community Services of the Greater Vancouver Area, $6,597; Family Planning Federation of Canada, $40,000.
Family Planning Grant Program: Family Planning Federation of Canada, $385,000; Service de Regulation des Naissances, $40,000.
2.	It is not the policy of the department to divulge the names of unsuccessful groups or individuals.
3.	It is not the policy of the department to divulge the names of applicants. However, we have now one application ($25,000) being examined.
N.B.-A considerable sum of money has been allocated for the National Conference on Family Planning held in Ottawa at the end of February. Approximately 300 delegates participated. Approximately $200,000 was also allocated as grants for research in the field of family planning during the fiscal year 1970-71.


DEPARTMENT OF AGRICULTURE-EMPLOYMENT OF MR. DION, BERTHIER-EN-BAS
Mr. Beaudoin: Is Mr. Dion from Berthier-en-Bas, in the constituency of Mont-magny, employed by the Department of Agriculture or one of its agencies and, if so (a) what are his duties (b) what is his annual salary?


Hon. H. A. Olson (Minister of Agriculture):: No, (a) not
applicable (b) not applicable.

March 20, 1972


POST OFFICE-COST OF COLLECTING POSTAGE DUE BY MEANS OF HONOUR SYSTEM CARDS
Mr. Coates: 1.	What was the cost of producing the cards informing Canadians postage was due when the Post Office Department increased the price of postage stamps from seven cents to eight cents?
2.	Who produced the cards?
3.	How many were produced and how many were used?
4.	Of the total number mailed regarding underpayment of postage (a) how many were returned with the postage payment (b) what was the total amount received (c) how many who were contacted for such underpayment did not return the cards?
5.	What was the total cost to the Post Office Department for this operation?


Hon. Jean-Pierre Cote (Postmaster General):: The process of collecting postage due by means of Honour System Cards was instituted some years ago and is a continuing system. No special provisions or cards were made as a result of recent increases in postage rates. No special statistics are maintained and it would not be possible to furnish the information requested in questions 1 to 5. Incidentally, these cards are not mailed but are left by the delivering employee with the postage due item.
Questions


Mr. Eymard Corbin (Parliamentary Secretary to Minister of Fisheries):: 1. Yes.
(a) Location Reservoir Gouin Lac Levasseur Riviere St. Maurice
Sampling Period June to September 1971 August to September 1971 June to August 1971
(b)	To ensure that the commercial fish production from the area in question complies with the guidelines established by the Department of National Health and Welfare.
(c)	The Inspection Branch, Fisheries Services, Department of the Environment.
(d) Lake or	Mercury Levels in PPM
River	Species	Low	Mean	HighReservoir Gouin	(Pickerel)	0.23	0.82	1.63(Pike)	0.22	1.23	1.84Lac Levasseur	(Pickerel)	0.54	0.71	1.01(Pike)	0.32	0.72	1.33Riviere St. Maurice	(Pickerel)	0.29	0.82	1.27


DISTRIBUTION OF POSTER ADVERTISING FOR ASSISTANT TO WAR VETERANS ALLOWANCE BOARD CHAIRMAN
Mr. Marshall: 1.	What was the distribution of Poster 72 DVA-HQI advertising for an Executive Assistant to the War Veterans Allowance Board Chairman?
2.	Were copies sent to all Canadian Legion Branches? [Translation]


Gérard Pelletier: I am
informed by the Public Service Commission as follows: 1. All departments throughout Canada and Overseas. All portions of the Public Service of Canada that are separate employers. All agencies, boards and corporations. Members of Parliament. Deputy Ministers. All placement Officers in universities, institutes and colleges throughout Canada. Canada Manpower Centres. Certified Bargaining Agents. In addition, an advertisement was placed in all the major daily newspapers throughout Canada.
2. No. However, an advertisement was placed in "The Legion".	*


ANALYSIS OF MERCURY CONTENT IN FISH-GOUIN BASIN
Mr. Matte: 1.	Has any analysis been made of the mercury content in fish, especially pickerel and pike, in the Gouin Basin in Haute-Mauricie and, if so (a) on what date was such analysis made (b) for what reason (c) who requested such analysis (d) what were the exact results for each lake and river in the Basin?
2.	Have any shipments of pickerel and pike from the Gouin Basin been rejected in the United States and, if so (a) who was the consignee (b) who was the shipper (c) what assurance is there that the fish really came from the Gouin Basin?
3.	What would be the exact causes of the high mercury content of the pickerel and pike in this area?
2.	No.
3.	The contamination may be the result of mercury compounds being leached into the watershed from natural geological occurrences such as from cinnabar deposits, as is the situation in a number of other locations in Canada. There is no evidence to indicate that mercury contamination of pickerel and pike harvested from the Gouin Basin is attributable to industrial pollution.


COMMITMENTS UNDER AGRICULTURAL STABILIZATION BOARD TO OFFSET UNITED STATES 10 PER CENT SURTAX
Mr. Burton: What commitments were made by the government under the Agricultural Stabilization Board to offset difficulties during the period when the United States 10 per cent surtax was in effect?


Horace Andrew (Bud) Olson: During the period when the United States 10 per cent surtax was in effect the Agricultural Stabilization Board: 1. Offered a special subsidy of 50 cents per bird for fowl slaughtered during an eight week period providing the number slaughtered exceeded the normal kill in the period; the subsidy to be pro rated among all producers.
2.	Offered to purchase and can up to 4 million pounds of eviscerated turkeys.
3.	Offered to purchase Canada No. 1 potatoes at $1.50 per hundredweight.
4.	Offered $114,000 to the Canadian Horticultural Council for market promotion of fresh apples.
5.	Offered a supplementary subsidy of 1 i cents per pound to blueberry producers on product delivered in the. period August 16, 1971 to October 15, 1971.
952

March 20, 1972
Orders for Returns


INTERNATIONAL TREATY ON MARITIME POLLUTION
Mr. Robinson: Has Canada participated in a proposal for an international treaty on maritime pollution and, if so, will the federal government advise if it will sponsor a resolution revising the United Nations Charter to create a United Nations secretariat on marine pollution?


Hon. Mitchell Sharp (Secretary of State to External Affairs):: The problem of marine pollution is at present being considered in connection with the preparatory work for the UN Conference on the Human Environment which will take place in Stockholm in June this year, the Marine Pollution Conference to be sponsored by the Inter-governmental Maritime Consultative Organization in London in June 1973, and the Law of the Sea Conference which may also take place in 1973. Canada is participating in the preparatory work for these three conferences and in the course of this preparatory work the possibility of an international treaty on marine pollution has been discussed. Largely as a result of Canadian initiative, a body of principles on the prevention of marine pollution and the preservation of the marine environment has been prepared for submission to the Stockholm Conference as part of the action plan for the control of pollutants having international implications, to be considered by the Conference. The endorsement of these marine pollution principles by the Stockholm Conference should assist the elaboration of any international treaty or treaties respecting marine pollution in the post-Stockholm period.
At present, proposals relating to the establishment of an organization within the UN system responsible for matters involving the marine environment are being considered in conjunction with the broader institutional questions which will be considered at the Stockholm Conference. The Secretary-General for the Conference has developed proposals on this subject which are being studied by governments. Canadian proposals on this matter with respect to both the environment generally and the marine environment specifically are now being actively considered in the light of the Secretary-General's proposals. At this stage, however, I am unable to go into detail on the scope and content of these proposals.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Latulippe: Are there still reserve regiments in the Canadian Armed Forces and, if so (a) how many (b) what is the name of each such regiment (c) what is the total strength of each (d) what was the average salary of each member of the reserves for the year 1971?
Return tabled.


CROP INSURANCE ACT PROGRAM
Mr. Southam: 1.	Under the Crop Insurance Act, what provinces have enacted enabling legislation?
2.	By province, how many farmers received indemnities under this program in 1971?

3.	By province, what were the total indemnities paid to farmers under this program in 1971?
4.	By province, what crops were covered by the Crop Insurance Act in 1971?
5.	By province, what were the chief causes of crop losses in 1971?
6.	By province, what were the total premiums paid by farmers under the Plan?
7.	By province, what amounts did the federal government contribute towards the premium costs?
8.	By province, what amount did the federal government contribute towards the cost of administration of the Plan?
Return tabled.



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, in the absence from the House of the Minister of the Environment and the Minister of Transport I sent to the Prime Minister's office notice that I would be asking the Prime Minister some questions about the oil spill off Vancouver Island from the freighter Vanlene. When can we expect effective regulations under the Canada Shipping Act, and particularly under Bill C-2, with a view to controlling the potential hazards that arise in Canadian waters from vessels such as these?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, the Leader of the Opposition was good enough to let me know he would ask this question. I shall attempt to answer it. The two ministers will be in the House tomorrow and might be able to give more detailed information. On the attempts to control this type of thing, I can tell the Leader of the Opposition that some measures have been taken under the Canada Shipping Act. As a matter of fact, I am meeting one premier this afternoon to discuss the application of them. We do not yet know the cause of this particular disaster. Therefore it is impossible to know at this stage what could have been done to prevent it. However, a preliminary investigation has begun in Vancouver, and when we know the cause of this wreck we might be able to determine means of preventing them in the future.


Robert Lorne Stanfield: What steps are being taken to remove from the vessel the remainder of the bunker fuel.


Pierre Elliott Trudeau: I understand that as of Friday a barge and some booms were alongside the wreck and that the operation of taking off the fuel had not begun because of bad weather but will begin any time now, if it has not begun. The apparatus is there and will begin to operate as soon as the weather permits.


Robert Lorne Stanfield: I have one further supplementary question, Mr. Speaker. In reply to my first question the Prime
March 20, 1972

Minister referred to a fund established in connection with oil tankers in our waters as distinct from freighters such as this ship. Has the government in fact undertaken to underwrite the clean-up cost in connection with this oil spill and, if so, what fund will take care of it?


Pierre Elliott Trudeau: Once again, we do not know the cause of the disaster and therefore we cannot yet at this date ascertain the responsibility. If it is possible, of course, to determine responsibility on someone's behalf, we will take suit in the normal fashion.


Mr. Thomas M. Bell (Saint ]ohn-Lancaster):: Mr. Speaker, I have a supplementary question for the Prime Minister. In view of the fact the Prime Minister is meeting Premier Hatfield today to discuss the oil pollution fund, will the Prime Minister himself, or through the ministers involved, see that the whole subject is related to the fact that we in the Maritimes may be paying through this levy for some of the damage on the west coast?


Mr. Speaker:: Order, please. I would think that the question is in the form of a representation or an argument.



POSSIBLE LEGISLATION TO CONTROL OIL-CARRYING SHIPS ON PACIFIC COAST

Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, may I address a supplementary question to the right hon. Prime Minister. In view of the fact this oil spill is not the only one that has taken place-there was one a few days, ago in Nanoose Bay from Department of National Defence ships there-is the government contemplating any legislation that would restrict and control the type of movement of oil-carrying vessels on the Pacific coast so as to prevent the recurrence of these many, very dangerous spills that have taken place in recent months?


Pierre Elliott Trudeau: The House of Commons knows that we took this kind of measure as regards shipping in the Arctic zone. However, with regard to the east and west coasts nothing is contemplated at this time beyond the legislation we have already brought forward to amend the Canada Shipping Act.


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have a question for the Prime Minister with reference to his last answer that we do have legislation, Bill C-2, covering this subject. When does the government intend to bring in regulations under that bill to tighten up security with regard to ships of this kind?


Pierre Elliott Trudeau: I am afraid I will have to defer on that question to the Minister of Transport.


Mr. Speaker:: I recognize the hon. member for Dart-mouth-Halifax East for the last supplementary on this subject.



OIL SPILLS-SUGGESTED PAYMENT OF CLEAN-UP COSTS FROM GENERAL REVENUES PENDING BUILD-UP OF FUND FROM LEVY

[Stage Direction]
Mr. ]. M. Forrestall (Dartmouth-Halifax East): Mr. Speaker, I should like to ask the Prime Minister whether
Inquiries of the Ministry
or not he would now consider in cabinet the advisability of the government establishing out of general revenues the required fund for the clean-up of oil pollution so that we would not have to wait for a number of years for the levy on oil movements to build up the fund to the level indicated as adequate by the government?
Pierre Elliott Trudeau: Mr. Speaker, the House knows that the government has not waited for the establishment of this fund. We have had to clean up spills in the past and we will continue to do so in the future. This levy is just a way whereby we can ensure that the large corporations which are moving oil will in some manner be able to pay for any damages which result from any accident.



EXTERNAL AFFAIRS


Mr. David Lewis (York South):: Mr. Speaker, I would like to ask the Secretary of State for External Affairs whether the government of the People's Republic of China had informed the Canadian government of its intention to explode a nuclear device in the atmosphere and, if so, whether this government expressed any protest against that intention?


Mitchell William Sharp: The answer to the question, Mr. Speaker, is no. The People's Republic of China did not notify us in advance. They do know, of course, our attitude toward explosions in the atmosphere. We are hoping the People's Republic of China will abandon its position and join with the Soviet Union and the United States in bringing an end to these tests in the atmosphere.


David Lewis: Mr. Speaker, the report about the explosion the other day also stated that the government of the People's Republic of China intends to explode some other kind of nuclear device in the atmosphere in the future. In view of that, is the government considering making formal representations to the government of China, through the diplomatic channels which are now open, urging that government not to continue these tests?


Mitchell William Sharp: Yes, Mr. Speaker, I have been considering this. I do not know whether it would add to the force of the representations we have already made to them both publicly and privately, but it is a suggestion that I have in hand. I do not want to get into the position, however, where protests of this kind are routine matters that follow each time they explode one of these devices. What we are looking for is an end to the testing, not the satisfaction of protesting.


David Lewis: Mr. Speaker, I am not asking for the satisfaction of protesting. Is the minister considering this kind of protest as a means of trying to persuade the government of the People's Republic of China to join the ban on
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March 20, 1972
Inquiries of the Ministry
testing in the atmosphere which has now been signed, and to participate in the discussions on the banning of all other kinds of testing?


Mitchell William Sharp: Yes, Mr. Speaker, I think this kind of representation would be a good deal more fruitful than a simple protest. They know our position. This is the line we have been following. We will be urging the Chinese and the French to participate in the ban on nuclear testing in the atmosphere, and to follow the Canadian position which is that all kinds of nuclear testing should be abandoned.
*
*


FAMILY INCOME SECURITY
Mr. Gerard Laprise (Abitibi):: Mr. Speaker, I should like to put a question to the Prime Minister.
I would ask him whether a date has been agreed upon between officials of the Department of National Health and Welfare and their counterparts in Quebec in order to find an acceptable repatriation formula for family allowances and, if so, could he assure the House that this formula will be more acceptable to families than to provinces?


Pierre Elliott Trudeau: Mr. Speaker, the Quebec premier sent me a telegram on Friday to inform me that he proposed that our officials should meet to discuss this problem. I feel that the point made by the hon. member with regard to the importance of worrying about families rather than provinces or governments is well taken, and we will keep it in mind.


PROPOSED MACKENZIE VALLEY PIPELINE- ACCEPTANCE BY GOVERNMENT OF TRANSPORTATION CORRIDOR STUDY CONCLUSIONS
Gordon Harvey Aiken: Mr. Speaker, my question is directed to the Minister of Indian Affairs and Northern Development. It is prompted by statements reportedly made by the Minister of State in Calgary over the weekend. Has the government accepted the basic general conclusions of the transportation corridor study relative to the Mackenzie River valley by Canadian National Railways and the Alberta Gas Trunk Line Company Limited?


Mr. Speaker:: Order, please. I would hope the question could be asked directly. I have suggested to hon. members previously that it is npt quite in order to ask questions about statements made outside the House unless they are asked of the Prime Minister to inquire whether a statement made outside the House represents government policy. The hon. member, however, is entitled to ask the question of the minister directly.


Gordon Harvey Aiken: Mr. Speaker, I had attempted to do that, but in any case may I ask the minister directly the question I have already outlined?


Hon. lean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, we have stated, as early as last August, that we would create a corridor for the construction of gas and oil pipelines in the north. However, we have not yet reached a final decision with regard to this corridor; when this is done we shall inform hon. members.


Gordon Harvey Aiken: Mr. Speaker, I would like to ask the minister whether the government has been provided with a copy of the report on this subject reportedly released today by the government of the United States in Washington?


Joseph Jacques Jean Chrétien: Mr. Speaker, I am not aware that a report on this subject has been published today by the United States government.


WHEAT-INQUIRY AS TO DATE OF ACREAGE PAYMENTS
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I address my question to the Minister of Justice. It has to do with the matter of acreage payments being made by the government of Canada, based on the amount of money estimated to be that which a two-price system would provide. I think it was some three weeks ago that he said an announcement would be made shortly. Naturally, the farmers out west, as the spring work is approaching, are anxious to know when they are going to get the payments.


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, what I indicated a few weeks ago would be announced shortly was the manner of distribution of the money, and that was announced some time ago. We are working on the exact figures and the manner of payment now. I would expect that the actual distribution, for the first time in connection with 1972, would be made some time in the month of April.


John George Diefenbaker: Mr. Speaker, I do not quite understand the meaning of "distribution for the first time." What is the meaning of those words?


Otto Emil Lang: Well, Mr. Speaker, I am talking about this year's payment.


John George Diefenbaker: Oh, I see, Mr. Speaker. Does the date of the distribution bear any relationship to the metaphysical musings of the Prime Minister on "Encounter" yesterday, as to the possible date of an election?


Mr. Speaker:: Order, please.
March 20, 1972


HOUSING
Mr. Derek Blackburn (Brant):: Mr. Speaker, I have a question for the Minister of State for Urban Affairs. In view of the fact plans are being made for changes in urban renewal policy, can the minister give assurance that properties and real estate purchased by municipalities at the present time will come under the new cost-sharing scheme when the new program comes into effect?


Hon. Ron Basford (Minister of State for Urban Affairs):: Mr. Speaker, I would not want to answer that until any new proposals were in fact laid before parliament.


FINANCE
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Minister of Finance. Does the minister intend to cover the deficit in the present budget, estimated at $750 million to $1 billion, by using the private bond market, or by use of the private banks or the Bank of Canada, generally considered to be inflationary in character?


Mr. Speaker:: Order, please. I have serious doubts about the hon. member's question. I do not think it is the kind of question that ought to be asked at this time.


POSSIBLE RELATIONSHIP BETWEEN DISCUSSIONS WITH UNITED STATES ON CANADIAN EXEMPTION FROM INTEREST EQUALIZATION TAX AND AUTO PACT NEGOTIATIONS
Mr. Mac T. McCutcheon (Lambton-Kent):: Mr. Speaker, may I direct a question to the Minister of Finance. Can the minister say whether there have been discussions recently with the United States government on Canada's present exemption from the interest equalization tax, and are these discussions connected in any way with the auto pact?


Hon. lohn N. Turner (Minister of Finance):: Mr. Speaker, if there have been such discussions they would have been within the purview of my colleague, the Minister of Industry, Trade and Commerce, but none have been had at the ministerial level, to my knowledge.


POSSIBILITY OF UNITED STATES AUTOMOBILE MANUFACTURERS NOT USING DISC PROGRAM
Maclyn (Mac) Thomas McCutcheon: I thank the minister very much, Mr. Speaker. I was just following the instructions of the Minister of Industry, Trade and Commerce in his answer on Friday. Mr. Speaker, I wonder if I
Inquiries of the Ministry
might direct a supplementary question to the Prime Minister. On Friday the Minister of Industry, Trade and Commerce stated:
I understand the automobile manufacturers in the United States have no intention of using it-
The DISC program. Can the Prime Minister inform the House whether the government has in fact received any sort of formal assurance from the U.S. auto industry that they will not use DISC?


Pierre Elliott Trudeau: Certainly, Mr. Speaker, the government as a whole has not received such assurance, but the question might be referred to the Minister of Industry, Trade and Commerce. I will do that and see if anything has been given to him in the way of assurance which has not yet been brought to the attention of the cabinet.


CANADIAN CULTURE
David Orlikow: Mr. Speaker, I should like to ask the Secretary of State whether the government has yet allocated funds to support the various ethnic and cultural groups in Canada in preserving and expanding their multicultural activities, as announced by the Prime Minister last October?


Gérard Pelletier: I shall take the question under advisement, Mr. Speaker, and shall be glad to let the hon. member have the reply.


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


David Orlikow: A supplementary, Mr. Speaker-


Mr. Speaker:: Perhaps we might hear the supplementary first and then the hon. member for Malpeque will be recognized.


David Orlikow: When the minister replies to the question would he indicate whether the plans of the federal government have been discussed with the provincial governments so that the activities of the two levels of government can be co-ordinated in one plan?


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


AGRICULTURE
John Angus MacLean: Mr. Speaker, I should like to direct a question to the Minister of Agriculture.

March 20, 1972
Inquiries of the Ministry
Has the minister any further statement to make at the present time regarding the disposition of potatoes which have been purchased by the Agricultural Stabilization Board in light of the resolution forwarded to him by the Prince Edward Island legislature on the matter?


Horace Andrew (Bud) Olson: Mr. Speaker, I do not think I will be making a statement today. However, we are taking note of that resolution and also some other representations that have been made by the Prince Edward Island Federation of Agriculture. Perhaps by tomorrow or Wednesday I shall be able to give a more definitive reply.


NATIONAL CAPITAL
Mr. D. Gordon Blair (Grenville-Carleton):: Mr. Speaker, my question is directed to the Minister of State for Urban Affairs. In view of the recommendation made by the Joint Committee on the Constitution about the future governing of the national capital region, can the minister state whether the government is prepared to deal with this recommendation and whether it is in favour of it?


Stanley Ronald Basford: Mr. Speaker, like any House committee report we are studying the whole of the report and certainly its recommendations relating to the national capital will be studied very carefully by me. They are interesting recommendations which make a useful contribution to the debate on the subject, but before making a careful study I would not want to commit myself one way or another on them. I am glad the mistake regarding some wording in the report has been cleared up. I would think that at some appropriate time in the future the whole question of the operations of the National Capital Commission could well be studied by a House and Senate committee that would examine all the issues surrounding the National Capital Commission.


Mr. Howard (Skeena):: Did you say yes, no, or maybe?




Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. Now that we have re-entered the big spending spree era, can the minister indicate whether it is his intention to open missions in Zambia and Barbados?


Mitchell William Sharp: Mr. Speaker, there are a number of recommendations before cabinet now dealing with the opening of some missions. We have the usual financial constraints that I know are supported by members of the opposition,

but within those limits I hope we will be able to make progress.


SUGGESTED ESTABLISHMENT OF ADDITIONAL TERMINAL ELEVATORS AT PRINCE RUPERT TO RELIEVE PRESSURE ON EXISTING EXPORT FACILITIES
Frank Howard: Mr. Speaker, the other day I asked the right hon. Prime Minister about the operations of the Wheat Board or the Department of Finance with respect to allocating funds for an enlargement of or addition to the Canadian government grain elevator facilities in the port of Prince Rupert. May I ask the Minister of Justice whether he has any plans this year to provide funds for such an expansion or enlargement?


Otto Emil Lang: Mr. Speaker, with the record movements of grain going out from the west coast an attempt is being made to use the present facilities in Prince Rupert to a maximum. We are looking at a number of alternatives for increasing that capacity, including the question of whether moving clean grain will increase the over-all working capacity. In addition, my colleague the Minister of Transport has under very active consideration steps which might permit the enlargement of the capacity or the facility itself.


Frank Howard: In light of the latter part of the answer about increasing the capacity of that port for grain shipment, could the minister put any timetable on that? Would he be prepared to say it would be before the end of this fiscal year or before the Minister of Finance introduces his first budget?


Mr. Speaker:: Apparently the matter is being considered by the minister. In the meantime the Chair will recognize the Leader of the Opposition.


THE CANADIAN ECONOMY
Robert Lorne Stanfield: Mr. Speaker, I should like to ask the Acting Minister of Manpower and Immigration whether it is his view that the economy is right at potential?


Mr. Speaker:: Order, please. That question, of course, is not in order. I am sure the hon. Leader of the Opposition knows that he cannot ask a question of that kind which is merely an invitation to express an opinion.


Robert Lorne Stanfield: Mr. Speaker, I am seeking the view of the government with regard to its economic policies and, with every respect, I would therefore suggest that it is proper to ask the Acting Minister of Manpower and Immigration whether it is his position that the economy is right at potential, particularly in view of the large amount of unemployment.
March 20, 1972


Mr. Speaker:: Order, please. Of course, that is the opinion of the hon. gentleman but it is not mine. I judge from the procedural standpoint and to my mind it is clearly not in order. The hon. Leader of the Opposition may wish to rephrase the question.


Robert Lorne Stanfield: May I ask the Acting Minister of Manpower and Immigration whether it is his view that an increased rate of private investment, which according to the government's own survey is to be about the same level as last year, should not be encouraged because it would be going beyond the potential of the economy?


Mr. Speaker:: Order, please. I do not wish to be difficult and I shall allow the minister to reply to the hon. gentleman's question, but I again suggest very respectfully that when a member asks a minister whether it is his view that such and such a situation exists it is an invitation to express an opinion. I could read many precedents to the effect that this kind of question is not procedurally correct. Again I want to insist that I certainly do not want to be too difficult in this respect. The minister might be allowed to reply.


Hon. Martin P. O'Connell (Acting Minister of Manpower and Immigration):: Mr. Speaker, some comments I made recently indicated that by standard or orthodox measures the economy is at full potential when it is reaching for a 6 per cent real growth rate. I was pointing out that that was still an inadequate performance in the economy even though measured by those traditional terms it appears to be at full potential. I went on to indicate certain manpower policies-


Mr. Speaker:: Order, please. The reply given by the minister confirms my original interpretation that this kind of question and this kind of reply give rise to academic debates about theoretical situations based on statements made outside the House. That is not the kind of question and answer which we ought to accept procedurally during the question period.


Robert Lorne Stanfield: Mr. Speaker, I shall comply with your ruling and see if I can figure out some better way of getting at the minister's policies.


MANPOWER
David Lewis: Mr. Speaker, I should like to direct a question to the Acting Minister of Manpower and Immigration and I shall not tax his potential forecast. Was the minister's department informed of the intention of the International Paper Company to shut down its newsprint mill at Dalhousie, New Brunswick, for at least a week and possibly longer? Also, were there any discussions between the department and the management of the mill about the shutdown which will leave some 1,300 workers idle for some time?
Inquiries of the Ministry


Abram Ernest Epp: Mr. Speaker, I shall inquire and pass the information to the hon. gentleman.


David Lewis: May I ask a supplementary question of the Minister of Public Works who, if I am not mistaken, is also the representative for the riding in which Dalhousie is found.


Some hon. Members:: Order!


Mr. Speaker:: Order, please. That is information which ought not to be included in the question because a question can be asked of the minister only in his capacity as a member of the ministry.


David Lewis: May I ask the Minister of Public Works whether his attention was drawn some weeks ago to the likelihood of difficulties developing as a result of the ice in the port at Dalhousie? Also, did he take any steps to find the necessary icebreakers to open the port so that lay-offs of longshoremen as well as the lay-offs now contemplated at the mill would be avoided?


Hon. lean-Eudes Dube (Minister of Public Works):: Yes, Mr. Speaker. This matter was brought to my attention. I contacted the Minister of Transport at once and all available icebreakers are in the region-


Mr. Speaker:: Order, please.


AGRICULTURE
Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I have a question for the hon. Minister of Agriculture.
Since profitable production depends to a great extent on the volume of imports into Canada of certain farm products, and since Bill C-176 on marketing of farm products passed by Parliament in 1971 contains no provisions to influence or control imports of farm products into Canada, can the hon. minister tell us whether he intends to amend the legislation so that imported farm products may be channelled through provincial marketing boards in the same way as those produced locally?


Horace Andrew (Bud) Olson: Mr. Speaker, I stated a number of times that any commodity that is imported will, of course, be subjected to the same rules and regulations as domestic production and distribution. I should advise the hon. member, referring to his comment about export markets, that in 1971 we had an all-time high record of agricultural products exported from Canada.

March 20, 1972
Inquiries of the Ministry ROYAL CANADIAN MOUNTED POLICE


PROVISION OF OVERTIME PAY
Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, my question is for the Solicitor General. It is the hardy perennial regarding overtime pay for members of the Royal Canadian Mounted Police. Is the answer yes, is it no, or it it still maybe?


Jean-Pierre Goyer: This is still under consideration, Mr. Speaker.


CANADIAN BROADCASTING CORPORATION
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Secretary of State. I wish to ask the minister whether, during the labour difficulties involving NABET and the CBC, he has had any communication or consultation with the president of the CBC or his top officials pertaining to the strike and, in particular, whether he had anything to do with arranging the meeting that is to take place tomorrow, and whether the CBC is working within federal guidelines for the settlement of that dispute?


Gérard Pelletier: Mr. Speaker, I indicated on a number of occasions in the House that the initiative and responsibility for the negotiations between the CBC management and the union involved rest with management. As to the so-called summit meeting that will take place tomorrow, I should like to be able to take credit for it, but I must leave that credit to the management of the CBC, which initiated the meeting.


John Patrick (Pat) Nowlan: I am glad that credit is going where credit is due. Be that as it may, will the minister consult with the president of the CBC after the meeting and, hopefully, come into the House on Wednesday, or whenever he will be here next, and report on the status of this continuing stalemate and, in particular, give details of what the cost has been to date to the Canadian taxpayer as a result of this continuing labour dispute?


Gérard Pelletier: Mr. Speaker, the other day I answered a question on this subject. In fact, I indicated that the CBC was actively seeking to evaluate the cost of the difficulties that have been going on for two months there and that these figures will be made public as soon as they will be available.


DISPUTE WITH NABET-POSSIBLE LOSS OF AUDIENCES
Mr. Mark Rose (Fraser Valley West):: Mr. Speaker, I have a supplementary question for the Secretary of State. Is the minister aware whether or not the CBC, in estimating the possible cost of this labour dispute, is considering the possible loss of audiences by CBC stations all across the country when they were just beginning to bring people back?


Gérard Pelletier: Mr. Speaker, this is another question, I think. I do want to consider it but as first formulated it dealt only with the financial cost.


FINANCE
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, my question is for the Minister of Finance. As part of the price in 1968 Canada had to agree that a portion of its holdings of United States dollars in the foreign exchange fund would be in non-transferable or non-negotiable U.S. securities. Now that the foreign exchange holdings have reached a figure of well over $5 billion, would the minister advise what portion of that fund is held in non-transferable U.S. securities and give his estimate as to the position in which this puts the fund?


Mr. Speaker:: Order, please. I have serious doubts about the question. It appears to me in any event that the question is rather technical. The hon. member is asking for very detailed information which ought normally to be sought by way of question on the order paper. Of course, the hon. member and the Minister of Finance know many things that the Speaker does not know. Maybe this is the kind of information that is at the fingertip of both the minister and the hon. member for Edmonton West. If so, I will withdraw my objection.


Marcel Joseph Aimé Lambert: All joking aside, Mr. Speaker, this is one of the difficulties that faces the Canadian nation with regard to the present piling up of United States dollars. I am asking the minister a question that should have been apparent to him right away, unless he is not doing his job.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. I think the hon. member's additional comment tends to indicate that I was correct in my estimation.

March 20, 1972


AIR TRANSPORT
John George Diefenbaker: Mr. Speaker, my question is directed to the Minister of Justice. In order to discourage potential hijackers for gain, is the government giving consideration, among other things, to bringing in as part of the de-incentive, if I can use that expression, a provision whereby no airline will be permitted to pay ransom? Similar discussions are taking place today in the United States, and it would appear to be a very effective way of dealing with prospective hijackers.


Otto Emil Lang: Mr. Speaker, we certainly appreciate the right hon. member's expression of opinion. There is no immediate intention to introduce legislation along these lines. Of course, legislation dealing with the general subject is before the House at the present time.


Mr. Speaker:: The hon. member for Yorkton-Melville.


Robert Jardine McCleave: A supplementary question.


Mr. Speaker:: The Chair will recognize the hon. member for Halifax-East Hants in a moment. The hon. member for Yorkton-Melville has been waiting for a while to ask his question.


Robert Jardine McCleave: My question to the Minister of Justice is supplementary to the question asked by the right hon. member for Prince Albert. Will the government consider the introduction of an amendment when the latest omnibus bill dealing with changes to the Criminal Code is in committee that would bring about the change that the right hon. member for Prince Albert is suggesting?


Otto Emil Lang: Mr. Speaker, in mentioning the legislation my intention was to draw specifically to the attention of hon. members the fact that we could have a discussion about this matter at that time, either in the House or in committee, and give full consideration to it. I certainly welcome the apparent understanding of members opposite that it is important to stand strong against hijackers whenever threats for ransom are made.


AGRICULTURE
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is to the Minister of Agriculture. It is now several months since the Barber commission report on farm machinery was made public. In view of this, can the minister enlighten us as to what action he plans toward implementing some of its recommendations?


Horace Andrew (Bud) Olson: Mr. Speaker, I do not think a reply to a question would be the way to give a detailed account on that. A number of actions have
Inquiries of the Ministry
been taken with some success along the lines of some of the recommendations of Dr. Barber.


Lorne Edmund Nystrom: In view of the fact farm machinery prices have increased drastically since the report, is the minister considering a further inquiry into the rapid rise of these prices?


Horace Andrew (Bud) Olson: Not at the moment, Mr. Speaker.


OPPORTUNITIES FOR YOUTH PROGRAM-EXTENSION OF LIMITS FOR PROJECTS
Mr. Colin D. Gibson (Hamilton-Wentworth):: Mr. Speaker, I would like to put a question to the hon. Secretary of State.
Does the government intend to extend the application period under the Opportunities for Youth program?


Gérard Pelletier: Unfortunately not, Mr. Speaker.


Some hon. Members:: Hear, hear!


Colin David Gibson: Why not?


CONSUMER AFFAIRS
Mr. Cliff Downey (Battle River):: Mr. Speaker, my question is for the Minister of Consumer and Corporate Affairs. It arises out of the fact that once again fertilizer manufacturers in Canada are shipping their product to the United States at prices which enable it to be delivered by truck back from the Dakotas and Montana to the prairie region for some $20 a ton cheaper than western farmers can purchase it at the plant. Is the minister aware of this situation and, if so, can he give us some assurance that in future any Canadian distributor willing to purchase off-season fertilizer production will be quoted the same price as are buyers from other countries?


Hon. Robert K. Andras (Minister of Consumer and Corporate Affairs):: I appreciate the hon. member's representation. I will look into the matter and see what can be done.

March 20, 1972
Inquiries of the Ministry AGRICULTURE


BRUCELLOSIS TESTING OF CATTLE-ALLEGED LOSSES RESULTING FROM TIME OF TESTING-REQUEST FOR COMPENSATION
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I should like to ask the Minister of Agriculture whether he or his department has received representations requesting amendments to the current regulations governing the administration of the brucellosis testing of cattle carried out under the auspices of the Department of Agriculture, bearing in mind that abnormal losses of cattle have occurred attributable directly to the administration of these tests in the early spring just prior to calving?


Horace Andrew (Bud) Olson: No, Mr. Speaker, but I will look into the matter and see whether any representations have been made to my office or to the department.


Donald Frank Mazankowski: Would the minister give us some assurance to the effect that these representations will be considered and that provision will be made to reimburse farmers and ranchers for the loss of their cattle in these circumstances?


Horace Andrew (Bud) Olson: I can give an assurance that these representations will be considered.


MANPOWER
Robert Lorne Stanfield: Mr. Speaker, I wish to address a question to the Acting Minister of Manpower and Immigration who has expressed the opinion that the economy is at its potential, while adding that we must not be satisfied with the situation-I suppose that was a reference to the amount of unemployment which exists. I should like to ask the minister whether he proposes to announce any new policy to attack unemployment and, if so, when we may expect such an announcement?


Abram Ernest Epp: The two main direct employment programs which have already been brought forward to cope with this particular dilemma in the Canadian economy are the special employment program in the winter and the opportunities for youth program in the summer. These are examples of what I had in mind. Further programs are being prepared now.


CONSUMER AFFAIRS
Mr. Barry Mather (Surrey-White Rock):: Mr. Speaker, my question is directed to the Minister of Consumer and

Corporate Affairs. Can the minister tell us whether his department has concluded the inquiry which I understand it has been making into allegations by the Automobile Protective Association to the effect that certain imported cars are being marketed in Canada with their year of manufacture updated or misregistered? If the report has been completed, may I ask when it will be made public?


Robert Knight Andras: I appreciate the fact that the hon. member sent me notice of this question the other day. The report on our investigations has been completed. It will be released later this week. It recommends that federal and provincial authorities exercise firmer control over the updating practices used by some automobile manufacturers and distributors. Regulations under the federal Motor Vehicle Safety Act, in effect since January 1, 1971, require that the actual month and year of manufacture be marked on a compliance plate affixed to the automobile. One problem, of course, is that provincial governments have authority over the actual registration of automobiles.
My department will investigate any cases of alleged misleading advertising in the area of year-dating of imported automobiles. It will also notify the Minister of Transport of any suspected cases of tampering with the compliance plate that may come to our attention.


Mr. Speaker:: Orders of the day.


GOVERNMENT ORDERS
John Napier Turner: that Bill C-8 to authorize the making of certain fiscal payments to provinces, to authorize the entry into tax collection agreements with provinces, and to amend the Established Programs (Interim Arrangements) Act, be read the third time and do pass.


Mr. Speaker:: Is the House ready for the question? Shall the motion carry?


Some hon. Members:: Agreed.


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, have you called orders of the day?


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

Order, please. There seems to be some confusion. Is the hon. member rising to speak to the motion?
March 20, 1972


Joseph Adrien Henri Lambert: Mr. Speaker, I rise on a question of privilege.


Mr. Speaker:: Does the hon. member for Bellechasse rise on the order now before us, i.e. the motion for third reading of Bill C-8?


Joseph Adrien Henri Lambert: Yes, Mr. Speaker.


Mr. Speaker:: I believe there has been a misunderstanding. I do not think the hon. member for Bellechasse understood that we had proceeded to orders of the day. It might be unfair to the hon. member not to allow him to make his speech. Perhaps with the indulgence of the House I might be allowed to recognize the hon. member.


Some hon. Members:: Agreed.


Mr. Speaker:: I believe the hon. member should be allowed to make his speech. I was under the impression that he had not realized that we have reached the orders of the day, on the third reading of Bill C-8.
With permission of the House, the hon. member will be allowed to make his speech, after which the motion will be put. Does the House agree?


Some hon. Members:: Agreed.


Joseph Adrien Henri Lambert: Mr. Speaker, first I wish to apologize. I usually follow attentively the business of the House but at the call of the orders of the day, I was consulting my colleagues and just at that moment you called the order for third reading of the bill.
I do thank the Chair and all my colleagues for giving me this opportunity of making comments on third reading of Bill C-8.
This bill is to authorize equalization payments to provinces, out of the Consolidated Revenue Fund, for the period from April 1, 1972 to March 31, 1977 and also to amend the Established Programs (Interim Arrangements) Act.
Mr. Speaker, the Canadian confederation has existed since 1867. It was on that year that our constitution was drafted and it has been the subject of discussion ever since. All governments, whatever the parties in power, in Ottawa as well as in Quebec, have accused one another of violating The British North America Act and, in most cases, it had to do with sections dealing with sources of revenue. Yet the Confederation charter clearly established the powers, jurisdictions and responsibilities of the different levels of government.
Section 91 for instance defines the powers and responsibilities of the Canadian Parliament. I do not need to recall here section 91 as it has been often quoted in this House and all Canadians should know about the constitution of their own country.
Section 92 defines the exclusive powers of provincial legislatures and section 93 gives every province the power to legislate in matters of education.
Federal-Provincial Arrangements Act
I should like to deal briefly with this aspect of section 92 providing for certain responsibilities and certain powers in the case of provincial legislatures.
Since 1867, the central administration has always shown a tendency to increase centralization in various fields and this, whatever the party in power. This tendency is quite natural because the Canadian Parliament is responsible for the whole Canadian territory and since it sees the problems at the national level it is natural for the central government to interfere from time to time in provincial fields of jurisdiction.
This centralization increased in wartime and mainly during the 1939-45 war-the war of which like most members I have been more specially aware-while in the name of Christendom and civilization the central government took over some sources of revenue which belonged exclusively to the provinces and which were to be handed back at the end of the war.
However, the war is over even though no formal order has been signed to this effect; it seems that after 26 years the war should be officially over and we should enter a new phase.
Mr. Speaker, it has been repeated for a long time throughout the country that Quebec is not a province like the others. Quebec is different and even though the right hon. Louis St. Laurent, a former Prime Minister, once said that Quebec was no different from the other provinces, both the Canadian constitution and the Confederation charter recognized a marked difference to the effect that Quebec because of its special character and of its French culture is not like the other provinces. The Fathers of Confederation, at that time, clearly stated that difference by giving exclusive power to the provinces so that the people of Lower Canada could pursue their emancipation and live according to traditions and rights which had been recognized till then.
One will remember, Mr. Speaker, that at every federal-provincial conference, the former premier of the province of Quebec, the hon. Maurice Duplessis, suggested it was unconstitutional for the central government to levy taxes for purposes that do not come under its jurisdiction.
One will also remember that other premiers said the same thing afterwards regardless of their political affiliation, precisely to protect this aspect of the constitution and to have the rights of the province of Quebec respected.
One will also remember that Mr. Duplessis, by having the Quebec legislature pass legislation setting up provincial income tax took very positive action to assert in an unequivocal way the rights of the province of Quebec. That happened in the fifties. One will remember that at that time, a very serious conflict opposed the then premier of the province of Quebec and the right hon. Louis St. Laurent.
Hon. members will also remember the famous meeting between those two men in a Montreal hotel to discuss this problem and will recall that Mr. Duplessis won this constitutional battle when at that time the central government accepted to gradually give back to the province of Quebec its rights in the field of income tax.

March 20, 1972
Federal-Provincial Arrangements Act
Admittedly that prime minister of Quebec rendered great services not only to his province but also to the whole country because he awakened public opinion to the basic problem of provincial revenue sources.
The bill we are now discussing indeed provides for the distribution in all parts of this country, of amounts of money collected by the federal government to allow poorer provinces to benefit from certain revenues they require to meet their obligations and responsibilities.
Mr. Speaker, a provincial government wanted to take advantage of the right to borrow against its credit, as provided under section 92 which granted that right to the provinces. In 1935 and the following years, the Alberta premier carried on a famous fight to enable his province, on the basis of the right granted under section 92, to achieve its purposes. It will also be remembered that throughout that period, the Prime Minister of Canada, the right hon. Mackenzie King, had said referring to the struggle of the Alberta premier:
If Social Credit has an opportunity of showing its mettle, it is in Alberta. William Aberhart controls the province and if the Liberal party is re-elected, Mr. Aberhart will be free to put it into practice.
What happened? Later on, to explain his idea more specifically, Mr. Mackenzie King stated, at the opening of the 1935 election campaign:
The Liberal party believes that credit is a public matter which does not concern bankers alone, but that it is of direct concern to the common citizen. The Liberal party is in favour of setting up immediately a national bank well structured to control the issue of money in terms of public needs. Capital flow should be related to the domestic, social and industrial needs of the Canadian people.
In 1935, Mr. Mackenzie King stated that a social credit government having just been elected in Alberta, the Liberal party, in an effort to get back into power, would do its utmost to allow the constitution to be respected and the province to free itself and manage its own affairs.
I should like to quote today a sentence from his speech in order that we may determine whether Bill C-8 follows the guidelines set by the founding fathers in all areas.
Mr. Mackenzie King spoke as follows:
Once a nation loses control over its currency and its credit, it does not matter much who in that nation makes laws. Once in control, money lenders will ruin any country. As long as control over currency and credit has not been restored to the government and acknowledged as being its most obvious and most sacred responsibility, any talk of democracy and Parliament supremacy is vain and futile. If my party is re-elected, we will assert our monetary policy in the greatest battle between high finance and the people ever witnessed by Canada.
Subsequently, Mr. Speaker, Mr. Mackenzie King was elected by the Canadian people and had an opportunity of allowing the government of Alberta to take advantage of section 92 of our constitution.
This prompted Mr. Douglas, who devised credit at the service of the community, to state in a speech that he made on November 30, 1937, and I quote:
A war has broken out in the western provinces of Canada: Alberta is the first battlefield. Given the issues involved, this war, whatever its outcome-and I believe with all my heart that we shall be victorious-carries implications reaching far beyond those of the war of 1914-18 or any other major conflict in history.
[Mr. Lambert (Bellechasse).J
It has become easy for the least shrewd of observers to see that in Canada as elsewhere in Britain or the United States, so-called democratic governments are one-way streets. In other words, the bodies that we call governments have a right to exist, to be adorned with the emblems of power, up borne by wealth, supported or accepted by the press inasmuch as they put their power first to the service of international financial interests-
A mere glance at history reveals that the right hon. Mackenzie King, despite his promises, was devoted to international finance since he used legislation to prevent the province of Alberta from using its credit to its own benefit.
And two economists were invited to step in. They were Messrs. Powell and Byrne. We remember that these two men were prosecuted and jailed for having supported a thesis contrary to the one then recognized, in order to enable Alberta to enjoy its own credit. In fact, one of them said:
This was real work of a democratic government. But the federal government, with financiers behind it, responded immediately. Less than one week after adoption of the three acts, there rose a storm which was unprecedented in the political history of the Dominion and the Prime Minister, the right hon. Mackenzie King, disavowed the three acts-
Mr. Speaker, I find it odd that hon. members are now accused of supporting theses or philosophies which do not make sense. The great leader, the god of the Liberals for years, did indeed support the theory that we are now advocating-that the credit of a nation should be at the service of this nation and minted by institutions belonging to this nation.
And if we refer to the answer given last week to a question appearing on the order paper, in which I asked information on several federal loans granted the province of Quebec over the last twelve months, we see that the loans, amounting to $65,900,000, carry an average interest rate of 7.4 per cent and are refundable over a period of 20 years. This money is available through taxes levied on the Canadian taxpayers.
I had a bank accountant make a calculation over the weekend in order to know the amount of interest the province of Quebec will have to pay, besides refunding the principal, and I got the figure of $97 million. In other words the province of Quebec will in turn have to tax Quebecers in order to get that amount of $97 million and pay interest to the federal government, although that government is empowered to provide the necessary credit to the nation through the Bank of Canada.
People find it funny when we speak about the Bank of Canada. They say that Creditistes think only in terms of the Bank of Canada and see in it the ultimate solution to all problems. Mr. Speaker, we are not providing a solution to all problems, but to those that must be solved by financial means. And hon. members will recall that in 1969, the Chamber of Commerce of the province of Quebec presented a brief to the federal government recommending the use of the Bank of Canada to help financing the public sector by means of loans to the provinces. In turn, the provinces could grant loans to the public bodies coming under their jurisdiction, that is the municipalities and school boards.
Mr. Speaker, people everywhere discuss financial questions, not only the Creditistes. However, I admit that we
March 20, 1972

are throwing more light over the matter than the other parties and, besides, that we do not stop there. People will sometimes say: Only the poor people support the Social Credit party. In fact, our supporters are not solely the poor people, but poor people who understand most readily since somebody who is made to understand through his wallet is liable to keep his ears wide open.
It is a long time since people have been suffering from insufficient incomes. Despite every and all government assistance programs, commissions and committees are being formed to inquire into the economic situation in Canada and submit reports. The Economic Council of Canada as well as the special Senate committee on poverty have tabled their reports in which they state that there is inequity in terms of distribution of wealth. If such inequity exists, the problem cannot be solved by hiding it, but by coming out into the open.
This is why I refer to those loans Quebec has obtained. I do not object to Quebec obtaining assistance, on the contrary. But if, instead of borrowing money to lend afterwards and hasten the process of in debtedness, we would use the services of the Bank of Canada to finance the public sector, to cash in on our credit in order to enjoy the outcome of our labor and that of all Canadians, then we would have been of service to the people at large.
Mr. Speaker, Quebec will have reimbursed in 20 years, $97 million in interests, excluding the initial loan of $65,900,000, making a total of $163 million. This is a deadend situation. I am mentioning this example just to emphasize that if Bill C-8 might improve the situation, it does not deal with the heart of the matter. I appreciate these are provisionnal arrangements concluded for a limited period of time. I know all that, but the fact remains, however, that while we will be living through these temporary arrangements for five years, we should strive in this House to devise the effective means that are conducive to the development of all regions of the country.
There are now three provinces which are not entitled to equalization payments. Those three provinces have to give money to the others to contribute to their development. I understand that we live in a confederative system and that the federal government has a responsibility to distribute as equitably as possible the nation's wealth. But there can be differences of opinion on the means to an end, and I think that if we established as soon as possible an income security system, each Canadian citizen would be assured of a minimum income, which would allow provinces to levy taxes from their citizens and to administer themselves under their own powers.
This is how I see things, and for this reason I wanted to make my views known so that everybody would realize that we are in good faith, just as much as any other member, when we discuss those problems. Only, we want the population to be as well-informed as possible.
Mr. Speaker, we could of course go into a lengthy discussion on education, but we have to recognize that until we change the constitution, the provinces have jurisdiction in this matter. So let us leave to them their sources of revenue in order that they may carry out their responsibilities. If the federal government needs more money to govern Canada efficiently, plain common sense dictates
Federal-Provincial Arrangements Act
that the solution we are proposing, which is certainly not perfect but is just as valid as any other, be considered.


Mr. Speaker:: By unanimous consent the hon. member has been allowed to make his contribution, although the question had already been put. In order to follow the proper order, the question will be put again. It is moved by the Minister of Finance (Mr. Turner) that Bill C-8, to authorize the making of certain fiscal payments to provinces, to authorize the entry into tax collection agreements with provinces, and to amend the established programs (Interim Arrangements) Act, be read a third time.
Is it the pleasure of the House to adopt the said motion? Motion agreed to and bill read the third time and passed.


INCOME TAX ACT
John Napier Turner: that Bill C-169, to amend the Income Tax Act, be read the second time and referred to Committee of the Whole.


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


Marcel Joseph Aimé Lambert: I rise on a point of order, Mr. Speaker. This motion, in its terms, is similar to or as a matter of fact identical with, one that was placed on the order paper in December of 1971 following the so-called mini-budget presented by the Minister of Finance on the night of October 14 during the adjournment proceedings of the House under Standing Order 26. There were two Notices of Motions of Ways and Means put forward on October 17. One only was proceeded with. The one presently before us appeared in Votes and Proceedings under date of February 22. Incidentally, and strangely enough, the entry under Votes and Proceedings does not indicate what type of motion or through which part the minister was trying to present the motion to the House. There was no indication whether it was being done under Standing Order 60 (1) or 41(2).
I notice, however, that in Hansard the appropriate wording has been put in the minister's mouth. The first point I wish to make is that the notice in Votes and Proceedings should be corrected. This was not done. Secondly, I would put to you that this is the first time we have had this sort of recurrence from one session of Parliament to another of a budgetary provision. I say "budgetary provision" in that it is a tax measure. There had been no prior consideration of this point because the new rules did not come in until prior to the 1970 session. So, we are in a position of de nova.
I want to ask Your Honour and all members, whether this method of proceeding was contemplated by the House when it adopted Standing Order 60. I suggest to you, Mr. Speaker, that this is an area which you have so felicitously described as one of those to which the committee on procedure should turn its attention. I would say

March 20, 1972
Income Tax Act
that upon a straight-forward reading of Standing Order 60(1) the Minister of Finance may introduce any and every tax change he may wish to bring in, whether it is to the Income Tax Act, whether it is to the Excise Tax Act, whether it is to the Customs Tariff or otherwise, and whether it is an increase or decrease.
Under Standing Order 60 (3), it is not obligatory for the Minister of Finance at any time to bring in a budget presentation. It is only in Standing Order 60 (3) that we get this reference to the budgetary presentation. Subject to political risk, there is no other provision in this House or in the statutes or regulations which binds the minister to bring in a budget. Yet resort now is being made to a Standing Order, or to a paragraph in the Standing Orders, which allows the minister to bring in any and every tax change he so desires. That is not what was in the contemplation of the committee and it is not what was contemplated by the House, I put to you, Sir. I will agree there is a political danger in not bringing in a budget and not having, shall we say, a financial report to the House and to the nation. Actually, I believe there was a mix-up in the sequence of the paragraphs in Standing Order 60. There was obviously discussion at the time and I confess I was a member of that committee. This point did not occur to me at that time, however, nor to the others but it certainly does now and I want to raise it so that we might reconsider it.
It was always thought by the committee and the House that our previous procedure was cumbersome in that we had a budgetary presentation, the Minister of Finance then tabled notices of motion with regard to the budgetary changes. There was then a resolution in committee of the whole with regard to each of the said motions. Then, we had a bill; there was second reading and then in the committee of the whole stage the bill was considered clause by clause. Finally, there was third reading. This was adjudged to be very cumbersome. Since the motions that were tabled by the Minister of Finance at the time of the budgetary presentation were discussed during the budget debate, these represented in part the subject matter of the budget debate. They receive full discussion. They were the budgetary proposals.
If one reads the wording of paragraph 60 (3), the House is asked to give general approval to the budgetary proposals. It was then determined that it would not be necessary to go through the preliminaries of the recommendation which was the usual prior practice. It was foreseen that the minister would merely lay on the table a Notice of Ways and Means Motion in accordance with what he proposed in the budget. But now, as I have said, there is no requirement for a budget and we have come to this procedure. It is wrong in spirit. But we are not on a budgetary proposal today. This means that the Minister of Finance is able to raise his taxes up or down without any budgetary accounting. There is no need for a budget aside from, as I said, the political risk. I repeat that this is quite wrong.
The third point I want to make relates to the carry over from one session of parliament to another of a tax measure that has been proposed in the former session. Let us consider what might happen if one interprets this rule in

this way. Suppose this tax measure were not proceeded with at this time and that there should intervene an election-and God forbid the same administration would be elected, particularly this one-the first thing that the new parliament could be faced with, without notice, could be the notice of ways and means motion that had been presented by the previous administration, without any accounting whatsoever. I say this is wrong, Mr. Speaker. This is not a hypothetical case, it is a true and very regrettable fact that the framing of Standing Order 60 in its present terms failed to take into account this possibility. While I will agree that one does not require the intermediate steps for all other motions that may be presented following the presentation of a budget, it certainly is not within the contemplation of this House, and never was, that tax measures should be dropped straight out of the blue on to the order paper and presented that way without the recommendation of His Excellency.


John Napier Turner: Mr. Speaker, as I understand the hon. member for Edmonton West (Mr. Lambert), his point of order really does not go to the admissibility of the present bill but is an invitation to the House through you, Sir, and to the appropriate committee to re-examine Standing Order 60. I submit to Your Honour the hon. member has admitted that it is possible to bring in a bill affecting the ways and means of the House and of the country without going through the formality of a budget. It is clear that Standing Order 60 (1) applies to a notice of ways and means in general terms and that Standing Order 60 (3) refers to a special type of order affecting ways and means, namely an order designated for the purpose of enabling a minister of the Crown to make a budget presentation in other words, a general notice of motion is contemplated under ways and means and in addition a special type of such motion called a budgetary presentation. So, I think the hon. member has conceded that it is possible to bring in the tax bill affecting ways and means whether or not it is preceded by a budget, subject of course to what he has recognized as the necessary political considerations and the necessary accounting aspects via a minister of finance through the House to the people of the country.
This bill follows upon a statement made last October 14 by the then minister of finance during the course of an opposition day which set forth a declaration of a cut in corporate income tax of 7 per cent and a cut in personal income tax of 3 per cent, both of those cuts to apply from July 1, 1971 to December 31, 1972. The first part of those cuts was implemented by this parliament in the last session under Bill C-275 which received royal sanction on December 23. That bill authorized the cuts until the end of the 1971 calendar year. This bill extends those same cuts, already announced by the minister of finance last October 14, to the end of the year 1972. In other words, the minister of finance of the day announced the cuts. They had to be authorized by legislation, and that is the purpose of the bill before the House. The country has received adequate notice of these cuts, and I assume that the accounting procedures of the Department of National Revenue are being made in anticipation of it.
I will say no more except to say that a re-examination of Standing Order 60 may be something for the House to
March 20, 1972

consider in due course, but in the terms of the present bill there is nothing in Standing Order 60 to impede its progress.


Marcel Joseph Aimé Lambert: Mr. Speaker-


Mr. Speaker:: The hon. member has already spoken on the point of order. We could go on for a long time if the hon. member for Edmonton West were to reply to the minister. I believe the hon. member for Winnipeg North Centre wishes to contribute to the procedural argument.


Mr. Knowles (Winnipeg North Centre):: Thank you, Mr. Speaker. I shall speak very briefly on the point. I think it is salutary for a member like the hon. member for Edmonton West to raise the point every once in a while- and I have heard him raise it before-that advantage should not be taken of the rules to the extent of bringing in budgetary changes very often without a budget presentation. I believe that is the point he was trying to make. He underlined the point, of course, that it would be politically rather stupid for a government to go any length of time without a budget presentation. I must, however, say to my good friend who sits close to me that I do not share the same anxiety that he has expressed about Standing Order 60.
I ask you, Sir, and I ask him to look at this. Standing Order 60 is made up of 11 different paragraphs. I ask you also to note that Standing Order 61, which has only one paragraph, also relates to the question of ways and means. I admit that I am playing a little numbers game here, but let me do it. This means that there are 12 items or paragraphs in the rule book regarding ways and means, 11 paragraphs of Standing Order 60 plus the one paragraph that makes up Standing Order 61. Of those 12 paragraphs, one, namely Standing Order 60 (2), is general in nature in that it provides for the designation of an order of the day for considering a ways and means motion. The other 11 fall this way: two of them, Standing Order 60 (1) and Standing Order 60 (11) under which it is possible for a minister of finance to make a tax change without a budget presentation, and the other nine; in other words, the other eight paragraphs as well as Standing Order 61, relate to the machinery for a budget presentation.
So I suggest to you, Sir, that if we drew 12 paragraphs having to do with ways and means and we applied nine of them to the process that involves a budget presentation- the speech and the six day debate-we made it pretty clear that that is what we expect to be the normal practice. I suggest that if any government went any length of time trying to rely on Standing Order 60 (1) and (11) to avoid a budget speech, the government would lose all the time it gained by the time the point of order was debated.
As I already said, I think that this is a useful viewpoint to be raised. Governments have to be reminded of what they ought to do. But I do not think that Standing Order 60 and Standing Order 61 are all that deficient. They make it possible for a change such as is proposed today to be undertaken without a six day budget debate, but the rules make it pretty clear that it is the intention of parlia-
Income Tax Act
ment that at least once a year there will be a full dress six-day debate on a budget presentation.


Mr. Speaker:: Order. I do not think the hon. members would want me to go into detailed references on the interesting point of order raised by the hon. member for Edmonton West (Mr. Lambert). The point he is making, I think, has been explained, and is supported to some extent by the hon. member for Winnipeg North Centre (Mr. Knowles).
While the hon. member for Edmonton West was speaking, there was a thought going through my mind that perhaps he was not entirely right when he suggested that under the old rules there was a procedural requirement that there be a budget presentation. According to the advice or information that I have, there has never been such a requirement in the rules. There has been a practice, under the old rules, that there be a budget presentation, but there was nothing in the Standing Orders, as they existed then, requiring that a budget presentation be made.
With respect to the hon. member's suggestion that it is a new procedure to have a ways and means bill which is based on a presentation of a budget in a previous session, it has been brought to my attention that perhaps this has been done before, more particularly in the year 1962, where the index has a reference to a budget resolution passed in a previous session. This, in itself, is an indication that even in the year 1962 this procedure was followed. It has also been brought to my attention that there was a ruling by then Mr. Speaker Lambert, which is reported at page 133 of the Journals for 1962, regarding whether or not ways and means legislation should be preceded by a budget presentation. I am sure the hon. member remembers the circumstances very well.
The only motion under the old rules was one to the effect that Mr. Speaker do leave the Chair. On those occasions, no one knew whether or not there would be a budget presentation. That was the point which the hon. member for Edmonton West, in his then capacity as Speaker of the House, made.


John Napier Turner: It is a very good precedent.


Mr. Speaker:: He was perfectly right, and I agree with him.


Marcel Joseph Aimé Lambert: But there is a great distinction.


Mr. Speaker:: Order, please.


Marcel Joseph Aimé Lambert: There is a very great distinction.


Mr. Speaker:: I do not want to get involved in debate with the hon. member. I agree with the ruling which he made at that time, and I say that although the rules have been changed since then the principle continues the same, and there is still no procedural requirement for a budget presentation. There was no procedural requirement then for a bill implementing the ways and means resolution to be based on a budget presentation.

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Income Tax Act
I appreciate the point made by the hon. member for Edmonton West. It is the kind of difficulty which perhaps results from the drafting of the new rules as they are before us now. The hon. member for Edmonton West, and his distinguished colleague, the hon. member for Winnipeg North Centre, are leading members of the committee on procedure, and they do from time to time consider some of these difficulties. This is one of the difficulties which they might like to look into some day.
Having said this, I would think that I would have to rule that the bill is now before us correctly from a procedural standpoint.


Marcel Joseph Aimé Lambert: I never queried that.


Hon. P. M. Mahoney (Minister oi State):: Mr. Speaker, this second reading speech has perhaps become somewhat redundant in view of the point of order. However, I think it would be well to summarize the reasons we are dealing with Bill C-169 today.
This bill completes the implementation of the following measures which were announced by the former minister of finance on October 14, 1971: a 7 per cent reduction in corporation income tax for the period from July 1,1971, to December 31, 1972 and a 3 per cent reduction in individual income tax for the same period.
The reductions in tax for the last half of 1971 were implemented during the last session by Bill C-275, which received Royal Assent on December 23, 1971. The present bill implements the reductions for 1972. The reason it was necessary to split the particular budgetary presentation was that at that time we were going through a major tax reform bill, and Bill C-275, if I can use less than precise language, amended the old Income Tax Act that was in effect until December 31 last year.
The major tax reform bill that was before the House last year, Bill C-259, effected numerous changes in the income tax law, including a major re-organization of the act and a major renumbering of sections, so it was necessary that that bill be passed or dealt with by parliament before a further amending bill, covering these tax reductions for the current calendar year, was introduced. Accordingly, what would normally have been presented in one bill was necessarily split into two.
The 7 per cent corporate tax reduction has been designed to give Canadian corporations greater flexibility in responding to the challenges that have confronted them in recent months, and to encourage them to contribute to a sustained growth in job opportunities. It will help their competitive positions in both domestic and international markets.
The 3 per cent individual tax reduction will also provide an important stimulus to the private sector by sustaining and encouraging increased demand for goods and services.
These measures have already contributed in an important way, along with other expansionary measures inaugurated by the government during the past two years, to the present accelerating improvement in the performance of our economy.
As stated by the Minister of Finance on October 14, 1971, it is estimated that the corporate tax cut will reduce

federal revenues by $160 million for the fiscal year 1971-72 and $175 million for the fiscal year 1972-73. The cut in personal taxes is expected to reduce federal revenues by $125 million in the fiscal year 1971-72, and by $225 million in the fiscal year 1972-73.


Marcel Joseph Aimé Lambert: Mr. Speaker, I trust this will not be deemed a comparison of oranges and apples. As I said earlier, we are dealing with a bill arising out of a motion originally presented by the then minister of finance on October 14, 1971.
As the Leader of the Opposition (Mr. Stanfield) indicated during the course of the debate on that occasion, after listening to the great applause that emanated from the government benches in response to the speech by the minister of finance, greeting it as though he were announcing something entirely new and fine, as though he were the Savior coming to the rescue of Canada, one was reminded of the very loud applause that had accompanied his disclosures in his June budget. His October 14 measures in effect were a frank and, I would say, humbling admission that he was totally wrong in June.
So, we had this rather interesting spectacle of a claque applauding any statement by the minister, even one saying in effect, "In June I was an ass; now, I am going to try to take myself out of the mess into which I got the country at that time." As a matter of fact, there could have been further proposals by the new Minister of Finance, setting aside the proposals put forward by his predecessor in October, in many ways contradicting the October proposals, and we could have had the same claque applauding from the government side. I would say that argument endorses my contention that the House rule, as it now stands, is wrong in philosophy.


An hon. Member:: Right!


Marcel Joseph Aimé Lambert: Without reference to it in the presentation, the Minister of Finance tables a notice regarding a tax increase or tax cut; he does not proceed with it and he gets the chop for too severe postures. This has happened before, it can happen again and likely it did in this case. The pressure was relieved by putting a new man at the helm. I can see the strategy of the Prime Minister (Mr. Trudeau) and time tends to block memories.
If one were to ask members of this House, and certainly members of the press, what the circumstances were behind this particular change in the Income Tax Act, most of them would have no answer. They would have to go scurrying back to the record, but they would never get the atmosphere in the House. The presentation of this motion today and of the bill is totally anti-climatic. It is there; what are we going to do about it? That is precisely what we intend to say; what is there to get so excited about? A tax cut of 3 per cent is being applied to personal income in the 1972 tax year. That is what is going to happen now. For those people with low income who pay no tax, this is no cut at all, but it certainly has some effect on those people at the middle income level.
What is the purpose of it? Is it to regenerate expenditures from the people at the middle income level? I have not noticed that there is such a glut of commodities. There
March 20, 1972

has been an underutilization of certain types of service, and certain commodities, but this tax cut will not provide that meaningful shot in the arm for Canadian industry.
Let us look at the taxpayer and his personal income. Certainly, he buys Canadian services and to the extent that he increases his purchase of imports, we bring in more imports. How much does that stimulate the Canadian economy? How does that necessarily cure the economic recession in the United States from which we get two-thirds of our imports? How does that help them? Our imports represent a small portion of their total economy, but they buy two-thirds of our exports; they gain. Our exports do not represent two-thirds of their requirements. They loom large for us, but, mean very little to them.
The total effect of this personal income tax cut is a very small shot in the arm but everybody will welcome it. The provinces are not going to be affected by it because the then minister of finance indicated that the federal treasury would absorb it entirely. I would refer hon. members to page 8690 of last year's Hansard.
I believe, Mr. Speaker, this proposal of a cut of 3 per cent of the tax payable again points up the difficulties of having an income tax system set up on the basis of an across the board personal exemption. I think the Minister of Finance would have preferred to give tax relief to lower income groups since they represent the greater number of taxpayers in Canada. To the old age pensioner, to the person who makes insufficient money to pay income tax, and there are many, this tax cut is meaningless. Unfortunately, however, the old age pensioner and the low wage earner are caught by inflation in the same wav that the person earning $25,000, $35,000 or $15,000 a year is caught. The increase in the price of food, the increase in the level of rents, of laundry, of this and that applies just as much to the old age pensioner and the low income earner to the extent that they make those purchases. Since they have to concentrate on food, shelter and clothing, they have all been hit hard by inflation.
I think it is callous and cold-hearted to say that our inflation, at 5 per cent or perhaps not 5 per cent, was lower than in any other country in the western world. What does that mean as far as the Canadian taxpayer is concerned? What comfort is it to him that, say, Holland, has 8 per cent inflation or that it went to 10 per cent in Great Britain? The point is that the person on a low fixed income, such as many retired people, is not affected by that change in that foreign country. It is what happens right here in Canada that affects him. That 5 per cent sounds very good but with the cost of living index now in the mid-130's it means 6j points. In other words, the 1961 dollar has depreciated by some 37 J points. The percentage depends upon whether you are at the upper or lower end of the scale; the higher the cost of living index goes the lower is the percentage and that looks good.
Information Canada can do jobs for Statistics Canada. I wish Statistics Canada would "level" with the people. Instead of using percentage points to indicate the cost of living, it refers to just so many points. One time you see an apple being juggled and the next time you see an orange being juggled by whoever wants to play with them when dealing with percentages as they relate to the cost of living. It would have been far preferable to have had a tax
Income Tax Act
credit system. The whole system could have been much more flexible and tax cuts could have been made where they would have been more meaningful in giving tax relief.
Let me turn to the corporate tax credit. Frankly, anyone who is incorporated, whether he is a small plasterer, paperhanger, painter, truckdriver or cement finisher, is involved in corporate income tax. It is not the big companies exclusively that are affected, but anyone with the letters "Ltd." after the name of his business. There will be a 7 per cent cut on the 1972 income tax payable. I do not think that is sufficient to be meaningful.
I do not think an 18 month tax cut for incorporated businesses is a sufficient stimulus for them to enter into long-range programs. For many people, it effectively provides walking-around money. It is a small measure, not sufficient to provide the necessary initiative or incentive to enter into an expansionary program. Why should it be? The government talks about how many millions of dollars it is going to cost, but it will only last 18 months. In many instances, programs must be of a longer term.
After January 1, 1973, corporations will again be in business at the old tax levels. I think it is absolutely fool-hardy to ask any business to enter into a program of activity. Should they purchase additional inventory, instal new machinery which will have to be paid for over a longer period of time or expand their premises, something which will also have to be paid for over a longer period of time? Should they hire new workers when they will have to fire them in 1973? As I said, on January 1, 1973 we will be back at the pre-cut tax levels. What happens? Perhaps, we will be exhorted to get down on our knees and pray for some miracle to happen, always hoping that we will get over the election. You can bet your bottom dollar we will have an election before January 1, 1973. This is a clear indicator that we will have an election before January 1, 1973. After January 1, we go back to the upper levels of tax.
As I said before, it is anticlimatic to discuss these proposals. This tax cut by the government is not sufficient to promote a really meaningful stimulus. After all, if one looks at the experience in Great Britain in the past two years, he would see they have injected two modest taxcuts into the economy, but they have not had the necessary effect. This week we read that the Chancellor of the Exchequer is likely to introduce some very extensive tax cuts. It may be a question of judgment, but the British Government is the best judge. I am not going to judge and I am not going to put the question. Perhaps it would have been better if they had brought in massive tax cuts at the beginning to get the economy going. At the moment, the treasury has been bled and nothing of consequence has been done. One has to go back on these matters. The effort has to be redoubled every time, even though nothing has been gained. I do not think that is the way one has to work to expand an economy.
As far as we in the official opposition are concerned, we are not going to oppose these measures. They are fine as far as they go. I think they were a humiliating admission, in the light of all those things that had been done in the

March 20, 1972
Income Tax Act
June budget and all those restrictions that had been proposed before that. Just a few months previous, the government had been imposing a surtax. In fact, this proposal represents an absolute condemnation of earlier acting out of the mouth of the ministry. A year before, the surtax had been added because it was needed. In June, it was dropped. The minister had this to say:
This change, combined with the elimination of the 3 per cent surtax, brings the effective reduction of corporation taxes from last July 1 to 10 per cent.
Isn't that setting up a beautiful Aunt Sally for nothing? In December, 1970, it was absolutely paramount to come in with a last minute budget to continue the dying 3 per cent surtax. Then, with a great fanfare, the surtax was removed in July, 1971. Why had it been put on in the first place? The economy was suffering just as much in December, 1970 when it was imposed. It was done so that the government could say "Well, we have now taken off a further 3 per cent; what good boys we are. We have taken 6 per cent off the tax payable on personal income tax since July 1." When you look at the June budget statement of the former Minister of Finance, it is replete with all the good things the government has done and how the economy is expanding. No wonder they had to make a change in the portfolio of the Minister of Finance. The former minister had lost any and all credibility as a result of the statements he made in October. Now, the present Minister of Finance (Mr. Turner) has to take charge of implementing this tax cut.
I am very interested in knowing when we are going to get the next budget presentation. Will it be before the Prime Minister (Mr. Trudeau) calls upon His Excellency? Are we going to get a budget presentation so that we will know that the budgetary deficit, as far as I can see at the moment, will be about $1,200 million this year? Are we going to get an explanation of that? We must remember that it is the Canadian taxpayer who has to pay every blessed cent of those expenditures, which this year are up to $18 billion. They wonder why the Canadian economy is suffering and creaking. In many instances it is not worth the candle to go off and do anything, because the tax will be so high. You will lose whatever you have made to somebody else, to somebody standing with a handout. The philosophy of the government has been to encourage the Canadian people to line up to receive handouts.
One hears people say the government should do this, the government should do that, the government should pay this, the government should pay that. How is this money raised except through taxation, taxation today and taxation tomorrow? All the more unjust is the taxation of those who have put money aside and saved it in various ways, for example, by joining pension plans. One has only to look at the Canada Pension Plan in the light of the increase in the cost of living to judge whether that plan is as good today, as it was when it was instituted. It is true that small increases to reflect the cost of living are embodied in escalator clauses. Benefits have increased. But the contributions payable have increased still more.
The same thing has happened with unemployment insurance. Benefits are increased. But the contributions go up, too. What happens when employers try to hire

people? Why should people work? The difference between wages paid on so many jobs and the amount they can get from other sources is marginal.


Mr. Bechard:: Surely, the hon. member is not serious when he says that.


Marcel Joseph Aimé Lambert: The hon. member says this is not serious. Let him come to my home city of Edmonton and I will show him.


Albert Béchard: I was suggesting the hon. member was not serious in saying such a thing.


Marcel Joseph Aimé Lambert: Serious? Ask any entrepreneur, ask anyone in the trucking business or in warehousing. They will tell you: try to get men nowadays. In so many instances, the Department of Manpower tells people to go and collect unemployment insurance benefits. I have personally heard men say: Why should we put ourselves in jeopardy by placing ourselves in jobs which will pay $150 and have to work-


Albert Béchard: Is that the advice you give them?


Marcel Joseph Aimé Lambert: That is the wrong kind of advice.


Albert Béchard: That is why I say the hon. member is not serious.


Marcel Joseph Aimé Lambert: I say this is the sort of mentality which the government is building up all the way through. This is the reason the Canadian economy is not doing well. People have forgotten how to work. Unless we do something to increase our productivity rate and reduce cost of production per unit, we shall find our overseas markets decreasing sharply as the days go by.
The parliamentary secretary knows the situation in the pulp and paper industry. As a result of the increase in the cost of production which, for a multiplicity of reasons, has taken place, many of our markets have been lost. It has meant that along with the effect of the floating dollar, we are simply outbid. It looks good to pile our goods in warehouses and congratulate ourselves on our ability to manufacture all these things. But it is the price that matters. Every year, sales decline. How many pulp or paper mills have been forced to close down or continue on a greatly reduced scale?
Look at the state of our heavy chemical industry, another example. Unless we can sell these commodities and services we are going through an exercise in frustration; we are raking leaves, and there is no government program, no form of baling out, which will do the country any real good until we make up our minds to counter inflation by reducing the unit cost of production, and become more competitive. Unless we do this, we are simply fooling ourselves.
I want to see tax changes which will provide a meaningful incentive to bring about an increase in production at lower cost in order that we may become more competitive. As Canadian productivity increases, we shall need to place less reliance on imports. Attention is called to great increases in Canadian exports at the present time. But consider the statistics relating to imports. Imports are
March 20, 1972

increasing at a faster rate. Incidentally, I have not heard so much crowing about last year's performance in the export market. It is a tough world we live in. All too often we see some little glimmer of light, a little wee candle somewhere on the horizon, and somebody suddenly blows it up into a great, powerful searchlight totally out of proportion to what is should be.
I hope hon. members will make their contributions to the debate today or during the committee stage. This bill, now embodying in legislative form a proposal which was discussed at great length back in October, at which time its deficiencies were well established, has now been before us for a long time and it would be anti-climactic to keep on arguing about it. Some people will find it of benefit. People who are non-taxable will not. I doubt very much whether the effect of the tax cuts will be of very great value to industry and the services. In total, the cuts are there, of course, but they become dispersed and, unfortunately, they cease on January 1, 1973.


Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, the tax bill which is before us this afternoon is essential to the effectiveness of the measure we passed just before Christmas in relation to the same fiscal year. With the consistency for which the government is well noted, evidence is given of the same approach to economic planning both from the point of view of financial justice and from the point of view of monetary tax incentives intended to provide employment.
I wish to avoid further rhetoric and to deal, in terms of substance, with the assertions I have made in my comments up to this point. I shall be relatively brief, because I intend to speak again during the committee stage, at which time I shall be proposing an amendment.
The tax cut on personal income, will have the effect of reducing tax revenue to the government by about $225 million. It is hard to imagine a more unjust way of distributing economic benefits to the committee than an across the board tax reduction of 3 per cent in the personal income tax field. I suppose that if a more unjust way could have been found the present government would have discovered it, so I think it is reasonable to conclude that this is the worst possible method the government could come up with.
For example, consider the effects of this tax cut on a married man with two children in the $4,000 income category; in other words, someone living at the poverty level in Canada. It means that he will save $2.19. A man earning $5,000 a year, again with two dependent children, will be able to save a grand total of $9.06. Spread over the course of a year this means that he will probably save enough to buy an ice cream cone every week. If a person were in the high income category of $6,000 a year, with the same number of dependants he would save a grand total of $16.59. This is what we get from a magnanimous government, a government led by the Prime Minister (Mr. Trudeau) who a couple of weeks ago in Victoriaville, Quebec, stated that we were moving to a new age of leisure and should not be too concerned about unemployment; that since a whole new ethic was emerging we should be more
Income Tax Act
concerned to establish other kinds ol creative outlets for our people.
The fact is, of course, that some 20 per cent of the population are living at or below the poverty line in Canada; that for each job available in Canada there are roughly 17 people to pursue it. This kind of nonsense coming from the Prime Minister is something that is, to anyone with the remotest degree of sensitivity, at least displeasurable, if I may understate it somewhat. If our quaint Prime Minister wanted to do something to help people at that income level, those living at or below the poverty line, it seems to me that the tax cut measure before the House should have been changed substantially so as to provide, on the ground of equity, some real benefit for those in the low income category, forgetting entirely the provision of any tax benefit for upper income Canadians. The government should make sure that all the gains are made at the bottom end of the income ladder.
Keeping in mind that as a result of this bill the $4,000 income earner with two dependants will save $2.19, a man earning $20,000 will save $164.58. A man earning $50,000 a year, the man who most likely will be a contributor to and supporter of the Liberal party of Canada, will save $620.75.


Mr. Whelan:: You mean, people like Pierre Berton? He supports your group and gets $100,000 a year for doing nothing.


John Edward Broadbent: The hon. member for Windsor obviously has a profound contribution to make. Would he like to say a few words?


Mr. Deputy Speaker:: Order, please. The hon. member would have to be in his own seat. The hon. member for Oshawa-Whitby has the floor.


John Edward Broadbent: If I may continue, Mr. Speaker, what about the poor individual who is ekeing out an existence on $100,000 a year, a man again very dear to the heart of the Liberal government? He will save under this tax proposal $1,515.39. He is the sort of man who attends $100 a plate dinners given by the Liberal party. I am not being frivolous, but the fact is that under these tax proposals a man living at the poverty level will save $2.19 whereas a man who is virtually in the millionaire category will save $1,515.39.
It requires no economic genius to do the kind of statistical breakdown that I have done here. This is the kind of maldistribution of tax benefit that you invariably get when you have an across the board tax reduction, in this case of 3 per cent. Inevitably with a fixed deduction across the board the rich or upper income groups will be more advantageously affected than the poor, and this is just the kind of thing that we should not have at this time in Canada. So, I suggest that on the basis of equity this proposal is totally unacceptable. On the other hand, some of our friends opposite like to argue that you cannot simply consider equity or fairness in making a tax proposal; you also have to consider the effect on the economy in terms of the generation of employment, and so on. That is a very sensible point. However, when you consider the impact of this proposal on the economy, it seems to me that the same negative conclusion is also inevitable.

March 20, 1972
Income Tax Act
The kind of injection of funds into the economy that is needed at this time, and which in fact has been needed for a long time, is much more effectively brought into being by reducing income tax at the average and below average income levels. I say that for the following, rather obvious, reasons, though perhaps not. Upper income earners, the middle class Canadians earning $15,000 or $20,000 and up, rather than spending this kind of tax deduction and injecting the money into the economy, therefore increasing demand and the likelihood of investment funds creating new job opportunities, are inclined simply to save it. They salt it away. By making sure that any tax benefit goes to the average or below average income earner, you give much more economic stimulus to the economy. This, in turn, leads to demand for more goods and services which results in increasing pressure to create more jobs. Therefore, on that ground as well I think this measure is subject to severe criticism. We should not make across-the-board tax reductions if the intention is to generate employment. The kind of tax reduction we need is selective in nature and should favour the average or below average income earner.
I should now like to say a few words about the corporate tax reduction. If the personal income tax reduction is open to serious criticism, then it is hard to know what kind of language to use with regard to the across the board 7 per cent tax reduction in the corporate sector. In my view it is sheer economic lunacy to offer this kind of across-the-board tax reduction to the corporate sector. A similar measure was brought in before Christmas, in the previous fiscal year. The point I made then and repeat now, since we are dealing with a similar kind of measure for the coming fiscal year, is that a 7 per cent tax reduction for the corporate sector across-the-board will simply give many, many corporations windfall profits, and that is all. Such reduction will not bring about greater investment. It will not mean that a higher percentage of corporate funds will be available for the creation of new jobs. There is no necessary connection between the tax reduction and the creation of new jobs.
If the government had really wanted the tax reduction for the corporate sector to lead to the creation of more jobs in the economy, it should have attached the creation of such jobs as a rider, if you will to such reduction. For instance, the government could have said to the corporations of Canada, "If you can show at the end of the current fiscal year that you have expanded your operation and employed more Canadians, you will be entitled to a 7 per cent tax reduction." Of course, there would need to be a certain minimum percentage increase in employment. If the government had said that, it would have made good economic sense. It would have been wise to say that to corporations. As I say, the government should have said, "If you expand your operation and employ more people, we will offer you a 7 per cent tax reduction in the current fiscal year." However, the government did not do that. It simply brought down an across-the-board 7 per cent tax reduction, which will simply enable many
companies to increase their profits or profit margins. The increase will not be exactly 7 per cent; however, it will be substantial. That is unjust. Reducing taxes across-the-

board for the corporate sector will not necessarily create more jobs.
Similarly, if the government had wanted to use a tax reduction as a means for creating more jobs, that reduction ought to have been applied to certain sectors of the economy. The government ought to have asked itself, "Which sector of the economy is most likely to employ more people?" It seems to me that of the three categories, namely, the service industry, manufacturing industry and resource industry, one category ought to have been excluded as a job producing category, that being the resource sector of the economy.


Mr. Saltsman:: The resource sector has already been given substantial tax concessions.


John Edward Broadbent: As the hon. member for Waterloo (Mr. Saltsman) says, tax concessions given to the resource sector are totally disproportionate to the service that sector renders to the Canadian economy, as pointed out by the hon. member for Duvernay (Mr. Kierans) who is a specialist in this field and who in recent weeks and months has voiced criticisms to this effect. The effective rate of tax that the resource sector of the Canadian economy pays is equal to about 50 per cent of the rate that the manufacturing sector pays. It is important to remember that, in terms of jobs, the resource sector employs very few people per dollar invested, as compared with the manufacturing and service sectors.
May I cite an example that I used on another occasion in the House last week? You may spend $1 million or many millions of dollars putting an oil well or oil pump on the land. All it will do is go "gurgle, gurgle, gurgle" and out will come the oil, and in will go the money to the pockets of investors. Very few jobs, indeed, will accrue from that kind of investment.


An hon. Member:: Most of the money will go to foreigners.


John Edward Broadbent: That goes without saying. Since the petroleum industry is about 98 per cent foreign owned, the money will leave the country. That is not the point here. I contend that instead of reducing taxes for the service sector, the manufacturing sector and the resource sector indiscriminately, we should have reduced taxes only for the manufacturing and service sectors. We ought to have said to those sectors of the economy, "You are being over-taxed vis-a-vis the resource industry and you employ more people per dollar invested than the resource sector; therefore, we will load the financial incentive, if you like, in your direction. We will provide you with financial benefits in the hope that more jobs will be created." Again, the government did not make this kind of economically sensible discriminatory decision. Instead, it offered an across-the-board tax reduction to the entire corporate sector.
I have said almost everything I wanted to say on those two points. I think the proposals for taxing personal incomes need significant revision, and I will be moving an amendment during the committee stage in this area in order to provide both some equity and some stimulus for the economy. Secondly, I think we need a change in the structure of corporate taxation in order to make those
March 20, 1972

taxes directly relevant to industries which provide more jobs, and only to those kinds of industries. We will probably be moving an amendment in that area, as well.
While talking about taxes, I cannot sit down without taking a parting shot at the government. I am talking about its general tax policy, and particularly as that affects average people in contrast to the way it affects upper-income people. In recent weeks, many men and women in my constituency have come to me and pointed out that when they collect unemployment insurance and SUB benefits-and I am glad to see the hon. member for Windsor sitting opposite me; he knows this very well and I will welcome his comments on the matter later-they are now not so well off as before. For the first time in Canada's history UIC benefits are being taxed. Therefore, these people are less well off under the new system than they were under the system which preceded it. In this area, instead of there being reform, there is regression. I hasten to add that our party does not oppose, in principle, the notion of taxing income, whatever the source. What we oppose, and this is the important part, is the taxing at this time of unemployment insurance benefits by a government which taxes only one-half of capital gains.
This government has brought in a capital gains tax. Instead of taxing the full amount of the gain, it taxes only half the gain. That is the kind of typical Liberal injustice to which we object. We would have fully supported the dollar is a dollar tax reform proposal that the Carter royal commission proposed. The commission said that we should tax capital gains just as we tax any other money income. The government has not done that. It has said to the man who makes $50,000 or $10,000, or however much it is, on the stock market in Toronto or Montreal, "You will have to pay a tax on only half your gain; the other half is tax free." At the same time it has said to the unemployed in Canada who are collecting unemployment insurance, "You will have to pay income tax at full rates on that unemployment insurance benefit." That is the kind of hypocrisy which I find totally unacceptable. One day it may be totally unacceptable even to the Liberal party of Canada, although I suspect Utopia will be here before that day arrives. With those remarks I will finish, and yield the floor to a member of the Creditiste party.


Gérard Laprise: Mr. Speaker, I would like to comment briefly at this stage on Bill C-169 which would reduce a little the income tax of individuals and corporations.
Like the hon. members who had the floor previously, Mr. Speaker, I feel this bill is a half-hearted attempt to reduce taxes. I would have hoped for a much more elaborate statement from the minister on that matter. He has indicated that the decrease of the income tax of corporations by 7 per cent was intended to give them more flexibility than at present, and that the decrease of the income tax of individuals by 3 per cent for 1972 would increase their purchasing power.
If we think a little of the effect of the tax reductions provided by Bill C-169, I feel that it will not be as favourable to the individual as the government seems to think.
Income Tax Act
First, individuals who pay $1,000 in taxes each year are rather scarce and we do not find many among lumberjacks, nearly never among miners, construction workers, service and store employees. The very few who pay $1,000 in taxes will receive a $30 annual reduction under the act.
Those, more numerous perhaps, who pay $500 in taxes will receive a reduction of $15 but those who pay about $100 will only have a $3 reduction, which is, after all, not overly generous.
As for those who don't have to pay any income tax, they will obviously not get anything out of this piece of legislation. That goes for those who live on retirement pensions, old age security or welfare allowances; this bill does not mean a thing to them.
For those who are more favoured, those whose revenues enable them to pay income tax, they at least have some reduction, but the vast majority of taxpayers stand to gain very little indeed.
The government is far more generous, however, toward corporations, large or small. Generally, they pay more taxes but this 7 per cent reduction represents rather significant sums.
On the other hand, we know that corporations can recoup the taxes they must pay by including them in their production or services costs.
Therefore, Mr. Speaker, once more, we realize that the government is far more respectful of large corporations than of individuals. However, I feel that the number of the latter is much larger than that of the corporations.
I believe it would have been smarter on the part of the government to grant a much larger reduction to individuals for the year 1972. Its effect would have been felt much more, since a larger purchasing power would have been available to individuals and workers, and the corporations would have equally benefited since the individuals would have had much more money to spend to meet their needs.
Considering those facts, Mr. Speaker, of course we cannot say that we are formally opposing this bill since its effects will at any rate be better than nothing, but the fact remains that the government cannot be too proud of having introduced this legislation because, in my view, and I said so in my opening remarks, it is much too timid for the importance they want to attach to it and its effect among our people, especially among the workers in general, will be very small.
Mr. Speaker, the bill must be referred to the House committee of the whole, and I hope that the minister will be much more eloquent in committee than he has been in his statement on the motion for second reading. It may be that we will be given-at least, I hope so-information much more meaningful than what we listened to this afternoon, and then, we shall be in a better position to evaluate the impact of such a bill.
IEnglish]


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


Some hon. Members:: Question.

March 20, 1972
Sales Tax on Equipment


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Honey in the chair.
Russell Clayton Honey: Order. It being five o'clock I now resume the chair.


PROCEEDINGS ON ADJOURNMENT MOTION
Mr. Deputy Speaker:: Order. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: The hon. member for Hillsborough (Mr. Macquar-rie)-External Affairs-Request for representations on behalf of oppressed Ukrainians-Effectiveness of Canadian action; the hon. member for Winnipeg North Centre (Mr. Knowles)-Canadian National Railways-Retired employees' pensions-Request for annual escalation and change in basis of calculation-Representations by minister; the hon. member for Richmond (Mr. Beaudoin)- Unemployment	Insurance-Payment	of benefits
delayed-Proposed steps-Advisability of decentralizing Montreal services.



PRIVATE MEMBERS' MOTIONS


Mr. H. R. Southam (Qu'Appelle-Moose Mountain) moved:: That, in the opinion of this House, the government should consider the advisability of remitting to municipalities, pursuant to section 22 of the Financial Administration Act, all consumption or sales taxes paid or payable by or to be paid or payable by such municipalities, in the five years immediately preceding January 1, 1972 and in subsequent years commencing with that date, in respect bf municipal equipment, otherwise exempt from such tax, but so taxed or liable to be so taxed by reason that such equipment has been or may be applied to any use as described in paragraph (c) of subsection (4) of section 27 of the Excise Tax Act.
He said: Mr. Speaker, I welcome the opportunity to rise on this occasion to speak to my private member's notice of motion appearing on the order paper as motion No. 2 dated February 23, 1972. It might be well to recall, for the sake of the record, and for those in whose interest this motion has been sponsored by myself, that this motion appeared in my name on the order paper last session as item No. 40. However, because of the large number of private members public bills and members motions, my

motion No. 40 did not quite reach the top of the list before the session finished.
The motion just read by Mr. Speaker refers to a very controversial situation which has existed in the province of Saskatchewan for several years with respect to the federal Department of National Revenue's application of the sales tax to certain municipal machinery, and from my information it has been a burning question in both the provinces of Alberta and Manitoba. There seems to be a definite opinion on the part of municipal officials that the Department of National Revenue has been coming down far too hard lately upon municipalities when municipal equipment has been used to do custom work for ratepayers or do minor street repairs for a village within the outer boundaries or minor jobs for school units, which for the most part are done gratis.
Other examples can be given, such as a municipal snowplough being called in to clear the small runways that have to be provided by villages and towns in outlying areas with small hospitals so that the Saskatchewan air ambulance can land to pick up emergency cases in order to flv them into some large centre such as Regina or Saskatoon. At other times in the dead of winter a piece of municipal equipment may be called to open up a section of roadway upon which a school bus may be stalled with a busload of schoolchildren. In any event, it seems that the Department of National Revenue is far too keen on applying the federal sales tax to municipal equipment that may have been used for purposes that I have cited, even to the point that it has in some cases been called utter discrimination.
The department has at times sent investigators to municipalities in various parts of the province for the purpose of checking municipal records to discover the extent of such uses. Where these investigators decide that there has been a diversion of the use of equipment, they treat the equipment as having been sold on the date of such diversion and levy the federal sales tax on the value of the equipment at the date of the diversion. Needless to say, the councils of the municipalities which have used municipal equipment to help out a school unit or small village have been very much disturbed at this approach by the federal government.
The problem has brought forth a number of requests from municipalities to have the law clarified and more fairly applied. Mr. S. J. Safian, Q.C., legal counsel for the Saskatchewan Rural Municipal Association has put the case very strongly to the government. The Hon. Darrel V. Heald, former attorney general of Saskatchewan, on April 6, 1971, made a strong plea by letter to the former minister of finance suggesting that he and his colleague, the Minister of National Revenue (Mr. Gray), should take some action to amend the law. At that time, the minister of finance in his reply took the side of the Minister of National Revenue and the bureaucrats by indicating that private contractors would be hard done by. It should be interesting to note at this point that Mr. Safian made a special investigation into these so-called complaints of private contractors and was informed by Mr. L. Ramsden, district chief of the investigations section, customs and excise, that the total complaints received from the two provinces of Manitoba and Saskatchewan did not exceed 12 in
March 20, 1972

number. This included written and oral communications to the department and it was indicated that less than one half were from the province of Saskatchewan. Consequently, it would appear that this is not a serious problem or argument.
In looking into this matter closely, I find that the Department of National Revenue is applying the strictest interpretation to the exemption provisions under the Excise Tax Act. In relation to the equipment referred to, the act exempts any such equipment which has a price of over $500 and is especially designed for use directly for roadmaking, road cleaning or firefighting, but not including automobiles or ordinary trucks.
The words used in the exempting provision are far from high examples of clarity. Is a tractor equipment which is "specially designed" for roadmaking, as distinct from road maintaining? I should like to stress this, Mr. Speaker. It is just as well designed for road maintenance, and yet the Department of National Revenue has gone so far as to take the position that such equipment could not be used for road maintenance. For instance, is the Caterpillar or Champion grader patrolling the municipal roads and trimming the shoulders building up the road and therefore making the road, or is it only maintaining it? Just how ridiculous can the government officials get at times, Mr. Speaker. Every reeve and counsellor who is concerned with this subject will know that in the great majority of cases involving the use of such equipment, it would require a great deal of hair splitting to establish any difference, and the line between the two in most cases would be most difficult to draw.
To cite one more specific example of the ambiguity of some departmental decisions, there is the case where a municipal council had hoped to use their municipal road equipment for levelling a licensed airfield which was owned and operated by the municipality. The Department of National Revenue customs and excise investigation section gave the municipality a flat "no". In yet another case, the municipality was confronted with the question of the application of the federal sales tax to its equipment when used to do custom work for another rural municipality.
Here the situation is the same on a very strict interpretation of paragraph (c) subsection (4) of section 27 of the Excise Tax Act. If the equipment is used for other than permitted uses, that is roadmaking, road cleaning or fire fighting, the sales tax may be levied whether the equipment is applied to such use in the municipality which was the first purchaser of the equipment or in another municipality. This seems to be an irrational policy on the part of the Department of National Revenue. Where the use is a permitted use within the meaning of section 27 (4) of the Excise Tax Act, and where the equipment is employed in another rural municipality in a permitted use, that is roadbuilding, this consequence should not follow as a matter of commonsense.
An example in point would be where, for instance, municipality A has its own equipment working on a north-south road forming its western boundary and municipality B immediately to the west must replace a culvert, say, or repair approaches to a bridge on an east-west road very near to where the road equipment of
Sales Tax on Equipment
municipality A is working. On a strict applir ,ion of the act the equipment of municipality A could not be taken across the road into municipality B to make repairs without leaving itself open to levy of the federal sales tax on that equipment. Strictly speaking, municipality B would have to bring its equipment for perhaps 20 or 30 miles to make these minor repairs.
Another common discrepancy is the case of ratepayers within the municipality approaching their council with the request to plough out snow from their driveways in the winter after the municipality has purchased a new motor patrol with a snow wing in order to clear their main grid roads of snow in the winter.
Numerous requests as I said earlier, have been made to the government to amend this section of the act in question. Both the Minister of National Revenue and the Minister of Finance (Mr. Turner) have promised to give serious consideration to remedying this particular complaint, as it so seriously affects our municipal governments according to the correspondence I have on file, but so far no action has been taken. It should be said in all fairness to the officials who have to administer this act that it is not they who determine the policy and that they are responsible only for the administration. The remedy lies with the Minister of National Revenue and the Minister of Finance and ultimately with parliament.
This afternoon I have purposely kept my comments very brief because in dealing with this subject and in discussing it with some of my colleagues on both sides of the House, I know that they would wish to support the intent of this motion. To this end, I urge most strongly these ministers, and the government of which they are part, to amend the Excise Tax Act in order to broaden the range of permitted uses for municipal equipment beyond the area of road making, road cleaning and fire fighting, and to remove the other unnecessary and anachronistic restrictions on the use of municipal equipment.


Mr. Judd Buchanan (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, the motion of the hon. member for Qu'Appelle-Moose Mountain (Mr. Southam) is related to situations where a municipality has purchased an article free of federal sales tax but subsequently diverts the article to a use which does not qualify it for tax exemption.
The Excise Tax Act provides that sales tax is not payable in respect of certain specified articles when sold to or imported by municipalities for their own use and not for sale. This exemption includes:
-equipment, at a price in excess of five hundred dollars per unit, specially designed for use directly for road making, road cleaning or fire fighting, but not including automobiles or ordinary motor trucks.
If a municipality purchases this equipment free of sales tax and then permits it be employed in work that is not for the use of the municipality, or that is not a use that qualifies for exemption, the municipality becomes liable for the sales tax. This is required by section 27(4) of the Excise Tax Act which reads as follows:
Where a motor vehicle or tractor or a machine or tool for operation by a motor vehicle or tractor

March 20, 1972
Sales Tax on Equipment
(a)	has been purchased or imported by a person who is the first purchaser or importer in Canada of the article for his own use and who purchased or imported the article for a use rendering such purchase or importation exempt from tax under this Part or
(b)	has been purchased as described in subsection 44(2); the following rules apply-
(c)	if within five years of such purchase or importation the article is applied by the purchaser or importer to any use (other than of a casual nature) for which it could not originally have been purchased or imported by the purchaser or importer exempt from tax under this Part, the purchaser or importer shall be deemed to have sold the article at the time of its application to that use and there shall be imposed, levied and collected a consumption or sales tax of 12 per cent on the value of the article at the time of its application to that use, payable by the purchaser or importer at that time;-
The motion of the hon. member urges that any tax collected from municipalities under section 27(4) of the Excise Tax Act in the five years preceding 1972 be refunded to them, and that any tax collected under this subsection in future years also be given back. Mr. Speaker, this subsection was enacted in 1962 to cover the situation where motor vehicles and tractors, allegedly purchased for tax exempt purposes, are diverted to a taxable use shortly after having been acquired.
Diversion to a taxable use includes a sale to someone not entitled to purchase free of sales tax. The rules apply for a period of five years from the date of the first purchase, after which the vehicles concerned can be diverted to taxable use without incurring sales tax liability. Under the wording of section 27(4) diversion of equipment, purchased tax exempt by municipalities, to non-exempt use cannot be permitted without incurring sales tax liability. However, the subsection makes an exception for diversions of a "casual" nature, and in the administration of the Excise Tax Act the Department of National Revenue has recognized that diversions of a casual nature do occur. From a practical point of view, such diversions are generally overlooked and payments of sales tax are not required.
I think there was some unhappiness when the Department of National Revenue some time ago requested the payment of sales tax on equipment diverted to taxable use in certain municipalities, where the municipalities in question advertised in local newspapers that they were prepared to do private contracting work with municipal equipment. It was felt by the department that this was certainly outside the definition of "casual." Diversions of a casual nature can include such operations as excavation of dugouts, ditching outside boundaries of a road allowance, street and culvert repairs, brush clearing, snow removal and so on.
In effect the motion proposes that municipalities be permitted to employ road making and road cleaning machinery and equipment purchases free of sales tax in any manner they see fit without incurring tax liability.
It should be noted that section 27(4) refers to any person who purchases or imports the equipment in question for tax exempt purposes and is not exclusively related to municipal purchases. The proposal of the hon. member would give preferred treatment to municipalities and would, no doubt, create pressure to extend similar treatment to other persons in analagous positions, for exam-

pie, provincial governments, irrigation districts, and so on.
The present sales tax exemption for road making machinery acquired by municipalities for their own use is sometimes strongly criticized by private contractors. These contractors may not purchase equipment free of sales tax and this may put them at a disadvantage when competing for work which the municipalities may decide to do with their own tax-free equipment. If this motion were accepted and municipalities were free to use tax free equipment in any way they wished, the unfair situation with respect to private contractors would be made much worse.
The Excise Tax Act exempts from sales tax a comprehensive list of articles and materials sold to or imported by municipalities for their own use and not for resale. Numerous requests have been received that a more general approach be adopted and that all municipal purchases be made exempt from sales tax. Although the motion does not refer to broadening the current exemptions through amending the Excise Tax Act, the effect of providing a remission along the lines suggested in the motion would be to extend significantly the current concessions afforded to municipalities.
It must be assumed that tax sales exemptions for municipalities exist because of the desire of the federal government to provide indirect financial assistance to local governments. Municipalities fall under the legislative jurisdiction of the provinces and it is sometimes questioned whether the federal government should come directly to their assistance. In this regard, it might be noted that the provinces provide little assistance to the municipalities by way of sales tax exemptions.


Max Saltsman: Mr. Speaker, I am very pleased to support the motion that is before the House. I will speak briefly, not because there is not a great deal to say on the subject but because I know there are many hon. members who wish to participate in the debate. Because of the nature of the subject matter of the motion, I would hope that it will not meet the usual fate of private members' motions, but will be referred to a committee for further study.
The motion is interesting in that a Conservative member is asking that we give public enterprise, in the form of municipalities, a break, or at least that we give them the benefit of the doubt. But members of the Liberal party, with their ideological hand-up on free enterprise, are concerned about the results of acceptance of this motion. They are concerned that private contractors might not like municipalities becoming involved in private enterprise. They are so hung-up on the private enterprise system that they are not prepared to give the benefit of the doubt to municipalities.


Mr. Guay (St. Boniface):: On a point of order- [Translation]


The Acting Speaker (Mr. Laniel):: Is the hon. member for St. Boniface rising on a question of privilege or on a point of order?
March 20, 1972


Joseph-Phillippe Guay: If the hon. member for Waterloo (Mr. Saltsman) means what he says, Mr. Speaker, then why is it that his party, which forms the government in Manitoba, does not alleviate the burden of the municipalities and give them a 5 per cent exemption? He speaks one way here in Ottawa, and the contrary way in Manitoba.


The Acting Speaker (Mr. Laniel):: Order, please. The hon. member should not take advantage of a point of order to ask a question. Further, this was more an expression of opinion than a question. The hon. member can seek the floor in due course and say what he has to say with respect to the motion.


Max Saltsman: Mr. Speaker, it is one of my great ambitions to hear the hon. member who has just spoken make a speech rather than an interjection.


Joseph-Phillippe Guay: I will speak in a minute.


Max Saltsman: The real point at issue is whether we are going to give municipalities some benefit of the doubt in terms of when equipment they have acquired for their own purposes may be used for another purpose. We are not talking about resale, I think that is fairly clear. Any question of a municipality buying a piece of equipment without sales tax and selling it, is a red herring. I do not know of any municipality doing this. We are talking about equipment bought for one purpose by a municipality and then, in view of its emerging needs, the council may decide to use it for another. Under the present legislation, a private contractor could say that a certain field of operation is his exclusively and that the municipality must not become involved in it. Had we adopted that philosophy at the beginning, no sewers or sidewalks would now be maintained by the municipalities. The maintenance of all those things we so carefully provided for ourselves within a city would be excluded, because they were provided by a private contractor of one kind or another.
I think it is wrong for the government to take this adamant position in reference to this particular section of the Excise Tax Act. I can appreciate the argument of neutrality as well as anyone else; the argument that we should not favour public enterprise over private enterprise. If this were applied equally throughout the economy, there might be some validity to the argument. The taxpayer is not neutral. Certain aspects of the private economy are not available to municipalities. When we give moneys to companies for research purposes we do not apply a yardstick to determine what those companies are going to do for the national interest and whether they are competing with any public enterprise. That money is given because some research is being carried out, although perhaps it is not going to be used in Canada at all. In the case of multinational corporations, the benefits may accrue to another country. There are many aspects of neutrality in the areas I have described.
As I have said, there are many things that could be said at this time, but in deference to other members who wish
Sales Tax on Equipment
to indicate their support for the measure before us, I shall conclude my remarks.


Mr. D. R. Gundlock (Lethbridge):: Mr. Speaker, I am happy to support this motion this afternoon and I do so having had a good deal of experience as reeve, councillor, and county chairman. In these roles, I have dealt with the matters that the hon. member who put forward the motion has mentioned. I am familiar, at first hand, with the small examples, if we want to use the word "small", to which the hon. member has referred.
I have heard the hon. parliamentary secretary put forth the government side, the rules and regulations. I have dealt with these personally. One of the reasons I should like to support the motion is an answer given by the former minister of finance to a brief submitted by the Saskatchewan Attorney General, Mr. D. V. Heald as reported in the Rural Councillor of September 1, 1970. The brief made certain recommendations but the minister's reply was simply that "no amendment to the act is proposed". The matter was raised later and the minister's response to the Provincial Attorney General was to the effect that restraint of inflation was a mojor consideration in forming the policies. Mr. Speaker, I find it very hard to relate "restraint of inflation" to this sort of thing.
The hon. member for Qu'Appelle-Moose Mountain (Mr. Southam) mentioned a case concerning the clearing of an airfield in the wintertime so that an air ambulance could land. The investigating inspector suggested that perhaps the sales tax on the snowplow would have to be refunded. This sort of thing is difficult for municipalities to accept in a practical way. I suppose the parliamentary secretary would quote the section of the act to me and say that piece of equipment was not used to build a road or to clean a road. I maintain that, in a practical way, the machine was most certainly cleaning a road, whether it was a roadway for an air ambulance or a roadway for a school bus or whatever.
I think the problem really lies in the interpretation of the act. We had a very strict interpretation of it a moment ago from the parliamentary secretary. In any interpretation, not only of legal words and acts, there must be flexibility. Some years ago when I was chairman of the county of Warner in southern Alberta, we sent a snowplow 80 miles into another municipality with a bottle of medicine because it was the only machine that could be found to deliver it. The machine went through the border town of Sweet Grass where the customs and excise men were located. They heard about this grader going into another municipality and we were told we had better be more careful.
If the government is not willing to amend the act, the minister should talk to his inspectors and ask them at least to be reasonable and use some flexibility in interpreting these words. We run across this all the time. A month or two ago when we were debating the tax reform bill, I recall asking the parliamentary secretary to consider including in the list of exemptions, rock picking. I know this does not have much to do with the present motion, but the point I am trying to make is that there should be flexibility in interpreting certain laws and regulations. I mentioned rock picking because I am a farmer. It is not an expense of farming to contract rock picking simply
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March 20, 1972
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because it is not listed as a deductible item. Land clearing and clearing bush is listed, but certainly rock picking is just as expensive a job as any other land clearing operation, but because it is not mentioned it is not allowed. The effect of the many of the provisions in the act before us depend on their interpretation.
I am not a lawyer but I have heard many times that justice must not only be done but must be seen to be done. The hon. member for Qu'Appelle-Moose Mountain mentioned the municipality that plows a north-south road which is a boundary road. I ask the parliamentary secretary, Mr. Speaker, can he imagine such a machine being exempt from this tax simply because it did not put the snowplow down when it may have travelled 20 miles over a road or entryway that needed cleaning? Can he imagine that sort of interpretation? I am quite sure the experts would be happy if the minister or his officials would explain these laws so that justice may appear to be done.
I mentioned the case of the airfield, and the snowplow that travelled 80 miles with a little bottle of medicine. According to law, these machines are excluded from sales tax exemption. I realize that no matter what law we have, there are ways around it. I will give an example of this. A municipal machine cannot build a ditch but the municipality has complete responsibility and control over safety on the waterways. I think we need a broader interpretation in this regard and I support the motion of the hon. member. I hope members opposite will consider this matter and accept this motion calling for an amendment to the law, and I trust the ministers concerned will accept the advice given during this private members' hour.
There are always ways to avoid taxation. I do not think municipalities are trying to avoid taxation, but they become frustrated when an inspector tells them they cannot build a driveway or diversion road because it is not on their land. We know there is an easy way around this. If it is for the benefit of the community, the owner could donate or sell the land to the municipality. Instead of nitpicking we should look at this matter closely. Any flagrant misuse of taxation policy is very noticeable. I do not think there will be any question of municipalities doing that. Taxpayers are the most important people to them and they will not let private contractors suffer at their expense. Our budget and the budgets of municipalities simply do not allow that sort of thing.
I strongly support this motion. If the House will not accept this amendment I strongly urge that the interpretation of the relevant laws be made more flexible.


Joseph-Phillippe Guay: Mr. Speaker, I would like first to refer to the question which I addressed a little while ago to the hon. member for Waterloo (Mr. Saltsman) and which has remained unanswered.

First, however, I would like to congratulate the hon. member for Qu'Appelle-Moose Mountain (Mr. Southam). I believe he is sincere in what he is doing. If he were not concerned with the area of municipalities he would not

have presented this motion to the House. I, too, am concerned. It is for that reason I am speaking in this debate.
I did not receive an answer to the question I directed to the hon. member for Waterloo (Mr. Saltsman) a short while ago. I feel a member cannot belong to a political party in this House and speak against some action of the federal government when his party, which forms a provincial government, has done the same type of thing. I refer to Manitoba and the sales tax it has applied to machinery such as is referred to in the motion of the hon. member for Qu'Appelle-Moose Mountain.
We have a sales tax in Manitoba which affects the purchase by municipalities of many of the items mentioned in this debate. The sales tax in Manitoba is not the same as it is in Quebec. In Quebec there is an 8 per cent sales tax on many items but the municipality receives a 6 per cent rebate on that sales tax. That is not the case in Manitoba. When the sales tax was first implemented in Manitoba by the provincial government every property owner was receiving a $50 rebate on school taxes. This was done until the government came up with what it thought was a better idea. When they imposed a 5 per cent sales tax they eliminated the $50 rebate. We have lost the $50 rebate on school taxes but we are still faced with the 5 per cent sales tax. This applies to such items as Kleenex, toilet tissue and other necessities and it also applies to machinery. There is no rebate to the property owner. Also, we still pay a 4 per cent tax on utilities. There are problems for municipalities which represent the grassroots people. I wish to refer to an information sheet of the Canadian Federation of Mayors and Municipalities. I think it indicates the problem of the high cost of operation of municipalities. I will then refer to what I think should be done to help them. The title of this article, which appeared in CFMM Information of Thursday, February 10, 1972, is "City requires federal tax aid". I quote from the article as follows:
With the cost of home ownership and rental already excessive, a 5.6 per cent increase in Ottawa's 1972 mill rate-meaning nearly $50 more in taxes for a home assessed at $8,000-is sad news. And there are more tax announcements to come.
On the evidence available in the budget statement, its not the city's managers who are to be faulted. As ever, the issues raised by the operating budget lie more on the revenue than the spending side.
A 16.6 per cent increase in spending is, indeed, a very considerable amount. Much of it is accounted for in salaries, notably the whopping 1971 arbitration awards to police and firemen. There is strong argument here for wage moderation, which has been taking hold in other sectors of the economy, in 1972 settlements. There is argument too on behalf of efforts to rationalize staff in the personnel study now nearing completion at the City Hall.
But a 22.8 per cent increase in the municipal mill rate, explained by the changing impact of the provincial grant structure, is not tolerable at all. Yes, the time has more than come for a massive swing to unconditioned grants. Just as important, if the city-and region-are to have any room to manoeuvre in their spending plans, there must be new tax sources made available.
Now I should like to quote the following passage from the Speech from the Throne of October 8, 1970.
Much progress has already been attained in these areas, housing and the provision of the many services necessary in an urban environment, but much more remains to be done. To solve the
March 20, 1972

problems will require an ever-increasing share of the nation's financial resources; not to solve them, to permit unmanaged growth, would result in an unacceptable drain on the nation's human resources. To foster co-ordination of the activities of all levels of governments, and to contribute to sound urban growth and development, the government proposes the reorganization of its urban activities under the direction of a Minister of State for Urban Affairs and Housing. The government seeks, by making rational its efforts in these fields, and through consultation with those most directly concerned, to help Canadians reach and implement the decisions that will determine their urban future.
The municipalities of Canada have been asking for tax relief for years. They have been asking for a greater share of the nation's resources in order that they may do their job better. The Canadian Federation of Mayors and Municipalities did succeed in getting the federal government to pay grants in lieu of taxes. They are asking, now, that sales tax on pollution control equipment be waived.
Mr. Speaker, I support any measure which would alleviate the financial problems faced by the municipalities. That the municipalities are, indeed, encountering major difficulties is evident from the report of the joint parliamentary committee on the constitution which, as hon. members know, was tabled only last week. The committee toured Canada to study the situation at first hand, interviewing people in all parts of the country. This was a wise decision and the recommendations were all the better for it. The committee undoubtedly appreciated the problems the municipalities were facing.
I should like to refer to the final report of that committee and in particular to the paragraphs which appear on page 54, chapter 21 of the report. I do not have time to mention all the recommendations made but I should like to quote at least paragraph 63 which reads:
A tri-level conference among federal, provincial and municipal governments should be called at least once a year.
In a brief note attached to this and other recommendations, the committee stated:
We agree fully that more co-operation, liaison and even harmony, is needed among all levels of government.
The meat of the recommendations is contained in chapter 22 where specific reference is again made to municipalities. I realize that these recommendations have not yet been accepted by the government, but I sincerely hope they will be given consideration. Paragraphs 64, 65, 66, 67 and 68 are all of great concern to the municipalities. I should like to quote paragraph 67:
In the light of the injustice done municipalities by their having to rely on the property tax for the bulk of their revenue, there should be a sharing of tax fields between governments that would allow municipalities direct access to other sources of revenue.
There are many other good suggestions made in this report. It should be borne in mind that the committee did not make its recommendations solely on the basis of the situation in Ottawa; they were the result of meetings held in all the provinces across Canada.
Coming more closely to the motion itself, I would point out that one would need to know a great deal about the detailed affairs of municipalities before being certain that in each case they would profit by the particular proposals which have been put forward. I believe that in the greater Winnipeg area, of which I have particular knowledge, some of them would, if adopted, lead to revenue losses in
Sales Tax on Equipment
certain directions. However, the intentions of the mover of the motion are good and for this reason I do not want to make any references which might be construed as criticism in that sense. Anything which would alleviate the difficulties of the municipalities and put more funds at their disposal would meet with my approval. In the end, of course, it will be tne taxpayers who will benefit, even those with low incomes, because the mill rate will be lower.
I feel that the proposal for complete exemption from all sales taxes is not a wise one. It savours too much of a booby prize in terms of what the municipalities are really seeking. A meeting is to be held here a week from today between the federal cabinet and representatives of the municipalities. It is to take place in the railway committee room and I suggest that hon. members who are concerned about these issues should attend to hear the briefs which are to be presented at 11 a.m. This is where they can be counted. We shall be able to see how many of us here are really concerned about the situation in which the municipalities find themselves.
I believe that instead of pressing for a single exemption, which does not add up to a great deal, the House should endorse the commitment of the government of Canada as expressed in the Speech from the Throne which I quoted a while ago, that is, to devote a larger share of the nation's resources to solving urban problems. This is not a responsibility of the federal government alone, of course; it is a responsibility of provincial government too.
If we had received all we were promised by my own province a few years ago, it would now be a good day for the municipalities. But the promises were never fulfilled. Taxes are still rising and no solution has yet been found. Always it is the same story: municipal problems are to be taken into consideration and an attempt made to find a solution. Then another year goes by without any result. The time_has come, Mr. Speaker, when results must speak for themselves.
Municipalities which have been making improvements to benefit their citizens have paid the shot so far. What we need is intergovernmental consultation on municipal financing, with a commitment by the federal and provincial governments to give the municipalities access to more tax resources, not simply single exemptions which add up to practically nothing. With that said, once again I invite all hon. members to attend the meeting next Monday at 11 a.m. in the railway committee room.


Mr. Ian Watson (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, I should like to congratulate the hon. member for Qu'Appelle-Moose Mountain (Mr. Southam) for giving us the opportunity today to discuss the financial problems of municipalities. The hon. member is suggesting in his notice of motion one method in which he feels the government of Canada could assist the municipalities in their financing. I am sure he will agree that there are dangers in the method he is proposing in that although it may make sense for road cleaning and road building equipment to be owned by one municipality and used by a second municipality, the possibility of such equipment being rented out or being used in competition
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with private contractors is stretching things a little farther than I am prepared to accept.
The question he has opened up today is one that is certainly worthy of a lot more consideration by the government. The whole question of whether municipal equipment should be exempt from sales tax while other equipment should not be exempt I feel should also include the question whether or not sales tax should be eliminated altogether on such equipment. Inquiries I have made in my department in this regard have not convinced me that this is a realistic proposition at the moment.
The trouble lies not so much with the larger items, which are easily identifiable and can be controlled fairly easily in that they can be traced quickly and efficiently to the manufacturer, but rather it lies with the smaller items that are purchased from storekeepers or dealerships. Here the problem is much more complicated.
As the hon. member is aware, it is necessary for a municipal purchaser to supply an end use certificate for items put to municipal use which are eligible for exemption. This process is a relatively simple one, I am told, when large items such as sewer pipes are involved. But when it comes to nuts and bolts and minor items which, though eligible, are purchased from small dealerships, this end use certificate procedure becomes complicated. The Department of National Revenue, which is responsible for keeping track of these certificates, spends a large number of man hours per fiscal year checking these very small purchases. In theory, one could suggest that it might be simpler to abolish sales tax procedures completely for municipalities, and undoubtedly this would be of major assistance to most municipalities. However, the amount of additional paper work involved, especially for small items, would be enormous.
If a different method of auditing could be worked out with the provinces whereby a better and more efficient check could be made of municipal expenditures for both small and large items of equipment-again I am talking about the theoretical situation where sales tax is abolished completely-then conceivably it might be possible to consider the hon. member's proposal, at the same time maintaining the safeguards which I am sure all hon. members would agree are necessary to prevent abuse. In view of the number of municipalities in this country, 1 am sure the procedure would be open to abuse if the doors were thrown open completely by eliminating sales tax on all items purportedly for municipal use eventually.
The question of municipal financing is one that concerns me particularly since I represent a constituency just across the river from Montreal. It is a bedroom or dormitory-type constituency that has doubled in size as well as population in the last 10 or 12 years. Although we see particularly the growing municipalities making mistakes that we all know how to avoid, mistakes that have been made elsewhere in North America, we are still repeating these mistakes.
Municipal finances are getting into an absolutely deplorable state today. I have letters from some of my constituents complaining about taxes amounting to $800 or $850 a year on houses worth no more than $12,000 to $13,000. I am sure few members of this House have constituents who are in such a deplorable situation. Anything

that would help relieve the municipalities in my area of their burden would be welcome. However, the suggestion implied in the hon. member's notice of motion, I feel, does allow for certain abuse which, on reflection, I am sure he would not want to see. However, the opportunity he has given us to discuss this matter is appreciated.


The Acting Speaker (Mr. Laniel):: Order, please. The hour appointed for the consideration of private members' business having expired, the House will revert to the business it was considering in committee.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration in committee of Bill C-169, to amend the Income Tax Act-Mr. Turner (Ottawa-Carleton)-Mr. Laniel in the chair.
Gérald Laniel: It being six o'clock, the committee will now adjourn till eight o'clock tonight.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
Russell Clayton Honey: Order, please. House again in committee of the whole on Bill C-169, an act to amend the Income Tax Act.
On clause 1-Additional deduction from tax.


Marcel Joseph Aimé Lambert: Mr. Chairman, I do not think there is any need for me to traverse in great detail what was said in the debate on the companion bill to this one which applied to tax in 1971. At that time I indicated that I would support some limitation in the amount of the reduction. I would think that a limit of about $60 would be right. That would represent a reduction of approximately 3 per cent on $2,000 of tax payable. A man earning $10,000 or $11,000 would pay in the neighbourhood of $2,000 in income tax. I do not have exact calculations in front of me. It seems to me, however, that we should be able to work on this basis. Bearing in mind the incomes that are earned today, I suggest that $10,000 or $11,000 a year embraces a large part of the working force.
Last December a representative of the NDP, the hon. member for Oshawa-Whitby I think, moved to impose a limit of $40 in the amount of the reduction.


Mr. Jerome:: The hon. member is referring to tax dollars?


Marcel Joseph Aimé Lambert: Tax dollars, yes. At that time I suggested that was not enough because such a low limit eliminated a large group of people who today are known, shall we say, as the solid core of working people. After all, today it is not uncommon for a married man
March 20, 1972

with one or two children to earn between $13,000 and $14,000 a year. Certainly, those who support the hon. member for Oshawa-Whitby and his party in many instances come from the upper quadrant, the upper third let us say, of trade unionists and they earn that much if not more. One need only look at today's wage rates to see the sort of money they are earning.
Taxes have risen for these people to the point that they are paying approximately $2,000 in income tax. A man with a taxable income of between $8,000 and $10,000 would pay income tax of $2,000 to $2,500. For the sake of rough justice, I would agree to a limit of $60 in the amount of reduction. A limit of $40 I think is wrong and will not accomplish enough.
I also want to support such a limitation because it is in keeping with what we advocated with regard to a tax credit. A limitation in this area will do the most good. If you are giving a tax cut, give it in the area where it will be most meaningful and where it will do the greatest good. If a tax credit system had been adopted, this sort of thing would have been easy to do in this area. That was the point we tried to hammer home in our criticisms of Bill C-259, the tax reform bill of 1971.
Here is a classic example of the flat 3 per cent reduction. For the man in the higher income bracket, the 3 per cent represents quite a fair amount. Let us take the example of a man with a taxable income of $25,000. He pays an average of 33 per cent or 35 per cent across the board in tax. Let us put it at a rough amount of $8,000 in tax. He will have the benefit of $240 as a result of the 3 per cent deduction which he is to be allowed. I do not begrudge him that. He will receive $240 on a taxable income of $25,000. The amount of $240 does not mean too much to him. However, if this $240 was available to an individual earning, say, $7,000 with a taxable income of $4,000, then we would be doing what we are attempting to accomplish in this country. That is where the thrust should be.
This is in keeping with the philosophy we have enunciated in our party in respect of tax changes and tax credits. I am dealing with rough figures, but this is what I would be much more inclined to support so far as a tax credit is concerned. This is a one-shot operation. It is not as though we were setting it up over a period of years. My figures may not be exactly correct.


An hon. Member:: That would not be new.


Marcel Joseph Aimé Lambert: I love to hear this sage from Hamilton.


Colin David Gibson: I did not say anything.


An hon. Member:: You are wrong again.


Russell Clayton Honey: Order, please. The hon. member for Hamilton-Wentworth on a point of order.


Colin David Gibson: Mr. Chairman, I was thinking all kinds of thoughts but I did not open my mouth on this occasion.


Marcel Joseph Aimé Lambert: Mr. Chairman, I apologize to the hon. member, but he is so prone to open his
Income Tax Act
mouth and let sounds come forward unthinkingly that I immediately reacted like everybody else. If somebody else made that statement, fine. As I say, these are rough estimates but that is the position I would take. I think the Minister of State attached to the Minister of Finance would not mind if we imposed a limit of $60. I know an hon. member wishes to bring forward a motion and I shall not steal his thunder. However, he will have much more chance of getting our support if he uses the figure of $60. That is all I shall say on this clause.


Some hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Chairman, I hate to upset the cheering of my colleagues who no doubt anticipate a prolonged and profound 40 minutes address. I made the essential points in debate this afternoon on second reading. I pointed out at that time that the measure before us is completely inadequate in terms of equity and fairness to taxpayers and to the average poor person and, secondly, in terms of providing money to those who would most likely spend it soon and thus stimulate the economy. Therefore, I should like to move an amendment to Bill C-169 as follows:
That clause 1 of Bill C-169, an act to amend the Income Tax Act, be amended by changing the phrase "3%" in line 11 to "6%" and by changing the period at the end of line 19 to a comma and adding immediately thereafter the following words: "or $60, whichever is the lesser.
I point out in graphic form the reasons for the amendment. I draw to your attention the present maldistribution of benefits in the bill before us. I introduced figures in the debate on second reading which clearly illustrate the maldistribution of tax benefits which this bill provides. If the House accepts this amendment we will set an upper limit of $60 on the tax benefit which will accrue. At present, if we check the effects of the government's proposal we will find that people in the upper income category will save, in absolute terms, much more money than the average income or poor person.
I have calculated, for example, that a person with two dependants earning $100,000 a year will save $1,500 in tax benefit. At the other end of the income scale, someone earning $2,000 will save a grand total of $2.25. In each case I am speaking of a person with two dependants. Someone earning $4,000 would save $16.41, someone earning $6,000 would save $32.28 and someone earning $8,000 would save $49.62. This type of maldistribution of benefit is something we should be attempting to rectify in order to make sure that those at the bottom end of the income scale receive the maximum benefit from the tax change.
Therefore, I suggest that members of the House who really want to do something at this time to give immediate benefit to low income groups should support the amendment. This will make sure that these people receive the money and it will not go needlessly to those who really do not need it.
Secondly, in terms of providing an economic stimulus to the economy-that is our concern, as it should be; it is one aspect of tax policy-by making sure that low and average income groups get the $60 we will ensure that much more of it will be injected very soon into the economy,

March 20, 1972
Income Tax Act
thereby increasing demand for services and for products, which will have an immediate spin-off effect in terms of increasing the demand for labour and therefore contributing toward the reduction of our unemployment levels.
By passing the same amount of money to higher income groups, as I argued earlier this afternoon, there is much less likelihood of that income being spent in the early future and acting as a stimulus to the economy. In fact, normally it would just be lodged in a bank or invested in some stock and soon its impact in creating jobs would not be felt. Therefore, I urge that all members present give serious consideration to this amendment because in terms of equity and economic stimulus to the economy it would be much more effective than the measure proposed by the government.


Russell Clayton Honey: The Chair has for consideration the amendment moved by the hon. member for Oshawa-Whit-by. Of course, the Chair will recognize other hon. members who wish to speak to the amendment. I do not believe the amendment is out of order.
I think that essentially the hon. member has complied with the considerations which the Chair must give to an amendment of this type. The amendment is relevant to the bill. It does not propose to increase the incidence of taxation upon taxpayers. In effect, the amendment would reduce taxation. The only hesitation that the Chair has is whether the hon. member in the latter part of his amendment, by in effect limiting the reduction in taxation, seeks to change the incidence of taxation on Canadians who are required to pay taxes. I do not hold this view too strongly and I mention it only as a question with which hon. members might wish to deal. However, if there is no objection the Chair is prepared to put the motion.


Stanley Howard Knowles: Perhaps I should not interject at this point, Mr. Chairman, since you are in agreement. Let me merely point out that it is the same as the ruling that was given on December 23 last.


Russell Clayton Honey: Is there any other hon. member who wishes to speak on the procedural acceptability of the amendment? Is the committee ready for the question?


Some hon. Members:: Question.
Amendment (Mr. Broadbent) negatived: Yeas, 19; nays, 33.


Russell Clayton Honey: I declare the amendment lost. Shall clause 1 carry?


[Stage Direction]
Clause agreed to.
On clause 2-Deduction in computing tax otherwise payable.
Marcel Joseph Aimé Lambert: In connection with the proposal with regard to corporations, it must be remembered that when I refer to corporations I do not disregard the individual and his wife or the two-man company which is incorporated. This provision applies to corporations all the way from the smallest to the biggest across the country. I have no inhibitions with regard to the word "corporations" as my friends to the left have. They think that anything that is named a corporation or that qualifies

as a corporation should be put to death or taxed to death. They say they do not want to put it to death but they will tax it to death, and rather than kill it outright they will just strangle it. At that point my colleagues and I part company, if we ever had company, with these people.
As a matter of fact, in light of the remarks I made this afternoon and that I have made in the past I would have preferred to see a 10 per cent cut in this provision, with a longer period, because frankly the minister is indulging in this one-shot business during an election year and is thus trying to fool the people. The former minister of finance indulged in something of this kind. Perhaps I would not call it misleading of the people because I do not think he could deliberately undertake anything like that, but he certainly misled the people when he said on the night of October 14 that this, in effect, meant a 10 per cent cut in corporate income tax as of July 1. Of course, that was the most blatant misrepresentation that one could make in this House. The surtax had been increased and added to in December because it was supposed to be a worth-while tax measure to bolster government revenues and to keep the economy on an even keel. Six months later, to the accompaniment of great clapping and slapping of desks by government backbenchers, the surtax came off. Everything was fine.


Patrick Morgan Mahoney: Whoa, Marcel!


Marcel Joseph Aimé Lambert: Everything was fine.


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: Yet within about five months-Mr. Chairman, sometimes you have to pitch your voice a little louder to get through thick ears.


Mr. Leiebvre:: Especially when you don't have too much to say.


Marcel Joseph Aimé Lambert: Let the hon. member get up and make a speech on taxes.


Thomas Lefebvre: If I can't make one better than you, then I won't.


Marcel Joseph Aimé Lambert: I know the hon. member can't say anything, for he never speaks. We will see what he is going to do tonight. I suggest that it was totally wrong for them to speak as they did in June. This was demonstrated in October by the then minister of finance. Yet, as I said earlier today, both sets of proposals received the same amount of clatter and clapping from government backbenchers. And why, Mr. Chairman? Because it is the thing to do.
I would have much preferred meaningful action to have been taken in June in regard to this matter. As a matter of fact, in December of last year we spoke and voted against the imposition of the surtax. The government was told that its action was wrong. It was demonstrated to be wrong by the action taken six months later, and it is now shown to have been doubly wrong by this proposal of a 7 per cent reduction limited to January 1, 1973. That limitation is questionable. I fail to see how they think that
March 20, 1972

anybody in business is going to make any meaningful investment on the basis of a one-shot-for one year- reduction of 7 per cent in the amount of taxable income. Mind you, I suppose we will have to say that it is better than nothing. I am not going to oppose it. I cannot propose that the amount be increased and there is no way that we can redistribute it. But while objecting to the amount and to the time limitation, we will support the proposal.


Max Saltsman: Mr. Chairman, I would like to direct a question to the minister on clause 2. It concerns the rationale for a 7 per cent across-the-board tax reduction. On what basis was this decision made? What information did the government have at its disposal from which it could assume that by deferring public moneys of this kind there would be an effective stimulation of the economy?


Patrick Morgan Mahoney: Mr. Chairman, obviously it is a question of judgment balanced against the ways and means requirements of the government. In this particular instance it was felt by the government that in the corporate sector a tax reduction in the order of $335 million over the 18-month period would have a meaningful impact on stimulating the ecomony, particularly bearing in mind that this was by no means either the first or the only measure proposed by the government to stimulate the economy. Also, bearing in mind the results that have been achieved, which seem each month to be proving out into an increasingly expanding economy, the measure seems to have been well founded.
However, to reply specifically, the figure could have been 8 per cent; it could have been 10 per cent; it could have been 5 per cent. The other figure could have been a year, six months, 18 months or two years. The balanced judgment was that this $335 million reduction over an 18-month period would provide a meaningful stimulus and, as I say, events would appear to have borne that out.


Max Saltsman: Originally this measure was supposed to end on January 1 of this year. Therefore we have had some experience with it. I am sure the government has had some experience of how successful the measure has been, not in a general way but in a specific way. When sums as large as the amount we are discussing are being remitted to industry, I think there should be some assessment. I am sure the department has made some assessment whereby it can demonstrate that where millions of dollars are being given to industry in fact a stimulus has been provided. What evidence has the minister that could persuade the open-minded people on this side of the House that this is a good measure and should be continued?


Patrick Morgan Mahoney: Mr. Chairman, I would not attempt to isolate the beneficial effects of this particular measure from the beneficial effects of other measures that the government has undertaken in relation to the economy over the last several months, indeed for almost two years. However, the evidence of economic performance during the latter part of 1971 and carrying on into the first two months of 1972, for which figures are presently available, would indicate that the economy has recovered rather remarkably from what was a genuine slowdown during 1970. This would also indicate that our economic perform-
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ance relative to other countries with whom we are prone to compare ourselves has been indeed favourable and that this measure, as part of a package of other economic measures, has indeed been effective.


Max Saltsman: Mr. Chairman, I do not know whether to thank the minister for that answer or to simply scratch my head and try to figure out what he said. However, I know that he is interested in providing as much information to the House as he possibly can. Since the government has spent large sums of money on various programs-we have put $1 billion into regional aid, we have expended large sums of money on LIP, large sums of money on the Opportunities for Youth program, large sums of money on this program, and of course, on personal income tax cuts-I want to know from the minister, what method does the government have of assessing the benefit to the economy of specific programs funded by taxpayers' moneys?


Patrick Morgan Mahoney: As I indicated earlier, Mr. Chairman, I would not attempt to isolate the beneficial effects on the economy of any particular program. I simply assess them as a package. The 200,000 new jobs our economy created during the past calendar year, the relatively good price performance, the containment of inflation-in relative terms, better than our trading partners-and so on, are all evidence to me of a fairly well managed economy; and this particular measure, in so far as it was applicable during the latter half of 1971, must be regarded as one of the beneficial measures.
To attempt, on the basis of a few months' performance to pinpoint what this, that or the other measure might have done in isolation from the rest would be an impossible task. To say how many jobs were created as a result of leaving this kind of tax money at the disposal of the business community, as opposed to how many jobs were created as a result of the greatly expanded housing program that was undertaken through CMHC last year, would be an impossible task. Perhaps some historian might be able to parse it. I can only judge these things on the basis of an over-all package.


Max Saltsman: Is there any program in the minister's department that follows on these tax cuts? Are interviews conducted with people who are recipients of these tax cuts, and is any attempt made to determine the effectiveness of these measures? After all, we are talking about very large sums of money. It is not good enough to say that we are going to throw the money up in the air in the hope that it lands properly and has some effect. When any government spends as much money as this one has there is, of course, some value but also some waste. I think the important way of measuring a government's success or failure in the spending of money is to see how effective it has been.
I ask the minister, through you, Mr. Chairman, whether there is a follow-up program to assess the effectiveness of these tax cuts.


Patrick Morgan Mahoney: Mr. Chairman, of course we try to assess the effectiveness of all government programs. I am not

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aware whether any report on the program in question is available as yet, but we have knowledge of the generally improved economic performance in Canada to bear out that on balance the package of programs has created an improvement. I shall inquire whether we have the results of any assessments of this particular package of measures over the first six months of its term, that is, the last six months of 1971. If figures are available, I shall attempt to impart them to the hon. member, but I do not have any assessment at my fingertips.


John Edward Broadbent: I should like to pursue this fascinating set of questions and the equally fascinating non-answers we are getting from the minister. The minister's answers are reminiscent of those we used to get from the minister of industry, trade and commerce-


Some hon. Members:: Question.


John Edward Broadbent: -on the question of money spent on scientific research and development programs. The fascinating Liberal theory at that time was that if you spend a million dollars on a science policy or any kind of research and development program, somehow something must occur that will benefit the economy and improve the level of scientific research. This is hardly a profound kind of causal analysis of what occurs in either science or the economy.
If the government has decided that by cutting a couple of hundred million dollars out of the tax load of the corporate sector of the economy there is bound to be a causal effect on unemployment, that seems to be a reasonable conclusion that any five-year old could draw. But surely intelligent economic policy was intended to get the maximum benefit per dollar spent.
I ask the minister why the government did not relate the tax benefit to actual expansion of employment, if the real intent was to stimulate the economy. I realize that stimulating the economy may not result directly in expansion of employment but perhaps in expansion of efficiency. Since the minister has already said that when this measure was brought in the government was concerned with an economy which was in need of stimulus, in need of more jobs being created, why did the government not say, "You can have your 7 per cent tax reduction if you can show at the end of the fiscal year that you have expanded your employment by a certain percentage"?


Patrick Morgan Mahoney: In the first place, Mr. Chairman, I would not wish the hon. member to feel that he has hurt my feelings at all-


John Edward Broadbent: That is impossible.


Patrick Morgan Mahoney: -by comparing me to the present Minister of Industry, Trade and Commerce or to any of his predecessors. Unfortunately, sometimes the answers to simple questions tend to be complex, and sometimes the questions, while simple themselves, deal with complex matters. Perhaps in asking his question in the terms that he did, the hon. member is reflecting the same preoccupation that he has, for example, with the manufacturing and service industries to the exclusion of resource industries.

It seems to me that a tax cut which permits a company, not necessarily itself, to create new jobs and to buy goods and services from its suppliers, thereby permitting them to create new jobs, is a valuable thing. The economy is not nearly as simple as the hon. member would seem to indicate. He is preoccupied, for example, with the relatively few people employed in mining operations. That is fine, but there are many people employed on the railways that haul the production of the mines, many people employed in the steel mills which provide the trucks, cars and so forth that haul the production of the mines. To simply relate tax cuts to direct employment would be to do a disservice to a very complex economy such as functions in Canada today. Our economy is not a simple operation and it does not lend itself to simplistic answers.


Some hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Chairman, I shall not say that the minister's answer was simplistic, but I am not sure if he implied what my simplistic solution to my own question was. I should like to catch the minister in the logic of his own reply and see if he can get out of this. If I understood correctly, he was saying that the manufacturing sector or the service sector is more labour-intensive than the resource sector, and if that is the concern there may be a case for the government applying its tax benefit only to those two sectors if they want to generate more employment. But he went on to say that the economy is more complex than that; that even if the resource sector is stimulated there will be effects because it purchases goods and services from other sectors of the economy, and he cited the railway industry and the steel industry.
Mr. Chairman, that misses the essential point. Of course they purchase goods and services from other sectors, but so does the manufacturing sector. Surely that is the point. If you have a steel industry, a textile mill or an automobile plant that in its own operation employs more people per dollar invested than the resource sector, there are spin off effects because all the goods and services they buy from other sectors means that the total employment introduced will still be greater than allowing some of the money to go into the resource sector. I should like the minister to comment on that point.


Patrick Morgan Mahoney: I do not think I can add very much to what I have already said. I feel the over-all performance of our economy has borne out the judgment of the government in this respect. I think probably the hon. member would find that a great deal of employment could be generated in the hand-made buggy-whip business, but perhaps the market for the product of that labour-intensive enterprise might not be very large.
I think Canada has to operate under the economy it has, not the one it might wish it had or that the hon. member might wish it had. Therefore we must work with the assets we have. The statistical information on the performance of our economy over the past year would indicate that it has been operating relatively well.


Max Saltsman: Mr. Chairman, since I know that the Minister of State has considerable experience with the resource industry, I should like to ask a question about the way in which a tax cut stimulates resource develop-
March 20, 1972

ment. It is my understanding that there has been a tightening of world markets and the demand for many of our minerals has been declining. There have been lay-offs in the nickel industry, the iron industry and industries of that kind. Under these circumstances of low world demand, would the minister explain how a tax cut to these industries will stimulate the economy?
I do not know whether the minister is thinking of the answer he wishes to give me or whether he does not want to answer the question. However, I would appreciate a comment from the minister.


Patrick Morgan Mahoney: Mr. Chairman, I find it difficult to answer a question as to how a tax cut for any particular industry stimulates the economy. It seems evident to me that tax cuts involve an increase in the net pay-off for the entrepreneur and make it much more desirable for the entrepreneur to carry on business. I do not think it greatly matters what is his particular line of work.


Max Saltsman: Mr. Chairman, that is the point I was trying to make. It seems there is no need at the moment, certainly in some of the resource industries, to provide any stimulation because the market for the resources does not exist. What would be the point of providing stimulus to the pulp and paper industry when it is in a very tight market, or the nickel industry which is laying off people? In what way does a tax cut stimulate the economy and provide the employment that all of us are interested in providing?
The Minister of Labour has repeatedly said, and I am sure the Prime Minister has also said it on occasion, that the government are very concerned about the high level of unemployment. They want to see this situation corrected. We in this House are being asked to vote on a measure that will spend $125 million of the taxpayers' funds. We are not given any sort of indication that this kind of expenditure is justified. We are interested in providing opportunities for fuller employment. We on this side want to be convinced that the measures before us will in fact accomplish that purpose. We want a much better explanation than we have been able to obtain from the minister. I hope the minister will rise and be more persuasive than he has so far.


Patrick Morgan Mahoney: Mr. Chairman, the hon. member is indeed fortunate in being asked to vote on this particular measure at a time when the economic indicators demonstrate that the economy is performing well. Unemployment is falling; employment increased by over 200,000 jobs over the past year. In spite of his preoccupation and my concern over the 600,000 people in Canada who are unemployed, I am not the least bit unhappy about the 8} million who are working.
The hon. member can take great comfort from the performance of the economy over the past several months, and being asked to vote on a measure that has been in effect for eight months as a result of the budgetary statement of last October, when the economic performance bears out the wisdom of this measure in combination with others the government has adopted.
Income Tax Act


Max Saltsman: Mr. Chairman, of course I cannot ask you to judge on how well our questions are being answered. Let me say they are not being asnwered in the least. The government is asking parliament to approve vast expenditures on programs which Iook like nothing more than a profit maintenance system for industries in Canada, some of which may need it but most of which do not. It is not being selective. It is an election year, so you must not be selective. After all, everybody has a vote so everybody participates in the boondock.
Let us consider the benefits that have been provided under this legislation to the ordinary taxpayer. We see a very nice juggling act. There is always an equation in a tax proposition. To the extent that one group pays less tax, other groups have to pay more. To the extent that this $125 million is being given away without any indication that it will provide jobs, the taxpayers in Canada who are not in industry have to pay for it. The money that is given to them under one provision is being entirely nullified under the other provision. In this bill we have a great sleight of hand, this juxtaposition of one thing to the other.
For a long time there has been evidence that tax concessions to industry do not stimulate the economy. I would like to refer to a very important speech made by the hon. member for Duvernay. I see the members of his party laughing at him. They did not laugh when they were falling over themselves trying to encourage him to be a candidate for their party. They laugh now because he had the courage to disagree with the trained seals in his party who are prepared to watch unemployment in Canada rise without saying a thing. He at least had the courage to dissent. He has now become an object of derision to his colleagues.
The hon. member for Duvernay has had wide experience in industry. He is a former president of the Montreal stock exchange. He is not the only one who has stated that tax concessions to industry do not stimulate the economy. The basis on which industry expands, and perhaps the only basis on which it expands intelligently, is consumer demand. If there is demand for a product and industry can produce the product at a profit, it requires no more stimulation than that. You can stimulate industry all you like, but if a consumer does not have any money to purchase a product, no expansion will take place. If the world market for metals is down, talking all taxes away from the mining industry will not encourage it to produce because there is no market for its goods.
We in this House are being asked to vote a vast sum of money to make it easier for the Liberal party to prove they are the friend of business in an election year. We are not prepared to be so generous to the Liberal party. At the beginning of the discussion of this clause we asked a number of questions in the hope that the Minister of State would give us an intelligent explanation and logical reason as to how the expenditures under clause 2 will result in additional employment in Canada. All we got from the minister was pious hope and vague suggestions that the government's program is enormously successful, although it is very difficult to sort out whether it is because of this measure, another measure or something else. Surely it is an abominable thing to come to the House
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of Commons, which is responsible to the people of Canada for expenditures made on their behalf, and ask us to vote over $100 million on this basis.
We are talking about the party that prides itself on its business acumen. That party says it is the manager; the Liberals know how to run the country and know how business should be conducted. However, it cannot give an even half intelligent account to parliament of $125 million. This is unthinkable for anyone who has the interests of the nation at heart. We are not averse to spending money to help the economy. We are often accused of being the big-time spenders. This is the party that wants to spend all the time, so they say.
When we suggest there should be a more generous contribution to old age pensioners, or we should take a less jaundiced view of the poor in our society, the government says that we want to spend this country into poverty. However, when the Liberal party wants to lay out $125 million to industry for a program they cannot even defend, that is not charity or welfare, that is business acumen. It is not good enough. We are not convinced, and unless we get some better answers from the other side we cannot accept this proposition.


John Edward Broadbent: I should like to add a few words to those of my hon. friend. The Liberal party in Canada is made up of lawyers, junior executives and the like.


Mr. Stafford:: What are you?


John Edward Broadbent: They claim that the only party in this country which has any experience of the workings of the economy is the Liberal party.


Patrick Morgan Mahoney: We have a couple of professors, too.


John Edward Broadbent: Yes, they are there as well.


Harold Edwin Stafford: Tell us about yours.


John Edward Broadbent: The witticism of the evening! It was not even from the hon. member from Hamilton; it was the hon. member for Elgin, that distinguished jurist who is now an economist. If ever an example were needed of the business and financial sensitivity of the Liberal party, we see it here tonight. They say they will cut taxes payable by the corporate sector to the extent of -what is it, $125 million?
They say this will be a wonderful thing for the economy. But they have not presented a shred of economic analysis in support of this view. They cannot cite any economist in this country or in the western world who would support the ludicrous statement made by a minister of the Crown a few minutes ago to the effect that this money is being sensibly spent. If the minister wishes to learn something about tax policy which will stimulate the economy, he should go to Norway, to Sweden or to West Germany.


Some hon. Members:: Oh, oh!


John Edward Broadbent: All these countries have had growth rates in the past 15 years which exceed the growth rate here. All of them have unemployment rates not above 3

per cent. The unemployment rate in West Germany is .5 per cent. I would remind hon. members that West Germany is governed by a social democratic party. Germany has imported two million foreigners to work there because the economy is being run so efficiently.
Japan, which was visited recently by a minister of the Crown, is by no means governed by a social democratic party but it is governed by a party which believes that economic planning is necessary, a party which believes it is important to control foreign investment and to determine which sectors of the economy should receive tax stimulus and which should not. It is a basic but sad fact of history that the party which has governed this country for most of the years since the Second World War should claim it has real insight into the management of a sophisticated, modern economy.
The only reason our economy has been relatively successful, and it has, is that there has been a powerful growth of the total North American economy, generated in the main by the country to the south of us, and there have been some fortunate spin-off effects. Unless the government smartens up and begins to use taxation policy in an entirely different way from the approach it has been taking up till now, we can expect that our economy, which is already slipping vis-a-vis those of the countries I mentioned earlier, will get much worse.
The kind of clause we see before us, which simply throws $125 million to the corporate sector in the hope that inevitably the party opposite will get a substantial donation to party funds in the forthcoming election, is an absolute disgrace.
Clause agreed to: Yeas, 39; nays, 12.
On clause 3-Reduction of refundable dividend tax on hand.


Max Saltsman: Mr. Chairman, I think we should ask the Minister of State for an explanation of clause 3. The language does not make it very clear.


Patrick Morgan Mahoney: Clause 3 is a consequential amendment which reduces the tax refundable to a private corporation on its investment income to reflect the 7 per cent reduction in its corporate tax. The hon. member will recall from his intense study of the tax reform legislation that private corporations only pay an effective tax rate of 25 per cent on their investment income. This is accomplished by having them pay the basic rate of 50 per cent under section 123 when they earn the income and then refunding 25 per cent to them under section 129 when they distribute the investment income to shareholders. Since the basic corporate tax under section 123 is being reduced by 7 per cent, the tax refundable under section 129 must also be reduced by the same percentage, that is, from 100 per cent to 93 per cent.


[Stage Direction]
Clause agreed to.
On clause 4-Reduction of refundable capital gains tax on hand.
Max Saltsman: Could the minister provide us with an explanation of this clause as well?
March 20, 1972


Patrick Morgan Mahoney: The explanation here is precisely the explanation just given in respect of clause 3, except that we are speaking now about the tax refundable to a mutual fund corporation on its capital gains. This, again, has to reflect a reduction of 7 per cent of the tax deducted, but in the case we are now dealing with, the tax refundable has to be reduced by 8.75 per cent rather than by 7 per cent because the federal government does not retain any of its share of the corporate tax on such gains; there is a full flow-through of capital gains tax on capital gains of mutual funds through the mutual fund itself to the unit holders.


[Stage Direction]
Clause agreed to.
On clause 5-
Mr.   Salt@: Mr. Chairman, I would repeat my previous request that the minister give an explanation of this clause.


Patrick Morgan Mahoney: Mr. Chairman, this clause modifies paragraph 51 of the income tax application rules so that the 7 per cent tax reduction will properly apply to a 1972 taxation year that began before July, 1971. Paragraph 51 provides a general rule for computing a corporation's tax payable for the 1972 taxation year where that taxation year falls partly in 1971 and partly in 1972. The technical amendment in this clause was necessary so that the 7 per cent corporate tax reduction would take effect on June 30, 1971, if we were dealing with a corporation's 1972 taxation year which overlapped June 30, 1971; for example, a 12-month taxation year ending March 31, 1972.
I might say, in anticipation of a question on the next clause, that clause 6 makes precisely the same change for co-operatives which also have a special rule for the computation of their tax for the 1972 taxation year.


[Stage Direction]
Clause agreed to.
Clause 6 agreed to.
Title agreed to.
Bill reported.
Mr. Deputy Speaker:: When shall the bill be read the third time? Now, by leave?


Some hon. Members:: Agreed.


Patrick Morgan Mahoney: the third reading of the bill.


Marcel Joseph Aimé Lambert: Mr. Speaker, I do not intend to reiterate what I said either on second reading or in committee. I think we made our position quite clear on this bill and anything now said would be in addition, either by way of extended comment or by way of comment in support of referral back of any particular clause to committee, would be anti-climactic and I do not think would serve any useful purpose.
We regret that the government has seen fit to take the position it has with regard to clause 1. Nevertheless, we are caught, with the Income Tax Act as it is, with a flat exemption, and the errors that existed will be perpetuated. I am also sorry the thrust of this tax reduction in the
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personal income tax sector has been not concentrated upon the medium and lower income earners rather than granting a 3 per cent reduction across the board. As far as the corporation tax is concerned, I think it unfortunate that this is limited to 18 months. I do not think a one-year exemption as provided by the bill or a 3 per cent reduction is sufficient to do anything really worth while. However, it is some very light measure of relief and to that extent we support it.
We have supported the bill generally and I shall not object to its passage, though it is an extremely poor, niggardly bill.


John Edward Broadbent: Mr. Speaker, I should like to move:
That Bill C-169 be not now read a third time but that it be referred back to committee of the whole House for the purpose of reconsidering clause 2 thereof.
I should like to explain briefly the reasoning behind this motion which follows directly from what I said a few minutes ago.


The Acting Speaker (Mr. Laniel):: Order, please. If the hon. member will excuse me, I think the motion should be put to the House at this time. The hon. member for Oshawa-Whitby (Mr. Broadbent) seconded by the hon. member for Winnipeg North Centre (Mr. Knowles), moves:
That Bill C-169 be not now read a third time but that it be referred back to committee of the whole House for the purpose of reconsidering clause 2 thereof.


John Edward Broadbent: As I was starting to say a minute ago, Mr. Speaker, the reason I am moving this motion is that the minister of the Crown has failed completely to justify the corporate tax giveaway provided in clause 2 of this bill. He has shown no reason whatsoever why the taxpayers of Canada should be subsidizing the corporate sector by this kind of tax reduction. I did try to make it clear that this party, in contrast to what the hon. member for Edmonton West (Mr. Lambert) suggested earlier, was not at all opposed to the provision of a corporate tax reduction. In fact, we would support a corporate tax reduction at this time if the government tried to relate it to the generation of new employment.
I suggested earlier this afternoon that this might have been done in one of two ways. First, by an across-the-board tax reduction applying to all sectors of the economy, such as the service sector, manufacturing and resource sectors alike, provided that a corporation in any one of those sectors showed at the end of the fiscal year that it had increased the number of employees working for it. We would then have seen a direct benefit to the economy. Such a proposal would have been a little more complicated than what I am now suggesting, but at least there would have been some reason for making a connection between a tax benefit and employment, instead of supporting a tax cut that bore no relation whatsoever to a firm's capacity to generate new jobs.
The second approach I suggested which would warrant a tax reduction in the corporate sector would be to make the reduction exclusive to the service and manufacturing sectors of the economy. The reason for that is the one

March 20, 1972
Income Tax Act
advanced by many economists and others in the country, namely, that the service and manufacturing sectors employ many more people per investment dollar than does the resource sector. Therefore, if we are to use tax policy as a means of generating employment one could at least see some plausible connection between a tax reduction at this time and the creation of employment.
It is precisely because clause 2 of the government's measure does not in any way show a plausible connection between the tax reduction and job creation that we cannot support it. This motion is therefore intended to send the bill back to committee at which time we would attempt to make the kind of amendment I have just outlined. It would be designed to reflect a serious attempt to institute a tax policy under which we could reduce taxes for industries in which jobs would result from such tax cuts, and we would not reduce taxes for the entire corporate sector at the expense of the people of this country merely to create a kind of welfare state for the corporate sector only.


Mr. Arnold Peters (Timiskaming):: Mr. Speaker, the Minister of State (Mr. Mahoney) who is piloting this bill through the House surprises me. Having listened to him and to his argument, I conclude that he expects us to believe that the bill before us will keep the economy afloat. He implies that bills such as this have kept the economy on a paying basis for a number of years, that they have kept the economy growing and that, therefore, we are dealing with a major piece of legislation to end unemployment. At the same time, it has not been given the billing that the winter works program, the Opportunities for Youth program or other programs have been given.
If the minister is right in his assertion that the reduction in tax will bring about all the benefits he suggests it will, then I am surprised that this bill has not been built up more by the Liberal party. Surely it could become one of their main election planks. Here is a measure which will permit industry to expand and unemployment to decrease, and it will cost only several million dollars.
There are differences of opinion as to what the 7 per cent corporate tax reduction will cost the treasury. The former minister of finance, now Minister of National Defence (Mr. Benson) said as reported on page 8691 of Hansard for October 4,1971:
The expenditure programs I have described are designed and will be administered in such a way as to have the earliest possible impact. The corporate tax cut is expected to result in a reduction of federal revenues of $160 million in fiscal year 1971-72, and a reduction of $175 million in fiscal year 1972-73. The cut in personal taxes is expected to reduce federal revenues by $125 million in fiscal year 1971-72 and by $225 million in fiscal year 1972-73.
He indicated that these cuts would cost the treasury of Canada approximately $1,000 million. That kind of expenditure should be given much more prominent billing. If the government thinks this piece of legislation will accomplish what it is supposed to accomplish, one would expect the government to give it much more prominent billing.
I know that many industries in this country are asking for tax reductions. I come from a resource area. If you reduce taxes for resource industries, you will find that not
IMr. Broadbent.]
one extra job will be created and not one extra pound of metal will be taken out of the ground. Inco, one of the largest mining companies in the world and certainly one of the largest in Canada, has been given its share of reduction in taxes over the past six months. During the past six months there have been massive lay-offs in that company. Many lay-offs are contemplated for the forthcoming year. Clearly, tax cuts have done nothing in that resource area. The same is true of the copper industry; there have been lay-offs there, too. Tax cuts have not produced extra employment in that industry.


Some hon. Members:: Hear, hear!


William Arnold Peters: Silver is a valuable commodity mined in my area. Silver mines are entitled to their share of corporate tax cuts. That industry has almost totally closed down. The fault lies largely with price of silver. Clearly, a 7 per cent tax cut in that area will not produce jobs. The same is true of the forest products industry, another large resource industry. For six months we have been dangling this carrot in front of that industry. Yet it is safe to say that there have been few periods in Canada's history when there have been more bankruptcies in that basic industry than in the past six months, particularly in northern Ontario and northern Quebec where we need many jobs.
The minister suggested that tax cuts have been used as a carrot, so to speak, to bring about employment in resource industries and induce expansion generally in the industrial sector. If this method works, if tax cuts will bring about increased production of certain commodities, I would agree with him. He suggested that if you reduce the cost of producing a certain commodity, more of that commodity will be produced. I agree with him. Nevertheless, Mr. Speaker, the government's policy does not work. It has not worked in the industries I have mentioned. It has not worked in iron, and I will bet it has not worked in oil although I am not sure about the oil industry. I have heard members representing oil industry constituencies crying of the need for larger contracts with the United States. That shows that sales perhaps are not as great as anticipated. The carrot technique is not helping these industries.
Other factors have influenced considerably our failure to make sales. The hon. member for Waterloo (Mr. Salts-man) referred to some factors. Since we have not sold as much as we expected to sell, I suggest that the government has put the cart before the horse. For instance, in the last 18 months over half a million people in Canada have not had enough money to buy anything except the bare necessities of life. They have been getting unemployment insurance, welfare and subsistence allowances. People like that are not in the market to buy. Therefore, the subsidies which the government is making available in the form of corporate tax cuts will not produce the results that are hoped for.
Anyone looking at the rest of the world will find that Canada's position is unenviable. Too much of our gross national product is derived from raw resource materials. These must be sold on international markets and we are finding it increasingly difficult to sell our raw materials at competitive prices on world markets. One must include
March 20, 1972

not only products such as I have already mentioned but also agricultural products. Certainly, we are selling a great deal of wheat on international markets. But Mr. Speaker, having talked to agricultural producers, I understand that the Wheat Board is selling our wheat for less than its cost of production. Clearly, reducing corporate taxes will not help that industry and will not produce jobs in other resource industries.
In some industries we have been fortunate. I suggest, however, that the $125 million the treasury saved in the past six months would have been better spent if used to find markets for Canadian goods. People I have talked to say they are interested in seeing government money assist in the development of new industry. They want to see the government participate in and operate certain industries. People are fed up with seeing $100 million spent in this field and $100 million in that on stopgap programs that bring no lasting result.
We had a stopgap program in respect of winter works. I am sure if we had sat down and thoroughly discussed it, we could have come up with a much more productive program. We spent $150 million on that program with no lasting results. If we had spent $150 million for the benefit of certain industries in some of the disadvantaged areas in Canada, we would have helped a large number of people and this would have had a cumulative effect. It would have provided jobs for many more who would be directly involved in the particular industry being subsidized.
To those members who say this provision is an inducement to industry, I say that unless they can show that it has produced more jobs in the direction in which it was aimed they will find that the loss to the Canadian taxpayer in respect of the companies which in my opinion did not need any tax concession will far outweight the few industries which will obtain legitimate benefit from this measure and in the end produce employment for people in their industries and the service industries surrounding them.
In respect of the 3 per cent reduction that is allowed the general public, it would seem there are many better ways to provide a fair and reasonable tax concession. People who write to me are interested in the personal exemption being raised to a reasonable level. The amount of $2,500 for a single person and $4,500 for a married person has been suggested. Some of my colleagues have suggested that the amounts be $2,000 and $4,000. We presented amendments to this effect when the income tax changes were before us. In this case, however, the concession in respect of the personal exemption is negligible at the low end of the scale. Any hon. member who has looked at his tax form for last year will know that 3 per cent at the level of his stipend will be quite advantageous to him. When one is paying income tax of $5,000, 3 per cent is quite an important factor. The average worker, however, who pays less than $300 will find that 3 per cent of that amount is not much help to him and is not much of a concession by the government. We give to those who have and wave at those who do not.
Income Tax Act
It seems to me that the government is giving a concession which will really not produce the result the minister suggests. The government has had six months in which to operate this piece of legislation: I believe it was implemented under the budget which was introduced last October. It has been in effect since then and, obviously, if you give a concession of 7 per cent on the tax a corporation has to pay it represents a large amount of money for a large number of companies. I suggest that if this is so, the results of that program should be evident and should be the subject of a calculation as to the number of jobs it has produced and its ability to keep companies in operation.
I think of some companies which recently have gone out of business. One is the company across the river. The 7 per cent did not keep it in business. Then there is the pulp mill in Timiskaming. It did not keep it in business. It did not make it any easier for the Spruce Falls company to keep its employees all year; they are suffering lay-offs at the present time. I believe every member here can think of a corporation in his area, particularly the large United States corporations, from which we did not derive any benefit because of the tax reduction which we provided but who have been adversely affected by outside influences which the minister ought to be looking into rather than making tax concessions. I believe the government could have distributed this thousand million dollars in a way that jobs were created and companies encouraged to go into production in a variety of fields. Rather than that, we are giving hand-outs to those who do not need them.


Mr. John Burton (Regina East):: Mr. Speaker, I shall speak for only two minutes simply to indicate that this bill is a piece of ludicrous nonsense and that the Liberal government is about six months behind the times. This bill implements and embodies the budget measures announced last October by the late minister of finance who has now gone to a better resting place. When the Liberal government was in a panic in respect of the unemployment situation, it knew it was in a desperate position and had to do something. The government announced that it intended to introduce these tax cuts, a 7 per cent tax cut for corporations and a 3 per cent tax cut for individuals. They even embodie some inequities.
1 want to draw to the attention of the House that when that measure was announced last October we had something of a levelling-off and in some cases even a drop in corporation profits. This no longer is the case. Today there is a sharp increase in corporation profits. The pattern today is for a sharp rise in corporation profits in 1972. These corporations will have the benefit of these tax cuts in a year when profits are rising sharply. I predict this will have an adverse effect on the economy before the year is out. The corporations will even have the benefit of capital gains during the year. There will be tax benefits accruing to these corporations. I believe, as this bill demonstrates, that the government is behind the times and the Canadian people know it.


The Acting Speaker (Mr. Laniel):: Order, please. Is the House ready for the question.


Some hon. Members:: Question.

March 20, 1972
Division


The Acting Speaker (Mr. Laniel):: The question is on the amendment to the motion. All those in favour of the amendment will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mr. Laniel):: All those opposed will please say nay.


Some hon. Members:: Nay.


The Acting Speaker (Mr. Laniel):: In my opinion the nays have it.
And more than five members having risen:


Mr. Speaker:: I declare the motion lost.
(Division No. 7)
YEAS Messrs:
Beaudofti	Lambert
Blackburn	(Bellechasse)
Broadbent	Maclnnis	(Mrs.)
Burton	Nystrom
Dionne	Orlikow
Gauthier	Peters
Gilbert	Rondeau
Godin	Rose
Harding	Rowland
Knowles (Winnipeg	Saltsman
Skoberg-20.
++NAYS
Messrs:
Howe Hymmen Isabelle Jerome Lachance Lajoie Lambert
(Edmonton West)
Lang (Saskatoon-Humboldt)
Laniel
Leblanc (Laurier) LeBlanc (Rimouski) Lefebvre Legault
Lessard (LaSalle)
Lind
Maclnnis (Cape Breton-East Richmond) MacLean Macquarrie McCleave McCutcheon Guay (St. Boniface)	McKinley
Guay (Levis)	McQuaid
Guilbault	Mahoney
Gundlock	Major
Hogarth	Marceau
Howard	Mazankowski
(Okanagan Boundary)	Murphy
[The Acting Speaker (Mr. Laniel).]



PROCEEDINGS ON ADJOURNMENT MOTION

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

["-because that is trafficking in human misery. There were some delays identified in January and February because of systems problems. These amounted to about 5,000 cases. These cases have long ago been corrected. We have no significant backlog in unemployment insurance operations in this country.\nThere will always be some cases delayed initially because information is not available from the claimant or his employer, or there are administrative errors; but this amounts to less than 2 per cent of new claims and less than two-tenths of one per cent of current claims. There is constant monitoring going on throughout the system and in all offices to ensure that claims are processed as speedily as possible, and there are quality assurance controls to keep the number of errors to an absolute minimum. Even though people complain of computers, there have been no major breakdowns in our five computer systems and no major delays caused by equipment breakdowns. Our greatest difficulty has been with the manual pay system which was designed as a short-term, interim system in the introduction of the new act.\nFinally, one should look at the good points of the program. The benefits paid in December, 1971, were 70 per cent higher than in 1970; the number of weeks paid were 13 per cent higher and the average weekly payments were 50 per cent higher. In the month of January, for example, $130 million was paid out to the unemployed people of Canada from coast to coast, thousands in the province of Quebec, most of them paid on time. In January of 1971, $85 million was paid out and in 1972 fewer people were unemployed than in 1971.\nLet us not forget, Mr. Speaker, that there are human beings working in the unemployment insurance and when we hear these statements about callous, indifferent unemployment insurance staff we are attacking a substantial number of people in the work force of this country who are doing a dedicated job and working overtime every week in order to give service to this hon. member's constituents and thousands of other people in the country. I resent very much the kind of attack made in the House tonight about people who are 16 weeks late receiving payments. Let the hon. member bring his list to the House instead of standing up every day attacking unemployment insurance and making this inaccurate, emotional appeal.\nMotion agreed to and the House adjourned at 10.34 p.m.", 'Tuesday. March 21, 1972']
Heath Nelson Macquarrie: Mr. Speaker, on March 2 I asked the Secretary of State for External Affairs (Mr. Sharp) what action he and the government contemplated following presentation to him by the Ukrainian Canadian Committee of a very important petition. This group of highly responsible and thoughtful Canadians had alleged widespread arrests of Ukrainian intellectuals by the governing authorities of the Soviet Union. I asked if the minister or the government had made any representations to the Soviet government concerning this very serious allegation. I also asked if the government of Canada planned to seek an investigation by any international body concerned with human rights and fundamental freedoms.
Whether the minister's reply brought satisfaction to the Ukrainian Canadian Committee or not, I cannot say. I can only observe that it impressed me as something less than convincing. The minister's observation that he had had a discussion with the committee was not news. That they had left the matter with him was also a subject in the common domain. But when on a supplemental I asked if the minister's non-reply indicated that the government had not found an effective way of dealing with the problem, he moved on to talk, not about Ukrainian intellectuals but the reuniting of Jewish families who were being oppressed throughout the world.
Why the sudden change of subject? Why the reluctance to advise the Ukrainian Canadian Committee and the House about the follow-through on this grave allegation? I have always welcomed the diminution of cold war tensions and increased contacts between the governments and people of countries once estranged. But if the era of
North Centre)
Allmand
Andras
Bechard
Bell
Blair
Breiau
Buchanan
Clermont
Comtois
Corriveau
Crossman
Davis
Deachrhan
De Bane
Downey
Dupras
Ethier
Faulkner
Flemming
Forget
Forrestall
Gibson
Gillespie
March 20, 1972

good will does not allow for exchange of views and inquiries such as this, what does it mean? What is its value?
I hope that we shall get some forthright replies. I hope that Moscow and Ottawa will not just proclaim closer contacts, but use them. The minister often tells us, sometimes self-righteously it seems to me, that we are dedicated to the pursuit of freedom and liberty for all. Here is a chance to do more than preach. Let us take up these matters seriously and seek a reply from the Soviet Union. If we demur from asking, our inflow of information will naturally be limited. In the absence of information we cannot begin to be helpful on the issue.
The Prime Minister (Mr. Trudeau) did not hesitate to make gratuitous and reprehensible public comments about the United States when he was in Russia. Perhaps his government and its ministers will in this instance not hesitate to make use of our cordial diplomatic contacts with the Soviet Union to pursue full and serious inquiries on the matter brought so forcefully and so sincerely to the minister's attention.


Mr. Gaston Isabelle (Parliamentary Secretary to Secretary oi State ior External Affairs):: Mr. Speaker, the government fully sympathizes with the views expressed on this issue by many Canadians. However, given the precepts of international law regarding intervention in the internal affairs of another state, direct representations to the Soviet authorities or to any international body might only provoke a negative reaction from the Soviet authorities and could very easily bring about results opposite to those desired.
During his visit to the Soviet Union, the Prime Minister (Mr. Trudeau) nevertheless raised similar and related matters with Mr. Kosygin on humanitarian and compassionate grounds. During Mr. Kosygin's visit to Ottawa, these issues were raised again both by the Prime Minister and by the Committee on External Affairs and National Defence of this House. I am confident that the Soviet authorities are now fully aware of our position.
The persistent and quiet diplomatic means we have used in relation to these issues have produced some results. As the Secretary of State for External Affairs (Mr. Sharp) has stated in this House, the Canadian government has been more effective in reuniting Jewish families than any other government in the world. As far as the arrested Ukrainian intellectuals are concerned, it would seem appropriate under the circumstances to use such techniques as we have found successful on related matters.
Sensitive issues between states can be broached only in an atmosphere of mutual confidence and trust if negative reactions are to be avoided. The government believes that Canada has to a certain extent been successful in achieving such an atmosphere vis-a-vis the Soviet Union.

And the government of Canada, Mr. Speaker, intends indeed to keep on using advanced methods, be they suggested by the private or public sector, to assist in the solution of problems such as those raised by the hon. member for Hillsborough.
Proceedings on Adjournment Motion



Stanley Howard Knowles: Mr. Speaker, on Tuesday, February 29, as reported at page 360 of Hansard, I put this question to the Minister of Transport (Mr. Jamieson):
In view of mounting concern with respect to Canadian National pensions, including both the need for the pensions of those already retired to be escalated annually, and the need to calculate Canadian national pensions on the basis of a factor of 2 per cent per year of service, will the minister make renewed representations to the Canadian National concerning these two matters?
The reply of the minister was that he would be glad to do so, whereupon I asked him a supplementary question in connection with how he was getting along with the Canadian Pacific Railway in regard to pensions. I received no answer to that question so perhaps we will deal with the CPR on another occasion.
Then on Friday, March 10, as reported in Hansard at page 713, I put another question to the Minister of Transport in these terms:
In view of the fact that Air Canada is now computing the pensions of all its employees on the basis of 2 per cent for each year of service, will the minister ask Canadian National Railways when it will take similar action and raise the basis of its pension plan from 1 1 per cent to 2 per cent?
The minister was good enough to reply that he would direct this question to the Canadian National and that he would pass the reply to me when it was received. There really is not much more I want to place before the House tonight by way of argument than the points set out in the questions I have read from the record. There is a great deal of feeling among Canadian National employees and pensioners concerning the pension situation. There are many improvements which they feel should be made, but the two main ones are those I suggested in my question of February 29, namely, the need to provide for the escalation of the pensions of those already retired to take place every year instead of just once, as has been the case thus far, and the need to put the basis for the calculating of Canadian National pensions on a 2 per cent factor, as is the case with so many other pension plans.
In my question of March 10 I made an allusion, which I think is terribly important in this whole situation, to the fact that Air Canada, which is owned by Canadian National Railways, does have a pension plan under which its employees get 2 per cent credit for each year of service. It does seem quite inconsistent, when Air Canada provides a 2 per cent factor, for the Canadian National, which as I say owns Air Canada, to provide only all per cent factor for the calculation of its pensions.
So, Mr. Speaker, I raise these two questions again tonight, an annual escalation and the establishing of a 2 per cent factor, because they are of intense concern to the people affected and because they feel, as I do, that it is time for action on both of these issues.


Ian Watson: Mr. Speaker, I wish to respond to the matter raised by the hon. member for Winnipeg North

March 20, 1972
Proceedings on Adjournment Motion
Centre (Mr. Knowles) on behalf of my colleague the Parliamentary Secretary to the Minister of Transport (Mr. Duquet) who is unable to be here tonight.
All hon. members are aware of the continuing efforts that the hon. member for Winnipeg North Centre has made and is making, as well as the work of the Standing Committee on Transport and Communications, to bring about changes which would better the position of Canadian National pensioners. Members of all political parties in this House have over the past number of years made very strong representations to the Minister of Transport on behalf of these pensioners. I have a volume of correspondence in my own files on this subject. I also have a number of CN pensioners in my constituency and I, along with other hon. members of the House, have made strong representations to the minister and they have been passed on to the CNR.
Some progress has been achieved as a result of these efforts. The Minister of Transport (Mr. Jamieson) made a statement about a year ago at this time of year and informed the House of certain major contributions made by CNR in this respect. The statement made approximately one year ago covered a wide range of CNR pensioners, their widows and survivors. The measures which were announced implemented most of the recommendations of the standing committee's report.
I agree, however, that there is need for further consideration on the part of CNR. Certainly there is no lack of sympathy on my part and on the part of the minister. If we cannot budge the CNR except by some form of legislation, I hope that some day the minister will consider that as a final resort. I am speaking as an individual Member of Parliament in that regard and not for the minister.
The minister has assured me, as he has assured the hon. member for Winnipeg North Centre, that he is making the strongest representations to the CNR and he has asked me, in my capacity as speaking for his parliamentary secretary, to inform the hon. member that he is continuing his discussions with the CNR and that he will give every possible consideration to the representations which the hon. member for Winnipeg North Centre made to him on February 29 and on March 10.
[TranslationI


UNEMPLOYMENT INSURANCE-DELAY IN PAYMENT OF BENEFITS-POSSIBLE DECENTRALIZATION OF SERVICES FROM MONTREAL
Léonel Beaudoin: Mr. Speaker, on March 7, I put the following question to the Prime Minister:
Since this situation is becoming increasingly worse because a great number of unemployed must wait five, six or even ten weeks, especially in Quebec, before drawing their first cheque of unemployment insurance benefits, can the Prime Minister tell us whether his government intends to improve those conditions in the very near future?
And the Parliamentary Secretary to the Minister of manpower and Immigration (Mr. Perrault) who was answering for the Unemployment Insurance Commission, stated, and I quote:

If there are cases of what is alleged to be an inordinate delay these will be investigated immediately,-
Mr. Speaker, in my opinion the Parliamentary Secretary to the Minister of Manpower and Immigration has misled the House by his prepostorous comments.
Since January I am swamped by a flow of unemployment insurance cases. I am aware that this new legislation was very poorly explained to the public. I understand, and the Parliamentary Secretary should understand it also, that this is not the proper time to make inquiries to see what is wrong. It is time rather to seek a settlement of this most unfortunate situation.
In my view, there are three main reasons for those delays. Everywhere, on television, on radio and in newspapers, everyone was told: You will receive weekly unemployment insurance benefits of $100 the new plan is completely improved, the government is going modern, it is thinking of you, and other things along those lines.
Such announcements put the people to sleep, and when they wake up they realize that they have had a bad dream.
I would now like to call the attention of the House to a telegram that I received from the provincial member of the constituency of Wolfe, on March 15, 1972, and I quote: My Dear Leonel:
Re: Raymond Beliveau Stratford
Received nothing for 16 weeks STOP Henri Poulin Garthby. Mr. Poulin stopped work in early December and has not received anything since last week STOP Family man, children, great hardship, brought before the court for non-payment of bills . ..
Those are but a few of the numerous cases that exist in the riding, people who should receive unemployment benefits STOP I tried to help them by making representations on behalf of these people but to no avail STOP I hope that you may be able to see to it that the fine talk about unemployment benefits one hears on television is implemented so that these people will receive what they are entitled to. Thank you for your co-operation.
Rene Lavoie, member for Wolfe
Similar cases, Mr. Speaker, around Sherbrooke are a common occurrence, they come up every day, even three, four, five and even ten times a day.
The answer that thousands of unemployed receive when cheques are delayed indefinitely, is this: Sir, we are waiting to hear from Montreal. Sir, your file has been lost. Sir, we have mislaid your file. Sir, we think you are not entitled to unemployment benefits.
Mr. Speaker, I should like the hon. parliamentary secretary to the Minister to tell us if that is what those people will use to buy food, fuel oil and survive this winter.
It is a great pity that the unemployed do not receive their benefits and have to go to welfare offices to beg for their pittance in order to survive, because that is too complicated in Montreal and machines are not doing the required work, etc.
Mr. Speaker, on Thursday March 16 I asked the minister of Manpower and Immigration (Mr. Mackasey) the following question:
A few days ago, in the minister's absence, due to circumstances beyond his control I am sure, I pointed out to his parliamentary secretary that a very difficult situation had developed in the Unemployment Insurance regional office in Sherbrooke, namely that the number of employees had been increased by about 25 or 30 per cent on the same premises, and that service to the unem-
March 20, 1972

ployed was thus greatly reduced, since many of them had been waiting eight or ten weeks now to get their unemployment insurance cheques. Is the inquiry over now and can the hon. minister tell us whether something is being done in order to improve that situation?
To which the Minister replied as follows:
Mr. Speaker, I must admit that the allegation regarding any slowness in the unemployment insurance office in Sherbrooke has not come to my attention, but I will look at it as soon as possible and report to the hon. gentleman.
There again, Mr. Speaker, I believe that this government's left hand does not know what its right hand is doing. The parliamentary secretary told me he would look into the matter and ten days later there are still unemployed people waiting for their cheques and no inquiry has been initiated as yet.
That is why I say that this is not the time for inquiries, but for improvements, for telling the truth about the Unemployment Insurance Act and refraining from "electioneering", promising Canadians pie in the sky.
Before a legislation is enacted, I suggest it should be seen to that administrative services required to meet demands under the legislation be set up.


Raymond J. Perrault: Mr. Speaker, the kindest thing that can be said about the hon. member's remarks is that they are short on facts and long on emotional appeal not based on fact. The hon. member, despite the comments in the House the other day, has yet to contact me personally in respect of any of these so-called delay cases. Unfortunately he was not in the House the other evening, March 14, when we undertook an investigation of the situation at Sherbrooke at the instigation of one hon. member. We were advised by the Unemployment Insurance Commission that between January 24 and March 14 the hon. member had submitted to the Sherbrooke office a grand total of 132 cases, not 450. In any event, as of March 10, 1972, the Sherbrooke office was in the process of answering only 19 cases submitted by the hon. member for Lotbiniere (Mr. Fortin). This hon. member had been interested in the list he had at that time at the local office.
I hope some hon. members will not try to seize upon this issue of alleged delays in unemployment insurance benefits in order to make some sort of political capital out of it-
Proceedings on Adjournment Motion


Léonel Beaudoin: You do this, rather than me.


Raymond J. Perrault: -because that is trafficking in human misery. There were some delays identified in January and February because of systems problems. These amounted to about 5,000 cases. These cases have long ago been corrected. We have no significant backlog in unemployment insurance operations in this country.
There will always be some cases delayed initially because information is not available from the claimant or his employer, or there are administrative errors; but this amounts to less than 2 per cent of new claims and less than two-tenths of one per cent of current claims. There is constant monitoring going on throughout the system and in all offices to ensure that claims are processed as speedily as possible, and there are quality assurance controls to keep the number of errors to an absolute minimum. Even though people complain of computers, there have been no major breakdowns in our five computer systems and no major delays caused by equipment breakdowns. Our greatest difficulty has been with the manual pay system which was designed as a short-term, interim system in the introduction of the new act.
Finally, one should look at the good points of the program. The benefits paid in December, 1971, were 70 per cent higher than in 1970; the number of weeks paid were 13 per cent higher and the average weekly payments were 50 per cent higher. In the month of January, for example, $130 million was paid out to the unemployed people of Canada from coast to coast, thousands in the province of Quebec, most of them paid on time. In January of 1971, $85 million was paid out and in 1972 fewer people were unemployed than in 1971.
Let us not forget, Mr. Speaker, that there are human beings working in the unemployment insurance and when we hear these statements about callous, indifferent unemployment insurance staff we are attacking a substantial number of people in the work force of this country who are doing a dedicated job and working overtime every week in order to give service to this hon. member's constituents and thousands of other people in the country. I resent very much the kind of attack made in the House tonight about people who are 16 weeks late receiving payments. Let the hon. member bring his list to the House instead of standing up every day attacking unemployment insurance and making this inaccurate, emotional appeal.
Motion agreed to and the House adjourned at 10.34 p.m.

Tuesday. March 21, 1972