1973-05-11

ROUTINE PROCEEDINGS


Mr. Thomas S. Barnett (Comox-Alberni):: Mr. Speaker, pursuant to the provisions of Standing Order 43 I seek the unanimous consent of the House to move a motion of urgent and pressing necessity which arises from termination of the Pacific salmon talks between Canada and the United States of America relating to a new agreement on reciprocal fishing privileges to replace the one that expires very shortly, and from the desirability of parliament declaring a Canadian position on this matter without delay. Therefore I move, seconded by the hon. member for Skeena (Mr. Howard):
That this House affirms the desirability of future co-operation between Canada and the United States in all matters relating to fisheries conservation and harvesting, which in its view must be based on recognition by both countries of each other's prior right to all fish stocks of its currently declared fishing zones and territorial seas, and of salmon originating in its rivers.
And that this House further affirms that, because of the intermingling of stocks in the fishing waters of the two countries, it is desirable that there be a continuing agreement between the two countries which will provide for an equitable division of the intercepted catch between nationals of the two countries.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


RAILWAY ACT
Mr. Stan Schumacher (Palliser) moved: for leave to introduce Bill C-180, to amend the Railway Act.


Some hon. Members:: Explain.


Stanley Stanford Schumacher: Mr. Speaker, at the present time the only requirement for fencing of railway right of way is a four and a half foot fence. While this may have been
satisfactory for the nineteenth century conditions under which that section of the act was passed, it is not satisfactory now, particularly for the protection of the life and limb of children who reside near railway rights of way in built-up areas. The purpose of this bill is to provide a higher standard of fencing in such areas.


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

[Stage Direction]
On the order: Introduction of Bills:
February 20, 1973-Mr. Coates-Bill intituled: "An Act to amend the Canada Pension Plan".
Mr. Robert C. Coates (Cumberland-Colchester North):: Mr. Speaker, I rise on a question of privilege in relation to this bill which for some time now has been allowed to stand. I feel that possibly it should not be stood any longer.
There have been discussions relating to this bill. The objective of the bill was to try to ensure that those people who were applying for a disability pension under the Canada Pension Plan and had gone through the procedures and were without counsel when they reached a certain position would have counsel afforded them. As a result of some difficulties regarding the possibility that this involved the expenditure of money and would upset the balance of ways and means, concern was expressed on the part of the Chair whether or not this was a proper private member's bill.
In the meantime, Mr. Speaker, I have had correspondence with the Minister of National Health and Welfare (Mr. Lalonde), and in that correspondence he has given me certain assurances he will make a technical amendment to the Canada Pension Plan legislation that, in effect, will do what I was trying to accomplish with this private member's bill. As a result of that assurance and as a result of the awareness of the minister of the concerns and problems of people in this position, I would like to withdraw the bill and thank the minister for his kindness in taking this step.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Is it agreed?


Some hon. Members:: Agreed.
Order discharged and bill withdrawn.
Oral Questions



ORAL QUESTION PERIOD

[Stage Direction]
May 11, 1973

Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I would like to ask the Minister of Finance a question relating to the announcement by the Bank of Montreal this morning that its prime rate is being increased from 6!4 per cent to 6% per cent, following an increase from 6 per cent to 6 V2 per cent on April 9. In view of the position the minister took yesterday with regard to the government's policy toward tight money, does this announcement follow any consultation between the banks and the Minister of Finance?


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, the president of the Bank of Montreal was trying to reach me this morning but I was tied up at a cabinet committee meeting. I notice that, although the prime rate has been raised from 6V2 per cent to 63A per cent, the bank in its release said that the rate on loans of $100,000 or less to small businesses will continue to be based upon 614 per cent. Rates on consumer loans are unchanged. What the bank is in effect adopting is a dual rate system to preserve accessibility for small business and consumer loans at the present rate in the market.
I gather that the pressure on the rate follows from the raising of the discount rate in the United States to 6 per cent and the fact that the prime rate in the United States is now 7 per cent which, if you take into account the manner of compensating balances used in the American banking system, puts the effective prime rate in the United States now between 7lA per cent and 8 per cent. What is happening is that this response of the prime rate announced this morning by the Bank of Montreal is a reflection of the pressure of international interest rates.


Robert Lorne Stanfield: I have a supplementary question. I ask it in view of the fact the bank also announced that the mortgage rate under the National Housing Act would be increased in the future. Does this not in fact indicate to the minister and the House that a tightening of money is developing and the banking system is already feeling it necessary to ration loans between large borrowers, for example, and small borrowers? Does this not in fact indicate a reoccurrence of tight money conditions?


John Napier Turner: No, Mr. Speaker. The fact remains that pressures on the Canadian banking system are such that as the interest rate differential between the American and Canadian capital markets widens, if it widens too much, the pressure on international borrowing against our own markets deprives Canadian borrowers of what credit allocations they might otherwise have had. What the banks are trying to do is to suggest to their larger accounts, particularly multinational accounts, to go into the regular capital markets and that it is appropriate, particularly on an immediate and medium-term

basis, to leave the loan allocations untouched and free for Canadian small businesses, businesses in those areas of the country not favoured by the rapid growth of some of the metropolitan areas, and to ensure that consumer loans remain untouched. Certainly the press release I received from the Bank of Montreal reflects that initiative. The president of the Bank of Montreal said that the objective-


Mr. Speaker:: Order, please. The minister will appreciate that the reply should not be too long; otherwise we will have to revert to motions.


Robert Lorne Stanfield: I wish to ask the minister whether in fact the rate of inflation that is occurring today does not in itself lead to a tightening of money and pressure on the money supply system because of increases in costs and therefore an increase in loan requirements? Does this inflationary situation, plus tight money, not create a vicious circle that feeds on itself? In view of this, does the minister intend to take any action to cut the cycle and deal effectively with the escalation in inflation that is taking place in order to avoid the continuing development of this tight money situation, or whatever the minister may choose to call it?


John Napier Turner: Mr. Speaker, I do not agree with the analysis in the preamble to the question by the Leader of the Opposition. The interest rates reflect two circumstances: First, the international rate structure, particularly in the North American capital markets and, second, a very strong demand for credit, reflecting a tremendously strong expansion in the economy at the moment. What the banking system is reflecting is not a restrictive monetary policy but a monetary policy that reflects the expansion in the economy while maintaining proper liquidity in the banking system.


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for Oshawa-Whitby and the hon. member for Temiscamingue and then the hon. member for Edmonton West and others.


BANK PRIME INTEREST RATE INCREASE-POSSIBILITY OF INCREASE IN NATIONAL HOUSING ACT MORTGAGE RATE
Mr. Edward Broadbent (Oshawa-Whitby):: I have a supplementary to the Minister of Finance. In view of what the hon. gentleman has just said, may I ask him whether or not we can expect an increase in the NHA basic mortgage rate to follow?


John Napier Turner: I think it would be very unwise for anybody in the House, particularly a Minister of Finance, to speculate on interest rates.


John Edward Broadbent: In view of that highly enlightening answer from the Minister of Finance, can the hon. gentleman assure the House that he will take steps to prevent an increase in the NHA mortgage rate?


John Napier Turner: My primary purpose is to ensure that a sufficient amount of money reaches the mortgage market, for reasons of which the hon. member is aware, in order that we can continue with the housing
May 11, 1973

program which is supplying more houses to Canadians than they have ever had before.


BANK PRIME INTEREST RATE INCREASE-EFFECT ON STABILIZATION OF ECONOMY
Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I should like to put a supplementary question.


Mr. Speaker:: The hon. member for Temiscamingue for a supplementary.


David Réal Caouette: Mr. Speaker, as he often does, the minister told us this morning that interest rates had been increased to 7, 7.5 and even 8 per cent in the United States. Can he say whether it is absolutely necessary for Canada to follow suit, and how the higher interest rate announced this morning will stabilize the Canadian economy and help fight efficiently against inflation?


John Napier Turner: Mr. Speaker, it is difficult to start a debate on the relation between current interest rates in the States or in Europe and Canada, but I shall be willing to do so in due course.


BANK PRIME INTEREST RATE INCREASE-SUGGESTED RETENTION OF PRESENT LEVEL AND ADJUSTMENT OF RATES TO PARTICULAR CLIENTS
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I have a supplementary question for the Minister of Finance. In lieu of accepting willy-nilly the increase in the prime rates of the chartered banks, would the minister not use his good offices in consultation with them, or through the governor of the Bank of Canada, to see that Canadian banks leave their prime rates at the present level and use discretionary adjustment of their rates to particular clients so as to carry out the policies requested by the government with regard to multi-national companies and larger accounts? In this way, small business would not have to overcome the higher and increasing prime rate.


John Napier Turner: It is on the basis of such consultation that the Bank of Montreal has, in effect, introduced the beginnings of a dual rate system. Both the governor and myself, in consultation with the presidents of all the chartered banks, have made it clear that there is not a restrictive money policy, that we want priority given to small business in this country, Canadian-owned small business, particularly in those areas of the country where growth prospects are less favoured.


Mr. Speaker:: Order, please. A number of members are seeking to ask supplementaries. Perhaps it might be wise to call upon the hon. member for Calgary North to ask the last supplementary on this subject, to which we might return later, and then I will continue the first round of questioning by recognizing the hon. member for York South.
Oral Questions


BANK PRIME INTEREST RATE INCREASE-EFFECT ON COST OF HOUSING
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, my question is directed to the Minister of State for Urban Affairs responsible for housing. It arises from what the Minister of Finance has said, that there is an undertaking by the banks to lend at the prime rate to borrowers of less than $100,000. There is no one in the country-I am thinking particularly of the people in small business-who can borrow at that rate. Would the minister tell us, since he is the minister responsible for housing and we have reached a social crisis in housing, what effect the increased rate will have on the cost of housing, which has already reached a crisis stage?


Hon. Ron Basford (Minister of State for Urban Affairs):: I would urge the hon. member, to the extent that there are any adverse effects, to join with me in passing Bill C-133 as quickly as possible-


Some hon. Members:: Oh, oh!


Stanley Ronald Basford: -so that the benefits of the legislation providing for subsidized interest rates can be made available to the people of Canada as quickly as possible.


Some hon. Members:: Hear, hear!


Eldon Mattison Woolliams: With the greatest respect, Mr. Speaker, we have a name for that kind of answer in the City of Calgary, but I shall not use it. Can the minister undertake now that all loans made directly by CMHC will be at a rate not more than one per cent higher than the prime rate so that the little people, the people the Minister of Finance talked about who cannot borrow money under 12 per cent, will be able to purchase houses?


Stanley Ronald Basford: Mr. Speaker, all I can do is to give an assurance that it will be at the rate prescribed by the National Housing Act as passed by parliament.


FEDERAL-PROVINCIAL AFFAIRS AGENDA FOR MEETING OF FIRST MINISTERS LATER THIS MONTH
Mr. David Lewis (York South):: Mr. Speaker, I have a question for the Prime Minister. Would the right hon. gentleman inform the House whether the agenda for the meeting of first ministers to take place later this month has been settled?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, as of yesterday morning I had answers from eight of the ten provinces, so the agenda has been tentatively settled to that extent. I do not know whether the other two provinces have replied since yesterday morning.


David Lewis: Would the right hon. gentleman inform the House whether the agenda contains an item dealing with the possibility of legislation to follow up the Food Prices Review Board which has been promised, and also whether

May 11, 1973
Oral Questions
any province has asked that the matter of the cost of living be placed on the agenda?


Pierre Elliott Trudeau: Mr. Speaker, until the agenda is agreed to it would be uncustomary for me to say what it contains. I will gladly make the agenda public as soon as it has been agreed to. Therefore I cannot answer in detail the first part of the question. On the latter part, I would say I have requested that exchanges be made between the provinces and our government to ensure that we can discuss economic questions, and each participant will, of course, be able to interpret that in the light he wishes.


FOOD PRICES
David Lewis: Mr. Speaker, may I ask a further supplementary of the Minister of Consumer and Corporate Affairs. In view of the fact the minister has already asked, I am informed, for nominations for the Food Prices Review Board and has received nominations from at least one source, will there be any further delay in announcing the personnel of that board or may we expect an announcement soon?


Hon. Herb Gray (Minister jaf Consumer and Corporate Affairs):: I hope there can be an announcement very soon, Mr. Speaker.


Mr. Speaker:: I believe the hon. member for Vancouver-Kingsway has a supplementary to the question asked a moment ago.


Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, I want to ask the Minister of Consumer and Corporate Affairs whether, in picking the personnel for the Food Prices Review Board, he can give us the assurance that consumers, particularly those of low income, will be represented on the board?


Herbert Eser (Herb) Gray: Mr. Speaker, among the types of people we are considering are people in that category.


COMMUNICATIONS
Mr. Rene Matte (Champlain):: Mr. Speaker, I wish to ask a question of the hon. Minister of Communications.
Could he tell the House whether it is possible that a decision on the Bell Canada rate increases be reached before the end of the 90 day period provided for on April 6?


Hon. Gerard Pelletier (Minister of Communications):: I am sorry, Mr. Speaker. I was absent-minded and did not hear the question.


René Matte: I am sorry, Mr. Speaker, that I had to wake up the hon. minister. There seems to be bad communications and, therefore, I repeat my question.
Is it possible that the hon. minister will reach a decision on the Bell Canada rate increases before the end of the 90 days provided for last April 6?


Gérard Pelletier: It is not impossible, Mr. Speaker.


EXTERNAL AFFAIRS
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Secretary of State for External Affairs. In view of the importance to Atlantic Canada of the Law of the Sea Conference, would the minister indicate whether a place and a date have been finalized for preliminary discussions this fall among the nations concerned, and whether the final conference will still be held next year in Santiago, Chile?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Yes, Mr. Speaker, there will be a meeting to discuss the organization of the conference before the end of the year. Present plans are to proceed to have the full conference in Santiago on the dates that have already been indicated.


AGRICULTURE
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, my question is directed to the Minister of Agriculture and has to do with the report of Statistics Canada regarding the danger of a grasshopper infestation this year in Saskatchewan, Alberta and Manitoba being greater than over a period of ten years. In view of the fact that about 80 per cent of the increase in the areas infested is expected in Saskatchewan, will the minister do what he can to assure the availability of the necessary chemicals to destroy this pest in advance this year when we expect large production and markets? This is a very serious matter.


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, we are aware of the report. I was in Saskatchewan last Thursday and Friday and visited the Minister of Agriculture of Saskatchewan and talked with our officials there. We receive weekly reports on this condition. We are attempting to make sure we do everything humanly and physically possible to control this infestation, particularly


if it amounts to what some people are suggesting could happen in the prairie provinces. We are concerned about making sure that production is not impeded in any way by such things as grasshoppers, politicians or anything else.


Some hon. Members:: Oh, oh!


John George Diefenbaker: Mr. Speaker, I am glad the minister included politicians because when he was in Saskatchewan recently he fully qualified as one politician interfering with my possibilities.


Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, I have a supplementary question for the Minister of Agriculture. In view of the fact certain chemicals formerly used for grasshopper control have been banned, can he now assure the House there will be sufficient supplies of effective chemicals that can be used in this war against grasshoppers?


Eugene Whelan: Mr. Speaker, I am aware of the different sprays that have been banned and the dangers of using some of them because of the effect on crops, the animal population and byproducts of the animal population. I am told that we do have effective sprays, and that is what I had in mind in answering the right hon. member for Prince Albert. I can only go on what my officials tell me, but if hon. members from western Canada have suggestions on what we should be doing I would be glad to hear them.


EXTERNAL AFFAIRS
Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, I should like to direct my question to the right hon. Prime Minister. In view of the fact South Africa has been expelled from the Commonwealth of Nations for some time now, would the Prime Minister tell the House why no plans were ever formulated by his government to withdraw Commonwealth preferential tariff treatment from that country?


Pierre Elliott Trudeau: Mr. Speaker, I will take notice of the question.


TOURISM
Mr. Eudore Allard (Rimouski):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce.
Is he aware of the discussions held at the last congress of the Canadian Association of Travel Agents during which many people dealing with tourism in Canada complained about the unfavourable image of our country in Europe and the rest of the world? If so, can he tell the
Oral Questions
House if he intends calling a federal-provincial conference on tourism problems in Canada and, especially, in the beautiful province of Quebec?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, I have already met with the provincial ministers of industry and tourism to discuss joint provincial-federal plans for the development of the tourist industry. I think all members would be most encouraged by the optimism of the provinces and all those associated with the tourist industry. We should be facing a big year.
[ Transla tion]


Eudore Allard: Mr. Speaker, on a supplementary.
In view of the answer given by the minister, can he tell us if he will launch in his department a study of the problems which were pointed out at the congress by the representatives of the Canadian tourist industry and could he inform the House of the results of this study before the end of this session?


Alastair William Gillespie: We are, of course, examining all proposals and suggestions from those in the tourist industry for the improvement of the industry. If there are any particular proposals the hon. member would like to make to me or to my department in that respect, I would be very glad to have them. In that connection, the estimates of my department were before the standing committee this morning, particularly those in respect of tourism, and I think that record might be of interest to hon. members.


UNEMPLOYMENT INSURANCE
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I should like to direct a question to the Minister of Manpower and Immigration who is responsible for the Unemployment Insurance Commission. It concerns a situation in the city of Toronto. It is reported from a high official of the commission that some 70 Italians have been deprived of benefits to which they are entitled and that even after two or three representations no action has been taken. Will the minister intervene in this matter in order to see that these benefits are paid and that any orders of disentitlement or that would relieve them of this money are rescinded so they can be brought back in good standing?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Mr. Speaker, there has been some investigation of the complaints, but I intend to examine the record myself and make a decision on it.

May 11, 1973
Oral Questions


BENEFIT CONTROL-INQUIRY AS TO FURTHER REPORT BY ADVISORY COMMITTEE
Lincoln MacCauley Alexander: Mr. Speaker, it has been some time since we have heard of the advisory committee to the commission that is examining reported overzealousness. Can the minister give any indication of how far the committee has proceeded with the investigation of claimants' complaints and just how long it will be before its report will be tabled?


Robert Knight Andras: I have been advised that the activities of the advisory committee are proceeding well. I understand they have some very specific meetings scheduled for the middle of May and that they are hopeful of giving me their final report before the end of this month.


LABOUR RELATIONS
Mr. John Harney (Scarborough West):: Mr. Speaker, I have a question for the Minister of Public Works about the present lock-out at the shipyards of Davie Shipbuilding Limited in Lauzon, Quebec.
The staff on his department employed at the dry dock of this yard being in complete sympathy with their coworkers who are barred from work, can the minister assure the House that his department is not pressuring its employees to force them to cross the picket lines?


Hon. Jean-Eudes Dube (Minister of Public Works):: Mr. Speaker, we called on our employees to return to work twice. They refused to do so, saying that they might be subjected to pressures, even physically. So we stopped requesting them to return. We do not intend to bring pressure upon them to force them back to work.


John Paul Harney: Mr. Speaker, is the minister aware that the lock-out at Davie Shipbuilding Limited is now illegal since no lock-out or strike can be staged legally before May 12?


Jean-Eudes Dubé: Mr. Speaker, it is not up to us to determine whether it is a lock-out or a strike, or whether it is illegal or not. We merely requested that our employees return to work. They have refused and we have no intention to exert any pressure on them to do so.


POST OFFICE
Mr. Doug Neil (Moose Jaw):: Mr. Speaker, my question is directed to the Postmaster General. In view of the fact that delays in mail delivery are becoming worse week by week, and in view of the fact I received a letter on

Wednesday, May 9, marked "rush" that was mailed at Gainsborough, Saskatchewan on April 28, some 12 days earlier, would the minister advise what steps, if any, are being taken by the Post Office Department to determine the cause of delays in mail delivery, and when can the citizens of Canada expect to begin to receive their mail within a reasonable time after mailing?


Some hon. Members:: Hear, hear!


Hon. Andre Ouellet (Postmaster General):: Mr. Speaker, a businessman who can guarantee 99 per cent efficiency of his operation is doing very well indeed. I would remind the hon. member that the Post Office Department deals with some 5 billion items a year, which would justify an average of 16,000 complaints a day. I do not believe we receive such a number. I therefore want to assure the hon. member that postal service on the whole is very good and if this particular incident occurred I regret it and we shall endeavour to find a solution to the problem.
*
* *


AIRPORTS
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, my question is for the Minister of Transport. In view of the government's expressed search for policies to remove discrimination against western Canada, and in view of the opposition of the majority of Pickering residents to the establishment of an international airport there, can the minister inform the House as to what efforts he is making to upgrade the international airport at Winnipeg as an alternative to the Pickering site?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, we have never considered that Winnipeg would be a substitute or alternative for Toronto.


Walter Gilbert Dinsdale: Mr. Speaker, may I ask the minister this question at least. Is he encouraging access to mid-western and western United States cities by Canadian air carriers operating from the strategically located mid-continent international airport at Winnipeg and, if so, when can we expect success from these representations?


Jean Marchand: I think the hon. member knows this is part of the negotiations which are being carried on now with the United States and we hope to obtain new routes and partly from Winnipeg to a certain number of points in the United States.

[ Translation]


MANPOWER
Mr. Marcel Prud'homme (Parliamentary Secretary to Minister of Regional Economic Expansion):: Mr. Speaker, before asking my question, I am sure I will have the unanimous consent of the House, and your approval, to express our warmest congratulations to the Canadiens hockey club which has once again shown its great superiority and efficiency by defeating the strong American team.
Now, Mr. Speaker, I wish to direct a question to the hon. Minister of Manpower and Immigration.
The hon. minister said yesterday that he was giving his attention to all the representations made by hon. members from Montreal concerning the renewal of local initiatives projects in the Montreal area, and especially in Montreal itself. I should like today to follow up the question put to him yesterday by asking him if there have since been any new developments in his department and whether he has come to a further decision about the demands of the many groups that at present benefit from local initiatives projects in Montreal?
[ English]


Robert Knight Andras: Mr. Speaker, I cannot add to my comments yesterday. The examination of representations continues, but there has been no decision taken yet.

[ Translation]


EXTERNAL AFFAIRS
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I wish to direct a question to the Secretary of State for External Affairs.
Does the hon. minister intend to take any action about the distressing incidents that have happened in the last few days in Pakistan, in which thousands of Bengalis wishing to be sent back to Bangladesh were arrested in the middle of the night and imprisoned in Islamabad, since when the President of Bangladesh has called upon other nations to register their disapproval?


Mitchell William Sharp: Mr. Speaker, we are trying to encourage the settlement of a number of outstanding difficulties among the countries of Pakistan, India and Bangladesh. We are doing everything in our power, which of course is not very great, in these matters, but I assure you that our concern is there. This is only one aspect, of course, of a very difficult problem. There is a special emissary coming to Canada-indeed, the Prime Minister saw him yesterday- for the purpose of discussing these questions and others.
Oral Questions


Mr. Speaker:: The hon. member for Saint-Hyacinthe on a supplementary.


VIET NAM-FINANCIAL SITUATION OF INTERNATIONAL COMMISSION OF CONTROL AND SUPERVISION-GOVERNMENT'S POSITION
Claude Wagner: I should like to put a supplementary to the Secretary of State for External Affairs, Mr. Speaker.
Is it true that the International Commission of Control and Supervision on the Viet Nam cease-fire lacks financial means to carry on with its mission? If so, does this government intend to increase its financial contribution to this end?
[ English]


Mitchell William Sharp: It is true, as is reported in the newspapers today, that the International Commission of Control and Supervision is insolvent. This is a very difficult and serious problem for the commission. It arises out of the failure to agree upon a budget for the forthcoming period. We have requested the parties to the peace agreement to make another advance that will enable the commission to continue its operations. In the meantime, I fully expect that we may have to provide funds that should have come out of the commission itself in order to feed our own contingent. But we are not taking on any other responsibilities.


PENSIONS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the President of the Treasury Board. Now that the government has committed itself to the removal of the 2 per cent ceiling from the annual escalation of pensions paid under the Canada Pension Plan, will the President of the Treasury Board take the necessary action so that the 2 per cent ceiling can be removed from the annual escalation of pensions paid to retired public servants and to retired RCMP and armed forces personnel?


Hon. C. M. Drury (President of the Treasury Board):: Mr. Speaker, as the hon. member and the House know, the government is very sympathetic to this proposal but has stated on previous occasions the notion or idea that the change in the escalation rates, both in the Canada Pension Plan and the Superannuation Act should be conterminous.

Oral Questions


CANADIAN NATIONAL RAILWAYS
[Stage Direction]
May 11, 1973

Mr. Joseph-Philippe Guay (St. Boniface):: Mr. Speaker, my question is directed to the same minister and it is in reference to Canadian National Railways' pensions. Would the minister give consideration to making representations to the CNR that the pensions of its retired employees be put on a parity with those of retired Air Canada employees?


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


Joseph-Phillippe Guay: Mr. Speaker, I believe the minister wanted to answer the question. I should like to repeat it, if the minister did not understand it.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. I was looking at the minister and he did not seem to be too anxious to respond. If he wishes to reply now, of course he will be recognized.


Joseph-Phillippe Guay: I believe the minister did not understand my question. Therefore I would like to repeat it.


Some hon. Members:: Oh, oh!


Joseph-Phillippe Guay: Would the minister give consideration to making representations to the CNR on behalf of CNR employees so as to give them an opportunity to have parity in their pensions with those of Air Canada employees?


Charles Mills (Bud) Drury: Mr. Speaker, while this does not come under my jurisdiction, I would be glad to see that the representations are passed on.


NORTHERN AFFAIRS
Mr. Erik Nielsen (Yukon):: Mr. Speaker, what the Parliamentary Secretary to the Minister of Transport has said in his question indicates how little he knows about the responsibilities of his minister.


Some hon. Members:: Oh, oh!


Erik Nielsen: I would like to direct a question to the Prime Minister which I put to him-


Mr. Speaker:: Order, please. The Chair will have to call on the hon. member for St. Boniface qui invoque le Reglement.


Joseph-Phillippe Guay: Mr. Speaker, in my view two ministers working together could perhaps make better

representations than only one, although I think that my minister is still the best.


Mr. Speaker:: Order, please. Before the minister rises on a question of privilege, I will recognize the hon. member for Yukon.


Erik Nielsen: Cabinet solidarity seems to be split asunder in more ways than one. On February 13 I directed a question to the Prime Minister concerning the unilateral and arbitrary prorogation of the Northwest Territories Council and at that time, as recorded on page 1231 of Hansard, he undertook to look into the facts as they were quite important. I wonder if the Prime Minister-and I direct the question to him and not to the Minister of Indian Affairs and Northern Development-has looked into the facts as he stated he would and, if so, will he now say what steps the government is going to take to see that there is no possibility of a recurrence of an incident of this nature?


Pierre Elliott Trudeau: Mr. Speaker, I undertook to look into the matter, which I did by suggesting to the Minister of Indian Affairs and Northern Development that he ascertain the facts and give an answer in the House, which he can do much better than I could.
[ Translation]


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I have had the opportunity of discussing this incident. Of course, there are problems in any democracy and I think that the Commissioner for the Northwest Territories has met with the members of the territorial council and everything seems to be settled. We shall have the opportunity of finding out next month at a new sitting of the territorial council. I intend to be present there in order to discuss these problems at the beginning of the sitting with the members of this council.


INQUIRY CONCERNING AMENDMENTS TO YUKON ACT RESPECTING STRUCTURE OF GOVERNMENT
Erik Nielsen: Can the minister inform the House whether it is the intention of the government to introduce in this session amendments to the Yukon Act to incorporate therein the reforms he has promised to the people of the Yukon in the structure of their government?


Joseph Jacques Jean Chrétien: Mr. Speaker, I did not make quite as many promises to the people in Yukon as the hon. member for Yukon did. I want to say that we will introduce legislation at the proper time but at the speed measures are being passed these days, I am not very optimistic about the possibility of having it adopted very quickly.


Erik Nielsen: I have one last supplementary question.


Mr. Speaker:: Order, please. The Chair will recognize the hon. member but there are only two minutes left before the end of the question period and I see many hon. members who wish to ask questions. I seek the co-operation of hon. members so that we can have as many questions as possible. I will not charge hon. members for the 15 seconds I have just taken.


Erik Nielsen: Since redistribution would have to take place before the next territorial election a year from this November and any increase in the size of the council would have to be dealt with in this session, can the minister say whether or not he expects to introduce amendments to the Yukon Act with respect to those increases in this session.


Joseph Jacques Jean Chrétien: Mr. Speaker, of course I intend to proceed as soon as possible, and I believe we will have lots of time because the next election will not be called before 1974.


LABOUR CONDITIONS
Mr. Duncan M. Beattie (Hamilton Mountain):: Mr. Speaker, my question is for the Minister of Labour. Since the minister has just met with his provincial counterparts, can he inform the House whether any agreement was made on the proposed new minimum wage and, if so, when will the legislation be enacted?


Hon. John C. Munro (Minister of Labour):: Mr. Speaker, I wish to thank the hon. member for giving me notice of his question. What took place at the conference of Ministers of Labour was a comparison of minimum wage rates throughout the country, both federal and provincial. There was no effort on the part of the provinces to ascertain the future policy of the federal government relative to the minimum wage other than to indicate that they would like some conformity between our own and their rates. I gave a general indication that we were considering further increases, but no specific time for the implementation of those increases has been determined.


VETERANS AFFAIRS
Mr. Harry Olaussen (Coast-Chilcotin):: Mr. Speaker, I should like to direct this question to the Minister of Veterans Affairs. I understand there is a large backlog of veterans cases to be processed. Can the minister inform us whether he has any intention of increasing the size of his staff?


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Mr. Speaker, I am very sorry but I did not get the first part of the question. Would the hon. member repeat it?
Oral Questions


Harry Magnus Olaussen: I understand there is a large backlog of veterans cases to be processed by the department. Is there any intention to increase the size of the staff in order to deal with them?


Daniel Joseph MacDonald: Mr. Speaker, the hon. member knows that we have increased our staff in the past and this is still in process. As hon. members know, it takes time to train staff to understand the legislation, evaluate the medical facts and all the rest. We are looking at this at all times and it is quite possible that we will further increase our staff.


RIGHT OF UNITED STATES TO SELL USED CARS IN CANADA-MINISTER'S POSITION
Mr. Jean-Marie Boisvert (Drummond):: Mr. Speaker, I would like to direct a question to the hon. Minister of Industry, Trade and Commerce.
Can the minister inform the House as to the intention of his department with respect to granting Americans the right to sell used cars in Canada?


Alastair William Gillespie: Mr. Speaker, there are no plans to change those rules.


SUPPLY AND SERVICES
Mr. Sinclair Stevens (York Simcoe):: Mr. Speaker, my question is for the right hon. Prime Minister. In view of the recent revelation by the Minister of Supply and Services that millions of dollars of goods and services are being purchased by his department through a procedure whereby, while there is tendering, tenders are opened in private, would the Prime Minister assure the House that this unusual practice will cease and that in future all tenders in the minister's department will be opened in public and that those tendering will be given the opportunity to attend such openings?


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: Mr. Speaker, it is true that it is the practice in my department. I personally wondered why. That was done during the days of the former Tory minister. On December 28 I asked that a study be prepared on the advantages and disadvantages of such a practice and that alternatives be submitted to me if necessary. My officials handed me the report today and I intend to discuss it with them next week.

May 11, 1973
Oral Questions


Mr. Speaker:: Order, please. The Chair will allow the hon. member a supplementary and will recognize the hon. member for York West and the Leader of the Opposition for the last questions and then call orders of the day.


Sinclair McKnight Stevens: Mr. Speaker, my supplementary is to the Prime Minister. Does the Prime Minister know of other departments that are following this practice of opening tenders in secret?


Pierre Elliott Trudeau: No, Mr. Speaker, I do not know of any such departments in the federal government. I am told that provincial governments follow that practice.


Some hon. Members:: Explain!


Pierre Elliott Trudeau: I am very satisfied with the answer given by the Minister of Supply and Services who certainly did the right thing in looking into this matter as soon as he became minister. If I understand correctly, it is a practice that began or at least existed in the days of the Conservative government in this country.


AGREEMENT BY FAMOUS PLAYERS AND ODEON THEATRES ON SHOWING OF CANADIAN FEATURE FILMS
Mr. Jim Fleming (York West):: Mr. Speaker, I should like to address a question to the Secretary of State. Can the minister confirm the various reports in recent days that an agreement has been made involving the famous Players and Odeon theatre chains to guarantee the showing of Canadian feature films for at least several weeks a year?


Mr. Speaker:: Order, please. We will assume that the question has been asked directly. The hon. member cannot ask the minister to confirm a report. The minister might reply briefly as if the question had been asked directly.


Hon. James Hugh Faulkner (Secretary of State):: Yes, Mr. Speaker. In line with the government's concern about getting wider distribution of Canadian films, an agreement has been arrived at. I am not in a position to outline the details because I still have to finalize some of them with the two chains.


CONFLICT OF INTEREST
Robert Lorne Stanfield: Mr. Speaker, I apologize for interrupting the Parliamentary Secretary to the Minister of Transport but I should like to address a question to the Prime Minister. The right hon. gentleman will recall that a number of days ago I

directed a question to him in regard to a report that Mr. Edgar Benson, when he was the minister responsible for Central Mortgage and Housing Corporation, had appointed an auditing firm with which he had formerly been associated, but of course is no longer associated, as the auditor for that corporation. I asked the Prime Minister whether the report was being investigated and whether this kind of appointment was consistent with the guidelines of his government in such instances?


Pierre Elliott Trudeau: Yes, Mr. Speaker, I looked into the matter raised by the Leader of the Opposition and found that, indeed, Mr. Benson, when he was the minister responsible for housing, had appointed a firm of auditors with which Mr. Benson had broken all associations many years before when he entered federal politics. I therefore see no conflict of interest involved in this question.


MONTREAL OLYMPIC GAMES, 1976-GOVERNMENT POLICY REGARDING SUPPORT-ADVANCEMENT OF FUNDS TO CITY
Pierre Elliott Trudeau: Unless there is a supplementary, Mr. Speaker, perhaps I might be permitted to answer a question put to me yesterday by the hon. member for Fraser Valley West regarding the Olympics. He asked me if any federal moneys or advances had been paid to COJO or to Montreal. I inquired from the Treasury Board and the President of the Treasury Board assures me that no such moneys have been paid.


Mr. Speaker:: Orders of the day.


Mr. Howard:: Mr. Speaker, I rise on a question of privilege. Earlier this week discussions were concluded in Seattle between Canada and the United States relating to an agreement with respect to fisheries, without arrangements being made for further negotiations. If there are no further negotiations the agreement will expire on June 15. If it does, there will be chaos in the fishing industry on the Atlantic and the Pacific coasts.
My question of privilege is that I would have thought, inasmuch as those discussions ended this week and considering the great difficulties and apprehension involved, that the Secretary of State for External Affairs would take the opportunity to make a statement to the House on motions about this question so that the public and Canadian fishermen in particular could understand what their position is with respect to those negotiations and that agreement.


Mr. Speaker:: Orders of the day.
May 11, 1973



GOVERNMENT ORDERS


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands) moved:: That this House disapproves the government's proposal to retreat by stages from the present cost-sharing arrangements with respect to hospital and medical care programs and calls upon the government to fund all health services on a 50-50 basis and to expand the health resources fund to enable the provincial governments to improve their health services.
He said: Mr. Speaker, last Tuesday, May 8, the Minister of Finance (Mr. Turner) presented certain tax proposals to the conference of provincial ministers of finance with respect to the contributions of the federal government to the health services provided in this country. These proposals are of such a complex nature that I am sure most people in Canada are totally unaware of their implications and what effect they will have upon future health services in this country.
It is significant that the provincial ministers of health gave a somewhat hostile reception to the proposals. I intend to examine them and propose the motion now before the House. In my opinion, the tax proposals advanced by the federal government represent an insidious and cynical attempt by the federal government to limit its financial contributions to hospital and medicare programs. I think it would be advisable to take a few minutes to review the fact that there are those in the Liberal party and in the present government who, throughout the years, have been somewhat hostile to the idea of a comprehensive national health program.
The first deliberate commitment by a government for a national health insurance scheme came in the 1945 Green Book proposals. At that time the federal government, having promised during the war that it would make Canada a better place for people to live in, and stimulated by the fact that just a few months before it had had a serious setback in the election when its majority in the House had been reduced to seven members, brought down the Green Book proposals. It is significant that the Liberal party's interest in health insurance has always had a direct relationship to the unsatisfactory state of its majority in the House of Commons.
One of those Green Book proposals was that a national health insurance program be shared jointly by the federal and provincial governments. However, nothing was done about it, and in 1946 the government of the province of Saskatchewan introduced the first comprehensive hospital insurance plan on the North American continent. In 1948, the province of British Columbia did the same, and these two provinces financed hospital insurance entirely on their own from then until 1958.
It is true that in 1956 the Liberal government of Mr. St. Laurent, when the Hon. Paul Martin was minister of national health and welfare, introduced the Hospital
Health Care
Insurance and Diagnostic Services Act, but it had a joker in it. The federal government would only contribute to hospital insurance if the majority of the provinces, representing a majority of the people of Canada, entered the plan, of course knowing that at that time the two central provinces were not interested in setting up hospital or medical care insurance. The result was that not one dollar was ever contributed to the hospital insurance plans of the provincial governments until 1958 when the government of the right hon. member for Prince Albert (Mr. Diefen-baker) took the joker out of the Hospital Insurance and Diagnostic Services Act, and made a contribution to hospital insurance.
That government also set up the Hall commission on medical care. It brought in its report during the Pearson regime, and it is to the credit of the present President of the Privy Council (Mr. MacEachen), who was then minister of national health and welfare, that the medicare act was drafted and placed on the statute books. May I say that that act sets forth a comprehensive national health insurance program. It recognized that hospital insurance and medicare were only one phase. That legislation provides that, by order in council, the federal government may extend health insurance to cover additional services such as dental care, optometric care, prescription drugs and other health services. May I also say that most of the opposition to that legislation came from inside the Liberal party, particularly from the financial mandarins. As a matter of fact, after the legislation was passed the then minister of finance, now Secretary of State for External Affairs (Mr. Sharp), imposed a five year limit on the agreement which was entered into with the provinces, and that five years will expire in a few weeks.
Instead of expanding the national health insurance proposals as contained in the legislation, the present government has been seeking ways to abdicate some of its responsibilities in this field. Last year the present Minister of Labour (Mr. Munro), who was then minister of national health and welfare, put a proposal before the provinces which they rejected. Last January 19 the present Minister of National Health and Welfare (Mr. Lalonde) put forth a modified version of those proposals. I must say that I was disappointed with that, Mr. Speaker, because personally I have been impressed with the innovations and the energy which the Minister of National Health and Welfare has displayed with respect to the whole question of social security. I thought he would bring the same imagination and aggressiveness to tackle this problem of health insurance. But he did not. He brought down the same proposal which last Tuesday the Minister of Finance put into more concrete terms.
What the Minister of Finance proposed was that, first, the provinces must accept the formula presented to them last January by the Minister of National Health and Welfare. That proposal is that over the next five years the federal government will restrict its contribution to hospital and medical care to its present contribution, plus an escalation based on the Gross National Product, with some slight cushioning in the first few years of the five year period. Last Tuesday the Minister of Finance also offered the provincial governments six percentage points of the personal income tax, and the revenues from the excise tax on the sale of alcohol and tobacco, and if the revenues

Health Care
from these sources do not provide sufficient to match what the federal government has been paying, then the federal government will give them a cash payment, bringing them up to what the federal government is now paying, plus the GNP escalation.
It seems to me ironic, Mr. Speaker, that for the future financing of hospital and medical care, the provinces are going to have to rely in part on taxes on commodities which ought to be curtailed in the interests of health. The federal government is now embarked upon a program of discouraging people from using more tobacco and more alcohol, and in the years ahead we could very well witness a situation in which the federal government will be advertising and telling people not to smoke so much and not to drink so much, in which case the provincial governments would have less revenues with which to discharge their responsibilities in providing health services to the people of Canada. The Mad Hatter in Alice in Wonderland could not have made a more absurd proposal.
Implementation of the recommendation made by the Minister of Finance will have two effects. First, it will leave the provincial governments with all the risks inherent in rising health costs. At present health costs are rising at anywhere from 13 per cent to 15 per cent per annum. To try to tie the federal government's contribution to the GNP has no relationship whatsoever to what the provincial government's responsibilities will be. Having got the provincial governments into a health insurance program, the federal government is now, by stages, proposing to pull out and leave the provinces with the primary responsibility for providing health care. This will either mean that the provincial governments will have to curtail the health services which they will provide to their citizens or they will have to impose additional taxes. The provinces which will not be able to impose those additional taxes will have a much lower standard of health services.
The Minister of Finance summed it all up in the speech which he made to the provincial ministers of finance last Tuesday when he said:
The amount of the reduction in federal taxes will, in due course, enable them to administer their programs without direct federal financial support.
If ever there was a start at moving down the road to a complete abdication of its responsibilities with regard to a national health insurance program, that statement represents such a step.


Some hon. Members:: Hear, hear!


Thomas Clement (Tommy) Douglas: The other day the Minister of National Health and Welfare said that the provinces will be $1.1 billion better off over the next five years. The provinces dispute that. They dispute it both on the basis of what these new fields will bring in by way of revenue, and on the basis of what the Minister of National Health and Welfare estimates the increased costs will be.
If the Minister of National Health and Welfare takes part in this debate, I ask him to tell the members of this House whether the $1.1 billion, assuming the provinces get it, constitutes a guarantee that that sum of money will

represent 50 per cent of the cost of providing hospital and medical care to the people of this country. Secondly, I ask him if that money, which the minister says the provinces will get, will be adequate to enable the provincial governments to move into phase two and phase three of the national health insurance program and provide the other medical services which were envisaged in the Medical Care Act.
The second effect of the proposal which the Minister of Finance has made is that the federal government is washing its hands of any responsibility for providing health services such as dental care, prescription drugs, optomet-ric care, eye glasses and other health services. The federal government is now seeking to pull out of the game. It is tossing in its cards, it is saying to the provinces, we will give you certain fields of revenue and this should be sufficient to meet your needs. It will be up to each province to decide whether these new sources of revenue will enable them to do two things; first, maintain hospital and medical care at its present level and, second, whether they will have the necessary finances to expand the health insurance program so as to make it comprehensive.
When the medical care legislation came into effect in 1968, nobody in this House felt that we had completed the task of setting up health insurance in this country. Canada is far behind most of the industrial countries of the western world. Small nations much less affluent than Canada, the Scandinavian countries, West Germany, Britain, Israel, the Lowlands, Holland and Belgium, and many other countries have a completely comprehensive health insurance program that covers every aspect of health services for their people. The federal government is now getting ready to wash its hands, abdicate its responsibilities and leave it to the provinces in the future to attempt to provide those services out of revenues which will not be adequate for that purpose.


Some hon. Members:: Hear, hear!


Thomas Clement (Tommy) Douglas: What is going to be the result? The result is going to be that we will end up with a mishmash of health services across Canada. Some provinces may not be able to continue to meet the escalating costs of health insurance and medicare. They may have to start imposing deterrent fees or a means test. Other provinces will not only be able to carry on the other services, but will have the necessary financial resources to expand their health program. However, those provinces will want to impose very severe residence qualifications for those who are going to enjoy the benefits of those services.
We are not going to have a national standard. We are not going to have a comprehensive program that covers people from the Atlantic to the Pacific. This is a complete negation of the whole concept of federal-provincial relations as laid down in the Rowell-Sirois report brought down prior to World War II. That set forth the proposition that every citizen of Canada, no matter where that individual might live, would be entitled to certain basic national standards of health services, education and welfare. That is the only way in which you can have national unity. You can bal-kanize a country in more ways than by promoting separatism. You can promote national disunity by having some parts of this country more favoured in terms of health
May 11, 1973

services, welfare and education than other parts of this country. Nothing will tear this country apart faster than to destroy the concept of having a comprehensive national insurance program by which all citizens of Canada, no matter where they may live, will be entitled to all the health services they need, irrespective of their ability to
pay-
The federal government's rationale for introducing this tax proposal is that they want to do two things. They want to provide the provinces with flexibility and they want to do something to curb escalating costs of hospital and medical care. I think there is much to be said for flexibility. I support the minister in attempting to do that, but I suggest that flexibility should not be used as a smokescreen for opting out of the federal government's legitimate responsibilities. The federal government can give to the provinces adequate flexibility with regard to which particular health services they will add to those that are now in existence with federal support without the kind of tax proposal which the Minister of Finance has presented.
The other reason they say they have introduced this is in order to curb rising costs. Of course, we need to curb rising costs, but you cannot curb rising costs by throwing the responsibility back on the provincial governments. Does anyone think the provincial governments are spending money like drunken sailors just because the federal governmment puts up 50 per cent? As a matter of fact, for every dollar which they get from the federal government for medicare and health insurance, the provinces have to put up a dollar. I submit, Mr. Speaker, that the dollars they have put up are much harder to come by than the dollars the federal government puts up. The greatest restraint is that the provincial governments have to match federal expenditures in the matter of health services. If we want to curb the escalating cost of health services, we shall not achieve this result by passing the ball back to the provinces. We can only do it if we are prepared to modernize our health delivery system.
There is no doubt money is wasted under our present health program. We are caring for many people in acute treatment hospitals where the cost is $50 or $60 a day who could be cared for in nursing homes for half that amount. There are many people in nursing homes who could be cared for under a home nursing program. The method of paying doctors may need to be completely revised. Then again, we could reduce much of the cost of medical care by setting up community health clinics where major emphasis would be placed on preventive health care, thereby reducing much of the cost of acute medical treatment.
Thus, I have suggested in this motion that in addition to the federal government funding health programs on a 50-50 basis, it should be prepared'to expand the health resources fund and make money available on a continuing basis, not just the six years for which the proposed trust fund is envisaged, but on a continuing basis on the very logical deduction that any money which is paid to provincial governments to put up nursing homes, to establish community health centres, to set up home nursing care programs, will more than repay us in the long run by reducing the annual cost of providing health services.
Health Care
I do not think, therefore, that either flexibility or a desire to curb the rising cost of the health program requires the kind of proposition which the government has placed before the provinces. The federal government could secure flexibility, it could help curb rising costs, by providing some of the necessary capital needed to modernize the health delivery system while at the same time continuing to do two things which are fundamental. First, the government could assure the provinces that, in one form or another they will be guaranteed that 50 per cent of the cost of any of the health services which are needed will be paid by the federal government and, second, that as they move into other health fields the federal government will be prepared to pay 50 per cent of the cost of those additional programs as well. After all, it is now almost five years since the medical care program came into effect. That program has brought great benefits to the people of Canada and I think the President of the Privy Council (Mr. MacEachen), who was minister of health at the time, has won for himself a place in the history books of Canada for the contribution which he made and which the government of that day made to the better health of the Canadian people.
But we cannot mark time. There is a growing need for dental health programs, particularly for school children and for the aged. Eventually, they should be extended to the whole population. This means spending money, for example, on building dental colleges and training dental assistants and dental hygienists. There is a growing need to move into the field of prescription drugs, particularly to help those who are suffering from long-term illnesses which require drugs to be administered over a long period. We all know, of course, that there are people who require treatment with certain drugs, such as insulin, for as long as they live. There is, too, a growing need for an optomet-ric service, again starting with children and then spreading out over the population as a whole. Such programs as these will not be introduced unless the provinces know that the federal government is prepared to share the costs on a guaranteed basis.
I hope that before this debate is over the Minister of National Health and Welfare and the Minister of Finance will assure the House and the people of Canada that the federal government will continue to guarantee a 50 per cent share of the cost of providing health services to this country, not only in respect of those services which are presently being provided but also with respect to additional services which ought to be provided and which, indeed, must be provided in the years ahead. Unless we take this course, we are virtually telling the people of Canada, through parliament, that the idea of a comprehensive health insurance plan, the concept that every Canadian, irrespective of race, colour or creed, will be entitled to all the health service he needs, has gone out of the window and that we intend to toss back into the hands of the provinces responsibilities they do not have adequate financial resources to meet.
[ Transla tion]


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, it gives me pleasure today to deal for the first time in the House with this very important aspect of my department having to do with the field of

May 11, 1973
Health Care
health. And I could say in that respect that I do appreciate the fact that the New Democratic Party decided to use this day to move a motion which will allow us to discuss that question so important to all Canadians.
Of course, that does not mean that I agree with the motion, far from it, but I think that it will certainly give us the chance to discuss both the situation that exists with respect to health services in Canada today and the proposals put forward by the federal government in that field in recent years.

I might be tempted to paraphrase, for the benefit of the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), a statement which was made at the recent meetings by a colleague of his from British Columbia, the provincial minister of health. There was, he said, a great danger when discussing these matters of using concepts and proposals of the thirties to meet problems of the seventies.


Mr. Grafftey:: That is another cliche.


Marc Lalonde: While we agree on the necessity of maintaining our health services in Canada, there is also a very strong feeling among all governments and the Canadian people, that we should get better value for our money and that we could make better use of the available resources in this sector at the present time. I think we can agree that these two major shared-cost programs have been highly successful in achieving their basic objectives of developing and making accessible essential health services of comparable standards on a nation wide basis. They were a necessary prelude to the next phase of rationalizing the comprehensive health care program so as to make it consistent with the particular health needs and the economic realities of today. However, the arrangements of the past, particularly in relation to hospital insurance, have tended to perpetuate our orientation toward high cost services. I was pleased to note that the hon. member conceded this fact.
A new approach is thus required-a rational and flexible approach which rewards efficient and effective provision of services and discourages inefficiency, ineffectiveness and the waste of costly resources; an approach that will encourage the evolution of the present system into one capable of meeting the needs of the future; in other words, a total approach that will result in the improved management of health care resources and their effective utilization through the entire range of facilities and services.
But while criticizing the present cost-sharing arrangements for contributing to an unnecessarily high rate of continuing cost increase, we must recognize that the present programs have served Canadians very well indeed in other respects. For example, the basic standards of comprehensiveness, universality, accessibility and portability have given all residents an outstanding degree of protection which undoubtedly has contributed to the improvements in health status which have occurred since the introduction of the two programs.

For example, on the eve of hospital insurance the Canadian infant mortality rate was roughly 20 per cent higher than that of the United States, 30 per cent higher than that of England and Wales and 40 per cent higher than that of Australia. By the end of 1971, the first full year of medicare for all provinces, our infant mortality rate had fallen to 10 per cent below that of the United States and to virtually the identical rate for England and Australia, although the rate had been dropping for them as well. Similar marked improvements have occurred in our maternal mortality rate as well.
With the introduction of the medical care program, medical practice has become economically viable in any community with a sufficient population to warrant a doctor. Decreased emigration and continuing high immigration of physicians from abroad, and an increasing output from Canadian medical schools, have pushed Canada's doctor-population ratio down virtually to the target which the Royal Commission on Health Services in 1964 despaired of reaching before 1991. The ratio for all active physicians, including interns and residents, was 1 to 661 at the end of 1971. All provinces have experienced a substantial improvement in their doctor-population ratios since the medicare program was first announced and the companion health resources program was implemented to assist in the capital and renovation costs of education and research facilities for health professions.
Thus, we have been getting some value for our money, and I would say good value. However, the combined rate of increase for hospital and medical services still amounts to some 12 per cent per annum and seems likely to continue at this level unless a different approach is taken to the delivery of health care. For example, it is generally agreed that many patients at any given time in general hospital facilities could be equally well cared for in less expensive facilities and that many routine tasks currently undertaken by physicians could be delegated to other professionals.
Many developed countries, including some with better mortality rates than ours, have succeeded in providing high quality health care to their citizens at a relatively lower expenditure than Canada. We believe, therefore, that we must and can improve the cost effectiveness of our present health care system and in this way help make available funds for the many major programs in a variety of fields which the people of Canada desire and need. The federal financial proposals are designed to enable and encourage provinces to take the most effective approach in the management of their health care systems.
The federal government is not proposing or considering abandoning the two great health insurance programs, nor in any way watering down their standards which mean so much to Canadians. What we intend to do is to help make it possible to improve their performance-both cost-wise and benefit-wise-and I am confident that, with the support of the Canadian people, and in co-operation with the provinces, we will succeed in doing just that.
I should like to concentrate for a few moments on the first part of the resolution that has been placed before this House. The first part of the resolution reads as follows:
That this House disapproves the government's proposal to retreat by stages from the present cost-sharing arrangements with respect to hospital and medical care programs-

It is obvious that the first component of the resolution is based on a misunderstanding, or possibly a complete misinterpretation of the objectives, concepts and principles of the federal proposal to the provinces for new financing arrangements in the health care field.
Let me emphasize at this point that the view the federal government is retreating by stages or otherwise from its financial responsibilities towards health care is inaccurate, misguided and misleading to Canadians who have come to rely on the existing insured-benefit program and who, in the final analysis, pay the costs thereof. As I will elaborate, the objective of the proposal for new financing arrangements is to provide greater flexibility to the provinces as well as the incentive to re-organize and create greater rationalization in their health care systems. In proposing a new form of contribution-that is, the per capita payment approach with provinces being able to apply the federal payments throughout the entire range of health services-the federal government is merely using the major instrument at its disposal to exert its force for fundamental change and to play the necessary role of the catalyst in expediting such change.
To understand properly the nature and purpose of the latest federal proposal for health care financing, which my colleague the Minister of Finance (Mr. Turner) and I placed before provincial ministers a few days ago, it would be appropriate to review briefly the circumstances which led to a re-examination of existing cost-sharing arrangements and the history of discussions that have taken place with the provinces on this matter for the past two and a half years. As all hon. members of the House are aware, the rate of escalation in costs of insured hospital and medical services has been a major concern to both the federal and provincial governments for a number of years. Several initiatives for reducing the escalation have been undertaken at both levels and on a joint basis. I am pleased to report that the steps that have been taken jointly with the provinces, and also taken by the provinces alone, have led to a situation in which the provinces have achieved a reasonable degree of success in their efforts to control costs. I feel certain that all hon. members will join me in an expression of appreciation to the provinces for such efforts.
However, these measures will have a short-term impact since they are not directed towards removing some of the glaring inefficiencies in the health care system. A more fundamental and comprehensive approach is required, an approach that will concentrate on the identification and development of less costly but equally effective methods of delivering health care services. The report of the committee on the cost of health services, as hon. members know, contains some 80 recommendations for reducing health costs. The majority of these lie in the sphere of the provincial authorities, and in our subsequent assessment of these recommendations in consultation with the provinces it became evident that the present arrangements did not offer sufficient flexibility to provinces to encourage implementation of many of the more economical methods of providing services.
Health Care
It was in the light of the foregoing circumstances that the provinces, in relation to the recommendations of the committee on the cost of health services, began to press the federal government for more flexibility in the use of the federal contribution. It was in response to this pressure that my predecessor, the Hon. John Munro, made known to his provincial counterparts at the federal-provincial conference of Ministers of Health on December 10 and 11, 1970, that he was prepared to re-examine the existing hospital and medical insurance legislation in consultation with them, for the purpose of developing a new approach to health care financing.
In stating his views at that time, Mr. Munro emphasized the need for a new approach, a rational and flexible approach which would reward efficient and effective provision of services and discourage inefficiency, ineffectiveness and the waste of costly resources. It was suggested that we should be seeking a form of financing arrangement that would enable the provinces to achieve greater flexibility in determining their priorities in the health care field within the context of national goals and in pursuing the most effective approach in line with these priorities; in other words, to encourage the introduction of more economical methods of providing services and other measures conducive to the development of a total health care system.
This is the objective which we established when we started to review the existing legislation and from which we have never deviated in the cause of formulating the latest proposals that we submitted to the provinces. Indeed, during the course of the many discussions which have taken place during the last two years with the provinces, although they disagreed in varying extent with some of the features of our proposals, never questioned the basic objective.
At this point it might be useful to members of the House if I were to set out more precisely these objectives. I will list six of them. They are: One, to reduce the rate of escalation in the cost of health services without impairing the quality of care, but introduce a form of contribution that would provide a greater incentive for control of costs; two, to give the provinces greater flexibility to determine their priorities in the health care field and to pursue the most effective approach in line with these priorities, consistent with the existing national standards; three, to optimize the use of all health resources; four, to permit the development of special programs like the thrust fund to bring about reorganization of the health care delivery system and thereby improve the efficiency of the system. The fifth objective was to simplify the financial arrangements between the federal and provincial governments, and the final objective was to meet the existing system of comprehensiveness, accessibility, universality and portability in respect of the basic hospital and medical care services and to obtain agreement for the co-operative development of additional standards in the over-all area of health services.
Surely, the establishment of these specific objectives as a basis for developing a new financial arrangement with the provinces and the nature of the discussions that have taken place with the provinces during the past two and a
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half years cannot in any way be construed as a move on the part of the federal government to retreat by stages from its responsibility in health care financing. We are attempting to introduce a substitute to the rigid forms of agreements that now exist. There is no question of the federal government retreating in any way from the well-established principles of the existing program, or of reducing its over-all role in the health care field.


Robert Lorne Stanfield: Except financing.


Marc Lalonde: I heard the Leader of the Opposition (Mr. Stanfield) refer to financing and I am coming to this. I should like to say a word about the proposals we put forward. It seems that some people, including the Leader of the Opposition, have found these a little bit complex. I will try to make them a little more simple.
What are the features of this formula? The first is a federal per capita contribution to provinces which would replace existing financial arrangements and which would escalate in relation to the growth in the economy with some adjustments that will be shown. The second is that the per capita contributions would begin in 1974-75 and essentially would be based on shareable cost for the fiscal year 1972-73. These base year costs would be adjusted upwards to reflect the introduction of an optometric benefit, unemployment insurance and, where appropriate, special adjustments for particular provinces.
The third is that the base year per capita payment would be escalated through 1973-74 with reference to the GNP plus one per cent. Contributions to provinces, of course, would also take into account population changes. The fourth would be a levelling of provincial per capita payments to a uniform national average over a 10 year period, a thrust fund totalling $640 million to be allocated to the provinces on a per capita basis and to be available to provinces during 1973-74, to be used at the time they want, after discussion and agreement with us, obviously. There would be provision for additional federal contributions to provinces in instances where provincial health spending would grow more rapidly than the rate of growth in federal payments, and a guarantee to provinces against the loss of federal contributions under the Canada Assistance Plan in instances where a province changes the basis for its support to health related services.
These are the basic features of the financial proposal that has been offered to the provinces. In addition, the federal government has assured the provinces that it will maintain its role in the co-operative development of standards, in the development and promulgation of health educational and promotional materials and in the provision of consultative services as required. Obviously, I do not need to spend time here in saying that the intention is to continue the broad range of services that the Department of National Health has been providing to Canadians in various forms for many years. So, the formula is not really complex, but it is not really simple, either.


An hon. Member:: It is confusing.


Marc Lalonde: Some people may be looking for simplistic solutions to these problems.


William Heward Grafftey: It is a bureaucratic nightmare.


Marc Lalonde: The present system would be even more complex than this system. What we are offering here is a solution which will certainly not only streamline the system but make it much more effective.
What about the estimated financial implications of this proposal on the basis of current projections of present shareable costs? The federal contribution under the present proposed formula would be greater by $1.1 billion over the next six years than under existing arrangements, and this is on the basis of the present projection of costs over the next six years. Out of this $1.1 billion I have mentioned the provinces would have available the thrust fund I have mentioned of $640 million. That fund would be provided to assist the provinces in reorganizing their health care systems and, in particular, to assist them in developing and introducing more economical methods of delivery care.
We firmly believe that the provinces will benefit considerably through a new financing arrangement such as we have proposed because the increased flexibility in the use of the federal contribution, combined with the innovation that will be possible through the use of the thrust fund, should enable provinces to reduce the rate of escalation in costs without impairing the quality of service. As will be noted, the proposed new formula includes no provision for the financing of new major programs. In this regard, I think you will agree that most provinces would object to the federal government taking an initiative in the development of new services or programs prior to the rationalization of the health care system and thereby releasing some funds from the existing programs that could be used for new programs. But this not excluded in the future.
The start of new programs like denticare or pharmacare is not excluded even on the basis of shared-cost programs. I would refer the hon. member to the statement made by the Minister of Finance on September 14, 1966 to the meeting of the ministers of finance in Ottawa in which it was said that most Canadians expect the federal government to retain some vehicle to bring about new countrywide social and economic advances in the future. He was referring to the cost-shared program. A constitutional paper was prepared for the constitutional conference entitled "Federal-Provincial Grants and the Spending Power of Parliament". There again it was clearly indicated that the federal government would remain in the area of shared-cost programs, but that this would have to be done on the basis of a clear consensus among the provinces. So, what we have here is a formula which, according to our calculations, -and there is always an element of risk; there is no absolute guarantee-would provide over the next six years an amount of over $1 billion more than the present formula would provide for improving the health services in this country.
I must say I was rather surprised and disappointed to read a report in the press of a statement by the Leader of the Opposition (Mr. Stanfield) while he was in Vancouver.
I am glad he could make it back for the end of this week. On Wednesday, the day after our proposal was made at the conference in Ottawa, he rejected totally the proposal and called it all kinds of names. I would have thought he might have taken the trouble to have at least read it rather than
May 11, 1973

depend on some garbled message which may have come through from Queen's Park.


Robert Lorne Stanfield: I rise on a point of order, Mr. Speaker. I am wondering whether the literature which the minister was kind enough to send me of the statements by himself and the Minister of Finance (Mr. Turner) are garbled reports or am I entitled to regard those as authorized versions of the latest gospel?


Marc Lalonde: Well, I can only conclude that the Leader of the Opposition could certainly have improved his service greatly had he obtained a copy of those statements the next morning in his office rather than in Vancouver. I would rather conclude that his master's voice from Queen's Park took no time to reach Vancouver, no more time than it takes to reach Ottawa these days.
I have only a few minutes, Mr. Speaker, and I wish to talk about the health resources fund. The health resources fund has been created to provide health training facilities in Canada. It provides for an amount of $500 million over the next 15 years. Out of that at the present time, as of March 31, 1973, $217 million have been paid to the provinces in contributions toward the costs actually incurred in creating the new facilities and another $81 million is committed to projects under construction. So, there is a total of $298 million committed to assisting in the creation of more than 150 projects forming the major part of our 16 health science centers across the country. But there is still a significant amount of money available in that category. There is an amount of about $200 million. These funds will be sued for major developments in the health research and training field over the next few years.
I must say that the proposed financial arrangements which are presently before the provinces contain provisions for $640 million for thrust funds which are available for both capital and operating requirements. Capital projects which provide less costly alternatives to acute bed facilities could be provided from these funds. This amount of $640 million would be available over a six-year period and, as I say, even if the provinces were not to use it in the six-year period they could still hold it in reserve. This amount should be compared with the $500 million under the health resources fund which was intended originally for a 15-year period. So, that is not such a bad deal.
The provinces have had placed before them, therefore, a proposal which includes a form of tax-sharing approach to which the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) referred. I might say I am afraid that, in spite of our efforts to reduce the consumption of alcohol and tobacco, I am pretty sure there would still be fairly substantial sources of revenue there for many years to come. If our campaigns should improve that situation, I could almost turn the argument around and say that we could assume a reduction in health costs because of the reduced consumption of tobacco and alcohol. This would mean, therefore, that the provinces would require less money for expenditure in that field.
Under our proposals the provinces would have referred to them six per cent of the income tax revenue plus the revenue from the taxes on alcohol and tobacco which have been mentioned. During the period when the value to the provinces of these additional taxes is less than the total
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value of the federal contribution toward health, the difference would be made up by a cash payment to the provinces. At the point in time when the value of these taxes begins to exceed the federal contribution, the provinces would keep the surplus. That surplus could be used for health and any other purposes they might wish.


Mr. Speaker:: Order, please. I have to interrupt the minister at this point for two reasons. First, his time has expired. Second, it is one o'clock. If the minister requires only a few minutes more to complete his comments, and if members would grant him unanimous consent, he might be allowed to continue now or at two o'clock. In this respect, the House is in the hands of members. Perhaps we could have an indication from the minister whether he could conclude in the next few minutes or whether he would prefer to resume at two o'clock.


Marc Lalonde: We could adjourn now, Mr. Speaker. I would require just a few minutes at two o'clock, if that is agreeable.


Some hon. Members:: Agreed.


Mr. Speaker:: It being one o'clock I do now leave the chair to resume the same at two o'clock.
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
[Transla tion]
Marc Lalonde: Mr. Speaker, I would like to thank all my colleagues who agreed to give me those few minutes to complete my remarks. I will deal very briefly with our proposal in the field of fiscal transfer.

I have heard several comments in the House about the transfer of the excise tax on alcohol and tobacco. Some hon. members seemed to feel that this was some kind of "bad tax". I am surprised at this introduction of the new concept of bad and good taxes according to the items which are being taxed and according to some moral criterion which should still be defined. The only thing I can say is that be they good or bad-and I suppose all taxes are bad-nevertheless no one has as yet invented a better solution to finance public expenditures. The fact is that the federal government has been spending large sums of money, I think over one billion dollars, over the last year. I am sure that the province of which the hon. member for Nanaimo-Cowichan-The Islands was premier would not hesitate to impose a tax on alcohol and tobacco to finance its operations, and the same would be true of the province for which the Leader of the Opposition was speaking a few years before he moved to leaner pastures. The federal offer, therefore-and I want to spend more time on this question-is a response to the provinces, both in terms of program control and flexibility and in terms of the willingness of the federal government to shift tax resources to the provinces as a means of financing federal contribu-
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tions to health, on the condition that the existing national standards be maintained.
As a result of the proposal that we have put forward, over the next several years the provinces, through the amount provided under the health formula made up of shifted tax resources and cash, will have the flexibility to make adjustments which should make funds available for other health programs. When the point is reached at which the value of these taxes begins to exceed the contribution under the health formula, the surplus, of course, will be available also at provincial discretion for assisting in total health financing, as I previously mentioned.


Robert Lorne Stanfield: In 1995.


Marc Lalonde: I think that once more the Leader of the Opposition is quite wrong. I suggest that he sharpen his pencil and he will find out that the cross over for many provinces will be some time in the early 1980s. I am not surprised that the finances of Nova Scotia were in such a bad shape when he left if he used such methods of calculation.
In conclusion, the federal proposal stresses the maintenance of the existing national standards and provides flexibility and thrust funds which will allow the federal funds to be used by the provinces for their total health financing. I think I can also say that several provinces would object in particular to new major shared-cost programs at this time, such as implied by the resolution before the House.
The mover of the motion asked a few questions in his speech, and I would like to spend a minute on them. First of all, he asked whether the $1.1 billion surplus which would be appearing according to our proposal over the next six years will cover 50 per cent of the cost of hospital and medical care. I can only tell him that this excess of $1.1 billion has been arrived at on the basis of figures provided by the provinces after many consultations and meetings with the provinces, and that on the basis of present projections as provided by the provinces over the next six years $1.1 billion more will be coming to the provinces for health expenditures than they would be getting under the continued present system of fifty-fifty sharing under the medicare and hospital insurance acts. I can assure him of that. I for one would say that if I were on the other side and if I were given a bet with odds of 1.1 billion, I think I would be crazy to refuse it. I would certainly not hesitate to take such a bet.
So far as the second question is concerned, as to whether it would be adequate to move into phase two and three of health care, I am not quite sure to what the hon. member was referring. I presume he was talking in terms of den-ticare and pharmacare, but I am not sure that that is what he had in mind. If that is the case, obviously this financing formula does not provide for those programs, but it has been quite clear from the beginning in our discussions with the provinces that the financing formula was not aimed at covering these plans. If the provinces were to agree with the federal government to embark upon new, substantial programs such as denticare and pharmacare on a universal basis, then there would obviously have to be new agreements, new discussions, and probably new legislation to put such programs into effect. As I have stated

before, there is nothing in our proposal that would preclude such an eventuality.
Let me say in conclusion that we believe what we have proposed is a fair and responsible answer to the problem. The moneys available are much more substantial than those available under the existing programs. Obviously, the provinces are free to reject the proposal; that is their right. But the federal offer has been made after over two and a half years of discussion, and if the provinces decide to reject it or refuse to consider it any further, at any rate let us not hear any more about federal rigidity and refusal to co-operate. I think the Canadian public and this House should know at whose door any blame should lie.


Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I am happy to be able to participate in the discussion of what I think is a most excellent motion presented with a most excellent speech by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). It seems to me that members of his party are generally at their best when opposing the government, an exercise in which they are not getting much practice but they can still do it. I listened most attentively to the hon. gentleman and found myself in agreement with the vast majority of his speech and I commend him.
It is an important subject. I notice that the minister said that the motion gave him the first opportunity to discuss this subject. I would say to him that it should not have been the first opportunity; he should have made a statement on motions before this conference or at least he certainly should have made a statement on motions after its dismal collapse. There should not be any reluctance to discuss in this House, before representatives of the people of Canada, the plans which he has made for the very important portfolio which he now holds.
There are so many areas of concern of which we must take note that I wondered which particular segment the hon. member for Nanaimo-Cowichan-The Islands would choose. There is great concern across the country for the casual, foot-dragging and underplaying with regard to the grave drug situation in this country. There is great anxiety, too, about the need to move quickly toward more efficiency in health care. The proposal of the Canadian Nurses Association is something which I think should commend immediate attention. There is great anxiety with the cynical disregard which there now seems to be for the whole question of medical research. One is appalled at the minute increase in the vote in this tremendously important field in this year's estimates which is just a little over $2,000. The hon. member for Nanaimo-Cowichan-The Islands, having decided to move into this field, must have had quite an exercise in intellectuality in choosing the area of immediate concern.
In his speech the minister indicated that, in his view, the plan which was so brusquely turned aside by the provinces a few days ago was not in fact a complicated plan. When I read the document I thought it was a bit complicated.


Robert Lorne Stanfield: Deliberately so.
May 11, 1973


Heath Nelson Macquarrie: After hearing the minister "elucidate" this morning I now know it was complicated.


Robert Lorne Stanfield: Deliberately so.


Heath Nelson Macquarrie: In this I agree with that great organ in the city of Toronto, the Globe and Mail which in an editorial this morning said:
Whether it was another failure or a bargaining ploy by the provinces, one thing is certain: the federal proposals were so complex that most Canadians would not have read them, let alone understood them, which is a bad state of affairs in a democracy.
When I read that I thought perhaps that gray shadowy person behind the legislative process in this country, that "genius" who dreamed up the FISP bill of the last parliament, must have employed himself in the convolutions that went into this plan.


Robert Lorne Stanfield: The same fellow.


Heath Nelson Macquarrie: It may indeed, as some of my colleagues suggest, be more than one. Perhaps it was a group effort or a committee effort and we know what committees can do sometimes. The formula is certainly cumbersome. But one thing about it was crystal clear; it was a bum deal for the provinces which they very smartly rejected on behalf of the people for whom they are trying to provide the best of medical service. I cannot but agree with the course they took.
I noticed with pleasure the reference of the mover of this motion to a document which I have often mentioned in this House, the Rowell-Sirois Commission Report on Dominion-Provincial Relations. It seemed to me that the minister somewhat denigrated this by suggesting that it happened to be a document of some decades ago. I am not one who necessarily believes that those things which are well established are automatically of no value. I think I have read most, if not all, documents on the Canadian constitution since the Rowell-Sirois Commission Report and I have yet to see one which in my judgment has a firmer grasp of the needs and values and priorities of our federal structure than that very fine document.
The only place where I may differ from the hon. member from Nanaimo-Cowichan-The Islands, is that being an ardent Canadian nationalist, I use the word "dominion" when I discuss these matters whereas he uses the more American expression "federal" but we all know what document we are talking about. I was impressed by what the hon. mover said about the irony of zeroing in on liquor and tobacco. Long ago in the legislature of the province of Prince Edward Island where the tax base is not so broad, Mr. Speaker, and where it is important to find every area you can for revenue, there was a discussion on the estimates and it seemed that the only place where revenues were expanding was from the taxes on liquor. The leader of my party at that time, a very distinguished physician, Dr. MacMillan, said "I still think, Mr. Speaker, that we cannot really drink our way into prosperity". I say to the people of Canada that they cannot smoke and drink their way into improved health.


Some hon. Members:: Hear, hear!
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Heath Nelson Macquarrie: I think we have to base our confidence on something a little better than that. I believe, as one who is something of an authority at least in a part of this realm because I gave up smoking long before I even heard of Miss Judy LaMarsh-


An hon. Member:: How about drinking?


Heath Nelson Macquarrie: I am here to orate, not to confess. I should like to say that, while we can find our moments of levity as demonstrated by the mover of the motion who has the light touch which I lack, being a dour, serious man on Highland Scottish extraction, the question is in fact a very serious one.
This week we had the very disturbing collapse of an essential dialogue between the two jurisdictions in this country. We had assembled the ministers representing the provinces and dominion in an area of immense importance to all Canadians, the field of health. A two-day conference was arranged which broke up after a one-day meeting, and I think the abruptness of the termination disturbed all of us and disturbed the people we represent. I have been looking over the various news items because I was not allowed into the conference. These things are now held behind closed doors. As I read the items I find room for deeper anxiety. The headlines read: "Federalism endangered by plan, Manitoba says"; 'There's no gain in it for us,' Crosbie says in rejecting proposal"; "No agreement on health costs", and all across the board there is a lack of confidence and a feeling of dismay that on this important question the two jurisdictions were not able to proceed.
The minister closed his peroration with the suggestion that it would not be difficult to place the blame and he implied that it lay with the provinces. I say that the major responsibility for the collapse of this very important conference lies in the inflexibility of the federal government of the day.


Some hon. Members:: Hear, hear!


Heath Nelson Macquarrie: Attitudes like that are revealed in an article by Peter Calamai, one of the most highly informed journalists in this field, which appeared in the Ottawa Citizen on May 7. The column is headlined, "No more sweetening of kitty: Lalonde". With an attitude like that at the beginning of a dominion-provincial conference, how in the world can we expect there to be a reasonable and harmonious discussion of this important matter. This government, which I consider as having been in office for one decade, and God knows that is too long, laid upon the provinces rigid restrictions in this field. Into that rigid framework the provinces have had to enter and administer the important and costly program of health care. It ill becomes the representative of the federal government at this stage of the game, after having laid down the rigid rules, to suggest that now he will leave to the provinces these rapidly accelerating costs and try to escape as far as he can from bearing the burden of these costs, many of them geared to the rigid formula inspired here, in Ottawa.
I am sure we all want the people of Canada to have a health care plan that is not only adequate but ample. I agree with the hon. member for Nanaimo-Cowichan-The

May 11, 1973
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Islands. Other countries in the world are ahead of us in this field and there is no reason why they should be. We are now at the stage in our social development where the proper health care of all Canadians is a.social necessity. It is a priority under our way of life. We cannot turn the clock back to the so-called glorious days of laissez-faire, because we know that even under our system substantial numbers of Canadians, this day, this hour, are left with inadequate care. One thinks of the permanently handicapped and of those, as the mover of the motion mentioned, who day after day must take costly drugs in order to maintain a viable standard of health.
We are all concerned about the tremendous increases in costs which have occurred in the last few years in this field, and we know that the provinces are bearing a tremendous burden in this field. Again, I agree with the hon. member for Nanaimo-Cowichan-The Islands. It is outrageous to suggest that the provinces are playing fast and loose with these funds and that they cannot be trusted. That is an outrageous suggestion. If the federal government cannot come up with something more realistic and generous than the complicated program thrown at the provinces the other day, it had better stick to the 50-50 formula. It is far better to stick with that than bring forward the kind of suggestion under which the government might do something in the 1980's to alleviate the situation.
I suppose the only element that could be more ironic than underpinning alcohol and tobacco would be designating the year 1984 as the year when action will be taken.


Robert Lorne Stanfield: Tax sharing might be significant by that year.


Heath Nelson Macquarrie: In the short time at my disposal, and I never like to speak beyond my time, may I say that in my view it is incumbent on the minister and the government, instead of sitting back now in a sulk, to negotiate seriously with the provinces; to start all over again, if necessary, to confess that they have been too rigid, too arrogant, too haughty, and to find a way whereby the federal government may maintain its traditional and proper role in ensuring minimal standards of health care across this country. At the same time, it must provide to the provinces sufficient resources to enable them to develop their own health systems which are geared to their own particular needs. It must give the provinces the administrative elbow room to develop within their own jurisdictions their own health systems so that they can obtain the maximum value for every dollar spent by either or both jurisdictions. We have had too much bureaucratic rigidity, too much of the take it or leave it attitude, too much of, "adopt our view, or go back to your provincial capitals".
I believe that if our government were to display sufficient sensitivity in this area, it would adopt certain priorities. I will name them in my limited time. First, the government should ensure that all Canadians get value for those tax dollars which go to meeting health care costs. We must take these things seriously. Second, it should ensure that each province has a fair and equitable share of tax revenues, either under the tax points system or under some other system, so that the provinces can meet their responsibilities for current health care programs and for

those programs which are needed to meet particular conditions within each province. Third, it should ensure what the present plan certainly does not ensure, that provision is made for the relative growth in revenues. These would have to be viewed realistically. Fourth, a sensitive, thoughtful and preceptive federal government would, of course, preserve its own power to use the fiscal system in order to maintain economic stabilization. It will also, and here I echo the Rowell-Sirois Commission whose chief prophet today is the hon. member for Nanaimo-Cowichan-The Islands, ensure the preservation of the principles of universality, comprehensiveness, accessibility and portability. These principles must be maintained.
Where we are most deficient, it seems to me, is in the lack of reasonable flexibility. When the late Prime Minister Pearson was in the House, he often talked about co-operative federalism. You do not hear that expression so much now and I do not think one sees it practised so much now, either. The federal system, as any historian or political scientist will tell you, is an extremely difficult one to operate. You cannot operate it by ultimata or by dicta. You can only operate it by continuous concession, constant compromise and eternal good will; declarations such as, "This is the last sweetener we are going to put into the kitty, take it or leave it", are recipes for the destruction of federalism. Federalism can crack on matters of social and economic concern as well as on deep political and emotional issues. Here, again, I find myself in accord with the mover of this motion. This is a matter of great importance. This is probably the biggest challenge the minister has faced and, so far, he has failed.


An hon. Member:: Ha!


Heath Nelson Macquarrie: If the sudden departure of the representatives of the provinces to their capitals is not a sign of failure, I do not know what more dynamic or dramatic indication one would want. I trust that the Liberal backbencher who laughed at my assertion a moment ago will take this seriously. I think the apparent lack of concern shown by the government has created a major crack in the whole structure of Canadian federalism. I hope, when this matter is taken up again by the first ministers, that we will see a bit more concern, a bit less callousness, more consideration and less inflexibility; otherwise not only our national health plan but our federal structure may be greatly endangered.
[ Translation]


Mr. C. A. Gauthier (Roberval):: Mr. Speaker, I should not like to miss this chance of saying a few words on the New Democratic Party's motion that reads as follows;
That this House disapproves the Government's proposal to retreat by stages from the present cost-sharing arrangements with respect to hospital and medical care programs and calls upon the Government to fund all health services on a 50-50 basis and to expand the Health Resources Fund to enable the Provincial Governments to improve their health services.
Mr. Speaker, I cannot give my wholehearted approval to this motion for the good reason that I see from reading it that it is the product of a socialist mind. I am not one bit socialist myself, but a democrat and where the provinces are concerned, I am for independence, which is why I
May 11, 1973

cannot accept the whole motion although I am in favour of parts of it.
This motion takes us back to the history of federalism, joint tax programs, and federal government spending power.
I had the privilege today of listening to the speech of the hon. Minister of National Health and Welfare (Mr. Lalonde). I was pleased to hear a former technocrat expressing his view on the profitability of federalism which he has been preaching for some years, as he did especially when he was the great mind behind the Rt. Hon. Prime Minister (Mr. Trudeau). And the statements he made today did not surprise me, as I knew nothing had changed, for every proposal made in the House was inspired by those technocrats. Indeed, I have always said that the present Parliament is being led by the technocrats, and that it is they who think up the legislation before asking us to pass it.
The proposals made at the meeting on May 8 were simply a repetition of those made at the meeting on January 19, although some have been slightly amended.
The Minister of National Health and Welfare said earlier that he needed more money. When health is concerned he needs more money and we get less for our money from those services.
I think we should consider carefully the current government proposals modified for the provinces. As recorded in Hansard for May 9 on page 3599, the Minister of Finance who was giving details of those proposals stated, and I quote:
First, we would be prepared to reduce the rate of federal personal income tax by 6 percentage points. These tax points would be equalized to the national average under the existing provisions of the Fiscal Arrangements Act. The federal government would give a firm undertaking to effect this transfer. But, for reasons I shall explain in a moment, ...
And he gave a few reasons for proceeding immediately with certain transfers. Again I quote:
Second, we would be prepared to eliminate the existing federal excise taxes and duties on domestic and imported tobacco products, spirits, brandy, wine and beer. Provincial governments would then be able to move into this tax room without any increase in costs to consumers . . . Third, to the extent that the value of the tax cut is not sufficient to pay for the federal contribution for health services, as determined under the GNP-escalated formula, the federal government would make this up by a cash adjustment.
However, when you consider that these proposals have been submitted by the provincial governments we say on their behalf that of course the current proposals are unacceptable to the provinces for the good reason that they will get even less, whatever the minister says, in return for the rights they have given up in favour of the federal government more than 40 years ago. What astounds me is the behaviour of the government which is always making submissions to the provinces whereas under a true federalism, the provinces should express their wishes to the central government. We are doing here what we blame the large unions for, that is, we are entirely forgetting the wishes of the grass roots to consider only those of the leaders. I think that the federal government is asserting itself in the same way as the big union leaders. The Minister of National Health and Welfare said elsewhere in
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his statement: "If the provinces do not approve of it, all they have to do is reject it." But he failed to add that if they refuse they will have nothing, which is simple. Reference is made to agreements with the provinces. But what is the nature of those agreements? The federal government stands before the provincial governements and says: This is what we want. You are free to accept it or reject it, but if you reject it, you will get nothing. The Minister of National Health and Welfare himself has just repeated those words.
Mr. Speaker, we call this coercion by leaders antidemocracy or dictatorial federalism, and the provinces cannot submit to this any more than union members can accept the conduct of certain union leaders who unilaterally impose their decisions on the provinces without even consulting them. And that is exactly what the federal government has been doing for many years as we witness ever more inquiries and federal-provincial conferences such as that of May 8, with decreasing success. And we witness the clash of brains between officials who are well installed in all departments and who are seeking a new gimmick in order to pester everybody and give more authority to the central government, while provinces are being turned into mere vassal institutions. What is regretable in Quebec is that we do not have a government strong enough to stop this invasion by the federal government. What did all these meetings with provinces bring as concrete results?
Mr. Speaker, one has only to read the newspapers of the day following this famous meeting to see once again the deplorable state of the situation. In the Montreal-Matin of May 9, for instance, we read and I quote:
Ottawa and the provinces on the warpath.
There is nothing new about them being on the warpath and I think they will continue to be because responsibilities are not outlined. I for one have always been opposed to these joint programs. I was glad, in the years of the former prime minister, the late Right Hon. Mr. Pearson, when he informed us that should he stay in office for another two years, there would not remain a single joint program. He had promised to remove them all. But six months later, the Liberal party compelled him to resign and elected another prime minister. Since then, joint plans have been increased threefold, and I say that so long as we have that system without a sharing of responsibilities, we shall have this quibbling. What I am hoping for is that if a province turns any specific field over to the federal government it does so on a 100 per cent basis, and not 25, 40, 75 or 80 per cent, a little game that leads to all this continuous bickering. It is still true that "Ottawa and the provinces are on the warpath". Here is what one can read in the May 9, 1973, issue of Montreal-Matin:


TOTAL FAILURE OF CONFERENCE
[Stage Direction]
The double conference of ministers of Finance and Health and Finance and Education respectively ended in total failure. Having been unable to agree on the financing formula proposed, at both levels, by the Trudeau government, the participants decided to go home and refer the whole problem to the premiers who are to meet in two weeks in Ottawa.
[Stage Direction]
May 11, 1973
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As the first lot was unable to agree, the matter will be referred to the provincial premiers, who will agree no better. Like the premier of Quebec, when they return from some conference where they achieved absolutely nothing, they claim to be satisfied and even say so on television programs. This, of course, is to disguise the party's failure, as citizens are inevitably the victims. I continue quoting:
This dramatic development came about at a time when there were indications, at least according to federal spokesmen, of provincial interest in the federal proposals. But it is now clear that that optimism was forced and that, on the contrary, the provinces demanded a higher degree of flexibility in the fields under their constitutional jurisdiction.
This failure is even more serious for the federal government especially as the minister of Health and Welfare, Mr. Marc Lalonde, had succeeded, a fortnight ago, in obtaining the unanimous approval of the provinces concerning the objectives of his program to review the social security system.
Some approval! How happy Mr. Castonguay said he was, in Quebec, upon his return from Ottawa when he said that at last there had been an agreement. And how! He has left the entire administration to the federal government. Incidentally, with regard to family allowances, that is what we want. That is what the country wants. If the family allowances system is turned over to the jurisdiction of the federal government, then let it take it over 100 per cent and then one will be able to say whether they administer it well or bad, but, let no one say that 40 per cent of the administration will be left to the federal government and 60 per cent to the provincial government or vice versa. Once again, those particulars should be determined clearly, to avoid quarrels.
To go back to my quotation:
The fact that the dual question of health care and postsecondary education has been referred to the government leaders themselves is a clear indication that relations between Ottawa and the provinces are not at their best.
Generally, the provinces want the federal government to move out of a vast field of taxation to allow the provincial governments to finance their own particular programs without having to beg endlessly and remain in a state of dependence upon the central government.
For that, the provinces and ourselves blame the federal government.
Before leaving, the provincial minister of Finance, Mr. Raymond Garneau, stated that if Quebec had accepted the federal proposals on financing postsecondary education, it would have lost several million dollars.
As for the financing of health care, Mr. Garneau finds the Turner formula too complex and not generous enough. Instead of the 28 tax points Quebec demanded, Ottawa offers only six-
And the Minister of National Health and Welfare (Mr. Lalonde) spoke a while ago of $1,100 million.
It is nice to talk about an increase of one billion one hundred million dollars over a period of six years, but if, for example, Quebec's expenditures for hospital services were to double, what would this billion be worth? This is very relative. If I am offered a billion tomorrow I would be crazy to refuse it, but we must think in the long term. With regard to the future expenditures of a province, what is this billion worth? It may be worth a trifle and this is why we are not ready to accept such amounts without first knowing, Mr. Speaker, if expenditures will rise or fall.

It is obvious that in the present situation-and I could mention six other items, but I will be satisfied with one- we suggest that the government accept the status quo, i.e. what was paid formerly to the provinces, because we must live in this upside down federalism; let us accept the formula of paying in equal parts the expenses of the provinces. This first proposal was much more equitable; by accepting to pay half of the expenses of the provinces, if the expenses increase, it is understood that the payments of the federal government will increase because, after all, it is the role of the federal government. It merely collects taxes to transfer them to the provinces. This is not funny, but it should play that role. Today, it benefits from its situation as collector to impose its will, to become a dictator, and this is why we would prefer the equal share formula for some time while waiting for a true revival of Confederation. We are now living with dictatorial federalism. If we come to a true revival of Confederation, the provinces will have something to say. They will then determine together the activities of the federal government in our country, as was done 40 or 50 years ago. At least, under the equal share formula, the provinces had or still have something to say. They can choose the quality of medical care and improve them and they are always assured that the central government will have to supply its share. In a word, they can still prepare their budget in accordance with the needs of the population instead of gearing health services to the amount that Ottawa will be kind enough to give them. The federal government could withdraw completely from such provincial fields as health and education. Let it withdraw completely and leave it entirely to the provinces-
The Acting Speaker (Mr. Laniel):: Order. I regret to have to interrupt the hon. member but the time allotted to him is now expired.


Mr. B. Keith Penner (Thunder Bay):: Mr. Speaker, it has come to my attention that there are quite a number of members who wish to participate in this debate. If there is agreement from all sides of the House, perhaps the suggestion could be accepted that henceforth there be a 15 minute limit on speeches, which would enable all members to have an opportunity of speaking before we adjourn for the weekend.


The Acting Speaker (Mr. Laniel):: Hon. members have heard the suggestion. Is that agreed?


Some hon. Members:: Agreed-


B. Keith Penner: Mr. Speaker, as an elected representative from one of the slow growth, developing regions of this country I should like to make a brief contribution to this debate and to express some of the concerns of those I represent. The tone of my arguments will be in direct contradistinction to the hon. member who has just spoken, particularly with reference to the role of the federal government in the health care field.
Any consideration of health care in Canada must, of course, include reference to the quality and and extent of service and the cost of all aspects of any comprehensive
May 11, 1973

health care program. The Minister of National Health and Welfare (Mr. Lalonde) has proposed to the provinces that existing shared-cost programs under the Hospital Insurance Diagnostic Services Act and the Medical Care Act be replaced by a single program under which the provinces would be free to use federal payments in whatever way would best assist them in the development of their health care programs.
The argument in favour of this proposal is that the provincial governments would have greater flexibility in introducing more effective and more economic methods of dispensing health care. In short, it is suggested that acceptance by the provinces of this scheme would mean better health care at less cost. That is what we want in Canada and it is what we should strive for. But is that what the result would be from this different approach to the financing of health services in Canada?
Speaking personally, Mr. Speaker, I am reluctantly just a little sceptical about the free-hand approach to the provinces, and I should like to try to explain why. I know the contention that this would be a step toward clarifying which government is taxing us to do what; but I am also aware of the tendency of some provinces, especially the one in which I happen to live, Ontario, blatantly to neglect their underdeveloped and remote regions. It is the federal government which has expressed primary concern for regional disparities, and in my view this must apply to health care as well as to economic development.
Rather than seeing less involvement of the federal government in health care services, I would favour a more active presence, particularly in the delivery of health care services in the more remote and underdeveloped regions of Canada. At the present time, as all hon. members know, the federal government is responsible for the health care of native people living on reserves. If you asked any chief or band council whether they would like this responsibility transferred to the provinces, you would get a very quick and strongly worded negative response.
Why is this, Mr. Speaker? Because Indian people know that they are much better served, in most cases, than are their brothers and fellow citizens living off the reserve in a remote area and who come under provincial jurisdiction. Non-native people who witness the establishment of nursing stations on reserves and who know that there are regular visits of medical specialists and dentists to isolated Indian communities quite rightly ask the question: Why can't we have these same services, the same quality of services? It is an empty, hollow answer to tell them that they come under provincial jurisdiction, we are sorry. The indignant rebuttal to that by my constituents is: If that is the way it is, then we, too, want to be under the federal umbrella for health care services; we want Ottawa to provide us with access to health care services which the province refuses to do. To persons residing in more isolated areas where there is a serious lack of hospital facilities and health workers, accessibility simply means the availability of services. It is of very little benefit to a citizen to have publicly financed health insurance coverage if he has only very limited opportunity for reasonable access to necessary and appropriate health care when it is required.
Access to health care is now being identified in a number of charters on human rights. It is my understand-
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ing that the primary objective of the existing federal health insurance legislation was to ensure that all Canadians would have access to services, irrespective of their ability to pay and regardless of where they live.
One of the difficulties which I see in the motion that is now before the House is that it calls only for the federal government to issue a blank cheque to the provinces for health care services. It says nothing about insisting that the provinces do a better job of distributing these services fairly and equitably in order to get the money from the federal treasury which is being offered to them. This government has endeavoured to adopt a fairly high profile in doing something about regional economic disparity. I ask them now to adopt an equally high profile in seeing to it that regions like northern Ontario receive much more in the way of health care services and facilities. Leaving the field open to the provinces, giving the provinces a free hand, will likely mean that those who now have will get more, and the have-nots will still be no better off.
From time to time we hear much said about constitutional propriety as related to such responsibilities as health care. That is a fascinating academic diversion, but it does nothing to help the men, women and children who live on the expanding frontiers of Canada and who deserve at least as much as their urban cousins namely the right to medical attention and health care as and when it is needed. It is the federal presence in this field which can guarantee help to those who need it most. If the federal government is seeking to retreat from the health care field-and I hope that is not the case; I have read again the minister's speech and I am assured that it is not the case- if there is any tendency or temptation in this direction, then I urge every possible reconsideration. Instead, I make the plea for a more active, direct involvement by the federal government in this field. To leave the provinces free to use federal payments in any way they like for the development of health care programs will only mean hardship, particularly for those who live in the vast region of northern Ontario.
The Department of National Health and Welfare Act charges the minister of that department with the responsibility for all matters relating to the promotion and preservation of the health, social security and social welfare of the people of Canada over whom the parliament of Canada has jurisdiction. In addition, there is to be co-operation with provincial authorities with a view to co-ordinating efforts made or proposed for preserving and improving the public health. I am not certain that there is a desire on the behalf of the federal government to retreat from this responsibility, but if that were so, then I would certainly oppose such a move. There is a need in Canada for the federal authority to become more closely involved with the provinces in the health care field; to co-operate more in efforts to improve public health; to take more initiatives, not less; to show more leadership and not draw back and give a free hand to a province like Ontario which is hardly aware of its own geography north of Sudbury, Sault Ste. Marie or west of Thunder Bay.
Since the Second World War, one of the most striking developments in the health care field in Canada has been the progressive involvement of the government. It is no
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longer accepted wisdom that medicine and government should never mix. The federal government's primary objective in the health field has been to promote and assist the development of essential services on a nationwide basis, the development of comparable standards of service across Canada, and to help make available the human, physical and financial resources required to provide these services. Much has been accomplished, and we do not need to review it all now.
This is not the time, however, to weaken the federal presence in the responsibility for health care; this is a time to strengthen it. To withdraw the federal presence and replace it only with tax points and other financial resources would be wrong. It would be much better, it seems to me, to remain an active participant and see that our 50 per cent share, or whatever it is, is being spent for the maximum benefit of Canadians and is fairly distributed.
The Minister of National Health and Welfare has clearly stated that the basic standards of comprehensiveness, accessibility, universality and portability would be maintained under any new scheme of health financing. I only wish I could share his faith that in giving the provinces more freedom and flexibility the result will be better health services at less cost. Maybe that will be so for British Columbia or Manitoba-I do not know-but as one who comes from northern Ontario I can tell the House that we have absolutely no faith or confidence in the government which presently occupies the seat of power at Queen's Park. Our medical care premiums are among the highest in Canada, yet in vast stretches of the province of Ontario there is little or nothing in the way of health care services.
Whatever the financial arrangements may be that the minister will work out with the provinces, I urge this government to have a strong voice in seeing that the funds allocated are appropriately and equitably used by the provincial authorities.


Robert Lorne Stanfield: Mr. Speaker, I do not intend to enter into a debate with the hon. member who has just resumed his seat, except to say that it seems to me a good deal of his speech would have been more appropriately made to the legislature at Queen's Park rather than here.
I should like to address myself to some of the things the minister said. I am sorry he is not here. I am sure he has a valid reason for being out of the House. The minister took a pot-shot at me for being out of the House in the middle of the week. I am sure a pressing engagement has taken him from the House, but I am sorry he is not here. I would feel a little easier saying some of the things I intend to say if he was here to hear them.


An hon. Member:: It couldn't be that important.


Robert Lorne Stanfield: We will see how important it is. First let me say that the minister took exception to a comment I made on Wednesday in respect of his proposal, and made the charge that I had made comments without knowing what he had said. The minister has a tendency toward this kind of offhand, snide comment. Apparently he had forgotten that his office, which is much more courteous than

he is, had sent me full documentation of the proposals. I had that documentation before me and was able to read and study it.
I may tell the minister through you, Sir, that I have had quite long experience in analysing proposals put forward by the Department of National Health, both here and in connection with my former responsibilities. Although the proposal here is complex, as has usually been the case, it does not take anybody with ten years' experience or more in analysing such proposals to see through them rather quickly. I am sure the distinguished member of the NDP who sponsored this motion was able to analyse the proposals in the same way. I do not take offence easily, but I resent the kind of stupid remark the minister made, when he does not even know what his own officials are doing as far as dispensing information is concerned.
It is very clear that the main purpose of the minister is to restrict federal financial responsibility in this area. That is the main purpose of this whole exercise, although it has been dressed up with a lot of talk about flexibility, and so on. I do not question the earnestness or the desire of the minister or his department to exercise the machinery which exists for controlling the growth of and the expenditure for these programs. I do not question their sincerity, but the whole purpose of this exercise is to limit the increase in the financial responsibility of this government. That is the main thing I want to say this afternoon, and that is why I suggest that any provincial government which accepts this proposal is out of its mind. I put it as simply and as bluntly as that.
The schemes which are in effect today were put forward by the federal government in the areas of hospitalization and medical care. There was no negotiation or discussion about essential matters. The hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) will recall very well, I am sure, that there was no give and take on any matter of consequence. The principles and the main features of these programs were laid down by the federal government, and that was that-the provinces either took them or left them.
Now the federal government has apparently made up its mind that it is not getting full value for the programs it laid out, and wants to restrict its financial liability. It talks about injecting flexibility into the programs but gives no indication at all as to how a province such as Nova Scotia, for example, can finance these measures and achieve flexibility. It is all very well to talk about building nursing homes and a whole scheme of institutions to take care of people, but you first must have the money to do that. For years this government would not even participate in cash grants for the construction of hospital beds. My hon. friend from Nanaimo-Cowichan-The Islands recalls all this well, as I recall it.
When the Minister of National Health and Welfare (Mr. Lalonde) talks about the federal contribution equalling 50 per cent of the total cost of these programs in future years-and he says it will-I have not the slightest confidence in his projections or his figures, because the whole point of the exercise is to restrict the growth of future responsibility. If that was not the point, the government would not be moving away from the 50-50 cost-sharing arrangement.
May 11,1973__________________________________COMMONS DEBATES________________________________________________3679
There is room for legitimate argument and discussion as to what the federal presence should be in respect of the administration and delivery of health programs, how much the federal government should be involved and how much the provincial governments should be involved. But there can be no room for argument about the responsibility of the federal government to participate fully in these financial responsibilities. The government is welshing on that aspect of the matter, Sir, and that is what angers me. It brought the provinces into these programs and it is now trying to welsh on its financial responsibility and its general responsibility to the Canadian people.
Now the government has introduced, for perhaps some kind of smokescreen, a proposed tax-sharing arrangement which even the Minister of Finance (Mr. Turner) calculates-and I have no more confidence in what he says in 1973 than I had in what he said in 1972-would mean that even in 1977 the amount the provinces would receive under this arrangement would constitute only 75 per cent of the federal financial responsibility. Presumably that means that we would be well into the 1980s before these tax-sharing arrangements would have any real significance to the provinces. Are we to take up time in the House and in discussion between the federal government and the provinces, with all the problems which lie ahead in the 1970s talking about some kind of phony proposal which might possibly have some significance in the 1980s?
In the end we come right down to the fact that an adequate health delivery program is vitally important to every Canadian. There is no doubt about that. I refuse to be a party to any effort by the federal government to welsh on its responsibility and limit its risk, leaving the provinces to accept the full risk in a situation into which the federal government led the provinces, sometimes willingly and sometimes not so willingly.
Be that as it may, we are now operating under programs which the federal government says are not producing results commensurate with the amount of money being spent on them. I say, let the federal government work with the provinces to make the health delivery system more efficient and more valuable to the Canadian people, but let us not have the federal government, under some talk about flexibility and tax-sharing arrangements and guff like that, try to restrict its responsibility and let the provinces wrestle with an increasing financial load which will be felt by the wealthier provinces and which we know is very unfair to the poorer provinces. I wish the minister had not been in such a hurry to leave the House. I would have liked him to be here so that I could have told him personally of these things. If he does not read these comments I hope I will have another opportunity of putting them to him.


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, most Canadians and most Members of Parliament have lived with the universal hospital and medical insurance plans which are in effect in every province in Canada for so long that they tend to forget what the situation was before we had them. They have eliminated the worry tremendous debt which could be, and was, incurred by Canadian citizens, and not just those in the lower income
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brackets, before we had this kind of system. I have read an article by the Washington correspondent of the New Republic which appeared in that magazine on February 10, 1973. He compares what happens in countries such as Canada, Great Britain and Finland, where there are insurance plans to take care of hospital and medical costs, with what happens in the United States. I wish to place some of his comments on the record in case some hon. members do not remember what happened a couple of years ago. He quotes from an NBC documentary and says:
There was this lower-middle-income worker with a heart attack. The hospital took him in, thinking he was covered by California's state health insurance; he wasn't. He cashed his life insurance for $4000 and gave it to the hospital, but he was left with $8000 still to pay. The doctor told him to go home, take it easy, relax, don't worry about anything.
How could he help but worry? The article continues:
A woman we know went to the hospital recently for an emergency check-up and chose a low-price room; she was discharged two days later-hospital bill $237.10. The American Hospital Association says a day in a hospital now averages $105.30. Health costs have shot up 40 per cent in four years.
That is the situation in the United States where there are no hospital or medical insurance plans. We have such plans in Canada because the CCF government of Saskatchewan, headed at the time by my colleague the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), did not wait for the other provinces or the federal government but implemented on its own a full hospital insurance plan and, later, a medical insurance plan. Then the federal government came forth with an offer to the provinces to pay half the cost of a hospital insurance plan provided it was universal.
I remember the opposition there was to that proposal from the provinces. I remember a former Conservative Premier of Manitoba, Mr. Roblin who at that time was the leader of the official opposition objecting violently to that proposal. According to him, all that was necessary was that the province of Manitoba pick up the tab for those people who could not afford to pay premiums into Blue Cross, the voluntary hospital plan. However, the people of Manitoba insisted on having a universal plan to cover hospital costs. Now we have it in every province.
I remember that when the Liberal government under Mr. Pearson made its proposal about universal medical insurance coverage and told the provinces it would share half the cost of the program, Premier Robarts, the Conservative Premier of Ontario, objected bitterly. He did not want the plan. However, he finally came into it not because he wanted the province to be part of a universal plan but because the people of Ontario said it was a good idea, particularly if 50 per cent of the cost was to be paid by the federal government. So Ontario and the other provinces came in.
We made a good beginning to this kind of program, but it was only a beginning. We still ought to be thinking about coverage for optical expenses, for dental expenses and for the cost of prescription drugs which are tremendously expensive. We certainly will not get the provinces to think about these things, even if Ottawa were to make such a proposal, because Ottawa is now saying to the provinces that it gave them a cost-sharing program for hospital and medical insurance and now it intends to get
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out and leave the provinces to carry the ball. Any provincial government which would think about co-operating with Ottawa to implement a denticare plan, an optical plan or a prescription drug plan, when Ottawa takes this approach to shared-cost programs, would have to be crazy.
The federal government is worried about the escalating cost of the present hospital and medical insurance plans. So it should be. Ottawa is no more worried than is every provincial government in this country because these costs are escalating. There is no questions about it, they are going up at a very rapid rate. So all governments are worried about what can be done. Just as Ottawa has been looking at the problem, the provincial governments have been looking at their plans to see what can be done. A number of suggestions have been made. Many of the suggestions which seem most likely to help reduce costs could be put into action very quickly by the provinces, except that Ottawa is not now committed to pay for alternative care.
Let me illustrate what I mean. The cost of hospitalization in one of our general hospitals is now running at between $65 and $90 a day per bed. If a person in any city in this country is hospitalized, no questions are asked; Ottawa pays half the costs for standard care. But many of these people, particularly after an emergency and following the acute stage of their illness, could be moved into a nursing home until they were ready to go home. Many of them could have some form of home care. Both of these types of care are substantially cheaper than the cost of having a person in a bed in a general hospital.
Why do the provinces not adopt such a plan? It is because even though it is cheaper, it is more expensive than 50 per cent of the costs of operating a general hospital, and Ottawa refuses to amend the legislation to pay 50 per cent of nursing home care or home care. The costs of medical insurance, that is, the amount going to doctors, have risen substantially year by year. They have risen whether or not the provinces agree to a formal increase in the rate.
Almost without exception there is an increase in the amount paid to doctors in every province, every year. I am not blaming the doctors. I am not saying the doctors, working the way they do, are charging too much, but we must consider whether there are not other forms of medical care which can be just as effective, or more effective than the present methods and will cost the community less. We should be looking at the possibility of using paramedical people who can do a great deal of the fairly routine work which doctors undertake.
The federal government commissioned Dr. Hastings of the University of Toronto to look at the whole question of medical care. Dr. Hastings made a report and recommended in it very strongly that we move on a voluntary basis toward a system of community health clinics. Some of the provinces-I know that my province of Manitoba is one of them-are very interested in encouraging the growth of community health clinics on a voluntary basis. There is no suggestion by anybody, that I know, that doctors would have to practice in a community health clinic or that patients would have to go to it, but on a voluntary basis

the province of Manitoba, among others, is very interested in such clinics.
Is there any suggestion that Ottawa will really support community health clinics? If there is, I have not seen it. We are concerned, the provinces are concerned and the public is concerned about increasing costs. The public and the provinces want to slow down the rapidly increasing costs, but not a single province, regardless of what party forms the government, has agreed or will agree to the unilateral proposal made by Ottawa that it will limit the amount of the increase which it is prepared to give toward the payment of hospital and medical insurance plans to the amount of the increase in the gross national product.
It may be that the proposals of the Minister of Finance (Mr. Turner) would cover 50 per cent of the cost of hospital and medical insurance for the next five years. But what happens after five years? As costs continue to rise, the provinces will no longer be paying 50 per cent; they will be paying 60 per cent, 65 per cent or more. Every province will be hurt. The wealthy provinces, such as British Columbia, Alberta and Ontario, can probably manage in one way or another. The people and the provinces who will be hurt are precisely those who can least afford to carry the costs of hospital and medical insurance.
Therefore I am amazed that a federal government which encouraged the provinces to go into hospital insurance, which forced the provinces to go into medical insurance, is now saying to the provinces: We are no longer prepared to honour the commitment we made to you when we urged this plan on you, that we would pay 50 per cent of the cost of these plans.
The proposal of the Minister of Finance and of the Minister of National Health and Welfare (Mr. Lalonde) cannot be accepted by the provinces. It is a proposal of which those ministers should be ashamed. While they have a right to be concerned about the costs of health services in this country, they have no right to renege on the promises and pledges they made to the provinces that the federal government would pay 50 per cent of the costs of hospital and medical insurance.
[ Trans la tion]


Mr. Maurice Dupras (Labelle):: Mr. Speaker, first of all,
I must say how puzzled I was after reading the motion moved by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), which reads as follows:
That this House disapproves the Government's proposal to retreat by stages from the present cost-sharing arrangements with respect to hospital and medical care programs.
I wonder, Mr. Speaker, if we should not read it as saying that his party denies to the provinces the responsibility of ensuring the management of health services. It is exactly as if we were denying the provinces the ability to manage their program themselves. And further on, this motion seeks, it seems, to restrict also the federal government's participation while urging that all health services be financed on a 50-50 basis. When one reads the statement made last Wednesday by the Minister of Finance (Mr. Turner) and that of other provincial Ministers of Finance, one can readily see that the 50 per cent will be exceeded, as stated in the motion.
May 11, 1973

This motion, Mr. Speaker, is not justifiable because provincial governments are denied the opportunity of selfmanagement and of ensuring themselves the management of health programs. What this government proposes in fact, Mr. Speaker, is very clearly stated in the release issued by the minister. It said that the purpose of the federal-provincial meeting was to draw up a new formula in order to determine the annual federal contribution to health services administered by the provinces, that this formula was designed to replace the present cost-sharing arrangement established under the Medical Care Act and the Hospital Insurance and Diagnostic Services Act and would give provincial administrations more flexibility in order to provide more efficient and cheaper health services, while making for reduced health care costs.
That, Mr. Speaker, the spirit of the program as introduced and prepared by the Minister of National Health and Welfare; this has nothing to do whatsoever with the motion introduced by the member of the New Democratic Party who wants that the provinces be denied the responsibility of managing this program.
As was seen, Mr. Speaker, and as was noted in the last few years the costs of medical care increased constantly year after year. One could read recently that those costs actually registered an increase of at least 14 per cent a year.
For the year 1973 or for the rest of the decade we should be mainly concerned with setting up a much more modern system which would provide Canadians in all provinces with much more adequate and cheaper health services.
It is in that spirit, Mr. Speaker, that the plan was introduced; it implements certain recommendations and especially those in the Harding report which, for example, deal with the establishment of community health centre networks to reduce the stay of patients in hospitals. A shorter hospitalization period would mean lower costs for the Canadian taxpayers and would make rehabilitation and nursing medical services much more accessible and at a much lower cost especially for those living in the rural areas of this country.
I am thinking particularly about the people in my riding who for a large part must drive several miles, over 50 in certain cases, to get medical care or hospitalization.
If they could go to community health centres located near their homes in their municipalities the cost of health care in Canada would be considerably reduced.
The Harding report recognized that such centres and services if well designed and administered would contribute greatly to reducing the cost of medical care as well as facilitate its access within a well integrated system. This is what I meant, Mr. Speaker, when I said that medical care would be much more accessible and could be provided cheaper than that administered in hospitals which several citizens cannot easily reach because they live far away from rural centres.
The proposals were described as very complex. Of course, the problem is also quite complex; there is no easy formula which would meet the needs and would be acceptable to all the provinces. We can already see some wavering or reluctance on the part of several provinces to accept the proposal. I think that they want to study the matter in
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greater detail, before passing judgment on the proposals which was not the case on the part of some hon. members.
Mr. Speaker, although the philosophy of the program has been accepted by the Leader of the Official Opposition (Mr. Stanfield), he refuses to understand all the complexities or the mechanics of the whole program which has been put forward to the provinces.
Last Wednesday, the non. Minister of Finance listed the mechanics for the financing of the program and I should like to correct certain comments that were made earlier by the hon. member for Roberval (Mr. Gauthier), the spokesman for the Social Credit Party of Canada, when he said, for example, that once again, it would be some kind of "big brother's" federalism where provincial governments would be subjected to some authority or dictatorship.
He quoted the formula-or part of it-which had been submitted, but without any further explanation. In fact, he omitted to go on and explain the mechanics of the tax proposal.
With your indulgence, Mr. Speaker, I should like to remind hon. members of some mechanics as announced by the hon. Minister of Finance. He stated that as far as personal income tax was concerned, he would like it to be quite clear that the federal government, for reasons known to the House, will not reduce taxes through tax abatements. He suggests rather the establishment of new federal and provincial tax schedules; when the federal government will reduce its rates, the provincial authorities may collect the relinquished federal revenue by increasing their tax rates. The taxpayer's onus will not be increased, a detail which the hon. member for Roberval (Mr. Gauthier) has failed to point out.
The member for Hillsborough (Mr. Macquarrie) referred to excise taxes levied on alcoholic beverages and cigarettes. I think that it is essential, Mr. Speaker, to read carefully page 3599 in Hansard of May 9 last. I quote:
In the case of tobacco products, the repeal of federal excise levies would allow the provinces to increase provincial sales taxes on these goods by an equivalent amount without increasing tobacco prices. The provinces would thus acquire additional revenue equal to the amount of federal revenue foregone.
Of course we are not giving up that taxation field in order to avoid our responsibilities or a reduction in such tax revenu, believing or foreseeing a reduction of those taxes on account of a general decrease in cigarette and tobacco consumption.
The hon. member for Hillsborough said that he had given up smoking, just like me. Like him I will say that I have not decided yet to give up drinking. I would like to reassure him on the government's intentions as concerns excise taxes on tobacco products and alcoholic beverages which are not likely to decrease in the coming years. If one looks at the development programs of the industries engaged in the production of alcoholic beverages or cigarettes, one can see, Mr. Speaker, that those industries do not expect either a decrease in their sales.
According to the proposal of the hon. Minister of Finance, the province of Quebec through tax abatement or opting out, already enjoys 16 points. It administers and finances a good part of that program and, as far as I know, it is not the worse for it. I believe the proposal that was made to other provinces, Mr. Speaker, the proposed pro-

May 11, 1973
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gram closely resembles that which the province of Quebec has known since 1970 and, as far as I know, the citizens of my province are not the worse for it.
I will quote again what the Minister of Finance (Mr. Turner) said on May, as reported at page 3600 of Hansard:
Of course, I do not want to suggest that provincial governments would have to increase their tax rates-
-as the hon. member for Roberval suggested, this new program would lead in the provinces to a tax increase in order to finance this program. But this is out of question, Mr. Speaker. I keep on quoting:
... by the precise amount of the federal cut. Provinces can raise their levies more or less than the federal reduction, as they see fit, and they obviously could alter the mix between personal income tax or their taxes on alcohol and tobacco.
In the proposal, the government commitments go a bit further and I quote:
Provincial governments would receive basic per capita grants from the federal government. And if required, the provinces would get further federal risk sharing payments should they spend at a rate above that of the growth of the basic federal grant.
These last lines contain the important part of the proposal. We can see there, Mr. Speaker, all the flexibility of the proposal which has been put to the provincial ministers, a flexibility which will allow the implementation of much more economical and efficient procedures for the provision of health services.
The hon. member for Roberval said that the provinces will not get anything; well, I cannot see the basis for such an argument. If this is really what comes out of the proposals, that the provinces will not get anything out of them, all they have to do is to turn down the proposal, Mr. Speaker, and keep on getting the existing 50 per cent.
I am coming back to the proposal brought forward by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). He starts out by congratulating the minister, saying that since taking over the department he has put forth tremendous energy and talent to seek a solution whereby health care will become less costly for Canadians and more readily available. And a little later on he accuses the minister of trying to evade his responsibilities and the federal government of trying to shirk its responsibilities by withdrawing from the program. Such is not at all the spirit or the philosophy of the program when one sees the commitment by the federal government. The minister said it would amount to $1.1 billion over the next six years, not based on the experience of the past two or three years, Mr. Speaker, but on a projection over the next six years. And in addition to that amount another $600 million is to be provided as a trust fund to assist provinces if, for instance, as indicated by the Minister of Finance in his statement, all these amounts should prove adequate.
I do believe there is no occasion to mobilize the finance ministers of the provinces and to stir up the concern of Canadians as to the fate of the health services programs offered to Canadians. In my opinion, health services or health care available to Canadians since 1970 are the best of any offered in industrialized contries. I shall of course make an exception regarding socialist countries, Mr. Speaker, as I should not like to start off a comparison between our services and those offered in socialist countries. However, comparing with western European coun-

tries and industrialized countries which respect private enterprise, it will readily be seen, Mr. Speaker, that we have an unparalleled system.


William Heward Grafftey: Mr. Speaker, in my view the delivery of humane, adequate and efficient medical health care services will be one of the most important, if not the most important issue facing the Canadian people in the next few years.

Let us suppose, Mr. Speaker, that tomorrow morning the aldermen of a town council were to declare it a law that the town hall is to give free bread to each family, and the next morning at 9 o'clock they went and drew up this law; the law would exist, but nobody in the city administration would telephone to the bakery to bake more bread. That, Mr. Speaker, is quite simply what we have done throughout Canada with medical services; the federal and provincial Parliaments have voted billions of dollars for medical services for most Canadians, and especially for poor and aged Canadians, but these services do not exist at all.

It is my contention that medicare in Canada today is purely a financial mechanism, as many members in the House today have already pointed out. It involves the worst kind of federal-provincial joint program. The Liberal governments' consistent approach to medicare has been one involving half socialism and half free enterprise. That is, I believe, why the NDP in Ontario would not, in their brave way, support some of the Liberal plans for that province. The program is half socialism and half free enterprise, and embodies the worst of both worlds. It simply does not work.
The same government that pours millions of dollars annually into this non-system refuses, through the health resources fund we have mentioned today, to make that system effective so that it may benefit people at the local community level. When medicare legislation was introduced into the House of Commons we knew that the only possible way the federal government could implement efficient medical health services at the local community level was by supporting in this House the concept of a health resources fund. What happened? No sooner was the health resources fund established than Treasury Board reduced it. Therefore we wonder why we are faced with the kind of problems which we face today.
What has the federal government done? It has poured billions of dollars, in the form of income supplements, into the non-system while at the same time maintaining a static supply of medical personnel and services. No wonder these services for many Canadians from coast to coast, for the disadvantaged living in rural areas and those living in the cores of cities, have literally collapsed. As hon. members have already mentioned, in many rural and innercity areas, low-income and aged people are not getting any service whatsoever. As they line up for diagnostic services and treatment I am reminded of the bread lines during the depression.
May 11, 1973



Mr. Speaker, quite often in the country it is easier to get a vet to see to animals than it is to get a doctor to see to human beings.
[ English]
In many rural areas there are no paramedical personnel, no community clinics and no primary care doctors. We warned the government 15 years ago that we would need these facilities. Often it is easier to obtain services of a veterinarian to treat your cat, dog, cow or horse than it is to obtain the services of a doctor to treat your family. That is the situation we are in. This government was warned about the problem when it introduced medicare, and now it is trying to draw away from its responsibilities. [Translation]
Mr. Speaker, we have in the-


An hon. Member:: Mr. Speaker-


William Heward Grafftey: Excuse me, but the hon. member has already spoken; I have only 15 minutes to speak about something important.
In the province of Quebec we have Mr. Castonguay's recommendations, which recommend the setting up of community centres and paramedical groups, with more general practitioners and more researchers in our medical schools. But what are the federal government's responsibilities in this field?
Let us take for example the rural area that I represent, Brome-Missisquoi. Before there was medicare in the constituency of Brome-Missisquoi, there were seven permanent doctors; in the town of Farnham, a town without a hospital or a community centre, there were four permanent doctors ten years ago, before medicare. What do we have now, Mr. Speaker? There is not one doctor in the whole constituency of Brome-Missisquoi, and there is just one in the town of Farnham.
[ English]
This is going on all across Canada.


An hon. Member:: Come, now.


William Heward Grafftey: Please do not interrupt. I know how frustrating it is for the hon. member to support the Minister of National Health and Welfare (Mr. Lalonde), but I ask that he please stop prattling.
Doctors have tended to practice in the hospital environment, and I am not blaming them entirely. I am blaming the federal government for the attitude it has taken with regards to co-operating with the provinces in order to effect the efficient delivery of medical and health care services. We have recommended time and again that the health resources fund must be backed up, voted on and supported by this House if the federal authority is to play its proper role in supporting medical and health care services.
I refer to what my leader has already said. Any federal withdrawal must be accompanied by a guarantee of transfer of tax powers to the provinces to allow them to maintain their level of spending, as well as a guarantee that the
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poorer provinces will not be short-changed by federal government withdrawal. This must not happen. The system has already collapsed for the poor and the aged who have no mobility to get into hospital centres. It must not collapse for all Canadians and it is bad enough now because of lack of federal responsibility in this regard.
The federal health resources fund must be expanded immediately to humanize health services. In particular, there must be more funds for medical research, training, primary care visits and paramedical assistance to develop community clinics, especially in disadvantaged areas. What does a town in my area do with medicare payments when there are no services? Ten years ago in Brome county we had seven full-time doctors, and four in Farnham. Now we do not have any in Brome county, and only one in Farnham. The paramedical people, the primary care physicians and the community clinics that we were told we must have 15 years ago, still are not there.
One cannot imagine what this means to low-income, disadvantaged Canadians and aged people whom medicare was supposed to help in the first place. A cruel hoax has been perpetrated upon them. Now the minister says we are going to withdraw from the program. The Minister of National Health and Welfare came before the Canadian people with a smokescreen, an unintelligible proposition which in effect means: We have pushed you into this program. Now sink or swim. This is irresponsibility of the first order which we cannot tolerate for one minute.
Medical and health care services constitute just one of the many challenges which are not being met by federalism as now practised in Canada.


Mr. Bechard:: Is that from your book?


William Heward Grafftey: Yes, but what does that really add to this debate?

Yes, this is in my book, but your remarks are not all that intelligent. I am aware of your frustration, but keep quiet. In the province of Quebec, it is a very important matter, believe me.

As I already mentioned, this is the worst kind of joint program. Every time the Minister of National Health and Welfare stands in the House we are told this matter is one of provincial responsiblility. But who initiated it? If any performance underlines the fact that we need basic modernization in this area, the performance today by the Minister of National Health and Welfare underlines it.
Like the challenge of the environment, transportation and living space in our cities, education and all the rest, medical and health care services test the very viability of North American federalism. If Canadian medicare schemes continue merely to be a financial mechanism the complete breakdown of services will come about sooner than we care to think. If doctors' incomes continue to soar, government authorities will have to put them on salaries. If doctors and medical manpower will not go into underserviced areas, surely a decent and humane state has an obligation to make sure medical personnel is equitably deployed.

May 11, 1973
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Public costs mean that public resources should be used to influence the operation of systems that are essential for the health needs of all the people-not just the rich and the advantaged but all the people. Costs will continue to skyrocket if governments, working with the public and medical profession, do not assume their responsibilities in determining that the plant, personnel and services are made ready. If they are not, what was the money voted for in the first place? Was it to make doctors more and more rich, and to make the system collapse?
In my view we have confused our priorities. We have devoted a great deal of effort to the production of material goods, and little effort to the care of the people who produce them. We have rushed ahead with cars, roads, factories and new food technology without really knowing where we are going and why. As a critic of health care services in North America, I say that our health care services are in appalling disarray. It is not good enough for the federal government to say they are spending billions of dollars, putting it into the system and taking no responsibility whatsoever for the effective working and implementation of that system.
We have been faced with real problems, a multitude of them, and we have thrown up our hands in despair. Our society, in terms of decent medical and health care services, suffers from deep social wounds-yet our approach is to put band-aids on them, what the minister suggested today is just another series of band-aids. We are only tinkering with parts of the non-system. That is worse than nothing. We need major surgery. I hope the government recognizes this fact before it is too late.


Mr. Deputy Speaker:: By agreement, the hon. member for Gatineau (Mr. Clermont) concedes his place to the hon. member for Dauphin (Mr. Ritchie).


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I thank the hon. member for Gatineau (Mr. Clermont) for making it possible for me to say a few words before catching my plane.


Mr. Isabelle:: I rise on a point of order, Mr. Speaker. It is not the hon. member for Gatineau (Mr. Clermont), but the hon. member for Hull.


Mr. Deputy Speaker:: The point is extraordinarily well taken and the Chair apologizes from the bottom of its mistaken heart.


William Gordon Ritchie: Mr. Speaker, I too thought you were mistaken. I welcome the opportunity to speak on this matter of health costs and the negotiations going on between the federal government and the provinces regarding paying for health costs. This debate is long overdue.
As one who has spent my life in the health care field, I have observed much of the discussion and the results of the negotiations of governments in this area. It is perhaps understandable that, with the rise of social consciousness, all citizens are entitled to the very best health services and, with rising affluence, to afford more elaborate and more expensive health care.
There has been peculiarly little dialogue on the fact that health care has definite limits of expansion. Politicians and the public have never accepted the realization that

there are no bounds to health care. The whole of the national economy could be devoted to health care and there would still be many worthwhile projects undone. I once knew a doctor who had been the personal physician of Pancho Villa and rode with him on his campaigns of civil insurrection in Mexico. To have one's private physician is as close to complete medical care as one can arrive at. But Pancho Villa obviously lacked many other things in the health care field that he might have had, such as hospitals, drugs, and so on.
I believe that the intrusion of the federal government into health care, welfare and, to a lesser extent, the educational field has been one of the very divisive factors in Canadian life. The Fathers of Confederation, very wisely, I think, and displaying much more forward looking ideas than Canadian governments of the past decade, reserved for the provinces health, welfare and education. Perhaps it was not foresight but merely an accident. In a practical way, this was a very farsighted, almost clairvoyant look into the future. They recognized, much more than recent politicians, that essential personal services to the individual are involved. Perhaps in the area of education and welfare, at least in a dollar way, there can be reasonable standards applied so that the costs remain within bounds and that individuals, regardless of where they live in the country, may enjoy reasonable equality of service.
I make no apology for advocating strongly that the provinces must be charged with the responsibility of administration in these three areas, particularly in the health care field. Health care is a personal service and there is an enormously wide variation in what is considered good health care. Basically, to those who are workers in the health care field all citizens must be treated as individuals. This means reasonable and early access to health care personnel. It means, generally, the interplay of one person with one individual doctor who must take an adequate history and conduct an examination which requires time, skill and, above all, an intense preoccupation with the patient. At the hospital level it means reasonable access when needed, and care by competent people. Unfortunately, under the so-called free-for the patient-medical services, all of these things become almost impossible to achieve because of the vast pressures at the entry to the health care system, the physician's office and the hospital admitting room.
I would like to expand much further on this important aspect, but in the limited time available perhaps I should say a word about the financing of health care costs. I think the 50-50 health sharing formula is the worst type of furmula to finance health care that could have been devised. It encourages a vast proliferation of bureaucracy and a tendency for administrators outside the health care field to move in and tell the health care workers how services should be run, and even which services will be provided. This situation came about largely because the federal government under the Pearson administration assumed the "holier than thou" attitude that they alone were capable of ensuring that citizens received adequate health care.
The federal government of the day assumed that all provincial governments were suspect and would not pro-
May 11, 1973

vide proper health care or use the money wisely. It was a sanctimonious, self-righteous and entirely uncalled for attitude because it assumed that provincial governments were much less capable and much less responsive to their citizens' needs than the federal government. The 50-50 cost sharing basis fulfilled a bureaucratic dream, because executive people in the health care field are great empire builders. Each and every person in the provincial departments of health had his own idea of what would be good, and there certainly is no end to the many good programs; indeed, all programs have some value. There was almost an irresistible urge to spend money and institute programs so it could be shown that their provinces had instituted programs; and of course no province could be left behind in instituting its own particular program.
Health care costs have been escalating much more rapidly than the country can afford. Fortunately, it is now being recognized that there are limits to what can be done. Perhaps the organ transplant era has shown that if this practice becomes widespread, nearly everyone could benefit during a lifetime but it would require an enormous number of staff, buildings and equipment for this relatively small field of medicine-and at what cost! I think the public is now willing to accept that there is a limit to health care services, that health care is a purely personal thing and that what the state is able to provide for the individual may not be nearly all that the individual would desire. I am sure that having arrived at this conclusion we can better deal with the financial aspect of health care. Until there is general acceptance that we cannot do everything, there will not be public acceptance of putting limits on health care spending.
There is great discussion taking place at this time in connection with health care delivery systems. All health care systems carry certain advantages and disadvantages. I cannot mention that the president of the American Medical Society, reporting on an inspection of health delivery systems in European countries and the Soviet Union said he was struck, not so much by their differences from the American system as by the number of complaints about the shortcomings of their systems. In other words, every health care system attracts an enormous amount of criticism.
We are now involved in community health care and community clinic projects, but these still depend on a physician taking time and skill and having his options open to give health care advice. It is doubtful there will be any material improvement in the over-all delivery of health care, although these developments could have a certain limited application. It takes time to see patients, and it seems doubtful that there would be any more time in a community clinic than under any other system.
The attempt by the federal government to give provincial governments more flexibility and responsibility and to work out satisfactory financial arrangements with them is long overdue. The federal government must get out of these 50-50 cost-sharing programs which are an invitation to overspending and poor programming. Federal politicians must leave it to provincial governments to set up standards on the basis of what they feel their citizens desire.
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There remains the general fear among certain disadvantaged provinces that their citizens would be short-changed because of a low regional economic base. I should think satisfactory formulae can be devised to allow such provinces to give their people care comparable to that available in other provinces. In any case, I feel it is difficult to set standards in the health care field with any degree of accuracy, and I have found that most so-called standards do not mean a great deal.
The latest federal-provincial conference ended prematurely this week and the provincial finance ministers have spurned the federal government's proposals to get out of these shared-cost fields. Whether they did this so as to have a bargaining tool, or whether the conference was, indeed, a failure, it is generally considered that the federal proposals are very complex and open to a great deal of uncertainty as to what might actually happen before payments finally settle down around 1980. As described in the Globe and Mail, it was "a fearfully complicated transitional means of payment" with uncertainty lasting for a decade, leaving the provinces six additional points of income tax, the revenue from excise tax and duties on tobacco and alcohol.
The Minister of Finance (Mr. Turner) has said the package would amount to the equivalent of 20.8 income tax points as these points produce revenue at present, and I think this is important. But Ottawa did not turn over 20.8 tax points, because these tax points will earn more and more money each year. Ottawa really would like to have control over spending.
These three programs were initiated by Ottawa over the objections of several of the provinces, and they were negotiated in areas which the constitution gives to the provinces. The health minister has finally recognized, on behalf of the government, that the provinces have to establish their own priorities and that there should only be minimal national standards. Canada is a very large and regional country. In the health care field Ottawa has been barging around deciding what is best for all. It may well be that the method of rebating federally-collected income tax to the provinces is not the best way of proceeding, and that changes in the provincial income tax system will give a truer view of our problems.
Before lunch today the Minister of National Health and Welfare (Mr. Lalonde) indicated that Canada had a good supply of doctors. However, I would point out that half the doctors in this country came from overseas during the last two decades. Many of the countries from which they came could ill afford to spare them or educate them. Accordingly, we have been looked upon as something of a pariah among western countries for having taken these highly educated people away from their own lands.
My view is that the supply of doctors will not be good in the future, because as time goes on there will be a reduction in the number of young people entering universities to prepare for the profession. Medical training is long and arduous, and those who have been through it sometimes wonder whether it is worth it. If the minister believes the supply of doctors is being maintained, I suggest he should examine this question further.

May 11, 1973
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Mb. Gaston Isabelle (Hull): Mr. Speaker,-


Marcel Prud'homme: At last, we are going to hear something sensible.


Joseph Gaston Isabelle: Mr. Speaker, I find it very interesting that such important subjects as the motion put forward by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) can be dealt with in the House of Commons. It gives us the opportunity to discuss in particular hospital costs, health care costs in Canada.
Mr. Speaker, it is easy for anybody to make much of a relatively recent problem, but its causes have not been analyzed and no attention has been paid to the problem of increased health care costs in Canada. I know that we are the second country in the world where costs rose quite sharply-right after the United States-since we spend 6.8 per cent of our gross national product on health care.
But when one wonders why health costs increased so much, one should make a much more detailed analysis than those I have seen up to now. For many years, in fact, little planning has been done in the field of medicine. It was everyone for himself.
I think this is where we were wrong. I remember that, at least in the province of Quebec-and I believe the same problem existed in other provinces-hospital workers were very poorly paid. I remember that almost anybody hired to do any kind of work with the sick. Maybe it was all right at that time and the matter of salary was not very important. Indeed, it was in the thirties, in the difficult years of the depression.
Anyway, we still have this old concept and when suddenly came prosperity, hospital workers automatically asked for higher wages. I cannot blame them but that really increased considerably the cost of health care in Canada. It is true that physician fees have slightly increased also, but we must think that the medical profession spends a lot of time looking after Canadians in need of their services. Of course, if a physician works 10 or 15 hours a day, he is doing a tremendous amount of work. We know that many physicians are hard workers. Certainly they make more money than those who work only 2 or 3 hours a day.
It is a very difficult profession and because I have been a physician for 25 years, I know what a great physical effort is required to carry out this unending work.
Today, it seems that if health costs are increasing it is because politicians failed to take their responsibilities or maybe they failed to listen to those responsible for health services in Canada. I remember that a physician was always considered as a poor administrator. It may be true but he is the one who predicted that we will have in Canada an escalation of medical needs which would seem unbelievable, because if those needs keep on increasing at the present rate, I think that by year 2000 all the money in Canada will be used for that purpose.
I will not give a historical account of what happened in the field of health care since Confederation. It is a most
interesting question and I ask all those unfamiliar with the health care and social security programs implemented in Canada to look into the matter. It is quite interesting and points to the shortcomings and the reasons for the current situation.
The medical associations of Canada have often suggested what should be done to avoid this escalation, namely to build hospitals for convalescents and the chronically ill. I think that if we did this, we would reduce by 25 per cent hospital costs in Canada. Unfortunately, nobody ever thought of that. Politicians have other concerns. For instance, let us consider what happened in Quebec where it was decided to remove the iron bars from the windows of a psychiatric hospital because they were unsightly and because politicians said that it looked like a prison. Should we lock up poor sick people in hospitals that look like prisons? So, the bars were removed and consequently last week three patients jumped through a window. They were not killed but are in serious condition.
This is what happens when politics meddles in a field such as this one-and this happened recently in Quebec, at the Saint-Michel-Archange hospital. Perhaps the hon. member for Louis-Hebert (Mrs. Morin) might check this over the weekend.
In any event, Mr. Speaker, if we are to reduce the cost of health care, we must do something practical, concrete, that is build hospitals for the chronically ill and convalescents.
When a patient is cured or recovering in a hospital, he must of necessity spend some time convalescing. For various reasons-I do not want to go into that now-he cannot leave the hospital on the seventh, sixth or fifth day. Why could he not spend that time, perhaps even a week, elsewhere to convalesce, until he is back on his feet and can resume his normal occupation? But today there are complications which impose a heavy financial burden on the government in view of the large number of people admitted to hospital these days.
Let us take the case of pensionners who are hospitalized at age 78 or 80. If science continues to make progress, I think we will live to be older and older for better or for worse. I think that the average life expectancy in Canada is now 72 and it will certainly go up within the next decade.
So why do we have to hospitalize older people who are prone to catching pneumonia, for instance, or any other similar illnesses which normally do not require them to be confined to a hospital? But because of their ill health, because of their physical state which is deteriorating, they have to be hospitalized. But the fact is that at a certain point, for one reason or another, they cannot be returned to their families. They cannot be returned home because they cannot more around or are suffering from deficiencies due to their illness. So we have to find a place for them to stay.
I know perfectly well that in my riding, for instance, in Sacred Heart Hospital there are many patients who should not be confined to hospital beds which cost $60 or $75 a day when normally they should be in institutions where the costs are $12 and $13 a day. I think we should give much more consideration to that problem.


The questions of cost-sharing is not new. The federal government has always paid its share. That we may want to withdraw might make sense because provinces each have their own priorities. But I would not want our withdrawal from those plans to result in the balkanization of Canada. It is absolutely essential that the federal government show leadership and say, O.K., we are going to withdraw gradually over a certain number of years when you will become entirely self-sufficient, provided that criteria and standards have been set up to prevent the citizen of the province of Quebec from getting treatment in New Brunswick or Ontario, or the citizen of Ontario in Saskatchewan.
Remember the hospitalization problems that arose between the cities of Ottawa and Hull when people from Ottawa would go to Hull for treatment and vice versa. It would be a pity if that became the rule throughout Canada, and we ended up with ten different plans, which would result in moral suffering for many people.
People say that doctors make a lot of money-and it is an easy thing to say-if they work hard, of course they will make money. But if not, they do not make money. It is easy to say. In fact, it is just a smoke-screen. People say that doctors are getting too rich, saying for example that a doctor in Quebec earned $43,000 doing urine tests. Now, I do not know what this doctor actually did, but it seems to me that he cannot have done anything else but urine tests, Mr. Speaker.
In any case, there are always exceptions. There are fools in every profession, maybe more perhaps among politicians. Let us say that there are fools everywhere. We must not get excited over the fact that a doctor is earning $200,000, $100,000 or $30,000 a year. If he earnes $200,000, he is going to pay income tax and the money will come back to the government, which can then redistribute it to the provinces for them to run their hospitals.
To my mind, the problem does not lie there.
I was listening to the hon. member for Brome-Missis-quoi (Mr. Grafftey) who quoted his book. I cannot quote from mine: I have yet to write it. But, in any event, he complained about the shortage of doctors. There will always be a shortage of doctors, Mr. Speaker, because ...


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but his allotted time has expired. If it is the wish of the House, he may continue. Is it agreed?


Some hon. Members:: Agreed.


Joseph Gaston Isabelle: I thank you, Mr. Speaker, as well as my colleagues. This is almost Christian charity, because I would like to insist on one specific point. Some complain about the lack of doctors. In Canada, there is one doctor for 826 citizens. In the USSR, there is one doctor for 413 citizens. But if we really dig deep in the statistics, we realize the situation is not nearly as serious as it would seem. In the province of Quebec, everyone lives either in Montreal or in Quebec City. It is not possible to remove the doctors from Montreal. To my mind, there are too
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many doctors in that city, as well as in Quebec City. There are quite a few there. They should go elsewhere. Doctors should be conscripted, so to speak; they should be told: You are coming out of the university; you will practice for two years where there is a shortage of doctors, then you can come back to the city.
This applies with regard to specialization; no one specializes on coming out of the university. One does not become a blacksmith after a few courses at a technical school. One must practice medicine to become aware of all its advantages and disadvantages to know how to practice and how to take care of the human being. It is important. One does not treat people like the hon. member for Brome-Missisquoi said. There are too many animals or too many veterinarians in his riding, I don't know. It is easier to obtain veterinarians than doctors.
Mr. Speaker, concerning specialization, the provinces are responsible to see about it. If they do nothing, then we must act. That is why every doctor should practice for three or four years before "embalming" himself in a specialty. If there was such a program, maybe we would maintain equal distribution between those who normally specialize and those who do not and would go as doctors in needy regions. I think this is what we should do.
The third step that should be taken to obtain more doctors, would be to prod universities and medical colleges which have done almost nothing since Canada exists. They are beginning to react a little because they have been prompted a little by medicare and other legislation. They are more careful than before. We should urge universities to lower the standards of admission which are set at about 80 per cent. If you have not obtained 80 per cent in science-not philosophy or catechesis but pure sciences- you cannot be accepted in medicine. What does that mean? It simply means that if you are admitted at medical school with 80 per cent, you are almost a genius. In medicine, so much is not necessary. We badly need people who want to work, tend patients and do something about health care in Canada.
Indeed, anyone cannot be accepted in medical school, but it is also true that current criteria are much too strict and those supermen who complete their studies with 80 per cent all want to become specialists, even psychiatrists. This is another matter which should perhaps be more closely considered, Mr. Speaker.
If we continue to increase the number of psychiatrists, as it has been happening for the past few years, we will be asking questions. We will be wondering whether we are in the right country, Mr. Speaker.
If the provinces are not astute enough to recognize the real problems which have given rise to today's high costs, I think that we should provide leardership and tell them: This is what we are going to do; we will give you some money, the methods may be altered according to your priorities, but the program, the basic system will remain the same.
If we act otherwise, it is the balkanization, the end of Canada as regards this program and others. We speak of the general practitioner, Mr. Speaker, when he made deliveries for $5, nobody spoke about him. Deliveries went from

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$10 to $25. This was expensive, this was frightening, only a specialist should have asked so much; at the time, we did not have any. Some were trained; they ask for $225 or $250 and it is not better.
At any rate, nobody spoke about them when they rendered service and now, if things continue the same way, we will find-the English word is probably more accurate-a sort of disincentive, a kind of non-stimulant to work as doctors. I do not know of any doctors who are now very enthusiastic about our laws on social security; maybe it is because we went too far. At any rate, if we want to reduce the costs of health care in Canada, we must opt for or against the programs. As far as I am concerned, we should opt out but we should keep essential bases so that everyone is treated the same way in Canada. To this end we should not put the cart before the horse; doctors must be trained. The approach is overhasty. Our medical personnel must be trained, after which the program can be considered. It is all very well to say that we want to train paramedical staff. I have no objection to a nurse, or anyone else, taking my blood pressure, but when it comes to having midwives officiating at confinements, which is still acceptable at a pinch, and is done in other countries, if any complications develop the doctor must be called, or else they can call the blacksmith, the farmer experienced in calving.
In my opinion the approach to the problem has been inadequate. Time should be laken to think over the problem, instead of practicing demagogy and bandying words one does not quite know the meaning of. It would be much more simple to give the problem intelligent consideration and to define it. The problem of excessive increase of medical care does not rest with the provinces, nor with the federal government. Increasing salaries will not bring about a great change. No hearing has been given as yet to those who are responsible for health care in Canada, it is as simple as that. I may be said to be mistaken, that would not be a novelty, but it might be well to really take into consideration the thoughts of Jules Verne, and see how right he was.


Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I rise this afternoon to support the motion put forward by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) which reads as follows:
That this House disapproves the government's proposal to retreat by stages from the present cost-sharing arrangements with respect to hospital and medical care programs and calls upon the government to fund all health services on a 50-50 basis and to expand the health resources fund to enable the provincial governments to improve their health services.
I support this motion in light of the federal government's proposal to limit for the next five years its contribution to the provinces in the field of health care. This plan would limit the federal government's contribution and contain an escalation clause tied in with the GNP. It would guarantee 6 per cent of personal income taxes, revenue from the excise taxes and, ironically, the taxes on alcohol and tobacco, to promote health care in the provinces.

The provincial governments have already stated their objection to this plan. Our party, and many speakers from the Conservative party have expressed their opposition. We believe that this program would limit financial spending for medical care, with the result that there would be an end to hope of any co-ordinated national health policy and the end to any progressive changes which are essential in this field. Secondly, it would mean that the poorer provinces would fall far behind those provinces which can afford to expand their health care services.
What has prompted this proposal of the federal government? It seems to me one can reason that the government either believes Canadians are so well off in the health care system which now exists that there is no need for expansion of services, or that the Liberal government, despite its high-sounding phrases, is not fundamentally committed to the concept of government responsibility for health care in the nation as a whole. In other words, perhaps the federal government is attempting to pass the buck to the provinces. I suspect the motive of the government is the latter.
Are we so well off in regard to health care that the federal government can wash its hands and say that now the provinces must look after it. Canadians spend, on average, $260 per capita for hospital and medical care, dentistry and prescription drugs. We are spending more and more on health care, but there is not a corresponding increase in the quality of our health services. One has only to think of the fate of the family doctor and the queues of people in hospital emergency waiting-rooms who are waiting for services which they so desperately need. Are the poor so well off that they do not need extended health care services? Families on low income and the poor of this land may still have to pay a health premium, because some provincial governments are not enlightened enough to include this in the over-all income tax policy. Thank goodness there are three New Democratic provincial governments which have already abolished the premium for health care.
What about the children in this country who have dental problems? Are we to ignore them and say that we do not need to expand health care services in this field? We should consider the cost to families which try to provide proper dental care for their children. When children have poor teeth, their health is affected and sometimes their school work as well. Not only is there the cost of dental care, but also the problem of service. In my area of northern Ontario, this service is sadly lacking. Ours is one of the richest provinces, but communities near mine such as Thessalon and Blind River are without dental care and proper medical services. These are moderately sized towns. What is the situation in respect of the smaller, isolated communities further north which cannot even obtain temporary dental coaches to visit the community to help the people solve their dental problems?
Are pensioners so well off under the provincial health schemes that no improvement is needed in this area? Can they afford eyeglasses, dentures or cardiac pacemakers? The other day I spoke to a pensioner who pointed to his ears and said he was wearing $300 in each year. He had to bear that financial expense from his old age security pension. Is the problem in respect of drug costs so small
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that the federal government does not see the need for adequate reform and financial help? Canadians spend $300 million annually on prescription drugs, yet how many people can afford them, especially those with low income and those on pension? Canada, unfortunately, has the highest drug prices in the world, due to the drug manufacturing industry which is very monopolistic and lacks competition, and to the lack of adequate federal legislation.
How, in light of these problems, can the federal government say that things are all right and that it now intends to withdraw from the financial commitment it assumed in the past? How can it say there is no need for a national plan to effectively increase the health care standards in the country, and that it intends to leave this field to the provinces? There is much to be done, and I am afraid that if we leave it, to the provinces we may have no guarantee that each province will make health care its number one priority.
We know that today provinces are beset with all kinds of costs related to things such as roads, job programs, and so on. Perhaps the richer provinces will be able to get by and expand their medical care programs. I have in mind provinces such as Ontario, Alberta and British Columbia. However, when we look at the record of the Conservative government in Ontario, I have my doubts about that province. But what of the poorer provinces, especially those in the Maritimes, and Quebec? The result is that if they are lucky they will be able to maintain the services they have, but may not be able to expand into areas where Canadians need some aid.
What happens to the concept of federalism which the Prime Minister (Mr. Trudeau) so fondly speaks about? How can we end the inequities which exist between the east and west coasts if we have a national health care plan which relies on the provinces to do the best they can with the finances available? I consider it a national disgrace that a country as wealthy as Canada cannot even match the health schemes of some of the poorer western European countries such as the Scandinavian countries, Britain and even Israel. There is need for effective action. There is need for federal government financing for medical care in this country.
The first thing that is needed is a comprehensive, fully publicly-financed medical care program covering not only hospital and doctor's services but also dental costs, private duty nurses, therapists and paramedical people, as well as a program that will deal comprehensively with optical care and ambulance service. Second, there is need for financial assistance to the provinces for the building of more community health clinics. I represent a constituency that was a pioneer in this field. It took the labour movement to get it under way. A health clinic was established to promote preventive care for people before they had need of a doctor or a hospital.
More funds are needed for hospital construction in the provinces. A rich province such as Ontario now is cutting back on its hospital construction program. It is here that there is need for more federal financial aid. Third, we need a program to reduce the cost of prescription drugs in this country. We should establish a Crown corporation to manufacture and distribute generic drugs in competition
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with private manufacturers, in order to help bring down the high cost of drugs.
Fourth, we need a system of cash benefits for sickness, to compensate for loss of income through illness or accident not covered by workmen's compensation. Fifth, there is need for more financial assistance to the provinces for the education of doctors, dentists and paramedical personnel. I think that is an area which is neglected. If we had more paramedical personnel, they could be handling some cases of sickness rather than tying up the time of high-priced doctors. All these areas need to be expanded, and I cannot see how we can do it under the proposal of the federal government that has been so wisely rejected by the provinces and most members of the House.
In conclusion may I say that too much needs to be done to cut back now. We need a comprehensive national health program, and we need federal aid to the provinces on a continuing basis. We need the guarantee of the federal government to pay 50 per cent of provincial health costs. We hear much about the rights of Canadians these days, but there is no more basic right than the right to good health. I say to the Liberal government that it cannot shun its responsibility in this field and hope to retain the confidence of the Canadian people.


Mr. Norman A. Cafik (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, may I begin by referring to this motion and the comments of the hon. member for Sault Ste. Marie (Mr. Symes) because he was the most recent speaker. I would say that there are really three elements involved in this motion. The first is that there is regret expressed by the mover of the motion, the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), that we are going to change the present cost-sharing arrangements in respect of the medicare and the hospital care program.
I can understand his concern in respect of that matter, because they have been very successful programs, but at the same time I hope all hon. members will bear in mind that the motivation is only to bring forward suggestions for change in the cost-sharing arrangements and in the formulae in regard to these two programs. The motivation for change is brought about primarily because of a series of federal-provincial conferences on this subject which have taken place over the last 30 months. Constant attention has been brought to bear on this subject by the provinces and by the federal government, and there is a wide degree of unanimity in respect of the need to adjust the formulae to allow the provinces to have an input in terms of their own priority in respect of health care services.
It is very important to underline the fact that in the present arrangements the provincial governments are forced almost by necessity-because we share on a 50-50 basis-to spend more money in the area which is most expensive, such as hospital acute care beds, and so on. In other areas where they want to enter into extended services for ambulatory care and other types of preventive medicine, we do not have arrangements to allow them to do this. It is in response to their request that we are trying to make the program more flexible.

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There are a number of ways in which we can approach this question, and clearly people will make different value judgments in respect of it. One is to widen the base of the kind of services that would be eligible under these two programs, or to change the programs themselves so that they become flexible and not tied to a specific type of medical service. Federal-provincial conferences have emphasized the need to do this, and this new formula is an attempt to allow the provinces the kind of flexibility that will give them an opportunity to put more emphasis on various important areas of health care service within their borders. That is really the reason we are bringing forward the formula. It is certainly not being brought forward because we want to vacate the field. There is no intention to do that at all but, rather, to recognize that in our federal system the provincial governments have legitimate concerns in respect of their own priorities. We should respect that principle as much as we can.
However, the federal government is determined, at the same time, that we maintain certain national standards and those national standards would have to prevail whether or not there was a change in the formula. I am referring to standards such as the comprehensiveness of the programs, universality, portability in Canada and accessibility to people regardless of whether they can afford to pay for these services. Those elements must be maintained. I feel that although there is a proposal to change the formula, it is a step forward, not backward. It is a step in the direction, not of balkanizing the country-which was suggested by the hon. member for Nanaimo-Cowichan-The Islands-but to keep the country together because of the insistence on these national standards which would make sure that Canadians from coast to coast were treated in an equal way.
I believe that if one were to accept the principle of the motion, which would be to give a blank cheque to the provinces and to simply say that we would pay 50 per cent of all health care costs in Canada, that would give rise to the balkanization of this country because we would have stepped out of the picture and allowed the provinces to do whatever they wanted within their own jurisdictions regardless of the effect it might have from coast to coast. It seems to me that we are doing precisely the opposite to what has been suggested by some members of this House. We must maintain controls, we must stay in the field and we must give leadership.
I think that we are recognizing, through this new formula, that in the past the original program was much needed and served Canadians well, but in past years there has been a tendency for the provinces to pay more emphasis to the programs expensive forms of health care such as hospitalization. Now that this question has been taken care of quite well in this country, they need flexibility to move into other areas which would be less costly.
Mention has been made of community health clinics in this country. We should give some emphasis to that question. However, in this respect members always seem to talk about the health resources fund. My understanding of the health resources fund is that it is not established to involve itself in that kind of operation but is primarily for the purpose of educating doctors, nurses and providing institutions for that purpose. If we want to do the kind of 
thing that hon. members are talking about, then I think we need the thrust fund which we have proposed in our negotiations with the provinces, whereby $640 million would be put forward over a short period of time, namely, five years. This money could be used by the provinces to develop innovative ways of providing services to communities without having to give undue emphasis to the more expensive forms of health care on which we have been concentrating in the past.
The motion implies that the health resources fund is inadequate and that we should provide more funds. I do not know what the hon. member has in mind in terms of additional funds, but let us say it was $500 million more. Would that provide any more available funds today? The fact of the matter is that there is roughly $200 million in that fund which has never even been requested by the provinces. So if more money is required for the kind of things the hon. member wants, it is not required in the health resources fund in my view but, rather, in a new kind of fund which we have called a thrust fund in our negotiations with the provinces.
It has been suggested, too, that in these negotiations the provinces have flatly rejected our proposals. That simply is not true. The fact is that a number of provinces have indicated their willingness to consider this program and to negotiate it. Certainly, some provinces feel that the proposal is not for them at the present time, but what is the alternative? In some cases it is for us to opt right out of the field altogether. As far as I know, that is not what the hon. member who proposed this motion, or anybody else in his party, wants. The difficulties we are having in respect of the federal-provincial conference are not because we are not following this motion, but because we are insisting that we remain in the health care field. I think the hon. member would agree with us on that.
Furthermore, Mr. Speaker, we have not really put the proposal to the provinces and said, "Take it or leave it". That has never been the case, and the Minister of National Health and Welfare (Mr. Lalonde) never said it was the case either in the conference or since. A statement was made to the effect that it would be difficult to put more sweeteners in the pot. I think it is understandable that in any negotiations there has to be a point where you feel you have gone as far as you can in providing funds. These funds are not a step backward. The formula is designed in such a way that no province will lose any amount of money that it presently has by accepting the formula, and under our formula within the next ten years they will receive $1.1 billion more than they would if they had stayed under the existing program.
I referred earlier to the thrust funds. They are designed to help the provinces reduce the cost of health care in this country by innovative programs so that we can get out of the acute care hospital situation. I do not think it is fair or reasonable for any Member of Parliament on this or any other side to say that we are proposing to opt out of cost-sharing. We have simply put forward a different formula for arriving at it, which would provide the kind of flexibility that the provinces desire. I personally cannot see anything objectionable about that approach.
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I recognize that some members are reading into this particular motion and into the present situation in the federal-provincial negotiations the idea that the federal government is saying that it does not intend to get involved in pharmacare, denticare, care for eyeglasses, or whatever. This question has not been taken into consideration at the present time. I think it is felt that before we become involved in these areas, we need some agreement with the provinces. As a matter of fact, in previous negotiations the provinces asked us to give a commitment that we would not enter into any new, broad program such as denticare or pharmacare without consultation with them and without a consensus that it was also a priority of theirs. They do not want the federal government to push them into this area. I think they have a point, because they have priorities too and we should respect them.
So, Mr. Speaker, this formula is not designed to take care of any financial expenditures that the provinces may incur in the area of denticare or pharmacare, because if they wish to go in that direction we would want to discuss it and negotiate what kind of arrangements should be made without any reference to the formula we have proposed. This formula does not in any way prohibit our becoming involved in cost-sharing in those areas if agreement is reached with the provinces in the future that this should be done.
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In my view, if anyone in this country is really trying to opt out of health care in the federal sphere, it is the Leader of the Opposition (Mr. Stanfield). In a statement made in the province of Quebec he said-I think I have it correctly-that the federal government must withdraw from shared-cost health programs and give the provinces a greater share of fiscal resources with an appropriate system of equalization. If that is not a suggestion that we drop out of this area and fail to provide the kind of leadership we have provided in the past, I do not know what is. He is proposing a new kind of tax-sharing arrangement with the provinces. It may be different in amount, in terms of the 6 per cent or in a couple of other details. However, the Leader of the Opposition may be proposing something different but for a different reason, because he is saying. "If I were the federal leader of this country I would get out of this field."
We are not saying that. We are saying that we will negotiate with the provinces to arrive at a suitable arrangement which would allow the kind of flexibility that would maintain national standards across the country for the benefit of all Canadians, and that we are going to stay in the health field. We are determined to stay because we feel that although it is largely a provincial responsibility, the federal government has a great deal of input and leadership in the field. I think we have proven that in the past, Mr. Speaker.
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.

Monday, May 14, 1973