1973-05-10

[Stage Direction]
Second report of Standing Committee on National Resources and Public Works-Mr. Hymmen.
[Editor's Note: For text of above report, see today's Votes and Proceedings.]

Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, I have the honour to table in the two official languages the texts of some 37 international agreements to which Canada has become a party since the last time I tabled similar agreements.


INDUSTRY
Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, pursuant to Standing Order 41(2) I should like to lay on the table of the House in both official languages copies of a report on double knit and warp knit fabrics and a second report on an inquiry respecting broad woven polyester filament fabrics.


URBAN AFFAIRS
Hon. Ron Basford (Minister of State for Urban Affairs):: Mr. Speaker, under the provisions of Standing Order 41(2) I wish to table in the two official languages an outline of the details of the forthcoming tri-level meeting
in Ontario which will take place on May 28 and 29 at Trent University in Peterborough.


CRUDE OIL PRICE INCREASE-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, under Standing Order 43 I desire to present a motion concerning a matter of urgent and pressing necessity.
Imperial Oil Company Limited has increased the price of crude oil by 25 cents a barrel effective May 1. This and other recent increases have no relation to increased costs of production and are related entirely to the oil shortage in the United States of which the oil companies are taking an unfair advantage.
In view of the fact that the area west of the Ottawa Valley has been made a captive market for western oil by act of parliament and that consumers are entitled to protection from unjustified increases in the price of crude oil and gasoline, I move, seconded by the hon. member for Kootenay West (Mr. Harding):
That the government take immediate steps to introduce legislation empowering the National Energy Board to set fair and equitable prices for all crude oil produced and sold in Canada.


Mr. Speaker:: The motion proposed by the hon. member under Standing Order 43 requires unanimous consent. Is there unanimity?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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



FISHERIES


Mr. Frank Howard (Skeena):: Mr. Speaker, I should like to rise pursuant to Standing Order 43 to propose a motion to the House based upon an urgent and pressing case. In April, 1970, Canada and the United States signed an agreement relating to reciprocal fishing privileges in certain waters adjacent to each other's coasts which carried with it certain benefits and rationalizations in terms of fishing. There have been some discussions about this matter
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May 10, 1973
Railway Act
between the two countries and the negotiations have come to an end. As a consequence there is a possibility in the very near future that the agreement will terminate, which will be a disaster for the fishing industry. Therefore I should like to move, seconded by the hon. member for Comox-Alberni (Mr. Barnett):
That the Standing Committee on Fisheries and Forestry be authorized to inquire into, and give priority to, the question of the agreement between the government of Canada and the government of the United States of America on reciprocal fishing privileges in certain areas off their coasts signed in Ottawa on the twenty-fourth day of April, 1970, the expiration of which is imminent.
If there is agreement to that motion, Mr. Speaker, I propose-


Mr. Speaker:: Order, please. Is there unanimous consent?
Some horv. Members: Agreed.


Some hon. Members:: No.


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



RAILWAY ACT


Mr. Bill Knight (Assiniboia) moved: for leave to introduce Bill C-179, to amend the Railway Act (deviations, changes and removal).


Some hon. Members:: Explain.


William George Knight: At the present time, Mr. Speaker, section 120 of the Railway Act does not provide for a mandatory public hearing to be held when railway companies make application to remove any regular station agent, caretaker-agent or caretaker. This amendment would provide for the requirement of a public hearing. At the same time there is no requirement for the type of service that must be provided by the railway's personal contact. This amendment would spell out the services to be included by such company representative if permission has been granted for the removal of regular station agents, caretaker-agent or caretaker. Therefore this bill would help protect the consumer-


Mr. Speaker:: Order, please.


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


Mr. James A. McGrath (St. John's East):: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister. I refer to the latest lecture the people of Canada have received from the Minister of Agriculture and specifically to the statement by the minister accusing price-conscious consumers of being spoiled by low costs. Was the minister expressing the policy of the government in this statement and, if not, would the Prime Minister tell the House exactly what the policy of the government is or who is enunciating government policy? I think we have arrived at a time when the people of Canada should know what the policy of the government is.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. The first part of the hon. member's question is, of course, in order, and the Prime Minister will be given the floor for the purpose of answering.


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, the particular part of the speech that the hon. member refers to is obviously not a matter of policy; it is a matter of opinion whether the people are spoiled. It is a matter of judgment. The policy of the government on all these matters is shared by the Minister of Agriculture and the rest of his cabinet colleagues.


James Aloysius McGrath: Mr. Speaker, will the Prime Minister clear up this matter and tell the House precisely what the policy of the government is with regard to the continuing increases in the cost of living?


Pierre Elliott Trudeau: Mr. Speaker, if the hon. member will stay around today he will hear the Minister of Finance and other spokesmen for the government give answers to this question.


GUIDELINES TO BE GIVEN PROPOSED PRICES REVIEW BOARD
James Aloysius McGrath: Mr. Speaker, may I direct a supplementary question to the Minister of Consumer and Corporate Affairs. Would the minister tell us exactly what guidelines the government proposes to give to the Prices Review Board which is in the process, we believe, of being set up? Will the policy enunciated by the Minister of Agriculture prevail, or exactly what guidelines will be given to the Prices Review Board?


Hon. Herb Gray (Minister of Consumer and Corporate Affairs):: Mr. Speaker, the guidelines are reflected by the statement I made on April 27 announcing the decision of the government to create such a board.
May 10,1973


REQUEST FOR STATEMENT ON MEASURES TO STABILIZE
Mr. G. W. Baldwin (Peace River):: I have a supplementary question, Mr. Speaker, for the Prime Minister. In light of what the right hon. gentleman has said and the statement by the Minister of Finance to the joint meeting on Monday that the federal government is to continue to bear the main burden of responsibility for economic stabilization, and as the Prime Minister cannot tell us today what he is going to do, would he take the first opportunity on motions to make a statement indicating by what means the government intends to exercise this responsibility and give absolute priority to the question of economic stabilization rather than merely to the survival of the government?


Pierre Elliott Trudeau: Mr. Speaker, I repeat, I believe that this is the very subject which is going to be discussed later today as a result of the motion to be put by the opposition. Members of the House and, indeed, the people of the country will see that the government is very much concerned about this problem. The answers and explanations of our position will be contained in the statements by the Minister of Finance and other spokesmen for the government later this day. I hope the hon. member will see his way clear to staying around and listening to some of the excellent speeches which will be made on this side of the House.


INCREASE IN PRICE OF CRUDE OIL-SUGGESTION THAT ENERGY BOARD FIX PRICE FOR PRODUCT PRODUCED AND SOLD IN CANADA
Thomas Clement (Tommy) Douglas: Mr. Speaker, may I direct a supplementary question to the right hon. gentleman. In view of the fact that the price of crude oil in western Canada has gone up by 55 cents a barrel in the last six months, and in view of the fact that the area west of the Ottawa Valley is a captive market since it does not enjoy the benefit of competition from offshore oil, may I ask the Prime Minister whether the government is giving consideration to a two-price system by which the National Energy Board would be able to fix a fair and equitable price for crude oil produced and sold in Canada?


Pierre Elliott Trudeau: Mr. Speaker, on the question of whether the government is giving consideration, the answer is that the government has indeed considered a great number of measures and counter-measures. On whether there will be any policy on this or on other aspects of the energy question announced, I want to say that the minister responsible is presently in Europe attending a very important conference on the problem of energy in the western world, and he will be able to answer the hon. member as to any plans he has in future.


INCREASE IN FOOD PRICES-REQUEST THAT FAMILY ALLOWANCES BE INCREASED IMMEDIATELY TO HELP THOSE ON LOW INCOMES
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, may I direct a supplementary question to the
Oral Questions
Prime Minister. As the Minister of Agriculture has stated that one-third of the Canadian people, those on low incomes, are hurt by rising food prices but will be helped by increases in old age pensions and family allowances, is it the intention of the government to increase immediately family allowances and old age pensions, specifically to compensate for the fast rise in food prices, or must these people wait for another six months?


Pierre Elliott Trudeau: Mr. Speaker, we certainly want to make sure that these measures are implemented as soon as possible. I repeat my regret that the measure is not in existence now, in the case of family allowances of $20, because we had hoped that it would be applicable since January 1 of this year. Unfortunately, members sitting on the opposition front benches did not see fit to go along with that legislation.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. Obviously, we are going to have debate on this point. The Chair will recognize the hon. member for Prince Edward-Hastings, the hon. member for St. John's East and the hon. member for Egmont on supplementaries, and return to this subject after we have completed the first round of questioning. The hon. member for York South.


George Harris Hees: Mr. Speaker-


Mr. Speaker:: Order, please. The hon. member will be given an opportunity to ask his supplementary later.


George Harris Hees: On a point of order, Mr. Speaker, I asked the Prime Minister a perfectly sensible, non-controversial question. The Prime Minister made a wisecracking reply and a misleading statement, but that is no reason why at this stage of the game I should not be allowed to ask a normal supplementary question to a good first question.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. I apologize to the Prime Minister. Hon. members appreciate the difficulty of the Chair in attempting to complete the first round of questioning. The hon. member says he has a perfectly legitimate supplementary. I do not quarrel with that. I am sure it will be quite in order when he is recognized for that purpose. Other members wish to ask supplementaries. The hon. member for Champlain is waiting for his turn to ask a question. I do not see why hon. members should object to the Chair trying to complete the first round of questioning and then return to this very important matter.


Some hon. Members:: Hear, hear!


Mr. Speaker:: This is why I recognized the hon. member for York South.


George Harris Hees: Mr. Speaker, my point of order is that the Prime Minister did not give me a factual answer. On a question of privilege, I request the right to straighten out this matter.


Some hon. Members:: Oh, oh!
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May 10, 1973
Oral Questions


George Harris Hees: My question of privilege is this. The Prime Minister knows there was nothing to stop the government bringing in that bill if it had wished to do so. It could have brought in bills to increase old age pensions and family allowances at any time during the past four months. The Prime Minister knows he is misleading the House and the Canadian people by making a statement that is absolutely untrue.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Mr. Speaker, I heard the member for Edmonton West say I deliberately misled the House. I do not believe he should have said this. I would ask him to withdraw.


Some hon. Members:: Withdraw!


Mr. Speaker:: Order, please. Perhaps at this point hon. members will appreciate what I thought was basic wisdom a moment ago when I tried to continue with the questioning in an orderly way. I think the hon. member could have waited a moment to ask a supplementary. There was not much point in rising on what he called a question of privilege. On his question of privilege, the Prime Minister says he heard a member say he deliberately misled the House. Of course, no member can say that. With all the noise that prevailed in the House. I certainly did not hear the hon. member for Edmonton West or any other member make that statement. I am not sure whether it will appear in Hansard The hon. member for Edmonton West appeared to want to rise a moment ago. If the words were spoken, I am sure he will want to agree with me that they are not parliamentary.


Mr. Lambert (Edmonton West):: Mr. Speaker, I wish to reply to the question of privilege. I appreciate the difficulty in which Your Honour finds himself, having experienced the same difficulties in the past, in not hearing words exchanged. I will avow, Mr. Speaker, that I did say the Prime Minister deliberately misled the House.


Some hon. Members:: Shame!


Marcel Joseph Aimé Lambert: On this score, either the Prime Minister is ignorant of the facts and has ignorantly misled the House or in making the statement he has induced the House, but with intention.


Some hon. Members:: Shame!


Marcel Joseph Aimé Lambert: I will say this in reply-


Some hon. Members:: Oh, oh!


An hon. Member:: Let him continue.


Marcel Joseph Aimé Lambert: If I have transgressed the usage of language in saying that the Prime Minister has deliberately misled the House I will apologize to Your Honour and to the House for using those words. But I will not withdraw the words that he was ignorant of the facts.


Mr. Speaker:: The hon. member can charge another member with ignorance, of course.


Some hon. Members:: Hear, hear!


Mr. Speaker:: I do not think that is unparliamentary. I would even go further and say that the hon. member does not have to apologize. I very often hear hon. members who are charged with uttering unparliamentary language rise and make an apology. What is required is not an apology, because that is perhaps going too far. The hon. member has not been asked to do that. He has been asked to withdraw the words, and I gather he does so. I would hope that we could again try to continue with the question period. I understand the point of view of the hon. member. He makes a distinction between what he said and what he wanted to say. He withdraws what he said and asserts what he wanted to say, and I guess we would all agree to that.


Pierre Elliott Trudeau: Mr. Speaker, I should like the withdrawal to be unequivocal. I must say that if the hon. member has some doubt-


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: -I am prepared to see the matter brought before the Committee on Privileges and Elections and I will gladly appear before the committee. I do not consider that he has withdrawn the statement.


Mr. Speaker:: Order, please. May I appeal to hon. members. I really thought that the hon. member's withdrawal was unequivocal. That is the way I understood it.


George Harris Hees: Certainly, it was.


Mr. Speaker:: I consider it that way.


Some hon. Members:: Hear, hear!


Mr. Speaker:: I think the hon. member for Edmonton West said he withdrew those words. He said he withdrew the words that the Prime Minister deliberately misled the House. That is my understanding. I will read Hansard tomorrow to see whether it is confirmed. I indicated to the hon. member a few moments ago that that was my interpretation of his words, and he confirms that impression; he asserts this in looking at the Chair. I accept this. I am entirely satisfied with what the hon. member has said. What more can we do? We could go on debating for a long time whether there has been a withdrawal. The Chair has to make the interpretation of the words of explanation given by a member who utters unparliamentary language. My ruling was that the language was unparliamentary. The hon. member, who knows the rules better than I do, recognizes it and has withdrawn. I would hope we could now go on to hear the hon. member for York South who has been waiting patiently in the wings.


Mr. MacDonald (Egmont):: On a point of order, Mr. Speaker-


Some hon. Members:: Sit down!
May 10, 1973


David Samuel Horne MacDonald: Just listen, for a change. I think the importance of the point of order should not be lost on all members of the House.


Mr. Reid:: It is certainly lost on you!


David Samuel Horne MacDonald: Twice during the last three days the Prime Minister, in answer to a direct question about immediate action on the proposal to increase family allowances put forward by the Minister of National Health and Welfare recently, replied with an answer that had nothing whatever to do with that question. He attempted to indicate that members on this side of the House were opposed to that proposition and, in addition, he attempted, in a manner which is well known not only to members of this House but to people generally, to indicate that the program which was being discussed here in this place this week was the same program as had been advanced by the government last year, which it definitely was not. I think that if the Prime Minister wishes to resort to this kind of childishness he could be spending his time in better places, perhaps with my five-year old in kindergarten.


Mr. Fortin:: Mr. Speaker, I rise on a question of privilege.


Mr. Speaker:: Order, please. The hon. member for Lotbiniere always speaks with lots of wisdom, and I will hear him with pleasure.


André-Gilles Fortin: Thank you, Mr. Speaker,-


An hon. Member:: On a point of order-


Mr. Speaker:: Order, please. We might allow another member to rise on a point of order, and that is the hon. member for Lotbiniere. He has asked for the floor on a point of order and he is recognized for that purpose.
[ Transla tion]
I apologize to the hon. member for Lotbiniere. He has the floor.


André-Gilles Fortin: Mr. Speaker, I would once again like to urge my colleagues to ensure that the first speakers during the oral question period do not ask supplementary questions, in order to do justice to all parties in the House, and to stop wasting time.
Mr. Speaker, I would like to say on behalf of our party that you can count on our support in your efforts to maintain order in the House, and I once again draw the attention of the Progressive Conservatives to the sad show they give, asking them to cease wasting time in the House during the question period.


Marcel Joseph Aimé Lambert: Is this not the same as your points of order?


Mr. Caouette (Temiscamingue):: Why not give a chance to others, you bunch of egoists!


Marcel Joseph Aimé Lambert: When it is one of your points of order, it is all right.
Oral Questions


David Réal Caouette: We are the parliament, not you.


Mr. Speaker:: Order, please. The hon. member for York South.


Some hon. Members:: Oh, oh!


Mr. Speaker:: May we have order, please. I hope we have gone beyond points of order and questions of privilege and will return to trying to complete the first round of questioning. I want to assure hon. members to my left who want to ask supplementaries that they will be given this opportunity in a moment, including the hon. member for Prince Edward-Hastings. The hon. member for York South has the floor.


INDIAN AFFAIRS
Mr. David Lewis (York South):: Mr. Speaker, I was tempted to rise on a point of order but may I pose some questions to the Minister of Indian Affairs and Northern Development. The minister knows that there has for some considerable time been a problem with the mercury pollution of a river system which has affected the residents of White Dog and Grassy Narrows reserves in northwestern Ontario. I have met with some of the leaders of these reserves-


James Aloysius McGrath: Mr. Speaker-


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


James Aloysius McGrath: Yes, Mr. Speaker. The rules apply equally to all hon. members of this House. The hon. member for York South is not permitted during the question period to make a statement, and that is precisely what he is doing now.


Mr. Speaker:: The hon. member is right. I agree with the hon. member for St. John's East that no member should make statements, allegations or declarations while asking a question. That is why I objected earlier, I thought very gently, when the hon. member for St. John's East asked a question, and I will with equal kindness ask the hon. member for York South to ask a question and not make a statement.


David Lewis: With great respect, I object to Your Honour agreeing with that perfectly unjust statement. I was not making a statement. Instead of saying "in view of the fact that there has been" I said "there has been". That is all I did, and I really do not appreciate this kind of nonsense on the part of the hon. member.
As the minister knows, there has been a problem for some years with mercury pollution of a river system affecting the residents of two reserves in northwestern Ontario. I wish to ask the minister whether his depart-

May 10, 1973
Oral Questions
ment has been in touch with the situation, has made tests of the inhabitants of those two reserves, or has taken any other action to assist the residents of those reserves?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, we have been aware of this problem for many years and I know that on several occasions it was necessary to see to it that Indians of this region change their fishing habits.
I think that my department's officials have communicated with the provincial authorities about the causes of such pollution. I have not yet received any report on its effect on the Indians of that region, but I shall inquire from the Minister of National Health and Welfare who looks after the health problems of the Indians and find out if he might give a reply to the hon. member.


David Lewis: Mr. Speaker, may I direct a supplementary question to the Minister of National Health and Welfare. Has his department been in touch with the residents of those two reserves, White Dog and Grassy Narrows, and have any steps been taken to supply the residents of those two reserves with alternative food to the fish they cannot now use in health?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, the Ontario government played a very prominent role in that field, especially because it seems that the pollution was caused by a company which dumped a considerable amount of mercury in the river and lakes concerned. The Ontario government was responsible for the situation and my Ontario colleague followed the matter closely.
In addition, a special team of doctors from my department was sent to the area to study the situation and make additional tests with a view to establishing whether or not the health of the persons affected is in fact threatened. These tests have not been completed. My department and the Ontario Health Department have been working very closely in conjunction with this matter for several weeks if not several months.


David Lewis: Mr. Speaker, may I ask another supplementary question, and I go back to the Minister of Indian Affairs and Northern Development. Even though Ontario has jurisdiction over the waters concerned and also the health question, working together with the federal department, in view of the fact the federal ministry still has a responsibility under the BNA Act and the Indian Act for the welfare of these people, I should like to ask the minister whether discussions have taken place to make available to the residents of those two reserves other nearby lakes or waters where they can continue their fishing habits and occupations?


Joseph Jacques Jean Chrétien: Mr. Speaker, I am taking the hon. member's recommendation under advisement and shall see
whether it would not be possible to implement it in order to improve the lot of the Indians of that area.


MANPOWER
Mr. Rene Matte (Champlain):: Mr. Speaker, I have a question for the hon. Minister of Manpower and Immigration.
In view of protests raised as a result of application of certain criteria for granting extensions of local initiatives projects, can the minister indicate whether he is considering changing such criteria?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Not at this stage, Mr. Speaker. We are reviewing these matters at all times and if there is any change in the program we will be announcing it.


LOCAL INITIATIVES PROGRAM-MONTREAL- SUGGESTION THAT SEASONAL UNEMPLOYMENT RATE BE ADOPTED AS CRITERION FOR APPROVAL OF PROJECTS
Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I would like to ask a supplementary question.
Given the fact that the Montreal area is disqualified for local initiatives projects because the unemployment rate for that region in March was 6.7 per cent instead of 6.8 per cent, according to the project acceptance criterion, could the hon. minister responsible for this program consider the seasonal rather than the monthly unemployment rate for March as the project acceptance criterion, thus allowing the Montreal area to benefit from the Local Initiatives Programs in 1973?


Robert Knight Andras: Mr. Speaker, we are using the'same yardsticks consistently throughout all regions of the country. Incidentally, by that same calculation the rate for the Montreal Canada Manpower Centre area is not 6.7 per cent but rather 5.9 per cent.

[ Translation]


Gilbert F. Rondeau: Mr. Speaker, I would like to ask another supplementary question.
Could the hon. minister-he did not answer my question a moment ago-consider the seasonal rather than the monthly unemployment rate for March as the project acceptance criterion for local initiatives projects?


Robert Knight Andras: The problem is that we would have to change the basic criteria all the way through. Every one of these is a relative matter and I doubt very much if it would make any difference in the end.

May 10, 1973


LOCAL INITIATIVES PROGRAM-NATURE OF EXTENSION OF PROJECTS
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, in view of the announcement by the minister that LIP projects will be extended by an amount of $30 million to $40 million and as letters from the minister's officials indicate that the time will be extended but not the funds, could the minister clarify this?


Robert Knight Andras: Mr. Speaker, I think that the release which was sent to all hon. members did indicate several categories of eligibility for extension of local initiative programs that had been under way as of now and as of May 31. One of the categories was the kind of project that had not been completed due to any reasonable delay-the weather, that kind of thing. We say they can be completed where no further funds are allowed, but there are several other categories that will also be eligible.


LOCAL INITIATIVES PROGRAM-MONTREAL- SUGGESTION THAT RATE OF UNEMPLOYMENT BE CONSIDERED IN APPROVAL OF PROJECTS
Mr. Jacques Guilbault (Saint-Jacques):: Mr. Speaker I wish to direct a supplementary question to the minister.
Could he tell the House if he foresees the possibility, in an area as large as Montreal, of taking into consideration the high unemployment rate in some Montreal districts as opposed to those with a lower rate, instead of putting all districts on an equal footing without considering the unemployment rate?


Robert Knight Andras: Mr. Speaker, as usual, we will take all these representations into consideration.


IMMIGRATION
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. Can he tell the House whether an investigation is now under way as to why Mr. Mallappa Reddy of Montreal was prematurely deported before all his appeal procedures were exhausted, as this action could seriously affect many others in similar circumstances?


Robert Knight Andras: Mr. Speaker, there are several circumstances I think should be brought out about this case, and with your indulgence I will try to be brief.
First of all, as was publicized in the paper this morning, Mrs. Reddy arrived in Canada as a visitor fully ten months after her husband had been ordered deported. Mrs. Reddy arrived, it has been established from inquiry, with $5,000 in her possession. His deportation order was upheld by dismissal of his appeal in November, 1972. He was given 25
Oral Questions
days to effect his deportation voluntarily which he did not do. Before executing the order, deportation authorities checked with the Supreme Court authorities to see if any appeal has been made, since the Federal Court appeal had already been dismissed, and the execution order was in fact implemented on that basis. In spite of all this, if all else fails and there is real hardship we are quite prepared to assist Mrs. Reddy through financial measures, but we must consider the fact that she had a fair amount of money in her possession when she came. We will assist her to get back with her husband.


MONTREAL OLYMPIC GAMES, 1976-INQUIRY RESPECTING DECISION ON GOVERNMENT FINANCIAL ASSISTANCE
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I should like to put a question to the Prime Minister.
Could he tell us whether it is true that the Cabinet has taken a decision about financing the Olympic Games? If so, could he tell the House what is that decision?


Pierre Elliott Trudeau: Yes, Mr. Speaker, a decision was taken by the Cabinet at the end of January to the effect that bills would be introduced in the House to authorize a certain financing plan essentially based on the issuance or sale of coins and stamps. This legislation, I hope, will be introduced in the House before the end of May.


MONTREAL OLYMPIC GAMES, 1976-LEGISLATION TO AUTHORIZE MINT TO PRODUCE SPECIAL COINS- DIVISION OF SEIGNIORAGE
Mr. Don Blenkarn (Peel South):: Mr. Speaker, I have a supplementary question for the Prime Minister. Is he aware that the mint is presently organizing and ready for the production of Olympic coins, and is there any legislation contemplated to allow the mint to be in a position to produce these coins?


Pierre Elliott Trudeau: Mr. Speaker, I am not aware of the premise to the question, but I repeat my previous answer that legislation will be introduced by the government enabling the mint to proceed with the scheme along those lines.


Donald Alex Blenkarn: Mr. Speaker, is the Montreal Olympic Committee going to be allowed to retain all of the seigniorage in connection with Olympic coins to be produced by the mint?


Pierre Elliott Trudeau: Mr. Speaker, this is a complex subject and the government will put its position before the House at the time it introduces the legislation and it is debated. I hope that the complexity will be understood by the opposition and that they will be in favour of it.


An hon. Member:: If you can understand it, we can.

May 10, 1973
Oral Questions


Some hon. Members:: Oh, oh!
Right Hon, J. G. Diefenbaker (Prince Albert): Mr. Speaker, the Prime Minister referred to the complexity of the question and in doing so he was pointing in my direction as if it were something he expected we could not understand. Does it not amount in fact to the people of Canada having to put up, because they will not receive the benefit of the coinage, some $200 million by indirect instead of direct contribution?


Pierre Elliott Trudeau: Mr. Speaker, the answer to the question is no, but I think the fact that it was asked proves, indeed, that the complexity of the question is not understood by the right hon. gentleman.


Mr. Diefenbaker:: Mr. Speaker, I approach the altar of the Prime Minister's arrogance with great diffidence. The Prime Minister should treat the House with a little more consideration and not be egregiously contemptuous. I ask him whether or not the plan is, as originally stated, that the mint will receive some $70 million for the actual cost of the production of the coinage and the difference between the cost and the value thereof will go to the Olympic committee? Is that not a simple question even for an uncomplex person such as the Prime Minister?


Pierre Elliott Trudeau: Mr. Speaker, on the preamble to the question I must point out that the hon. member chose to intervene because he said I had pointed at him. I must say that I did not. I was gesticulating in the direction of the hon. gentleman who asked the question. But if he wants to see himself involved I will gladly repeat my answer to him, that the facts he stated in the first question have no for an answer and indeed it proves that the question is very complex. If the hon. member wants a longer statement, we would have to revert to motions.


Some hon. Members:: Agreed.


Pierre Elliott Trudeau: I would only be prepared to speak on motions at the time the legislation is given first reading. If we get permission at the time of first reading to make a statement on motions I shall indeed be glad to make it.


John George Diefenbaker: Mr. Speaker, I rise on a question of privilege. I am not thin-skinned like the Prime Minister but invariably when he wants to be contemptuous he refers to me as the "honourable" member. I always refer to him as "right honourable" despite the fact that he is not a member of the Imperial Privy Council and only Mr. St. Laurent and I are.


Mr. Speaker:: Order, please. Would the hon. member for Peel South resume his seat. We are running short of time. Hon. members will appreciate that we are on only the third or fourth question. I would ask the indulgence of hon. members not to have too many supplementaries on each subject. The hon. member for Peel South has a supplementary to his question. The hon. member for Fraser Valley West wants to ask a question. I will recognize the hon. member for Peel South for one supplementary and the the hon. member for Fraser Valley West. That will take us quite far along in the question period.


Donald Alex Blenkarn: Thank you very much, Mr. Speaker. I object principally to the Prime Minister's suggestion I cannot understand and that members of this House cannot understand the question of seigniorage. The right hon. gentleman from Prince Albert explained it in detail to the Prime Minister-


Mr. Speaker:: Order, please. The hon. member should resume his seat when the Speaker takes the floor. This is elementary. I recognize the hon. member for the purpose of asking a supplementary. I think he should try to ask a supplementary rather than debate the matter. We have had a mini debate on a subject that is very mysterious to the Chair, but the hon. member should ask his question.


Donald Alex Blenkarn: Mr. Speaker, will the Prime Minister advise the House when this matter will be brought before the House in terms of legislation authorizing the issuance of these coins and other things?


Pierre Elliott Trudeau: Yes, Mr. Speaker. In a previous answer a few moments ago I indicated that it would be our intention to bring it before the House before the end of the month.


MONTREAL OLYMPIC GAMES, 1976-GOVERNMENT POLICY REGARDING SUPPORT-ADVANCEMENT OF FUNDS TO CITY
Mr. Mark Rose (Fraser Valley West):: Mr. Speaker, I shall not try your patience with a series of supplementaries, but I should like to direct a very uncomplicated supplementary to the Prime Minister. In view of the fact that the Treasury Board's study of the Montreal Olympics of about six weeks ago revealed that an estimated deficit would perhaps accrue of somewhere in excess of $200 million, I should like to ask whether or not the government has changed any policy decisions regarding federal support for the Montreal games and whether or not any funds have already been advanced to the city of Montreal for the purpose of the Olympics through any department of government?


Pierre Elliott Trudeau: Mr. Speaker, on the first part of the question the answer is no. The policy of the government remains as I stated in my statement to the House at the end of January or the beginning of February. On the second part, whether any funds have been paid out under the provisions of that statement, I do not have the answer; I have every cause to think the answer is no, but I will look into the matter. Finally, I want to assure the House that when I talked about complexity I did not mean to insult anyone's intelligence. I was referring very much to a very complex question indeed, and I hope the House will understand that.
May 10, 1973

[ Translation]


OPPORTUNITIES FOR YOUTH PROGRAM-SUGGESTION THAT PROJECTS REFUSED TO BE REVIEWED
Mr. Charles-Eugene Dionne (Kamouraska):: Mr. Speaker, I have a question for the hon. Secretary of State.
Has he considered and accepted a formula for review of Opportunities for Youth projects which were rejected although they are obviously meaningful to the young people sponsoring them?


Hon. James Hugh Faulkner (Secretary of State):: No, Mr. Speaker. I regret as much as the hon. member the difficulty faced by those whose projects were rejected, but frankly I am not considering further funds for those at the moment. I think that is the short answer to the question.


SUGGESTED VISIT BY PRIME MINISTER TO EUROPE TO PRESENT CANADIAN POSITION
Mr. Peter C. Bawden (Calgary South):: Mr. Speaker, I have a question for the Prime Minister when he is listening. In view of the success achieved by the President of Mexico in appearing last month at the European Economic Community in Brussels and the announcement that President Nixon will be visiting Europe this fall when he will no doubt press the position of the United States on trade with the European community, will the Prime Minister consider a trip to Europe to put forward Canada's position forcefully to the European community?


Pierre Elliott Trudeau: Yes, Mr. Speaker. I appreciate the hon. member's suggestion that I do a bit of travelling. I have the intention of preparing travel plans for the coming year.


Peter Colwell Bawden: Mr. Speaker, the Prime Minister said he would be preparing his travel plans for Europe for next year. Would he not consider it more appropriate to be putting Canada's position before the community this year?


Pierre Elliott Trudeau: Mr. Speaker, the House should know that the Minister of Industry, Trade and Commerce was in Europe just a matter of a couple of weeks ago putting this case, and it has been put on previous occasions by the Secretary of State for External Affairs and by various other ministers including the Minister of Finance who was over in Europe. I myself put the case very strongly in the United Kingdom when I visited the Prime Minister of the United Kingdom in December. I can assure the hon. member that the representations are constant and continuous, but that does not preclude, I repeat, my consideration of further travel plans for the year to come.


Mr. Speaker:: Order, please. There are just a few minutes left before the end of the question period, and I would ask hon. members to give other hon. members an opportunity
Oral Questions
to ask questions. Perhaps the hon. member for Calgary South might ask a last supplementary, after which I will recognize the hon. member for Kent-Essex and then the hon. member for Saskatoon-Biggar.


Peter Colwell Bawden: Mr. Speaker, I am aware of the visit of the Minister of Industry, Trade and Commerce to Europe, but does the Prime Minister not think that an appearance by himself would be more appropriate and have more impact than appearances by his lesser ministers, particularly when so many countries are being represented in Europe by their chief executives?


Mr. Speaker:: Order, please. That is an argument.


MANPOWER
Mr. H. W. Danforth (Kent-Essex):: Mr. Speaker, I would like to direct a question to the Minister of Manpower and Immigration who, I am sure, is well aware of the problem. Because of the fact it is becoming quite apparent that shortages of farm labour for planting and harvesting could seriously jeopardize food production in Canada, and at the same time thousands of students desperately need summer employment to obtain money for their further education, would the minister at this time, or in a statement on motions, indicate if any new initiatives, over and above those used last year, to survey adequately both needs and to resolve this most serious problem are in process?


Robert Knight Andras: Mr. Speaker, I will examine the hon. member's representation and give him a more satisfactory and detailed answer later.


AGRICULTURE
Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. In view of the recent announcement by the minister of a one week deadline for the government of Saskatchewan to agree to the implementation of the small farm development program, can the minister tell the House whether an agreement has been reached by the two governments or whether negotiations are still in progress between himself and the provincial government?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, I met with the Minister of Agriculture of Saskatchewan in Ottawa on Tuesday. He submitted some ideas or suggestions to me to consider. I am resubmitting them to him in Regina this afternoon, and we have agreed to have these negotiations finalized by next Wednesday.


Alfred Pullen Gleave: May I ask the minister whether, in view of the fact several other provinces, including Quebec, have
3614

May 10, 1973
Oral Questions
not yet signed an agreement, he also issued an ultimatum of one week to the province of Quebec?


Eugene Whelan: Mr. Speaker, we are taking them one at a time but they will all be treated the same way.


Some hon. Members:: Hear, hear!


INQUIRY OF THE MINISTRY
[Stage Direction]
proven to be responsible and financially stable, could these applications be approved without the necessity of going through a formal hearing?
Mr. Pelletier (Hochelaga):: I am not sure, Mr. Speaker, that I would dare express an opinion on whether or not the CRTC is bound by law to hold a hearing, but I am convinced it is proceeding as fast as possible. Now, if the hon. member wishes to inform me of special cases or abnormal delays, I shall be happy to bring them to the attention of the chairman of the CRTC.


David Réal Caouette: Mr. Speaker, I have a question for the right hon. Prime Minister. As usual, the matter is very serious.
Two days ago, following statements by the Leader of the Official Opposition to the effect that prices to fishermen in the east and the west and also to western farmers should be increased, I asked the Prime Minister whether he intended to have the Leader of the Official Opposition examined. Now I notice that for the past two days the Leader of the Official Opposition has not been in the House? Has the Prime Minister had him sent to the hospital for examination?


Marcel Joseph Aimé Lambert: Were you in a mental home when you were absent? Because in fact you were absent, weren't you?


BROADCASTING
Mr. R. E. McKinley (Huron):: Mr. Speaker, before asking my question I would just like to say, in view of the remarks made by the last questioner, that I believe the Leader of the Opposition is in Vancouver.
I would like to direct a question to the Minister of Communications in charge of the Canadian Radio-Television Commission. In view of the fact many communities are anxious to have cable television available to them and that the CRTC seems to be dragging its feet in setting hearing dates for applications, will the minister take it upon himself to see what can be done to have the CRTC exhibit some urgency in this matter?
[ Translation]


Gérard Pelletier: I suggest, Mr. Speaker, that any delay in the holding of CRTC hearings is strictly due to the tremendous workload the commission has to deal with. I do not believe there is negligence on their part; I maintain continual contacts with the members of the CRTC and I transmit to them representations submitted to me by hon. members.


Robert Elgin McKinley: As many applications for cable television service have already been submitted to the commission to which there is no opposition and the applicants have been

*
* *


REPORTED INSISTENCE BY UNITED STATES THAT CANADA ACCEPT ENERGY DEAL IN RETURN FOR ACCESS FOR CANADIAN MANUFACTURED GOODS
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. In view of the report from Washington which appeared in today's Globe and Mail that Secretary of the Treasury George Shultz had intimated that in trade talks between Canada and the United States the United States was taking a package approach and insisting that in return for the U.S. accepting manufactured goods from Canada we would have to accept the U.S. proposal for an energy deal. Is this being discussed in the trade talks right now and, if so, what is Canada's position?


Alastair William Gillespie: Mr. Speaker, of course I have not seen the transcript of the secretary's remarks and until I have I cannot comment in any detail. It is true that we have resumed talks. I think that the atmosphere for our discussions has improved very considerably. I think there is an understanding and a willingness on both sides to deal with separate issues on their merits.


John Edward Broadbent: />
' a supplementary-


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for his supplementary, but we have reached the end of the question period. In fact, with the implied consent of hon. members I have allowed a little extra time because of the points of order and questions of privilege we had earlier in the question period. As I say, the hon. member may ask his supplementary, and then I will recognize the hon. member for Brome-Missisquoi on a last question.


CANADA-UNITED STATES AUTO PACT-SUGGESTED REMOVAL OF DUTY PAID BY CANADIANS ON IMPORTS
John Edward Broadbent: Mr. Speaker, my supplementary is on one of those separate trade items referred to by the minister. Could he inform the House whether the governments of Canada and the United States are discussing, as a change in the auto pact, the proposal I made in the House on March 13 to remove the 15

May 10, 1973

Oral Questions


Some hon. Members:: Hear, hear!
per cent duty that Canadians must now pay if they purchase a car in the United States?


Alastair William Gillespie: Mr. Speaker, when I have something more to state with respect to our discussions I will do so in the appropriate way. I think it would be premature at this time to make any statement in respect of these talks.


PENITENTIARIES
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, my question is directed to the Solicitor General. It concerns the escape of yet another inmate from the Cowansville medium security institution while visiting his wife in Montreal. Since one of the officials of the minister's department has said that this inmate can be considered dangerous, will the Solicitor General now order an independent inquiry into the escapes of maximum security inmates from medium security institutions, and into the transfer of these inmates to such institutions? Can he now assure the House that he will establish an independent inquiry in order to find out just what is going on?


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, I have said that I have an inquiry under way at the present time and that when I receive that report I will consider the suggestion put forward by the right hon. member for Prince Albert. I want to say that in this case the inmate in question had a child on the day he was arrested, and this was the first opportunity he had to see the child. He was allowed out of the penitentiary on that basis. Unfortunately he breached the trust put in him and escaped from the guard. This incident is also under investigation by the inquiry and I hope to have a report soon.


Mr. Speaker:: Order, please. A number of hon. members are seeking supplementaries, but I think I should really call orders of the day. I apologize to the hon. member for Brome-Missisquoi who wishes to ask a supplementary, but with his forbearance and consent perhaps the matter could be pursued tomorrow. The hon. member for Peace River is rising on a point of order.


BUSINESS OF THE HOUSE
Gerald William Baldwin: Mr. Speaker, I should like to ask the government House leader about the business of the House for the next week, but before he comes to his place I think I am entitled to remark on the gratuitous statement made by the hon. member for Temiscamingue (Mr. Caouette). The Leader of the Opposition (Mr. Stanfield), who is the leader of the only effective opposition in this House,-


Some hon. Members:: Oh, oh!


Gerald William Baldwin: -is in Vancouver at the request of a great many people there to outline the alternative policies.


Some hon. Members:: Oh, oh!


Gerald William Baldwin: I should like to ask the government House leader-


Mr. Speaker:: Order, please. The Minister for Consumer and Corporate Affairs.


Stanley Ronald Basford: Mr. Speaker, on a question of privilege-


Mr. Speaker:: The hon. minister rises on a question of privilege.


Stanley Ronald Basford: Mr. Speaker, the statement that has just been made is not entirely correct. The Leader of the Opposition (Mr. Stanfield) is not in the city which I represent at the request of that city; he is there because the Conservatives have been flogging $100 tickets all over the place.


Mr. Bell:: He didn't say that.


André-Gilles Fortin: Mr. Speaker, I rise on a question of privilege.


Mr. Speaker:: Order, please. The hon. member will have to wait for his point of order.

The hon. member for Lotbiniere on a question of privilege.


André-Gilles Fortin: Mr. Speaker, we were deeply hurt by the disparaging connotation of the remark made by the hon. member for Peace River about the hon. member for Temiscamingue (Mr. Caouette). That party should know that the hon. member for Temiscamingue is the leader of the opposition party for Quebec in Ottawa.


Mr. Speaker:: Order, please. The hon. member rises on a point of order. I would hope that the hon. member for Peace River (Mr. Baldwin) would not attempt another reminder of that kind.

The hon. member for Temiscamingue wants to raise a point of order.


David Réal Caouette: Mr. Speaker, my point of order is to inform the hon. member for Peace River that there are only two Progressive Conservative members in the province of Quebec, and they do not even see eye to eye.


Gerald William Baldwin: Having settled that important issue, Mr. Speaker, I should like to ask the government House leader about the business for this week and next week.
26314-12J
May 10, 1973

Increased Cost of Living
When replying I would be grateful if the hon. gentleman would indicate if the government has now composed its differences so that he can tell the House just when the ways and means resolutions with regard to corporate taxes will be introduced. I first asked that question two months ago.


Mr. MacEachen:: As the House knows, Mr. Speaker, we will be considering an opposition day today and another tomorrow. On Monday, I would hope to call the amendments to the Criminal Code related to capital punishment, followed by the Fisheries Development Act and the CNR financing bill. On Thursday and Friday of next week, it will be necessary to call opposition days. The timing of the introduction of the corporate tax changes is very much in my mind at the moment.


James Aloysius McGrath: Mr. Speaker, may I ask the government House leader-and I do so in view of the statement made yesterday by the Minister of Agriculture which is the only statement of government policy we have had on the increase in the cost of living-if the government will give consideration to setting aside the low priority that he has outlined before the House and bring in amendments to the Family Allowance Act so that we can get money into the hands of the poor who have to eat every day, not just once every six months.


Jack Marshall: Mr. Speaker, if I may put a question to the government House Leader. In view of the fact that we cannot get any enlightenment on the subject of disability pensions from the Minister of Veterans Affairs (Mr. MacDonald), since that was promised six months ago as a priority, would the minister state when he is going to introduce legislation on disability pensions?


Allan Joseph MacEachen: Mr. Speaker, I believe most hon. members would agree that capital punishment and fisheries are priority items, as is action on family allowances and the subject of pensions brought up by my hon. friend. They will be brought in at an early date, and hopefully will be dealt with before the end of June.


Mr. Speaker:: Orders of the day.



GOVERNMENT ORDERS


Mr. James Gillies (Don Valley) (for Mr. Baldwin) moved:: That this House deplores the failure of the government to take concrete and effective action against the rising cost of living, so evident in the price of shelter, food and clothing; and therefore urges the government to impose an immediate temporary freeze so as to enable it to develop a satisfactory plan in conjunction with the provinces, industry and labour for the purpose of keeping the cost of living within acceptable limits.

He said: Mr. Speaker, I rise to speak on this motion with the feeling that we are talking about one of the most important problems that is before the Canadian public today, the problem of the high cost of living and what we are going to do about it. It would seem to me that we do not have to debate the subject at length to ascertain that we have a serious inflationary problem in Canada. The consumer price index has increased by 6.6 per cent and the food component of that index has increased 12.9 per cent. All the forecasts we have indicate that inflation is going to be with us in the future. I know that these forecasts can be very difficult. Certainly, the forecast made a year ago by the Minister of Finance (Mr. Turner) in his budget, when he hoped that there would be reasonable price stability during this year, has not come true. I mention that not in a pejorative sense at all, but merely recognizing how difficult it is to make good forecasts in this particular area. I accept the explanation given by the Minister of Finance and the government many times that there have been great difficulties throughout the world in terms of food supplies, rising incomes and the rising expectations of people who are using more food. I accept those statements and would not debate them here today.
What I should like to debate is how we are going to evolve ways to deal with these particular problems in this country, and what we should do about inflation and our monetary and fiscal policy in a general sense. There are those who would argue that we should live with inflation as it is. A conventional part of economic wisdom says that inflation and full employment must go together, that we should go for full employment and be willing to live with the inflation it generates. I think that is a defeatist attitude, a program that is basically unacceptable in any contemporary economy, in any contemporary country. The inflation that could be experienced in a country such as Canada could be so high that we could not expect the Canadian people to bear such an unjust burden. People on fixed incomes are desperately burdened as it is. Those planning a pension or insurance program are already badly hit by inflation. Certainly, the great regional disparities in this country mean that the burdens of inflation fall heaviest on those who live in areas of low income.
We have unleashed in Canada today a series of expectations which bode ill for us in the future. Historically, many countries have found themselves in serious economic difficulties in terms of employment and economic growth because of unbridled inflation. So, we must do something about those inflationary forces in the Canadian economy at this time.
But beside that, and apart from that, the fact that we are experiencing a cycle of inflation in Canada today indicates, I think, that we have not come to grips with the problems of economic management in the Canadian economy. In the last two or three years we have had an inordinate level of unemployment. Our level of unemployment has been among the highest of any industrialized country in the world and we all applaud the reduction of this high level, even by a slight amount. There has been an enormous underutilization of our productive resources, and we have probably lost between $5 billion and $6 billion of
May 10, 1973

possible production per year because the economy has been operating below capacity.
The same can be said of taxes. We have lost a great amount of tax income which would have been generated by people who would have been working. We have had an economic policy that, very simply, has led to an increasing proportion of foreign control of our own economy. We have operated under an economic policy which simply has not worked for Canada and the amount of inflation from which we now suffer simply underlines this fundamental fact.
What worries the people of Canada and must worry all in the Parliament of Canada is this: As we enter this pattern of upswing and inflation, are we entering into the classical cycle when price expansion will eventually cause economic contraction? Will there be once again lost production, and are we, going to experience a classical business cycle? Analysts are saying that the high costs of today will be reflected in higher costs tomorrow which means there will be more inflation. The situation certainly calls for action right away.
Why are we experiencing the present level of inflation in Canada? There are two major causes of inflation. The first well known cause is cost-push, the cause or the inflation which we experienced last year, a matter which appeared to be a matter of great concern to those responsible for economic policy at that time. They asked, how is it possible that we have both inflation and high unemployment? The answer is, of course, that the inflation was not related to demand factors at all. There was cost-push inflation operating in Canada during the last two or three years, and that cost-push inflation should have been dealt with then. So, we were in the ignominious position of having a high level of unemployment and high levels of inflation.
What has happened now, and the reason that we have such great problems in Canada today, is that the cost-push inflation generated two or three years ago has now been supplemented by demand-pull inflation. Actually, we have both, and because we suffer from both forms, we must simply do something about it. Why has demand-pull inflation come about? One could argue that it has come about because incomes are rising. However, basically and primarily, demand-pull inflation, as we are today experiencing it, has come about as a result of the futile attempt of dealing with the inflationary problems of three years ago, as if it were caused by demand-pull and therefore by introducing high interest rate policies, a slowdown of the economy, and fiscal policies which stopped normal growth. So, we have shortages of supply now. The occurrence of cost-push inflation and demand-pull inflation together are creating inflationary expectations in the economy which the economy simply cannot sustain.
The real question is not necessarily why do we have this inflation, but what can we do about it? What kind of policy can we evolve that will make it possible for Canadians to have reasonably full employment and price stability at the same time? How can we cope with the situation in which the Canadian economy now finds itself? No one would argue, I least of all, that this question can be solved in any simple fashion. At the same time, it appears to me
Increased Cost of Living
that there are basically three approaches that can be taken to solve this particular problem.
The first is the great, classical approach, the traditional approach, which says that if there is inflation in the economy, you must slow down or dampen the economy, raise interest rates, impose high taxes and cut off excess purchasing power. This supposedly stops the forward movement of the economy and slows down the inflationary spiral. That was the policy followed by the government in 1970 and that is the policy that some of us are frightened the government will follow again. That policy, of course, will not work. It will not stop inflation unless you generate unacceptably high levels of unemployment. We are still suffering from the use of such a policy three years ago. One can give the government great credit for bringing the rate of inflation in Canada down to quite low levels through such a policy. However, in doing so, it paid a cost that was enormously high, a cost Canadians today are not prepared to pay again and inflation was only temporarily checked.
The question one must ask is, why does that classical approach not work now? Why did we end up having high unemployment and inflation at the same time, even though there was a slow down in the economy? The reason the policy does not work is that such a policy is designed to work in an economy which is totally competitive, where competitive forces are operating all the time. The trial of that policy two or three years ago, made it self-evident that the Canadian economy had within it a series of blocks, of power groups which do not respond the way competitive markets do. We do not have perfectly competitive economy. So, we find that the traditional policy for fighting inflation does not work. The Phillips curve that people talk about is not applicable. We do not have acceptable trade-offs between employment and inflation. Consequently, it does not make good sense to follow the traditional policy.
The second thing I wish to say about that policy is that it depends upon enormously good economic forecasting and analysis. I have argued many times in this House that we are not properly organized in Canada for economic policy making. We need a system of competent economic forecasting, but do not have it. I do not want to press that point except to say that if we are to use monetary and fiscal policies alone to create full employment and combat inflation, we must be very sure that we are accurately measuring the leads and lags that take place in the economy. Our estimation and analysis in this country of these leads and lags has been very poor indeed. We just have not been able to predict them. Whether anybody else could do so I am not prepared to say, but the government has not been able to do so. Relying on a policy when we do not have the tools to undertake it is folly indeed. We know that if you follow the classical way to fight inflation in this country, the policy is not going to work. It has not worked in the past and will not work in future, and we must reject the idea that it will.
I do not think anybody in this parliament is prepared to see the Bank of Canada tighten the money supply and raise interest rates to slow down production in order to get inflation under control. That is a perfectly unacceptable way to approach this problem at the present time.

May 10, 1973
Increased Cost of Living
On the other hand, if we do not follow the traditional method, we must do something else. We are not prepared, it seems to me, to accept the rate of inflation prevalent in the economy. It affects expectations involving, among other things, international trade. If we cannot accept it, one must ask, what are the alternatives?
One alternative is calling for voluntary restraints, asking everyone not to raise prices, asking labour not to raise wages and industrialists not to sell labour not to raise wages and industrialists not to sell their goods at higher prices. This was attempted but did not work. The thrust was made, but did not work. What is left?
It seems to me, Mr. Speaker, that, given the structure of the economy and the problems we are facing, we simply have to come to some sort of enforced incomes policy if we are to get rid of the inflation which is doing so much harm to so many Canadians at the present time. Nobody really approaches such a solution to the inflationary problem with any pleasure. I agree with the Minister of Finance (Mr. Turner) that you have to approach the idea of making the policy work with care. However, I and the members on my side of the House, at least, feel strongly that we must do something to contain inflation. The people of Canada, I think, feel the same way. I think the people of Canada are looking for somebody to give leadership in this area and say, "Let us try this, let us make the economy work effectively."
What are the arguments against an incomes policy? What are the arguments why we should not attempt to adopt incomes policy? The first argument is that it will not work. I reject that out of hand. There is no reason to believe we cannot design an incomes policy in this country that will work. One looks at the experience of other countries, particularly the United States and England and it is clear that the record is mixed.
Indications from the British experience are not in, although we know the inflationary rate in that country has been reduced. One has to be careful of international comparisons, but I believe the rate has dropped roughly from 10 per cent to 6 per cent. We know that until they went to phase three in the United States, the American experience worked well. When they went to phase three, it worked badly. I reject out of hand the idea that we are incapable of designing in this country an incomes policy that will work. All we need to have is the will, the courage and the leadership to put it into effect.


Some hon. Members:: Hear, hear!


James McPhail Gillies: The second reason it is said we should not have a policy is that it would create a vast bureaucracy to administer the program. No one is talking about an incomes policy today that is comparable to the incomes policy operated in the forties during the war. It is a different situation altogether. Nobody is talking about rationing. We are talking about an incomes policy with no rationing. We could administer and operate an incomes policy in this country with something in the neighbourhood of 800 to 1,000 people. What the figure would actually be, I would not suggest specifically, but we know that when the United States with 225 million people ran its

income policy, they ran it with 1,200 people. The argument put forward that we would have a vast bureaucracy does not wash in the present situation.
The third reason that is given for not having an incomes policy in Canada is that we have an open economy. It is said that any country where 25 per cent of the gross national product is generated through international trade cannot make an incomes policy work. Again, it creates some difficulties. My own view is that they are far from insurmountable. Indeed, it would not be a bad idea to look more carefully at our export and import policies at this time, as well as our capital flow problems, and relate them to a growth program in Canada.
Finally, it is argued it would not work because the people are not ready for it and do not want it. What evidence is there? Every Gallup poll you look at, and I do not like to mention Gallup polls, indicates the Canadian people want some sort of incomes policy in this country at the present time. Certainly, most members of parliament found during the Easter recess that the major problem facing Canada today is the cost of living. There is no question about it. How long do Canadians have to wait before some action is taken to deal with this p; oblem? The Canadian people are willing, able and eager to have positive approach taken to lower the cost of living. These are the arguments made against it.
What are the arguments for it? Certainly, the argument of getting the cost of living under control is important. The field of housing, which will be dealt with later, is terribly important. With the rate of inflation today only 6 per cent of the families in Toronto can afford to buy a single family home if they are not to spend more than two and one half times their income on housing. The present rate of inflation in the cost of housing today, if compounded, and I know these figures have been quoted before, means that in the year 2,000 the average selling price of a single family house in Toronto would be $250,000, a quarter of a million dollars. We have to break such inflationary expectations.
An incomes policy would give us time to work out economic policies that would lead to the proper use of our resources, a stable employment program, a stable import-export program, a program that would allow the Canadian economy to move forward the way in which it should. I cannot state how sincerely our party is committed to the fact that now in Canada we should have a 90 day freeze on incomes, prices, rents and dividends as a start in attacking the inflation problem in the Canadian economy.
I want to make it very clear that we think that the 90 day period of time should be used, and in this I agree completely with the leader of the New Democratic Party, to consult with the provinces, leaders of labour, the leaders of industry, leaders of agriculture and leaders of consumer groups to work out a stabilization program. It has never been part of the Conservative party policy to have a 90 day freeze and that's it. We believe an incomes policy has to be an integral part of our monetary and fiscal policy if this country is going to operate with full employment and reasonably stable prices.
We would use the 90 days to develop the program in detail. We think guidelines should be developed for measuring acceptable changes in prices and incomes. We sug-
May 10, 1973

gest guidelines that are not voluntary, but that are enforceable. When there are productivity changes, these can be taken into account and remedies can be provided for those suffering inequitably because of the program. There is no reason why it cannot be done. We believe it can and should be done. In this economy, we have had enough experience in the old fashioned idea of monetary theory alone and fiscal policy alone, fighting inflation and bringing about full employment. It is not working. How much evidence do we need? We think it is essential to supplement monetary and fiscal policies with an incomes policy right now.
Before 1936, before Lord Keyne's great work, anyone who suggested there were times a government had a responsibility of operating without a balanced budget in order to get full employment was totally rejected. Surely, in the seventies we are not so blind that we are going to allow the Canadian people to be damaged by inflation and accept high levels of unemployment because we are unwilling to concede the proposition that it may be necessary now to supplement traditional policies with an incomes policy.
In this parliament, there has been debate after debate of all kinds of what are responsibilities of government. But surely, no one can argue against the proposition that it is a central responsibility of the federal government to follow policies to provide full employment and price stability. Surely this cannot be argued. It must be the central thrust, the central responsibility of the federal government. This is a responsibility which the government is not accepting, and I hope hon. members on the treasury benches opposite will accept our suggestion, will adopt an incomes policy, relate it to monetary and fiscal policy and get this country moving again.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Before the hon. member resumes his seat, I gather the hon. member for Davenport is seeking permission to ask him a question. He can only do this with the hon. member's permission and on the understanding that the hon. member has not yet completed his speech.


James McPhail Gillies: I shall be glad to answer a question. I wish I knew what it was before it was asked, though.


Mr. Caccia:: Would the hon. member tell the House what are the components of his prices and incomes policy at the point when the 90-day freeze which he is proposing comes to a conclusion?


Mr. Muir:: He has just told you.


James McPhail Gillies: I would be glad to answer that question if I were given another 20 minutes.


Some hon. Members:: Agreed!


James McPhail Gillies: Basically, we believe we should work out a series of guidelines for appropriate increases in incomes and prices. These guidelines would be enforceable and adjustments would be permitted corresponding to changes in productivity. This would be accompanied by policies
Increased Cost of Living
designed to increase supplies in the market of agriculture products, housing and so forth, so that the forces of supply and demand would operate in an effective fashion again.


Some hon. Members:: Hear, hear!


Charles L. Caccia: A further question-


Mr. Speaker:: Order. The day is getting short, and I believe there are a number of hon. members who wish to take part in the debate. If too many questions are asked at the end of speeches, the number of speeches possible might be cut down. If members of the House wish, we can, of course, allow further questions, though I believe there is some objection taken to this-perhaps we should allow the Minister of Finance to make his speech.


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, we address ourselves to this motion with a recognition that rising prices in this country involve us all in a matter of growing concern-a concern felt by the country as a whole and shared by this House. No one is going to deny that inflation is hurting every Canadian. I must say the government is watching the situation with a commitment to do everything it can to ensure that low income families, in particular, are left with sufficient disposable income to cope with the rise in prices. The economic responses are not easy.
I listened with great care to the hon. member for Don Valley (Mr. Gillies) and I still do not know what economic responses he would make in sufficient detail to allow a considered judgment to be made upon them. I want to suggest to him that there are no magic, clear-cut solutions and it is no use deluding ourselves or the country into believing that a solution is easy. I do not believe posturing is going to provide a solution, nor will rhetoric, nor political cosmetics.


An hon. Member:: Talk to the Prime Minister about political cosmetics. He has his hand in the jar.


John Napier Turner: Mr. Speaker, this motion glaringly underlines the lack of credibility of the Conservative party in its mounting desperation for power. I am not surprised that the hon. gentleman, when he blurted out the word "poll", should have retreated from it immediately. What the motion does is to propose a vague and ill-defined type of freeze. Its terms certainly do not give the House any clarification of its intent, neither did the hon. member for Don Valley. As I say, it proposes an ill-defined type of freeze on the incomes of Canadians to be followed by further controls of an even more vague and ill-defined nature.
Despite the pertinent question put by my hon. friend from Davenport (Mr. Caccia), we were not able to ascertain the precise nature of what the hon. member had in mind. We are quite willing to recognize the gravity of this problem for Canadians. Our difficulty is in understanding just what policy the hon. member wishes to pursue.


Marcel Joseph Aimé Lambert: Look at your budget speech of last year. You haven't done a damn thing about it.

May 10, 1973
Increased Cost of Living


John Napier Turner: I submit that the proposal put to the House this afternoon could very well, over the longer term, hurt Canadians far more than it would help "them. It is a proposal which could aggravate inflation rather than relieve it and it could, as the Leader of the Opposition (Mr. Stanfield) warned in earlier days, substantially increase tensions between various groups in Canadian society. I am sorry the Leader of the Opposition is not here today.


Marcel Joseph Aimé Lambert: You have been absent, too.


John Napier Turner: I am not complaining about it. I suggest to the hon. gentleman that it will not cost him any money to listen to me this afternoon.


An hon. Member:: It is costing the country a fortune!


John Napier Turner: The Leader of the Opposition said on January 31, 1971, that "there had been a lot of loose talk about wage and price controls".


An hon. Member:: That was two and a half years ago.


John Napier Turner: No, about one and a half years ago. I continue the quotation. He said:
-even cabinet ministers are mentioning it these days as the answer to price stability in Canada.
Incidentally, I may say I was a faithful reader of the hon. gentleman's contributions to the Toronto Telegram before he entered politics. Even if he is a recent convert, one wonders what his motives are.


Some hon. Members:: Oh, oh!


Robert Muir: The Prime Minister is a convert, too.


John Napier Turner: I continue. This is the Leader of the Opposition speaking:
It is important for us to recognize the far-reaching implications of such controls which, by their very nature, could be nothing better than a short-term solution taken as a final resort after all other means had failed.
They would cause untold resentment among groups and individuals who felt unfairly done by and they would result in a climate of constant confrontation. In additon, of course, they would inevitably lead to a highly centralized and therefore inefficient form of economic planning.
I say as strongly as I can that we must make a further, serious effort at a time when inflation is partially, if temporarily under control. This is the time to act again to set up a pattern for co-operation. And this must be combined with monetary and fiscal policies which will appear credible and workable to the people involved.
I agree with the last few words of that citation. I am sure the knowledgeable members of this House-and by definition every member of this House is knowledgeable on these matters-will recognize the problem of inflation is worldwide in origin. There is no way in which a major international trading nation like Canada can insulate itself from these forces. To suggest that it can do so represents a flagrant attempt to mislead the Canadian people. I say to the hon. member for Don Valley that if this recently-acquired obsession with controls, for whatever motives he might care to have attributed to him-maybe the word "obsession" is a little too strong-


Some hon. Members:: Oh!


John Napier Turner: -is based only on the fact that we ought to have wage and price controls in this country in order to give it a try, run it up the flagpole and see if anyone salutes it, to use the old Walter J. Thompson aphorism, then surely he is deluding himself, the House and the people.


Some hon. Members:: Hear, hear!


John Napier Turner: The hon. gentleman was talking about inflationary expectations. I venture to say him that every time he brings up this matter in the House in these terms he is prompting expectations that if he were in power-fortunately this is an academic question-it would result in a self-fulfilling prophecy and prices would be escalated even more than they have been escalating. I suggest to him that this is a self-defeating type of policy.
Let us analyse the underlying situation. While Canada's price performance has been significantly better than that of most other industrial nations, it has felt the impact of the global increase in food prices and the price of commodities. When I talk of commodities I am talking of international commodities such as wool and cotton which affect our clothing prices. Recent figures published by Statistics Canada indicate that as a result of my budgetary measures the cost of children's clothing did not rise following the relief granted from sales tax. If you look at the figures relating to international commodity prices of lumber, which of course affects the cost of housing, you will see there are world-wide shortages. These increased prices result from adverse weather conditions, failure of world crops or a general increase in world-wide demand- for example, in an affluent country such as Japan, which is becoming more consumer oriented-flowing from a sharp upturn in economic growth as well as an increase in personal incomes. This is a situation that we must recognize. Our economy is vulnerable because we handle large amounts of imports and exports and we are not immune from the contagion of this world-wide problem.
Aside from food, let us look at wages and salaries and other commodities. These have been rising, but they have been rising relatively stably. When I take a close look at what the Conservative party is proposing here, I come to certain conclusions, and they are these. The Conservative party is advocating an immediate temporary freeze. But they do not tell us what is to be frozen.


Some hon. Members:: Oh, oh!


Mr. Baker:: Where have you been?


John Napier Turner: If hon. members read carefully what the hon. gentleman opposite said today, they will find it impossible to distinguish whether he is talking about a temporary freeze or continuing permanent controls. I invite hon. members to read the exact words that the hon. member used this afternoon. The motion then goes on to refer to developing-
-a satisfactory plan in conjunction with the provinces, industry
May 10, 1973

and labour for the purpose of keeping the cost of living within acceptable limits.
Again I ask, what do they propose to freeze? In an earlier motion which was put forward by the hon. gentleman's deskmate, the hon. member for Northumberland-Durham (Mr. Lawrence), they proposed a freeze on food prices, except those at the farm gate. I ask you, Mr. Speaker, whom do they think they are fooling? It should be obvious to any aduit Canadian, and certainly to every farmer, that if food prices are frozen at every level in our marketing system except at the farm gate, prices paid to the farmer for his output will be effectively frozen as well.


James McPhail Gillies: No one says anything different.


John Napier Turner: Let me go on further. The farm gate is the point where most of the upward pressure has originated on food prices because of a shortage of supply to meet demand. Last year increases in the price of meat, fish, poultry, fruits and vegetables at the farm gate accounted for more than 60 per cent of the increase in food prices.
The effective freeze on food prices at the farm gate proposed by the official opposition, the Conservative party, would cause farmers to cut back on domestic production rather than encourage the essential increase in supplies which is sought by the government, and will eventually lead to a renewed price explosion. What hon. gentlemen opposite fail to realize is that the problem of food prices is one of shortage of supply. You do not curb the problem by imposing price controls; you only curb it by encouraging supply, and, as I say, the hon. member has failed to realize this.


Marcel Joseph Aimé Lambert: Who wrote this speech?


John Napier Turner: Again I suggest to the House that it is impossible to apply a freeze or controls to imported goods. Imported goods in 1972 amounted to $1.2 billion and accounted for some 10 per cent of all food consumed in Canada. I submit it is also impossible to apply a freeze or controls to other imported goods. Last year total imports amounted to $18.5 billion, a substantial proportion of all goods purchased by Canadians.
If there is any doubt intellectually about the fact that the Conservative party proposal could hurt rather than help Canadians at this stage, it should be dispelled by a recent letter dated April 24, 1973 to the Wall Street Journal by John Kenneth Galbraith, a distinguished Canadian-born economist, a man who, as hon. gentlemen know, is one of the leading advocates in the United States of selective income controls of a permanent nature. As an exponent of controls, Galbraith wrote to take strong exception to action by the United States administration in imposing a freeze on meat prices. This is what he said, and I want to quote him:
The purpose of control is to arrest the interaction of wages on prices and prices on wages in that part of the economy characterized by strong unions. As such, it is an essential supplement to fiscal and, in its more limited role, monetary policy. It is nowise a substitute for such action. Controls should not be used where price increases are caused by an excess in aggregate demand or a shortage in the specific supply. If so used, some momentary effects
Increased Cost of Living
apart, the result will be either random shortages in the retail stores, violations or, more likely, both.
The present behaviour of meat prices, as of numerous other prices, shows every indication of being caused not by wage and cost increases but by the pull of demand. For this the right remedy is to stop playing games with the Congress over who will be responsible for the next tax increase. The need, whatever the prospective level of spending, is now for a prompt increase in taxes.
Not only do the Conservatives propose to compound problems in Canada by imposing a freeze on prices of food and other goods; they also propose to intensify these problems by vastly increasing fiscal and monetary stimulus. If there is one thing that even a student in first year economics should know, it is that if one is to attempt to apply any wage or income or prices policy, one has to have an accommodating fiscal and monetary policy.


James McPhail Gillies: Certainly; I agree with that.


John Napier Turner: The hon. gentleman agrees. When I presented my budget on February 19 and said that, evaluating the system as best I could, the maximum cash requirements of the government of Canada against the markets of Canada, weighing the problem of unemployment and the rising cost of living, was $2 billion, the hon. gentleman and his friend, the hon. member for Edmonton West, as well as their leader, said that that stimulus was only half as much as it should be, that we should double the deficit from $2 billion to $4 billion. Now, Mr. Speaker, these hon. gentlemen cannot have it both ways. They cannot ask for a policy that will restrain the rise in prices in this country by putting a lid on the economy of this country, and at the same time propose to juice up the fiscal element in the country by twice as much. I think on the basis of better judgment, the hon. gentlemen opposite might well want to reconsider the position they took about two months ago.
I do not think it is difficult for Canadians to understand the consequences of the proposal made by the Conservative party to put fire under the kettle and then increase the pressure of the burners, increasing economic stimulus and hoping that, by holding the lid on, they will prevent the lid from blowing off and a lot of water spilling over. The hon. gentleman is suggesting the imposition of a lid on our price structure in this country, and is in no way suggesting there should be an accommodating fiscal and monetary policy to go with it. I say that such a proposal is absolutely ridiculous.


Marcel Joseph Aimé Lambert: You are antediluvian.


James McPhail Gillies: It is a cost-push situation.


John Napier Turner: The government does not contemplate the adoption of controls under current circumstances. We are only prepared to adopt them if, on balance, controls are supported by conclusive evidence that there would be net benefit to Canadians. We do not believe under the present circumstances that that will be the case.
We can recall the situation in the United Kingdom which faced a critical emergency situation with a rampant increase in prices and wages far exceeding that of most other industrial nations. We pointed out, and I repeat now,

May 10, 1973
Increased Cost of Living
that the United Kingdom exempted food at the farm gate. They also exempted imports from the freeze the subsequent controls.


James McPhail Gillies: And look at what has happened in the U.K.


John Napier Turner: We have had an even more vulnerable economy. The United States imposed a freeze followed by a control program in August of 1971 to deal with serious domestic and international economic problems of a kind that did not confront Canada. Why was the United States position different from ours? I suggest it was different because their dollar was in deep trouble and their trade figures showed a deficit position with a $10 million deficit on visible and invisible accounts.
While the United States program had some temporary success in curbing inflation, more recently U.S. prices have been increasing more rapidly than in Canada. It is all very well for hon. gentlemen to say that phase one and phase two worked, but a system of prices and incomes control has to be looked at over the entire phase of putting them on and how you are going to be able to take them off. I suggest to the House that these are the effects that have to be looked at.
In March the United States consumer price index was up 8.8 per cent over December, at seasonally adjusted annual rates, compared with 7.7 per cent at seasonally adjusted rates in Canada.


Marcel Joseph Aimé Lambert: When ours was 13 per
cent.


John Napier Turner: Rising food costs were the major, and remain the major, cause of price pressures in the United States in recent months. What is of prime importance in the context of the present debate is the fact that U.S. food prices have soared despite the fact they continued under the more rigorous phase two control program and moved to phase three for most other prices in February. The increase at an adjusted annual rate in the U.S. for food prices, March over December, 16 per cent in Canada, compared to 29.8 per cent in the United States. In other words, despite the fact that there were price and wage controls in the United States for the first three months of this year, at annually adjusted rates the rise in food prices in the United States was double that of Canada.


Marcel Joseph Aimé Lambert: That is selective; over the last year ours is in excess of theirs, and you know that.


John Napier Turner: Mr. Speaker, as the Montreal Star said in an editorial on May 4, 1973:
-if 18 months of controls have been ineffective in breaking the back of inflation in the United States, what hope would there be for the 90-day freeze proposed by Canada's Conservatives?


An hon. Member:: Let's have a serious debate.


John Napier Turner: When we look at other comparisons, we see there has been a sharp variation in the rate of price inflation in various countries, with a recent acceleration in most during the period from 1970 to

the end of the first two months of 1973 inclusive. The over-all increase in consumer prices in Canada of 15.6 per cent was lower than that for all the other 11 leading industrial nations.


Marcel Joseph Aimé Lambert: How does that help Canadians?


John Napier Turner: I have said that for any price and wage control system to work in this country we need an overwhelming national consensus. I have referred on several occasions in this House to the need for a strong consensus in support of any system of controls if it is to work effectively. I note that the motion speaks of consultation with provinces, industry and labour to devise some kind of undefined plan for control following a freeze, but there is no indication of a consensus among any of these groups in favour of adopting controls under present circumstances. Certainly, the Leader of the Opposition has had no success in persuading the heads of Conservative governments in Ontario, Alberta, New Brunswick and Newfoundland that a freeze-control program should be adopted. As a matter of fact, if the recent budget of his colleagues from Queen's Park can be taken into consideration, the 40 per cent rise in sales tax does nothing to relieve the inflationary pressures in this country.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: What about your tax increases?


John Napier Turner: In fact, together with the restoration of the 3 per cent surtax it is equivalent to a 16 per cent rise in personal income taxes in Ontario.


Marcel Joseph Aimé Lambert: What about your increases in general corporate tax for 1973?


John Napier Turner: Nor is there much evidence of any enthusiasm among other provincial leaders. In its brief to the government in March, the Canadian Labour Congress again made abundantly clear its continuing strong objection to controls. The great bulk of business and farm leaders also made it clear that they do not support the adoption of controls under present circumstances.


An hon. Member:: How about the Canadian people?


John Napier Turner: I listened with great interest to the hon. member for Don Valley when he tried to flog the strawman of restrictive monetary policy. There is no restrictive monetary policy. The governor of the bank before the committee, and I in the House on two occasions, have repeated that there is no restrictive monetary policy. This is an expansionary monetary policy paying careful attention to the control on liquidity.


Marcel Joseph Aimé Lambert: What is the liquidity ratio of the chartered banks today?


John Napier Turner: The government's
policy, shown particularly by the February budget, is to restrain inflation by easing the pressure of rising prices on budgets of Canadian families through tax and tariff
May 10,1973

reductions which will increase take-home pay and moderate the cost of a wide range of consumer products, and will at the same time provide special relief for the elderly, the veterans and their families. In other words, the fundamental aim when there is that type of squeeze is to increase the disposable income of Canadians by tax reductions at the personal and sales tax level and to encourage an increase in supply by the agriculture industry, as well as by international competitive policy. That is the policy the government is currently following.
The real proof of the pudding can be found in a comparison of our costs with the disposable incomes of Canadians. I am concerned that the disposable incomes of Canadians, particularly for lower income Canadians, remains in a position to meet whatever increase there is in the cost of living. The aim of the budget and other government policies is to encourage an increase in supply of goods through an increase in production to meet rising demand; in other words, to deal with the basic source of the problem rather than to try to cover it up with a bandaid of the kind offered to Canadians by the Conservative party.
I want to recite again to the House the specifics of the last budget. They are reduced personal income taxes by the equivalent of 12 per cent to 13 per cent; raising the basic exemption from $1500 to $1600; ra sing the exemption for married couples from $2,850 to $3,000; cutting the basic federal tax by 5 per cent, providing a minimum reduction of at least $100 and a maximum of $500; indexing personal income taxes beginning in 1974; abolishing the federal sales tax on all children's clothing, footwear and wear-goods and non-alcoholic beverages and the special tax on toilet articles, cosmetics and clocks and watches with a manufacturer's price of less than $50; reducing tariffs temporarily by an average of five percentage points on a wide range of imported foods and other consumer goods totalling $1.4 million in 1972; permitting family farms to pass from one generation to another free of capital gains tax; removing restrictions for tax purposes on the reinvested earnings of small businesses; increasing the old age pensions to $100 a month effective April 1, 1973; raising the combined OAS/GIS to a maximum of $170 a month for single persons and $325 a month for couples; injecting a further $190 million into the economies of the slow-growth regions of Canada by including local school taxes on property in the calculation of equalization grants to the provinces. This represents 26 per cent of school taxes paid by the local ratepayers of the seven receiving provinces which, if it is passed along by the provinces to the local ratepayers, will increase their disposable incomes by that much.


Some hon. Members:: Hear, hear!


John Napier Turner: We must also consider the measure of my colleague the Minister of National Health and Welfare (Mr. Lalonde) to raise family allowances $20 a child in respect of all families, and the announcement by my colleague the Minister of Consumer and Corporate Affairs (Mr. Gray) of the establishment of a food prices review board to monitor food prices.


Some hon. Members:: Oh, oh!
Increased Cost of Living


John Napier Turner: The combined effect of these provisions in respect of fixed incomes, lower incomes and those with large families is to increase the disposable income so as to combat the rising cost of living. I want to say that the policy of the government at this stage in our economic cycle is to increase the disposable income of Canadians, particularly those with fixed and lower incomes, and to increase the supply of agricultural and manufactured products by combined agricultural policies, tariff policies and fiscal and monetary policies. Our aim is to meet the problems with a sound economic policy and not by 90-day stop-gap measures; a sound economic policy that reflects the international forces applying in this phenomenon of domestic inflation that is apparent to most Canadians.


Some hon. Members:: Hear, hear!


Mr. Deputy Speaker:: I understand the hon. member for Peace River (Mr. Baldwin) wishes to be recognized for the purpose of asking a question.


Gerald William Baldwin: A question of privilege, Mr. Speaker. I just wonder whether the Prime Minister (Mr. Trudeau) would now like to apologize to me for pressing me to stay and listen to what he described as new and exciting ways to deal with the problem of inflation.


Mr. Deputy Speaker:: Order. This seems to be another one of the interjections which have become sort of the order of this afternoon. The hon. member for York South.


David Lewis: Mr. Speaker, as I begin my remarks, I want to say to my friends in the Conservative party that all of us listened very carefully and very courteously to the interesting speech of the hon. member for Don Valley (Mr. Gillies). I noticed that while the Minister of Finance (Mr. Turner) was speaking, they did not return the same courtesy. I hope they will from now on. If the question of rising prices is as important as the hon. member for Don Valley said, and all of us agree, it seems to me this debate should be carried on with seriousness instead of in the way in which some members of this House have behaved during the past few minutes.
It occurred to me, as I watched the question period and the last few minutes in this House, that the members of the Conservative party think they can overcome the results of the Gallup poll by being negative, destructive and noisy. I want to tell them they cannot do that, Mr. Speaker.
I shall deal with the proposal of the hon. member for Don Valley in a moment, but I want to say to the Minister of Finance that it does not help to resolve the problem now before this House as well as before the people of Canada for him merely to recite again what he told us on February 19 and to make a speech which suggests that all that can be done has already been done, that nothing more should be done. I know of nothing less helpful to the situation in Canada than that kind of entirely unjustified complacent attitude which the Minister of Finance has shown. I could not help but notice when the hon. member for Don Valley spoke, that one of the reasons he gave that it is no longer possible to affect the price situation by creating unem-

May 10, 1973
Increased Cost of Living
ployment is that our economy is no longer competitive. That is what he said. I agree with him entirely. I merely find it very difficult to understand why he supports an economy that grows more and more monopolistic and therefore unable to deal with the real needs of the Canadian people. That is the basic difference between his very thoughtful approach to the problem and the approach which we of the New Democratic Party take.
He says blithely in his speech that countries have been hurt by inflation of this level. I do not know what decade he is talking about. If he is talking about the decade of the 1920's, there is no doubt he is right. But if he is talking about the decade of the 1960's and 1970's, I challenge him to give us an example of that kind of nonsense. Is he talking about Japan? Has its economy gone to pot? Is he talking about Germany? Has its economy gone to pot? Is he talking about any of the western European countries? The fact is, of course, that when you have rising prices throughout the world internationally-I am speaking now not from the point of view of Canadians who are hurt, and I will come back to that point in a moment, but from the point of view of the economy as an economy and from the view of our position internationally-and if the prices in your country are not rising at a level higher than the general situation your economy, in fact, is not hurt. Indeed, the fact is that Canada has not been hurt internationally. If that is the case, then what on earth is he talking about?
The Minister of Finance has already cited from the Leader of the Opposition (Mr. Stanfield) a quotation which had been drawn to my attention earlier today, but let me say in general terms that the Leader of the Opposition and members of the Conservative party twitted the government for having a kind of paranoia about inflation, for being preoccupied with inflation and for being obsessed with inflation. The Conservative party spokesmen then were right because one can easily become obsessed with this question in the terms in which the hon. member for Don Valley spoke. The hon. member for Don Valley and the members of the Conservative party today are making precisely the same mistake. They are attempting to impose, if they had the opportunity, a freeze that is meaningless and undefined which would cause immense harm to a large part of the people of Canada, never mind the economy as a whole, and which would, in the first instance, be of particular harm to the farmers of this country.
I have said many times when addressing farm meetings, which I have had the pleasure of doing for many years, that I do not claim to be a farmer but I do claim to know a little about the situation in respect of our farm population in this country. For some three or four years, from about 1969 to 1972 inclusive, the farmers of this country, perhaps like the farmers in many other parts of the world but particularly in this country, were getting the raw end of the stick. Their prices were too low, their costs of production were rising all the time and they were being squeezed by international prices on the one hand which, they could not control, and on the other hand by the cost of production, which they could not control. Their income fell continually year by year. I say as one urban person in this country that if the consumers of Canada were paying higher prices for food only because the farmer was at least

getting a decent price for his products, the consumers of Canada would have no right to complain.


Some hon. Members:: Hear, hear!


David Lewis: This is were I part company with the Minister of Finance because my observation of the situation in Canada with regard to food prices and other prices, which I will come to in a moment, is that the purchaser in the supermarket and in other food stores does not pay a higher price now merely because the farmer is at last getting a decent price for his products. The consumer is also paying a higher price because of the monopolistic control of the food packaging, because of the waste in food advertising and packaging and because of the monopolistic control over the processing of food and the monopolistic control by the supermarkets in this country which gouge consumers beyond the point where it would be justified to raise prices because of the farmers' income.
I often go shopping with my wife. Time and time again she has drawn my attention to the fact that she picks a tin of something off the shelf which has a price and a label on it, that she then takes that label off and finds under it another price five cents lower and then takes that label off and finds a third price ten cents lower again. What that means is that the supermarket has had that tin on its shelf for months. It was brought in at a low price and the merchant is now taking advantage of the situation to get what the traffic will bear by gouging the housewife unnecessarily when she goes shopping. It is this kind of consideration that has made us demand a food prices review board and indeed a prices review board generally, if we could have one, because what you would have then would be an agency that would look into the reason for the increased prices; you would be able to expose the unfairness that exists. That is what we should be after. We should be able to expose the unjustifiable increase.
As I will suggest in a moment, Mr. Speaker, if the government took the necessary step, then somebody would have the authority to do something about the situation when prices have been unfairly raised. Everyone in this chamber, when he talks about inflation, is concerned, genuinely I believe- I do not for one moment question the integrity of the hon. member for Don Valley any more than I hope he questions mine-about the low income people in this country. There is one simple, decent, humane, moral way of dealing with that problem, and that is to raise the income of the low income people of this country-


Some hon. Members:: Hear, hear!


David Lewis: To enter into a massive system of price, wage and incomes control

and I will come back to that in a moment-to enter into a massive system that will freeze injustices where they are and that will create divisions, and to suggest a 90 day freeze during which you can do nothing at all except wait for the whole thing to blow up when the 90 days are over, all in order to assist the low income people, is nonsense. The fact is that the old age pensioners, the families on welfare, and the people on low wages are now poor because our society has not been justly run, because the redistribution of wealth and
May 10, 1973

income stops at the gate of the Liberals and Conservatives, who are much more concerned with serving their corporate friends than with serving these people.


Some hon. Members:: Hear, hear!


David Lewis: Of course, Mr. Speaker, I was glad to see the increase in the old age pension to $100 a month, but I say to the Minister of National Health and Welfare (Mr. Lalonde) and to the Minister of Finance that if they are concerned, as I know they are, about the condition of the old age pensioner, particularly in an era of rising prices and particularly when those rises are centered in food and shelter, then the way to deal with that is not to boast about an increase of only $13 and some odd cents above what the old age pension would have been, but to increase it much more, as could have been done, because the economy of Canada can well support it.
We supported the budget because it did have some income tax cuts on a very progressive basis for individual taxpayers, and we were glad to see that, but again I say that if we are concerned about the low income people one way to help is to increase their disposable income. There, I agree with the Minister of Finance. I merely disagree with him because the steps which are taken by governments, steps to increase this disposable income, are always puny steps, mincing steps, instead of adequate and humane steps to solve the problem.


John Napier Turner: They help to solve the problem.


David Lewis: Sure, they do. If you increase the income of the low income groups, then of course you increase the demand for goods and services and so, at the same time, you have to increase supply.


John Napier Turner: You have to have both.


David Lewis: Right. The point I am making is that instead of attempting an impossible and unfair system of price and wage controls, and it really is wages, not incomes, let us deal with the low income people in a way in which they can be dealt with justly and fairly and without harm to the economy.
I reject the idea of a freeze, not only because it is undefined but because it is a meaningless thing. I am not going to accuse the hon. member for Don Valley, as the minister did, that all he was suggesting was a freeze. I listened to the hon. member. I appreciate that what he said was, "Let us have a temporary freeze during which we will work out some policy of controls." I was interested when he said there was no reason why we could not have a system of controls that will work. He said we only need the will, the initiative and the leadership-all the things his party has not got, Mr. Speaker!


Some hon. Members:: Hear, hear!


David Lewis: He said we only need these things to have a control system that will work. I must admit, Mr. Speaker, that I listened anxiously to him as I sipped a cup of coffee behind the curtain, to hear exactly what that price control system, what that income control system would be; where it would go, how long it would last, what the constitutionincreased Cost of Living
al problems are with the provinces, how those constitutional problems may be overcome, how long it will take to implement, what kind of bureaucracy will be required to enforce it. Will it apply to farmers, will it apply to wage earners, will it apply to wage increases that are already provided for in collective agreements, because there are such? What are the details of it, and indeed what are the broad outlines of it? And, Mr. Speaker, nary a single word on that from this ex-professor of economics who spoke so eloquently in other ways.


Some hon. Members:: Hear, hear!


David Lewis: The reason there was not a single word is not because the hon. gentleman is not intelligent and doesn't know economics. He is both; he is intelligent and knows economics, and because he knows economics he knows darn well there is no system of controls that has worked in the United States or Britain, or in any other part of the western world, or indeed even in the communist countries where, with all the totalitarian controls they have, they have not been able to do the kind of thing that the hon. member for Don Valley suggests is possible in Canada.
It is significant to note that when the Conservative party first started talking about this they talked about price and wage controls. They never talked about anything else but price and wage controls. Then, the hon. member for Don Valley joined their ranks. He is a much more tactful person, a little more sophisticated and thoughtful person. He saw it was unjust to control only wages, so he said, "Let us stop talking about price and wage control, and let us start talking about price and incomes control." Well, let me tell him, Mr. Speaker, that this is the kind of talk that the President of the United States engaged in, this great President of the United States whom the hon. member for Don Valley wants us to follow, not so far as Watergate, but up to the fence, Mr. Speaker.


John Napier Turner: They have reached their watershed.


David Lewis: Let me inform the hon. member for Don Valley that if you compare the second quarter of 1971, the last full quarter before the Nixon economics were imposed, before the controls were imposed, with the fourth quarter of 1972, the latest full quarter on which I have information, we find that in the United States corporate profits before taxes increased 20.6 per cent, and corporate profits after taxes increased 25.1 per cent. It is true that dividends only increased 5.1 per cent, but undistributed profit increased 50.5 per cent. The profits were undistributed. The large corporations held in their coffers half as much again as the undistributed profits they had before the controls were imposed. Of what value is that to the people of the United States?
Remember there was an increase of 20.6 per cent for profits before taxes and 25.1 per cent for profits after taxes, but average straight time hourly earnings in manufacturing increased only 8.7 per cent on a seasonally adjusted basis. I would point out that the other figures I have given are also on a seasonally adjusted basis.
The reason I feel this talk about incomes control does not apply really to incomes can be put in the question:

May 10, 1973
\P
Increased Cost of Living
how in heaven's name are you going to control the income of the doctor, the lawyer, the architect, the engineer and the accountant? How does the hon. member for Don Valley propose to control the use of the increased profits of the corporations? When these people talk about incomes control, what they really mean is wage control because that is easy to impose. Organized workers negotiate in a glass bowl,-


Some hon. Members:: Hear, hear!


David Lewis: -in public, and if anybody wants to know what the increase is for the auto workers or the steel workers-


Mr. Alkenbrack:: A point of order, Mr. Speaker.


Mr. Deputy Speaker:: The hon. member rises on a point of order.


Almonte Douglas Alkenbrack: I should like to ask the Leader of the New Democractic Party if he does not recall that federal price controls worked during the second great war and during the postwar period. Would he answer that question for me?


Mr. Deputy Speaker:: Order, please. The question may be answered, but it really is not a point of order. The hon. member for York South (Mr. Lewis).


Almonte Douglas Alkenbrack: Mr. Speaker, on a point of order-


Mr. Deputy Speaker:: Order. There can be no point of order arising from the Speaker's ruling on a point of order. The hon. member for York South (Mr. Lewis).


David Lewis: Mr. Speaker, I say that the wages of organized workers are public knowledge, and if you want to know about an increase all you have to do is get hold of the union or the employers concerned. The wages of the unorganized worker can also be controlled because the government would have the greatest ally in that area, namely an employer who would rather pay less than more.
Those who talk about incomes control are not being entirely honest because they are talking about something that cannot be imposed. What can and would be imposed is control of working people in this country. There are too many working people in Canada making the minimum, and some below the minimum necessary for a decent living, for us to accept the idea of controlling their wages.
I have only two or three minutes left, Mr. Speaker, but I want to make one final point. It is this kind of consideration, the impossibility, the unworkability, the injustice- in fact, the senselessness-of temporary freezes, and the injustices and inequities of a system of control as well as the impossibility of doing it in peacetime that has made us support the idea of a food prices review board and a prices review board generally. If the prices which people have to pay are fair in relation to increased costs, then people just accept that and live with it, but I suggest there is a measure of unfairness in the increased prices and a prices review board could find that out.
Mr. Speaker, I draw your attention to the fact that Imperial Oil, followed by Shell and Gulf, increased the price of crude oil. Imperial Oil increased it on May 1 by 25

cents a barrel; that is a total of 55 cents a barrel since November, just six months, or a 20 per cent increase in the price of crude. Already that increase in the price of crude is being reflected in the increased price of gasoline to car owners. Again, this affects the farmers of Canada because the agricultural industry-although some members of this House may not know it-is the largest user of oil and energy in this country, as an industry. Pretty soon this increase imposed by Imperial and Shell and Gulf will be reflected in increased food prices because farmers' costs will increase as a result of it. Why were these prices increased, Mr. Speaker? Do we not have enough oil in Canada? Was there an increase in the cost of producing the oil? Not at all. They were increased in Canada because Imperial, Shell and Gulf can get a higher price outside this country. That is unfair to the people of this country.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but the time allotted to him, plus some extra, has expired.


Some hon. Members:: Continue.


Mr. Deputy Speaker:: The hon. member may continue if there is unanimous consent.


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Deputy Speaker:: There is not unanimous consent. [Translation]


David Réal Caouette: Mr. Speaker, I do not and I did not object to the hon. member for York South (Mr. Lewis) finishing his statement. I am not the one who is stopping him.


An hon. Member:: The Progressive Conservatives are.


David Réal Caouette: The Progressive
Conservatives.


An hon. Member:: That is correct.


David Réal Caouette: I am not surprised.


David Lewis: I am not surprised either.


David Réal Caouette: Mr. Speaker, the motion before the House today is of great importance to the whole country, and hon. members. In fact, it says:
That this House deplores the failure of the government to take concrete and effective action against the rising cost of living, so evident in the price of shelter, food and clothing; and therefore urges the government to impose an immediate temporary freeze so as to enable it to develop a satisfactory plan in conjunction with the provinces, industry and labour for the purpose of keeping the cost of living within acceptable limits.
Mr. Speaker, the day before yesterday I believe, I asked the Prime Minister whether he would recommend the hospitalization of the leader of the official opposition (Mr. Stanfield) for the purposes of a psychiatric examination. The leader of the opposition was in the Maritimes at the

May 10, 1973

same time as I, some 10 days ago, and he promised that a Progressive Conservative government would improve the conditions over there by getting better prices for fish. He had also made the same promise to the western wheat growers and the dairy producers in Quebec. And upon his return to the House, he proposes freezing prices. This is completely incompatible!
Mr. Speaker, this matter, as I said earlier, is most important because it concerns Canadians. I would bet my shirt that tonight, on the CBC news, instead of reporting on this important item, they will talk about Viet Nam, as usual. They talk about the problems of foreign countries rather than Canadian problems; they forget to talk about our own problems-


William Heward Grafftey: Do you not think there was a problem in Viet Nam?


David Réal Caouette: It is certainly not a Canadian problem.


William Heward Grafftey: Not a Canadian problem?


David Réal Caouette: It is not a Canadian problem. Our problem is the rising prices in Canada. By all means let us take an interest in what is going on the world, but let us begin by putting our own houses in order, including that of the member for Brome-Missisquoi.
Mr. Speaker,, in Canada we have provincial governments. In Quebec, we have a Liberal government, as in Nova Scotia and Prince Edward Island. In Ontario, Alberta, New Brunswick and Newfoundland there are Progressive Conservative governments. In the three remaining provinces, British Columbia, Saskatchewan and Manitoba, there are New Democratic governments. Let us go and see if people are better off in those provinces, if prices are lower and if the cost of living is less than we know it to be in Ottawa, if we are to believe Canadian statistics.
Mr. Speaker, it is all very well to say: If I were in power, I would do this or I would do that. But the Progressive Conservatives were in power when inflation was growing in Canada. Why did they not fight it? Why did they not wipe it out? Why did they not take some action? Why did they not introduce legislation?
Mr. Speaker, it is all very well to say to the government: You have not done it right. But what would we do in their place? Even the spokesman for the Progressive Conservative party who spoke just now did not offer any solution. The Minister of Finance (Mr. Turner) said after that: There is no magic solution. So we have to put up with the present state of affairs, because there is no magic solution.
Mr. Speaker, the problem in Canada is not so much prices as the loss of our products. That is the real problem. Prime Minister Trudeau boasted recently that Canadian production would reach $102 billion for the first time in history, while the gross national income, including parliamentary allowances, everything included, would be about $70 billion. Now, I should just like hon. members to ask themselves: how and when can you buy $102 billion with $70 billion? That is a simple enough rule. How and when? Mr. Speaker, it is the system that tends to inflation, that leads us straight to inflation.
Increased Cost of Living
Not long ago Premier Bourassa of the province of Quebec went to the United States to borrow $100 million to finance part of the James Bay development, in the constituency of my colleague from Abitibi (Mr. Laprise); he managed to borrow this sum at 10 per cent interest for a period of 25 years. Here again, those who have done elementary mathematics can easily see that in 25 years we will be paying $250 million in interest alone, and that we will still owe the $100 million capital we borrowed.
Mr. Speaker, did the premier of the province come back from the United States with a cartload of American dollars? No: he came back with what is called a promissary note, a little piece of paper marked $100 million, 10 per cent interest, 25 years, signed Robert Bourassa, the whole thing endorsed by the entire population of Quebec province. So it all works by figures. What did the Americans base their $100 million on? On what they have? The Mis-sissipi, Watergate, Mr. Nixon's election? No! They based the $100 million on the feasibility of the James Bay project. If the project had not been good, Mr. Bourassa would not have got 25 cents from the United States. They studied the project and said: "All right, we will finance it".
Mr. Speaker, that is why we suggest using the Bank of Canada. The governor of that institution can write figures too. Based on what? Inflation? No; based on the James Bay project. He can do the same thing as the Americans. And then, we could lend to the provinces, and not just to Mr. Bourassa, without interest, as we so kindly do for India, Thailand, South America, countries of Europe, Africa, etc. They are interest-free loans for a period of 60 years. Recently a $48 million loan was granted.


Mr. La Salle:: For the purchase of Canadian products.


David Réal Caouette: Yes. Would the James Bay development project not also permit buying Canadian products? It is the same thing. An agreement to purchase Canadian products can be entered into in Winnipeg, in Quebec, in British Columbia. Obviously, we would not be purchasing all our material in Japan with those $100 million. Let us buy here, in Canada. There can be agreements between the provinces and the federal government. And the Bank of Canada is there for that purpose.
Mr. Speaker, they think that is funny. By the time India reimburses those interest-free $48 million loaned for 60 years, the right hon. Prime Minister (Mr. Trudeau) will be 115 years old and he will no longer be around. As for little Justin, he will be barely 61. That is about the only change there will be.
Mr. Speaker, there is a solution to fight the current inflation: lower interest rates, make use of our financial institutions, become masters of our credit instead of going begging abroad. Do you think it is pleasant to see representatives of our municipalities going to Europe, to Switzerland, to Germany to borrow money for the development of our natural ressources? It is inconceivable that a government tolerates such a situation. As long as we continue in that direction and keep talking about price controls or control of whatever you want, this will lead to absolutely nothing.
Mr. Speaker, the Minister of Finance talked about a miraculous solution, but there is none. We have been

May 10, 1973
Increased Cost of Living
suggesting for quite a length of time that a compensated discount be granted at the retail level, following an agreement between a national commission and Canadian retailers whereby prices would not change. This would be an agreement not an imposition. Everyone is free to join or not. But if you join, then the government would order the payment of a 25 per cent compensated discount on retail prices, which means that for a $100 purchase the consumer would pay $75 and the government $25 as compensated discount to the retailer. The retailer would have $100 and inflation and price increases would thus be efficiently controlled. But no. Yesterday, the Prime Minister asked me whether that was constitutional or not; to my mind, he did not know whether the matter was constitutional or not. It seems to me we should look into it.
Indeed, I wonder what is keeping the Canadian parliament, which is sovereign, from passing a law to adopt a compensated discount, as was done anyway during the war in the case of milk.
Mr. Speaker, that is no miracle solution but a very normal one. Why does the government hesitate to try it out? What is it waiting for? Why speak of freezing prices which would lead right away to a black market? Why not try the solution advocated by the Social Credit party?
Mr. Speaker, I repeat: this is no miracle solution. The member for York South spoke of increasing the income of low wage earners. He is against price control. He has not always been against it, but now he is. I think that he has heard us often enough to reach this conclusion.
A price freeze is no good, really no good. They suggest increasing the income of workers, those who are drawing a small income. But how are we to increase this income? The hon. member has failed to explain. He has not referred to it.
I am going to tell you how. You must take from the haves and give to the have nots. That is the way to increase the income of the poor, that is the socialist solution.
Mr. Speaker, the Canadian who earns $25,000, $50,000, $75,000 or $100,000 a year does not hide his money in a corner of his bedroom. He spends it, he buys things, he opens a business or something similar. His money is used for something, this is not saving. So, they are going to take it from him and give it to somebody who has less money. The total revenue remains exactly the same; the total national revenue will still amount to $70 billion and they will not be able to purchase the $32 billion worth of goods which are on the shelves, in stores, in wharehouses, in sheds, in back stores as we call them. To take from the rich to give to the poor will not solve anything.
The hon. member for York South stated that his solution would be wage control. This is exactly what I have just said. If you have the chance to make money, the government will watch you and take it away. Thus, private enterprise is killed, the stimulus which drives someone to do something. He is discouraged and then he says: If I have to work for the government, I will give up. This is what happens in private industry. So the solution of the New Democratic Party is not effective.
As far as we are concerned, we say that we should make up the difference between production and national income

at current prices, paying at first a compensated discount and then distributing a national dividend to every citizen. This is a solution.
Mr. Speaker, whatever may be said, whether it seems ridiculous or funny, as long as those solutions are rejected, we will continue to beat around the bush. We will always be considering absurd motions as the one introduced today and far-fetched solutions which do not solve anything but create worse problems.
Mr. Speaker, the Creditists are continuing to instil these principles into Canadians so that the products will be available to the Canadian people and allow them to be their own masters.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: Order, please. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Norfolk-Haldimand (Mr. Knowles)-Unemployment Insurance-Commission policy respecting unemployed agricultural workers seeking benefits; the hon. member for Fraser Valley West (Mr. Rose)-Post Office-Steps to increase compensation of rural mail delivery contractors; the hon. member for Peel South (Mr. Blenkarn)-Canada Development Corporation-Request for tabling of details of appraisal of Polymer for sale to Corporation.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Gillies (for Mr. Baldwin):
That this House deplores the failure of the government to take concrete and effective action against the rising cost of living, so evident in the price of shelter, food and clothing; and therefore urges the government to impose an immediate temporary freeze so as to enable it to develop a satisfactory plan in conjunction with the provinces, industry and labour for the purpose of keeping the cost of living within acceptable limits.
James Aloysius McGrath: Mr. Speaker, yesterday and today we directed questions to the Prime Minister (Mr. Trudeau) and the Minister of Consumer and Corporate Affairs (Mr. Gray) to try to establish exactly what the government policy is in this critical area of
May 10, 1973

inflation and rising prices. On a number of occasions, we asked the Minister of Consumer and Corporate Affairs to outline the government's guidelines for areas within federal jurisdiction or the government guidelines to be imposed upon the proposed prices review board.
Today, Mr. Speaker, the Minister of Consumer and Corporate Affairs said that he announced government policy in this regard and the guidelines when he made his statement on April 27. I read that statement. Nowhere can I find in it any reference to government policy with regard to food prices or the cost of living. Nowhere can I find in it any reference to government guidelines for the new prices review board. In the news stories covering the press conference of April 27, when the minister made this announcement, we are again left in the dark. There is no reference whatsoever to exactly what the government policy is in this regard.
It is interesting to reflect on the circumstances surrounding the announcement by the Minister of Consumer and Corporate Affairs. He chose to make his announcement in the midst of the Easter Recess when parliament was not in session. What is even more difficult to understand, he made his statement coincidentally with the closing of a major federal-provincial conference in Ottawa on welfare. I am sure this announcement was made in the hope that the half-hearted attempt to meet the consensus of the food prices committee, and the growing fears in the country, would be obscured by the statement closing the federal-provincial conference on welfare. That is the only conclusion we can reach.


Herbert Eser (Herb) Gray: Will the hon. member accept a question?


James Aloysius McGrath: I am sure the minister will be participating in this debate. My time is limited. I am sure the minister will be able to ask all the questions he wants when I finish my speech. I am sure the minister hoped his announcement on his half-hearted attempt to meet the demands of the food prices committee and half-hearted attempt to meet the New Democratic Party half way would be obscured by the news flowing from this federal-provincial conference on welfare. That must surely be the explanation as to why the minister elected to make his statement at the time when the House was not sitting. Subsequent events have shown there was certainly no urgency.
The minister was trying to say he was treating this matter as one of great urgency. He could have at least waited one more week until parliament was in session and made his statement in the House, thereby allowing the members of this House to respond to the action the government was taking. But no, Mr. Speaker, the minister elected not to take that course. There is a good reason for that. The minister knew that the statement he made on April 27 setting up the prices review board would not be acceptable in this House and would not stand up to the scrutiny of this House. That is why he elected to make this statement when the House was not sitting. The committee recommended and I quote:
The Committee recommends:
1. That the Government give consideration to the advisability of introducing the necessary legislation to establish an independent Food Prices Review Board equipped with such powers as are
Increased Cost of Living
necessary to review prices, and that it report to the Minister of Consumer and Corporate Affairs. In its reports to the Minister, the Board could make recommendations concerning appropriate action to be taken.
The government does not intend to introduce legislation in this House. It does not intend to bring this review board into the House in any way, shape or form. Instead, they circumvent the House by using the provisions of the Inquiries Act to establish this commission. If the government had shown enough courage to meet the recommendations of the committee and to bring legislation before the House something might have been said for it, but the government knows full well it would have been faced with amendments and that these amendments would, at the very least, have had the effect of putting some teeth into the useless board whose establishment is proposed.
Given the situation in which parliament finds itself, the minister knows that the proposed review board, as announced by the minister on April 27, will not be acceptable and that hon. members would, by way of amendment, have considerably strengthened the board in fulfilment of their commitments and responsibilities. As a consequence, no legislation has been introduced. The board is to be set up under the Inquiries Act. What will it do? The provisions of the Inquiries Act will give the board no more power than could be exercised by the Special Committee on Trends in Food Prices. The commissioners will be able to call for papers and persons and examine witnesses. That was precisely the role of the special committee. Obviously there is no future for the special committee, because the special committee is now redundant by virtue of the minister's action.
But even allowing for all the limitations and shortcomings of the review board, surely there must be people in Canada who could be approached to serve on the board. Until yesterday not one Canadian had been approached. Nobody had been invited to participate in this work. No invitation had been extended to any Canadian asking him to chair this board. One wonders what has become of all the expertise which I am sure must be lying around in the bureaucracy of Ottawa left over from the Prices and Incomes Commission. One wonders, in particular, why Dr. Young was not called upon. After all, he must have amassed considerable experience during his tenure as chairman of the Prices and Incomes Commission. I submit he was not consulted because, as a result of his experience, he has reached the conclusion that only some form of income control would effectively halt inflation in Canada. And this, as we all know, would prove embarrassing to the government.
There has been an adverse reaction across the country to the minister's statement. We know it is not acceptable to most of the consumer groups. I refer, for example, to a release by the Women Against Soaring Prices. In a brief dated May 2, this body expressed its views as follows:
Government guidelines for this Board are incomplete and unsatisfactory. Dependence upon "investigation and publicity" just is not powerful enough to deal with rising prices. Moral persuasion has not worked in the past and will not work in the future. At most, all that can be accomplished is a levelling-off effect on food prices.

May 10, 1973
Increased Cost of Living
That is the reaction of one group and it is re-echoed many times. I am sure the minister is aware of editorial opinion as expressed in the newspapers. The reaction of the editorial writers is consistent with the general reaction across the country. The minister's statement of April 27 was an affront to parliament. It showed contempt for this House and, more particularly, it was an affront to the special Committee on Trends in Food Prices which worked diligently to come up with the recommendations it placed before the House.
In the midst of all this, in the midst of the latest figures released by Statistics Canada a couple of days ago, showing a 2.6 per cent increase in the cost of food for the month of April, what are we doing? What is parliament doing? What are the priorities of the government? At a time when food, shelter and clothing prices are soaring, parliament occupies itself with amendments to the wildlife legislation. What are the legislative priorities for the balance of this week and next week? These open-ended opposition days, where the issue will not be resolved because there is no vote, by virtue of what I consider to be anomalies in the new rules, were designated by the government. They were not designated by the Official Opposition or by either of the other parties. It is the government which manages the business of the House. It was the government which said we should deal yesterday with amendments to the wildlife legislation. And this at a time when the whole country was talking about the scandalous increase in the price of food.


Herbert Eser (Herb) Gray: You could have had a vote today if you had wanted it.


James Aloysius McGrath: Certainly, the government is not getting its priorities straight. There is concern about this issue across the country. What shall we be doing next week? We shall be dealing with the question of capital punishment. Mr. Speaker, that bill has been around since this session began. Yesterday the Minister of Agriculture (Mr. Whelan) said the poor were suffering because of high food prices but that the rest of us were spoiled. And, in that statement he recommended that the government should increase family allowances. Surely, in view of this, the government should re-arrange its legislative program in line with the consensus which exists in the House and immediately bring in amendments to increase family allowances thus placing money directly into the hands of the poor.
The Prime Minister, in his continuing efforts to deceive and mislead the House, talks about the fact that increases in family allowances could have been made last year, but for the Official Opposition. I reject that statement as being a gross deception. The Prime Minister, as the leader of this country, should show responsibility as such, and not mislead the House. The opposition did not prevent that bill getting through.


An hon. Member:: Yes, you did.


James Aloysius McGrath: That bill was withdrawn by the government because they were getting flak from the government of Quebec. That is true, and the present Minister of National Health and Welfare (Mr. Lalonde) knows of what I speak because he was the Prime Minister's emissary to Quebec. That was why the bill was withdrawn.

They talk about one man holding up third reading of that bill. The fact of the matter is that the House could have sat next day and given third reading to the measure. Or the government could have brought the bill on when the House met in emergency session in September to deal with the Vancouver dock strike. There was a disposition among all members to bring it on at that time.
The situation now is that after five years of study there is no FISP arrangement. It took approximately five years to come up with a Family Income Security Plan and now it is defunct. What do we have instead? We have a policy announced by the minister as a result of a federal-provincial conference under which the family allowance will be increased to $20. He talks about some new mechanism in connection with which he needs the consent of the provinces. I say to the minister: Bring in the increase in the present family allowances right away, as an interim measure. Let us not wait another six months for the new program mentioned by the minister following the federal-provincial conference. Let him bring in legislation now as a means of getting money directly into the hands of the low income group, those with large families and those living on fixed incomes, the people who are feeling the squeeze. The poor cannot wait six months for the minister's bill, they need money now. They have to buy food every day.
Where are the poor of this country? They are in the large cities where inflation is highest. They are in areas of regional disparity where incomes are low and unemployment is high. They constitue a very substantial majority in this country who are suffering from the consequences of the complete failure of the government to relieve the burden imposed on them by inflation. When the Prime Minister rises in this House to respond to questions, I challenge him to place the facts before the House instead of continuing to try to deceive the people of Canada. The fact is that we could have had the family income security plan, and we could have had it before the close of the last session of the last parliament; it could have been in effect now.
I point out that as an interim measure the government can change its legislative program and immediately bring in amendments to the present Family Allowances Act. There is a disposition on the part of members in the House to deal with this matter expeditiously because it would put money into the pockets of the poor, those with large families and on fixed incomes.
The Minister of Finance (Mr. Turner) spoke today, and I listened very carefully to what he said. I am sure that other members on the government side will confirm, and I am sure a reading of Hansard will also confirm, that the minister categorically rejected any suggestion of a freeze or any kind of controls as a means of fighting inflation. But I heard no reference whatsoever to what the government does propose to do. There was no mention in the minister's speech of the government's contingency plan. The fact is that there is no contingency plan.


Mr. Cullen:: Then, why ask about it?


James Aloysius McGrath: Because the Prime Minister has said that there is one. The Minister of Consumer and Corporate Affairs appeared before the special committee on food
May 10, 1973

prices and said that there was a contingency plan. However, I think the record will bear out that the minister was contradicted in this regard, because when the Minister of Agriculture appeared before that same committee he did not seem to be too knowledgeable about a contingency plan. As far as he was concerned, it was something that was just being talked about and was still evolving.
One gets the very distinct and clear impression that the difficulty about it is that the cabinet is split, that the government is divided on this issue, that there is no consensus within the government. This is why the Minister of Agriculture was allowed to spout off idiotic remarks about consumers never having had it so good, about how the people of Canada are spoiled, and food still remaining the best buy, contradicting the Minister of Consumer and Corporate Affairs who has a difficult enough role to play as it is.
This is just about the first anniversary of the first budget of the Minister of Finance and it is interesting to look back to see what the minister said in May one year ago in his budget speech. He said that the government is committed to reasonable price stability, and that they do not expect food prices will rise as fast in 1972 as in 1971, that the current tendency encouraged them in this expectation. Well, Mr. Speaker, in spite of the minister's expectations and all his subsequent remarks, the food index jumped 2.6 per cent to 156.2 per cent in April from 152.2 in March. This compares with average increases of 0.8 per cent between these two months for the five preceding years. There was also a 12.9 per cent rise in food prices since April 1972, with food consumed at home rising 13.3 per cent and restaurant meals up 10.7 per cent from the preceding month of April 1972. Obviously, the Minister of Finance does not have the policies to cope with this problem.
That the government does not know how to deal with the problem becomes increasingly and painfully evident with each passing day. The government is playing for time. It is playing politics with this most crucial and serious issue in Canada, an issue that is bringing hardship to hundreds of thousands of Canadians. The government is playing for time, for some short-lived political gain. I say that this is disgraceful and the sooner the country is rid of this government, the better.


Jack Sydney George (Bud) Cullen: Mr. Speaker, once again the hon. member for St. John's East (Mr. McGrath) has not disappointed us. His speech has run true to form. It was the typical hatchet job that he does so well and which we in this House have come to expect.
I know for a fact that the use of the Inquiries Act, which after all is legislation passed by this parliament, in connection with the major recommendation of the special committee on trends in food prices was a quick and immediate response on the part of the minister. The only attack that the hon. member for St. John's East can seem to summon up is the negative one of saying that it is taking a little more time than he thinks is necessary to find the appropriate membership of the board. He fails to recognize that not only do we have to find personnel for the board, but first it must be determined whether we want on the board consumers, chartered accountants or lawyers. Having made that determination, the cabinet can
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then select personnel who in their view will best fit that particular role.
Imagine if you will, Mr. Speaker, that the Minister of Consumer and Corporate Affairs (Mr. Gray) had decided to take the other tack-in other words, not do anything while the House was in recess. The first member who would have risen under Standing Order 43 would have been the hon. member for St. John's East, suggesting that nothing had been done about the food prices committee report. If on the first day the minister had introduced legislation setting up the kind of board he proposes to set up under the Inquiries Act, we would have had the opposition members asking why we did not take action under the Inquiries Act because we could move much quicker. This is the kind of situation where the government side cannot win. If it moves too fast, it is accused of not using legislation that would slow up the process. If it does introduce legislation that would slow up the process, given the heavy amount of work on the order paper, the government would be criticized for moving in this way in order to get out from under the report of the food prices committee.
I was also interested to hear the hon. member say so much about the prices review board when it was his party which rejected out of hand the major recommendation of the committee, despite the fact that it had the support of the Conservative government of Alberta. Their terminology was a "monitoring board", but this review board had the support and backing of the government of Alberta and was a suggestion that government made.
The hon. member who preceded me quoted from a statement prepared by Women Against Soaring Prices, the WASP group, but I did not see him jump to his feet when the same group proposed that the consumers of this country enter into a boycott. He was not so quick then to jump on their bandwagon. In point of fact, he thought that they were wrong at that time. I suggest that the WASP group was wrong on that occasion and that they are wrong now. If you want to set up a board with authority to roll back prices, then I suggest you read some constitutional law.
The hon. member referred to editorial writers in this country, and I am just wondering how many of these editorials he has read. He said the consensus among the editorial writers of this country was that there is no point to a food prices review board being set up under the Inquiries Act. I suggest he and I must read different papers. No doubt he reads Tory ones, whereas I read ones that are objective.
To be fair, editorial opinion on this subject is probably divided. But even those who oppose the setting up of this board under the act at least say we should give it a chance to see if it works. If it is successful with food prices, then it might be a pilot project for dealing with other commodities. Although it is easy in an off-hand way to ridicule, it is difficult to come up with any positive suggestions. I challenge the members of this House to read the speech made by the hon. member for St. John's East and find one positive suggestion that he made during the 20 to 25 minutes he spoke. He did not tell us how they would cope with rising prices.

May 10, 1973
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I read with some interest, but I must say with little hope, the motion proposed by the Conservative party, with a view to determining if it answered the question I had in mind. The hon. member for Don Valley (Mr. Gillies) presented his address, and we are still wondering what, in fact, the opposition parties would do and where they would go after the 90-day freeze. We still do not know what they intend to freeze. We heard a lot of criticism about the NDP and the problems it had with its waffle group, but I suggest the Tory waffling that is being done here makes that NDP group look like a bunch of pikers.
Let us look at the record. In April, 1972, when the Conservatives thought they had absolutely no chance of winning the election but expected to have at least a respectable showing and this was when leadership candidates were rattling their sabres, being more interested in the leadership than politics-what was their view? I suggest the leader of the NDP hit the nail on the head when he said there was no comment about dividends or incomes, but strictly comment about wage and price controls. In any event, in the view of the Conservatives they were not going to form a government and it was quite safe for them to talk in this way. They did not talk about dividends or professional fee control; they talked strictly about wage and price control. After the election in October, 1972, they were as surprised probably as we were when they realized they might be asked to form a government. What was their position then? They still talked about controls if necessary, but not necessarily controls. That has a familiar 1940 ring to it, and I suggest that is where the Conservatives are, about 30 years behind the times.
Then, they saw that this party was going to form the government and they began to hedge their bets a little bit. At that time they said they did not think this was the time for control. We then heard the two financial critics of the Conservative party, Tweedledum and Tweedledee, one saying he would be dumb today because the other was dumb yesterday; one saying this is not the time for controls and the other going on the CTV national network saying the time has come to bring in a temporary freeze all the way down the line, not stopping even at the farm gate.
This was supposed to be a temporary freeze. Then, the people of Canada spoke up and said that you cannot control everything; there are some areas beyond the capacity of Canadians to control. The Conservatives said then they would not control those things they could not control. They did not want to hurt the farmer and the fishermen, so they intended to stop at the farm gate. I suggest that, in fact, is meaningless. You are either going to have controls or you do not have controls. You cannot have half-way measures, and I suggest that proposal does not even go half way but only works to the detriment of the Canadian worker and consumer. I suggest there is no support in the country for that position. I suggest it is very easy, and a good political pitch, for the Progressive Conservatives to say that because prices are going up they intend to impose controls, but when you pin them down you find they do not know where controls are to be put on, how they are to be put on, or what results these might have.
It is interesting to note that this motion provides for discussion with the provinces, industry and labour. The food prices committee carried out such consultations and actually had these people appear before it. That committee had before it representatives from the CLC and we know what their position is. They are against control. That committee and representatives from the governments of Alberta and Manitoba, one Progressive Conservative and one NDP government, and they are also against controls. The committee had a representative from the Canadian Cattlemen's Association before it who also indicated opposition to controls. The committee had representatives of consumer associations appear, and they said this was not the time for controls. Why is there a need for consultation when we already know the position these people take?
Members of the Progressive Conservative party have been saying that we should show some leadership. I suggest we have shown leadership but that they are bankrupt in this regard. They know that no one is in favour of controls but they really have nothing to suggest except a 90-day freeze. They suggest we should put the lid on for 90 days and then watch it blow off after that. They know that we will be in power and that they can hedge their position. This is only a political promise.
What kind of controls are we getting from Progressive Conservative parties? We have seen an example of this in Ontario. Thank God for an effective opposition in Ontario. That government proposed a 7 per cent energy tax, but fortunately the opposition parties were successful in having that tax rescinded. What did that government propose to do about the rising cost of living? It simply increased the sales tax by 40 per cent, and that is not the way I would like to see the federal government act. Fortunately for the people in the rest of Canada, this increase only applies in Ontario. Imagine what might have resulted if the federal government had increased sales tax by 40 per cent instead of dropping it by 47 per cent for those in the $5,000 income bracket.
I do not intend to reiterate what was said by the Minister of Finance (Mr. Turner), but he did highlight the government's aims, for those who were listening to him, although I think there were very few. I wish I had the ability of the leader of the NDP to put the Tories in their place regarding their behaviour and courtesy shown in this House. It was very difficult to hear what the Minister of Finance had to say because of the interjections by the Tweedledums and Tweedledees across the way who realized that the minister was punching holes in the one argument put forward by the Conservatives that might have had at least some merit.


An hon. Member:: Who wrote that speech, Jack?


Jack Sydney George (Bud) Cullen: I wrote this one and I think it's pretty good. In any event, the Minister of Finance did outline the highlights, for those in this part of the Chamber, and admitted that there were areas where no control is possible. The hon. member for Don Valley waved his hands and admitted there were areas that cannot be controlled, but apparently he did not want to hear about them. He tried to brush aside those remarks, but he was kind enough to state these were not excuses. He actually conceded there

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were reasons for price increases and areas over which Canada had no control.
We in this party do not operate in a vacuum, and Canada cannot operate in a vacuum. We must operate in world markets. Surely, the hon. member for Don Valley recognizes that fact. It might be interesting to go back to the time when the hon. member for Don Valley was addressing his economic students to find out what kind of pitch he was making at that time. I venture to guess that some of the hon. member's lectures on why controls would not work in Canada would be very interesting. I can imagine him putting a question such as this to his students: Give us your views why controls would not work? It is only a guess on my part, but I feel that we might find one or two questions of that kind in his examination papers, or certainly in his lectures. I hope that most of his students were good thinkers and pointed out to him, notwithstanding the fact they might get a failing mark, that what he proposed would not work in theory and would certainly not work as far as Canada is concerned.
I want to state that, as Chairman of the food prices committee, I agree with the hon. member for St. John's East (Mr. McGrath), the committee did work hard. I think we disagreed on only one point. I understand their party is prepared to accept five or six of the recommendations of that committee and only oppose the establishment of a food prices review board. In any event, the committee did work hard, no thanks at least in the beginning to those opposition members who first of all were successful in removing any expertise we might have received from the Senate. I am not particularly given to defending the Senate in this Chamber, but I think members of that place, particularly members such as Senator David Croll, might have played an important role in the work of that committee. Such members might have provided much expertise but, for whatever reason they had, the Conservatives rejected that expertise, and I suggest this has worked to the detriment of Canadians generally.
The leader of the NDP said the Minister of Finance was being complacent when he said that certain things had been done, and nothing more remained to be done. I suggest he was misinterpreting what was said by the minister. The minister not only outlined what had been done, he went on to say what was being done and what would be done in the future. There is no complacency on the part of this government. With a two-seat majority in this House we cannot afford to be complacent but must act in a responsible way in order to win the respect and support of other hon. members.
The minister indicated that we were combatting rising prices by increasing exemptions, lowering taxes, removing tariffs and allowing the transfer of family farms from one generation to another without imposing a capital gains tax. He also pointed out the increase in old age pensions and guaranteed income supplements, veterans' pensions, higher family allowances and higher income supplements for senior citizens, having them tied to the cost of living. All these things have been done and will be done by this party and government, and that is why I am pleased to support it, as I have done for some considerable length of time.
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Much has been said to discredit the food prices committee. It has been suggested that it was a toothless committee and could only come out with recommendations that were toothless. I suggest that the Leader of the Opposition (Mr. Stanfield) was breathless when he suggested the committee and its recommendations were toothless. He obviously did not consider the board's powers under the Inquiries Act. If the hon. member were in the underwear business now and decided to raise prices to an exorbitant level I wonder whether he would be somewhat apprehensive about the review board having a look at the situation. Our committee worked well. We never lacked a quorum. I give credit to all hon. members for this. Members of the Conservative party, such as the hon. member for Victoria-Haliburton (Mr. Scott) and the hon. member for Medicine Hat (Mr. Hargrave) made a sincere effort to see that the committee worked.
The Committee had credibility to the point that two provincial governments asked that their representatives be permitted to appear before us. One of them had this to say about our committee and about the fact that such a committee was set up:
We commend the members of the Committee for their undertaking and for their dedication to objectively review and analyse all this complex situation and set of problems. While we do not assume to have all the answers at hand, we would like to explore with you the philosophy of our government in this area and some suggestions for your consideration.
If that committee was a waste of time, certainly the Progressive Conservative government of Alberta did not think so.


Harold Warren Danforth: Mr. Speaker, in opening my remarks this afternoon, I cannot forgo an observation that has become so apparent this afternoon. The Minister of Finance (Mr. Turner) when he spoke, the Leader of the New Democratic Party (Mr. Lewis) when he spoke and the chairman of the food prices committee, each in turn castigated this party because they learned nothing about the income regulations that this party proposed. They learned nothing about their scope or their aim or composition. They were speaking from, by their own admission, absolute ignorance when they indicated as their reasoned opinion that such regulation could not work. Mr. Speaker, in my opinion this is absolute hypocrisy because if they make statements like that on a subject that is so serious, they should at least know some of the fundamentals of what is proposed. Had they listened to the various speakers from this party who have endeavoured from time to time in a reasoned and reasonable way to indicate what we believe would provide a solution to one of the most terrible problems facing this country today, they would then have had some indication of what we are trying to accomplish.
What I would like to do this afternoon in the time allotted to me, which is very short, is to show why the people of Canada are not only confused but alarmed at what is happening. I listened with rapt attention to the Minister of Finance. I listened with very careful attention to the leader of the New Democratic Party and to the Chairman of the food prices committee. What struck me as a Canadian was the fact that each of them seemed pre-

May 10, 1973
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pared to accept this tremendous increase in the cost of living. They seemed prepared to accept inflation as a Canadian way of life and as something that was unavoidable. The only solution they put forward, each in his own way, was to give more Canadian tax dollars to an ever-increasing number of Canadians who find that they cannot survive under this government's economic program. This is what will cripple this country. This is what will cripple the New Democratic Party, because their basic support is from the labourers of this country who are the middle income earners. This is the very group which this government is carefully placing as the main target for taxation in its tax reform bill. This is what we are up against. This is what is happening in this country today.
Now, I should like to say what else, in my considered opinion, is confusing the Canadian people. I refer to the statements by the ministers of this government as they travel across this country. The Minister of Agriculture (Mr. Whelan) tells the farmers what they like to hear. He is saying that food in Canada today is a bargain. He is saying that food prices are not too high and no doubt will go even higher. The farmers of this country have to work in close co-operation with the consumers of this country, and I say that in making such statements the minister causes divisiveness between two groups which may be irreparable. He gives the consumers of this nation the impression that the prices they pay in the food stores are the prices the primary producers receive, but there is a great difference between the two. The farmers are not having it that great. The farmers also are consumers.
One of the greatest problems facing farmers is that their input costs today are rising at a greater rate than their selling prices despite the increasing price of food. As soon as the present inventories that the agricultural producers of this country have, which were produced at lower cost levels, are exhausted, the farmers will not be receiving the high income it is alleged they are receiving at the present time.
Then, we have the minister who represents a riding adjacent to mine. He is a neighbour of mine and is a man for whom I have the greatest respect. What did he say? He said that food prices are too high. One minister says they are too high and another minister says that they are not too high. This minister not only says that they are too high but that, because of its great concern, the government set up a special parliamentary committee for the prime purpose of studying the trend in food prices and ascertaining why they are so high. The purpose of this committee was to bring in a recommendation, and it recommended the establishment of a committee to control food prices and, if necessary, roll them back. One minister says the prices are not high enough and another minister has a policy to roll them back.
So, we go to the Prime Minister (Mr. Trudeau), the leader of this party. What does the Prime Minister say? He says there is no cause yet for alarm, that he does not consider there is any crisis yet. As a matter of fact, he believes there is no need for a contingency measure at this time, although we have had the greatest increase in food prices the consumers of this country have experienced. How can the people of this nation know what the government proposes? They are utterly confused. Perhaps they

could accept the suggestion of the New Democratic Party and the Liberal party that we must accept the high cost of living. Maybe the people of Canada could accept this proposition if they knew how high prices would rise. But, Mr. Speaker, from the gravest experiences over the past months, even after the Prime Minister said inflation was licked, people know that it has continued at an ever-increasing rate. What makes me discouraged and alarmed is that the Minister of Agriculture, on behalf of the government, says that food is a bargain in this country. He does not tell the people of Canada that under Liberal administration the dollar has dropped in purchasing power from 100 cents to 69 cents. Not only is the government responsible for the increase in the cost of food, but for a 30 per cent devaluation of the Canadian dollar.
These are the problems we are concerned with when we say there should be some form of income control. It may be all right for various political parties to say, for various reasons, that there should be no control on wages. But talk to the men who are working and earning wages and you will find they are perfectly prepared to accept control if there is also control on the goods and services they purchase. Their constant demand for wage increases is because the dollar is going down in value and the cost of the things they buy is increasing.
I would like to deal with the Minister of Agriculture who speaks on behalf of Canadian farmers. I have the greatest respect for him as an individual, as a farmer and as a gentleman, but I cannot say that of him as a member of the government. Why can't I? It is because he says that food prices are still too low, that they should go up, and that farmers need more for their produce. But at the same time he supported wholeheartedly the budget introduced by the Minister of Finance which removed the tariff on imported food, the purpose of which was to reduce the price of food in Canada, and thereby reduced the price received by the very farmers he is championing.
The Minister of Agriculture goes around the country and says, "Grow more. Produce more. Get with it." At the same time he wholeheartedly supports marketing schemes proposed by the government the sole purpose of which is to control supply, to put quotas on production, to introduce supply management and government-regulated prices. You cannot have it both ways, Mr. Speaker, but that is what this minister is doing. What else is he doing? He is one of those who say that if you want to get ahead as a farmer in Canada, you have to produce, you have to increase efficiency, you have to get with it. But he supported a government which paid people not to grow grain. He supported a government which butchered hundreds of thousands of chickens to prevent them laying eggs.
He is the same minister who supported the national dairy marketing scheme and set it up as a model, the very purpose of which was to allocate dairy quotas to such a degree that for the first time in Canadian history we became importers of dairy products rather than exporters. This is the minister who gets up on a public platform and says, "Grow more. Produce more," but then comes into this House and supports every single measure to reduce the production of farmers and to reduce their incomes.
May 10, 1973

It is no wonder that the people of the nation are confused. It is no wonder that the primary producers in agriculture are becoming sceptical about the nice, pleasing speeches being made by the Minister of Agriculture. They are businessmen. They would greatly prefer progressive action from the minister on measures to solve their problems rather than pleasant speeches designed to win friends and influence farmers.
When we in this party talk about controls we are not talking about freezing Canadians into a position in which they cannot move. We are not talking about introducing hardship for any group of Canadians. We are trying to bring in some sort of program designed to help this country out of the dilemma in which it finds itself. It is not good enough for any government, let alone a Canadian federal government, to say that because things are going on in other countries, it naturally follows that they must go on in Canada. Somebody has to be a leader. Somebody has to find a solution to these inflation trends. Why can't it be the Parliament of Canada?
The only thing holding the Parliament of Canada back from making progress in fighting inflation and the increasing cost of living is the stubbornness of the government in refusing to accept, even in part, a proposition which the opposition sincerely feels will work. Government members castigate us about a 90-day freeze. They talk about it as if that is the total program. They castigate us for not laying the program out in full.
On a subject as complex as this no man in the world has the capability to discuss the question completely and to illustrate the remedy within a 20-minute speech. I congratulate the hon. member for Don Valley (Mr. Gillies), because in a series of speeches he has done more to illustrate a policy that will work than all the ministers of finance I have had the pleasure of hearing during the last two parliaments. The hon. member for Don Valley made a simple statement that will find acceptance-


Charles L. Caccia: Very simple.


Harold Warren Danforth: -even from the hon. member who interjected. The hon. member for Don Valley said the present economic policies are just not working. If you think they are, just go and ask your constituents. If you do not know what is going on, you had better find out or you will not be here very long. The hon. member for Davenport (Mr. Caccia) insists on injecting himself into the debate. It is to him I allude. If he does not know right now that the increased cost of living is a massive problem in his riding, a riding with which I am familiar, then he is not accepting his responsibilities as a member of this House.
In conclusion, Mr. Speaker, no one in this House can be accused of not being concerned about the problems facing Canadians. No one in this House can be accused of being unsympathetic to the fact that the cost of living is going up at an alarming rate. The only difference between members of the House is on the way the problem should be attacked. If I have any plea to make to this parliament it is to ask members of the other political parties to lay down their partisan, political shields and, as responsible Members of Parliament, show some interest in the principle that we are proposing at this time.


Charles L. Caccia: May I ask the hon. member a question?
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The Acting Speaker (Mr. Laniel):: This can only be done with the consent of the hon. member who has the floor.


Harold Warren Danforth: I will be glad to receive a question.


Charles L. Caccia: In light of the non-partisan plea which the hon. member just made, would he enlighten the House on the remedies he would like to propose?


Harold Warren Danforth: Mr. Speaker, if the hon. member had been in the House during the course of debates on the economic policies of his government which have taken place in this session alone, he would not have to ask such a stupid question.


Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, the terms of the resolution before us are very broad, covering the entire spectrum of the cost of living. I am as aware and as concerned as anyone about the elements that go to make up the cost of living, food, rent, clothing, utilities, transportation and the rest. But on the principle that the longest journey begins with a single step, I will confine my remarks today to cover what can be done about the spiralling price of food wh;ch some analysts tell us may increase by as much as 45 per cent. I am well aware that this will not frighten the Minister of Agriculture (Mr. Whelan) nor some other ministers perhaps, but it frightens the people of this country and it frightens me. I am afraid to think about the situation that can occur if nothing is done about food prices in an effective way.
At the outset of my remarks I want to warn the government that it cannot get away with the type of food prices review board which has been proposed. Certainly the skirts of the New Democratic Party may be broad and protective in some regards, but I warn the government that it is not going to be able to hide behind them. We have said that the board as announced by the Minister of Consumer and Corporate Affairs (Mr. Gray) is not adequate and will not pass as far as we are concerned.
I come from a west coast province, and to us the situation in which we are placed today appears as though there has been a big shipwreck and people are tossing about in the water. The government has proposed a search and rescue operation but has confined its terms strictly to the business of search. While people are in the water, the Minister of Finance (Mr. Turner) is telling them that the situation is inevitable and nothing can be done about it because of world conditions of one sort or another, and the Minister of Agriculture is reiterating tiresomely from the shore that food is a very great bargain-if you can get it! In the meantime, the Conservatives are watching the heads bobbing about in the water and are advising the stranded people to freeze for 90 days, but saying nothing about what they propose to do during the 90-day period.
Watching the Progressive Conservative party, I rather
wonder if their reticence about bringing forward their 90-day program is because they have no ideas for it. I am afraid all they would do is put on a 90-day freeze and then, like Mr. Nixon, take it off and watch prices skyrocket. I am afraid they have not taken the warning of the late Jan Masaryk, the Czech patriot, who declared: "Excitement is

May 10, 1973
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no program". I think the Conservatives believe that excitement will convince the voters of this country that they have something. But the voters know that at the end of 90 days, prices would go still higher.


An hon. Member:: That is nonsense.


Winona Grace MacInnis: It may be nonsense, but you will have a chance to contribute in your own way. We in the New Democratic Party are firm in our determination to press for more than an investigation. The board as set out by the Minister of Consumer and Corporate Affairs does not have anything like the powers that we asked for and that the people want. Mr. Speaker, neither this party nor the people of this country are going to be fooled by what the board is at the present time. It is just an investigatory board, a toothless wonder.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Winona Grace MacInnis: I am not going to be silenced on the matter, Mr. Speaker. Up to this point the proposed prices review board has been nothing more than the resurrection of John Young's prices and incomes commission, which did absolutely nothing for three years except to spend $3 million of the taxpayers' money and produce reams and reams of paper. It was a waste of time, paper, money and expertise.


Some hon. Members:: Hear, hear!


Winona Grace MacInnis: That is exactly what is proposed now. Mr. Speaker, I want to put forward our proposals. We believe that the Minister of Consumer and Corporate Affairs should, without delay, bring in legislation to clothe either the board or himself-I do not think it matters very much which one it is-with the power to act on the findings of the board. Anything short of power to act is a waste of time and a deception.
Let me tell you, Mr. Minister, that you are lighting a slow fuse if you think you can get away with a board that is just another investigatory body. You cannot. The people of this country have been led to believe that this committee was a forerunner of action on the part of the government; they have been led to believe that the government is concerned about them. It is not only the people on low incomes who are suffering-although they are suffering most severely-but as costs creep higher and higher, people in the middle and higher income levels are suffering as well. Some of the analysts promise us a 45 per cent price increase in the future.
Mr. Minister, I say that by bringing in a board of this type in your name you would be, in my opinion, betraying the consumers of this country. The consumers trust you with their well-being, and they do not believe that you are going to fob them off with just another investigatory, time-wasting body. I would suggest that you keep your record clean and do not get-


Mr. Speaker:: Order, please. I trust the hon. member will not mind my interrupting, but I must remind her that an effort should be made to address the Chair rather than the minister.
[Mrs. Maclnnis (Vancouver-Kingsway).l


Winona Grace MacInnis: I certainly shall, Mr. Speaker. I am referring to the minister, but it certainly causes me no hardship to put my remarks through the Chair. I shall remember that.
We want the minister or the board to be clothed with powers to prevent unjustifiable prices, to roll back prices which are unjustifiable and to protect the farmers where necessary by price supports or subsidies, or in whatever way is essential. I was rather amused this afternoon to hear one of the hon. gentlemen to my right, who like myself is from the city, suggest that all we need to do is plan for very quick production. I was thinking how the farmers would react to that idea. Presumably, within this 90-day freeze beef could be raised from conception to table. I know it is going to be more complicated than that.
We do not propose that the price of all kinds of meat be controlled, but that there be selective controls on certain foods which, taken together, would add up to a nutritionally sound diet. Don't tell me it cannot be done. I have here a copy of the Daily Telegraph of London, England, dated February 22 which points out that in Britain they are exercising very definite control on the price of a particular commodity. That is the Kellogg's firm, which has 60 per cent of the market. The government is telling Kellogg's that it will hold the line on those prices as long as it believes it should do so and prevent their going higher, because higher prices would be unjustifiable.
I want to pay tribute to the chairman of our food prices committee, but in my view he was stretching the point a bit when he referred to the quick response by the Minister of Consumer and Corporate Affairs in dealing with the prices review board. I do not think his response was quick.
I agree with the hon. member for St. John's East (Mr. McGrath). Surely, even during these last two or three weeks when he was looking for suitable members for the board, the minister could have found at least one suitable candidate. As well, he might have done something else- met with his opposite numbers in the provinces and discussed with them provisions that would be necessary to overcome any constitutional obstacles in this field, with a view to overcoming them. Even if they did not remove them, we might have discovered what they were.
Mr. Speaker, in this country there have been many areas over which jurisdiction has been divided between provincial governments and the federal government. Governments could not encroach upon each other's jurisdictions. However, when the public wanted action taken in a joint way, it was taken. When the people wanted income taxes to be collected exclusively by the federal government, the provinces were able to surrender the power of taxation to the federal government. These things can be done if the government wants to do them.
My great fear is that this government does not genuinely wish to set up a prices review board that can act. I have not seen evidence of such a desire and that is why I am afraid. I am telling this to the consumers of this country because they must make sure the government realizes how essential it is that the board be in a position to act. Also, I am telling the Minister of Consumer and Corporate Affairs that it will be highly dangerous for him if he does
May 10, 1973

anything short of giving this board the powers that it needs. That can be done and must be done. Merely because we cannot see all the way through the thicket does not mean that we should not make a start in this area. We must make a start.
Undoubtedly there are some who want to leave things to the workings of the marketplace. I am talking of people like the Minister of Agriculture. That view, I suspect, is also held by some other members of the cabinet, including the affable, knowledgeable and able Minister of Finance. Mr. Speaker, I will tell you what such action would mean today. If you leave these things to the workings of the marketplace it will mean leaving the consumer at the mercy of some large and powerful corporations who will first destroy their weaker competitors and then be in a position to demand from the consumer every cent that the traffic will bear. Those who were on the food prices committee know that and they will be even more aware of this fact when we resume our sittings in a short while.
People must have food in order to live. Consequently, the food industry is highly profitable if you consider it in its entirety. Anyone who doubts that should look at the profits of the great corporate structures underlying the supermarkets and some of the other sectors of the food industry. No wonder prices are going up: profits are going up and profits are there to be reaped.
As long as the food gamblers can sell their wares at a profit, it matters not a whit to them who gets hurt in the process, whether it is the farmer whose existence is threatened by the rising cost of machinery and farm supplies, the low-income families whose children cannot get proper nutritional food, or the middle-income families who are brainwashed, along with the rest, into buying all sorts of things they neither want nor need because of the wasteful ingenuity of those servants of the supermarket, the advertisers. I have noticed that according to press reports advertisers are beginning to worry. They are becoming sensitive because people no longer believe many of their claims about the wares the supermarkets display. They are now saying that they must improve their image.
The purpose of the food prices review board is that of taking a first, real step to transform the food industry from its present status of a gambling venture into what it should be, an industry to supply the needs of people for food at the lowest cost consistent with quality and with the protection of those who are involved in food production, the most vulnerable of whom at the moment are farmers.
Water has always been a public utility. It has been regarded as too important a substance to be cornered by one or two big monopolies for their own private profit. I am glad to say that there is one provincial government that is beginning to look at food a little in that light. The government of British Columbia is beginning to supply the co-operative movement, regarded as an enemy by the great monopolistic private food chains, with funds to build up a co-operative, non-profit alternative to the gambling food chain business which is so deeply rooted in the country in which we live. I am glad to see that this beginning has been made.
May I have two or three more minutes, Mr. Speaker?
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Mr. Speaker:: The hon. member has three minutes. If it is after six, I would assume hon. members would want the hon. member who has the floor to complete her remarks.


Some hon. Members:: Agreed.


Winona Grace MacInnis: Thank you, Mr. Speaker. I suggest that the minister look at this board in a way completely different from that in which he has so far viewed it. Consumers have become aware, as the minister no doubt knows, that committees which sit too long merely involve procrastination. Their establishment often means that decisions are put off and that a whitewashing job is done. People will not put up with that any more. I hope the minister realizes that if he does not act there will be retribution. If retribution does not come about in this House, he and those associated with him will suffer that retribution at the hands of the people across this country who trusted this government to do something in solving the problem of food costs. Those costs are part of the cost of living which people must bear. People must have food in order to live. If the government betrays the trust of the people, it is doomed no matter whether it receives the coup de grace in this House or at the hands of the voters.


Mr. Speaker:: It being six o'clock, I do now leave the chair. The House will resume this debate at eight o'clock.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, some 2,500 years ago a Greek philosopher was attributed a statement he once made to the effect that he knew that he didn't know. Presumably it was Socrates who pronounced it. I would like to borrow that statement from him tonight in approaching this subject, because it is of such complexity that it makes one realize very quickly the limits of one's knowledge in attempting to come to grips with it.
I would rather have listened for the duration of the debate. However, the speech made at the opening this afternoon by the hon. member for Don Valley (Mr. Gillies) touched upon certain aspects and this has prompted me to respond to what he said.
In his speech, the hon. member for Don Valley emphasized the importance of introducing a freeze. He called it an "immediate temporary freeze." He mentioned 90 days. It is this kind of conflict to which I take strong exception. What does it mean? Expressed in those terms, it is truly a Conservative philosophy. It says to society, those who are trying to catch up in their income and standard of living with those who have made it, "Stay where you are and accept the fact that for a certain period of time you will not be able to catch up with the rest of society."
Who will be hit? Who is going to suffer? Who is going to be affected by a freeze of the kind proposed through this motion of the Conservative party? It is the working poor, the unorganized worker and the organized worker earning less than $80 a week, such as a hospital worker. It affects
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all those in society who are trying to improve their lot and catch up with the others.
This kind of measure would not affect the professionals who earn a reasonable income. This is where the whole question of wage and price controls becomes so intriguing. It is easy to impose controls on the wage earner because the system is set up in a way whereby wages are determined by the employer. With a measure of this kind, whether of short or long duration, experience in other countries has shown that once you introduce a temporary freeze, when the period is over the government finds it necessary to extend it because of the complexity of the situation, and politically it is not easy to remove.
Usually, a measure of this kind affects the wage earner in all sectors of the business world. How would it be possible to introduce a freeze or control without affecting the income of non-wage earners, those who by virtue of their activity are not dependent on a salary? Are you going to say to the professionals that by virtue of this freeze, the lawyer, doctor or accountant should stop seeing clients at a certain point because he has reached his income ceiling? Conversely, will you say to these professionals that once they have reached the ceiling permitted under the measure they should serve their clients free of charge? These are questions that come to mind.
It would be very helpful if the members of the Conservative party would explain to us how they would do this without harming those sectors of society that are trying to catch up with the others, namely, the wage earners, the working poor, the unorganized workers and the organized workers at minimum salaries. How could a measure of this kind work effectively for those who are not wage earners, such as the professionals? This philosophy of the Conservative party says, "Let's freeze everybody in their place. You who are lagging behind, stay there. Those who are doing well can take it. In the meantime we might find a solution." We have not heard from the hon. member for Don Valley, except for a brief answer which lasted a couple of minutes, as to the measures he would introduce at the end of the temporary freeze.
I have no particular knowledge of economics, as you can see perhaps from my expose so far. I represent the average guy who is looking to parliament for the answers. Today the onus is on the Conservative party to provide the answers, and so far they have not outlined a policy which can convince me they have an alternative to what the government has done so far.


An hon. Member:: Nothing.


Charles L. Caccia: They have offered only a short-term, temporary proposal without looking to see what would happen at the end of the rainbow.


An hon. Member:: Listen to the speech. Read it.


Charles L. Caccia: I listened to the speech this afternoon; I do not need to read it. How do you implement controls in a federal system of government unless you have full cooperation at the provincial level? How do you implement controls in a democratic society, in which I suppose one of
[Mr. Caccia.1
the motives in life is making a profit, when you have set up your own business and wish to catch up with those who are doing better, or when you are not a member of an organized union and want to catch up with people who are earning a better wage? How do you go about introducing compulsion in a society which fundamentally abhors compulsion?
The other question is, what happens when controls are taken off? Will the level of prices remain unaffected at that point, or is it likely, as has happened in other countries, that when you take the lid off, all that has been gained is lost in a matter of weeks? Have members of the opposition thought this through and, if so, what are their answers? What happens after the 90 days to the weaker segments of society who are trying to catch up with the others? Certainly a doctor earning $50,000 a year will not be affected by the freeze, but a worker in a hospital earning $80 a week is in a different position. How would the Conservatives allow him to catch up with the others, according to their theory?
In searching for an adequate answer we must also realize that Canada is not an island; we cannot isolate ourselves from the inflationary spiral which is sweeping the entire western world. As we all know, we are dependent on trade with other countries. How do we isolate Canada from the inflation we import? This country has to import in order to export. I heard nothing this afternoon about that aspect of the problem. The hon. member for Don Valley mentioned it briefly, but he moved on at once to another subject.
Before we embark on a temporary freeze the people of Canada are entitled to know what will happen at the end of the freeze. It is for us, as politicians, not just to provide answers which will relieve the anxieties of the moment because that course might be politically expedient, but to provide answers which will demonstrate that we have thought things through and that we have a chance to implement a policy all the way through. To me it seems the Liberal approach so far has been as sound and as effective as it reasonably could be.


Some hon. Members:: Oh, oh!


Charles L. Caccia: Wait a moment. When your turn comes you will have an opportunity to contribute. The government has done one thing; it has redistributed income by taxation. You take away purchasing power from those with higher and middle incomes and give it to those with low purchasing power, and you do it by means of programs of income support such as old age assistance, the guaranteed income supplement, allowances for children, programs for veterans, the Canada Pension Plan, and so on. This is a form of redistribution of income. You can do this to the extent society is willing to accept it.
When we were considering the capital gains tax in this House, who were opposing it as a measure which was thought to be the end of the world? It was the members of the Conservative party. They were opposing one of the most logical and sensible measures for the redistribution of income to permit those who have no way of defending themselves to be helped through the government's system of redistribution of income by taxation. So you take pur-
May 10, 1973

chasing power away from certain groups and give it to others by way of social security programs.
A second measure which has been introduced is provision for a cost of living increase in the programs I have mentioned so that those who live on fixed incomes have a chance to keep up with increases in the cost of living through regular adjustments. Another measure is one which was announced recently, the setting up of a prices review board. I am looking forward to seeing how this will work. I really do not know whether it will be able to achieve the objectives the public expects it to achieve. Perhaps it will only serve the purpose of emphasizing the complexity of this issue.
Another measure which is still to come is the introduction of really effective legislation in the field of monopolies, keeping monopolistic trends to a minimum and, if possible, eliminating the fixing of prices. Then, I suppose-and this can be done in several ways through our agricultural policies-we might introduce incentives designed to increase the supply of certain products. I recall a lengthy debate which took place in this chamber until seven in the morning. It was on the introduction of agricultural marketing boards. Members of the Conservative party were strongly opposed to these boards. Do they still think it was such a bad idea? Would they still be opposed to that measure, now that two years have gone? If so, why?
Sometimes memories in this chamber are very short, but it does no harm to raise these matters. I do not know what the answers are to the issues. I am Socratic; I do not know. But I do know the Canadian people are very disturbed by this trend. They want to have correct political answers, sound answers which will stand the test of time-not temporary measures which will serve merely as window-dressing.
In conclusion, since it is they who have introduced this motion I believe it is the responsibility of the Conservative party to tell us what will be done when the temporary freeze comes to an end. Will they renew the freeze for another few months? Having done so, what will they do next? How are they going to enable those sectors of society that are trying to catch up with other sectors to improve their lot, their wages and conditions? How will they deal with inflation which is imported into Canada from other parts of the world? Unless they can, the exercise here today will only have raised false hopes. It seems to me that we can do better than that.


Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, this is one of those days when, under the rules, the opposition is assigned the right to raise certain grievances. To put the debate on the tracks, as it were, may I refer in my introductory remarks to the motion. We have asked the House to deplore the failure of the government to take concrete and effective action against the rising cost of living so evident in the price of shelter-which I shall deal with in a moment-food and clothing. We urge the government to come forward and impose an immediate temporary freeze on the price of shelter, food and clothing and to hold discussions within 90 days-a factor my hon. friend from Davenport (Mr. Caccia) seemed to miss-with the
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provinces, industry and labour and come up with some plan to stop the ever-increasing, galloping inflation.
Having listened to the speech of the previous speaker, if I may refer to it for a moment, I took the position that the hon. member had thrown up his hands. He is speaking for the Liberal party, but really he is a Liberal back, not in the nineteenth or the eighteenth century but in the seventeenth century-laissez-faire, let it go. On the one hand he cried about people on small salaries, and on the other hand talked about people with larger incomes. What he was really saying was that there was no revenue.
This parliament has already approved an increase in the old age pension, we have approved an increase in the exemptions of small wage earners, we have improved the pensions of veterans-but by the time the cheques got into the envelopes the inflationary spiral had eaten up the increases granted. The government knows that and the Canadian people know it.
When we came to this House four months ago I do not know whether the government had great hopes, but their only remedy to cure high prices was to set up a special committee to investigate food prices. That special committee recommended that we set up a food and prices review board. I agree with the hon. member for Vancouver-Kings-way (Mrs. Maclnnis), who in turn agreed with our member who led off this debate, the hon. member for Don Valley (Mr. Gillies), and also the hon. member for St. John's East (Mr. McGrath) that this board will be useless. It is only an excuse for inaction. It really means more procrastination while Canadians suffer.
I could not help but agree with the hon. member for Vancouver-Kingsway who spoke before supper. After all, this lady is a great parliamentarian of great capacity. She has a feeling for humanity and an understanding, following the tradition of her great father and parliamentarian in this institution. She has been influenced by socialists. This influence must come from her leader and other members of her party. She said that this review board will mean nothing but further procrastination, and there she let the cat out of the bag as far as her party is concerned. She knew this review board would be useless.
We said that a committee that would study the cause of price increases would be useless. This is merely hoping that something will turn up, like Micawber. The Canadian people knew that the cost of living was high. They knew the cost of food was high, and so are rents. Housing is expensive, as is clothing. They know their pay cheques will not meet the demands of their families. They know that now. They also know that prices will go higher because the government has no remedy. This government is bankrupt of ideas.
I was one who criticized the setting up of this committee, not only because I knew its recommendations would not solve the ball of wax of inflation but also because it was too narrow in purpose. The committee was set up to study food prices only. One wonders why it was restricted to that aspect alone, since the cost of living is rising, as is the cost of housing and shelter, which I will deal with in a moment, and clothing. Only last night I read that the cost of clothing during the next few months will go up 50 per cent. So why were just food prices picked out? I think the reason is that there were political implications. The Liber-
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al party and another party in this House were frightened of those political implications, so they zeroed in psychologically on food prices in order to move people's minds away from the real issue. But people's minds are on the subject because their pocketbooks are on it. We said this to parliament as early as last January and now, four months later, it has been proven that what we said was correct. What was needed was not parliamentary investigation but responsible government action.
We have put forward a concrete program and we refer to it in our motion. We have recommended a temporary freeze. My hon. friend from Davenport keeps asking what will happen after 90 days. During the 90 days there will be discussions with the provinces, with industry, with labour and with farm organizations.


Charles L. Caccia: What happened in the United States?


Eldon Mattison Woolliams: My hon. friend asks what happened in the United States. I should like to quote what the Prime Minister (Mr. Trudeau) said. I must say the Minister of Finance (Mr. Turner) rather shocked me today, because I used to shadow his portfolio when he was minister of justice and I got to know him very well. He said that the price index increase in Canada was lower than that of any country in the western world. He had better get together with his Prime Minister; even he seems to be more honest. In answer to a question put by the hon. member for Prince Edward-Hastings (Mr. Hees), the Prime Minister said, as reported at page 3510 of Hansard:
I should like to tell the hon. member that in some countries which have applied price and wage controls the consumer price index has been increasing. It has been increasing in the United States at a seasonally adjusted annual rate of 9.8 per cent in the past three months. On a year-over-year basis the increase in the consumer price index in Japan was 8.4 per cent, in Germany, 6.9 per cent, in France 7.0 per cent, in the United Kingdom, 8.2 per cent-
However, the Prime Minister admitted that the rise in the index in Canada over the same period was 13.2 per cent. Britain imposed temporary controls, and the United States has temporary controls. I say there is some record, at least, that they worked; they worked well while in operation. We put that forward as a concrete suggestion.
Before dealing with housing, one of the questions always raised by the Prime Minister-it must have been his favourite subject at university-is the constitution. For too long he has been hiding behind the constitution. I say that under the constitution the government has the power to act in order to implement a temporary freeze on all prices. Pausing there, as the hon. member for Don Valley said, we are living in the year 1973. During the first war, under the terms of peace, order and good government the federal government realized it had the power to stop galloping inflation and declared, not by act of Parliament or by changing the constitution but by judicial decision, that there was a national crisis. If we had a similar judicial interpretation today that there was a national crisis, any government in Canada under that formula would be able to implement some form of price control, particularly in the field of housing.
I am tired of this government.
(Mr. Woolliams.]


An hon. Member:: The country is tired of it.


Eldon Mattison Woolliams: Yes, the country is tired of its always hiding behind the constitution.
Let me deal particularly with that subject the hon. member for Don Valley (Mr. Gillies) suggested would be raised in this debate, that is, housing. We have in Canada the most serious national housing crisis that has existed during my lifetime or the lifetime of any Member of Parliament sitting in this House. The index refers to a 6 per cent increase in housing. I made 10 or 15 phone calls across the nation today about this situation, and I found in talking with real estate people and those in the house construction business that costs have increased in the major cities in Canada from a low of 50 per cent to a whopping high of 100 per cent since the Trudeau gang took office. Believe me, the people of Canada have not forgotten that this is the same old gang running the country. It may try to create a new image and a new psychology, but its policies are the same. We have the same kind of unemployment, the same kind of inflation and the same bankruptcy of ideas. There has been no change.


An hon. Member:: What about the Tory promises?


Eldon Mattison Woolliams: The hon. member talks like a seventeenth century economist. In the 1960s, those in the low-income group were able to buy houses in the major urban centres for much less than today. In 1968, a house with three bedrooms and a bathroom and a half cost approximately $15,000. Today that same type of house, whether it is in Edmonton, Calgary, Toronto or Ottawa-there might be a slight difference-would cost $30,000 to $35,000. The cost has increased a whopping 100 per cent. I have checked the price of housing from Vancouver to Halifax and, speaking relatively, these increases have taken place on a pro rata basis. I repeat that the increase has ranged from 50 per cent to 100 per cent in the two cities that have the doubtful honour of suffering the highest increases as a result of this government's policies. In the city of Toronto the increase has been 100 per cent, and in the city of Ottawa it has been 80 per cent. These two cities lead the pack in the increase in housing costs.
This government has merely set up a review board to look at the price of food and investigate the causes of the increase, yet these terrific increases in the cost of housing have taken place. My friends on the other side are always asking for solutions. Let me remind them that the CMHC is guilty of instructing solicitors to commence more foreclosure actions than any other housing corporation in Canada. The leader of the NDP-I see him in the House- has made reference to corporate bums. This state-owned and controlled body, and I have the figures, today has instructed solicitors to foreclose on the little people across the land.
When reading the Toronto Star tonight I noted that spokesmen for that socialistic government agency said there were 260,000 homes in respect of which only 2 per cent of the owners were behind in their payments, and with respect to only 1 per cent foreclosure action has been taken. Even I, not being a mathematician, can figure out that 1 per cent of 260,000 is 2,600 homes across the country that are subject to foreclosure action.
May 10, 1973

Let me deal for a moment with the history of this type of thing. I want to make three points. Only 6 per cent of the wage earners in Toronto can today own a home. The heading of this article suggests that housing in Toronto is a major social tragedy. I suggest it is a social tragedy everywhere. Rents are going up for the old and for the students. I refer to an article which appeared in the Globe and Mail of January 29. It reads in part:
Munish Gajadhar moved into a one-bedroom apartment at 230 Oak Street on January 1.
His rent in the morning was $137, and by suppertime it was $152. If that is not galloping inflation, then I have never seen a galloping horse outside the city of Calgary. Let me say a few more words about this great, national agency. I know of a case where a man signed a mortgage on a house in April, 1966, for $12,350. He was a Calgary resident. An action was started in January of this year by a member of a firm appointed as a result of all the compassion this Liberal government can muster. I am sure of that because one of the members of that firm ran against me as a Grit during one election.
This man was three mortgage payments behind; $118 for October, $118 for November and $122 for January-a total of $358. He was out of work, but even so an action for foreclosure was started. He obtained an order from the court, and after consulting certain people he was able to sell the house, as a result of inflation, for $21,000. When he went to pay CMHC his arrears, although they were only $358, the partisan solicitor charged him $579.50. That is the type of thing done by this government which has great feeling for the people! That is quite a collection fee on such a small foreclosure. Of course, the CMHC representative suggests there are only 2,600 foreclosures today in Canada.
I remember when the former leader of the NDP was Premier of Saskatchewan. He has talked about foreclosures in the 1930s. Never was there a corporation in Canada so heartless as the CMHC-and it is under the control of the minister responsible for housing. Let me say to the hon. member on the other side who wants remedies but will not take the medicine when you give it to him, it is time the CMHC ceased to be an independent body and was made directly responsible to the minister, in order that he might control the fate of Canadians living in urban centres.


An hon. Member:: You can't blame them for patronage appointments in that regard.


Eldon Mattison Woolliams: That is another thing I do not want to get into at this time; it would take too long. This government has appointed so many Grits to so many boards lately that it has run short of jobs for them.
Only the rich can buy a house in Canada. Those in the middle and low-income groups are forced to live in public housing which will be our future ghettoes. Those who oppose this party when its members move motions are now bleating like sheep because they know this government is bankrupt of ideas. They know this government has driven the middle-class and the poor people from their homes into public housing, at high rents. I think Pitt was right when he said that when votes cease to be important, they will cease to be bought. That is what is happening to
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the Liberal party right now. Members of that party are becoming nervous and jittery.


An hon. Member:: Oh, come on.


Eldon Mattison Woolliams: Then go to the people and see what happens. Our problem is one of over-all inflation rather than simply rising food costs. We must consider the whole ball of wax, the entire field of inflation. We must make decisions in these terms, rather than continue to bleat like sheep about food prices only. The increase in food prices will continue as long as we have inflation and Liberalism in this country.
Last night in the U.S. news and world report several top economists of the United States, Britain, and I believe one from France-I do not try to hide the fact that other countries are experiencing inflation, but at least they are doing something about it-said that if inflation continues we will have a greater recession in this country than we had in the 1930s. This kind of economic condition spells distress, unrest and war-and, God knows, even in my lifetime we have had enough of that. Surely the time is past due for the Liberals to start moving. If they want to hold power, let them hold it with responsibility and start governing.


Some hon. Members:: Hear, hear!


Eldon Mattison Woolliams: What should this government be doing in addition to what I suggested about CMHC? It should act within the authority and power of the constitution and not hide behind it. As the hon. member for Don Valley and the hon. member for St. John's East have said, we should immediately impose a temporary freeze on prices in order that we can initiate discussions at all levels with the groups I mentioned in my opening remarks. While the freeze is on, quick action should be taken to consult the provinces, industry and labour. This is not a selfish race against time but is a step one that must be understood for the economic good of the whole country rather than for any special group with special privileges.
We should repeal immediately the 11 per cent sales tax on building materials so that at least those people I have spoken about will be able to afford new homes. We should produce a new national housing program, making grants to the municipalities to clear away the bureaucratic dead-wood and deadlock which exist at all levels of government, and guarantee the little people that the interest rates which they pay on their CMHC mortgages will be no greater than 1 per cent over the prime rate. I am not talking about private lending institutions; I am talking about where the lending is through a government entity. In that case it should never be greater than 1 per cent over the prime rate. I understand that at the present time-if it has not risen today-the prime rate is 6V2 per cent. So the rate on CMHC mortgages should not be more than 7V4 per cent.
We are not competing for public money with industry, because this government has the ability to gather in millions, indeed billions of dollars through taxation by hitting the middle-class and lower income people of this country. I spoke to the parliamentary secretary to the minister

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responsible for housing and said, "Bring in your housing bill." I told him we have two or three amendments to it. I said that the bill is only a band-aid bill, but let us at least get the band-aid on the move. I gave him the undertaking that our party wants to see the Liberals on the move. We want to get the bill to the committee, where we will move our amendments, hope to get some support from government members, move the bill back into the House and get some action. It will not solve much, but it is better than nothing. The Prime Minister tries to say that there have been delays. I cannot say he deliberately misrepresents the facts, but I can say he wanders from the truth.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but the time allotted to him has expired.


Mr. Ross Whicher (Bruce):: Mr. Speaker, generally it is with a great deal of relish that I speak in the House of Commons. However, tonight I do not have that sense of enjoyment because, quite frankly, this is one of the few occasions in my parliamentary career, when to some extent at least, I have to agree with what has been said by the members of the opposition. The most serious problems we have in Canada today is that of inflation. It is a problem which has been with us for a number of years. One would be less than truthful if he did not admit that.
This is not merely a Canadian problem; it is worldwide. I agree with the hon. member who this afternoon said that just because it is also a problem in the United States, in England, in France and in Germany does not mean that if the people in those countries happen to close their eyes, we in Canada, whether members of the Liberal party, the Conservative party or the New Democratic Party, should close our eyes to the problem. We cannot do that because the citizens of Canada are suffering grievously from this great sickness of inflation and it is up to us to do something about it.
Many arguments have been put forward as to why we do not have a system of controls in Canada.


An hon. Member:: We have inept leadership, that is why.


Ross Mackenzie Whicher: We have somebody with a loud voice on the other side. Please do not interrupt me when I am on your side at the moment. We have been told that there are many arguments against it. The first argument is that it will not work. Mr. Speaker, I am not prepared to accept the lame excuse that controls will not work, because they simply have not been tried in Canada in peacetime.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: It is true that they have been tried in other parts of the world; no one would deny that. However, it is not true that they have been tried in our chosen country, for which we are responsible. For that reason I say that until they have been tried and proven unsuccessful, I will not accept the excuse that they will not work. I have also been told that controls are unconstitutional and we must obtain the permission of the provinces and get agriculture, labour, industry and everybody else on our side.

It is high time we had a little chat with the provinces, with agriculture, industry, labour and all the other segments of the economy. If we do not-and this is the question I want to ask members of the House of Commons tonight-what is the alternative? People on my side of the House say that the members of the opposition have not told us exactly what they would do. But I have not heard from my side of the House either, since this Parliament started or during the past number of years, the alternative to controls in Canada. The alternative must be in our lifetime. I say, with sadness, that the alternative is absolute financial chaos in our lifetime if something is not done to stop the runaway inflation we have in Canada.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: Surely, Mr. Speaker, it is not necessary for one to have been to school or to university to understand this fact. A person earning $10,000 a year now in Canada, ten years from now-with the rate of inflation we have on May 10, 1973-will have an income of $20,000 a year; twenty years from now he will have an income of $40,000. One of my friends on this side of the House, whom I respect, said, "How can you bring in controls when the doctors, certainly, will not care about it?" He said that doctors today are earning $50,000 a year, while hospital workers are earning only $4,000 a year. To that hon. member I say that everyone knows that ten years from today a doctor who now has an income of $50,000 will have an income of $100,000 a year, and the hospital worker will be earning $8,000 a year-if we do not do something about inflation. I think it is high time we did something about this problem.
I think the only people who will agree with me are hon. friends to my immediate right. They say we cannot control things in this country. Only a month ago we put controls on a great Canadian corporation, Bell Telephone. Complaints came from my party, of course, from the NDP in particular and there were at least groans and sighs of dismay from my Conservative friends when the Canadian Transport Commission brought in a recommendation that Bell Telephone be granted a 2.3 per cent increase. The government said that this was too much and that it would have to review the situation. We heard the moans and the groans of the leader of the New Democratic Party about Bell Telephone gouging the public with a 2.3 per cent increase, but only a week or ten days later Ontario Hydro workers were granted a 30 per cent increase over a three-year period, or 10 per cent a year-and the leader of the New Democratic Party did not even give one good grunt.
You cannot have it both ways. Somewhere along the line we will have to face this situation. I am not going to say that Bell Telephone is making too much money, but just compare its increase of 13.5 per cent over the last five years with the 63 per cent increase by the Post Office, which is a nationalized concern, the 50 per cent increase by Ontario Hydro, which is a public concern, and the 39 per cent increase by Quebec Hydro and you will see that public enterprise has not really done too badly.
I only raise this matter to show that we have controls in Canada when we want to bring them into effect, but when
May 10, 1973

we do not want to bring them into effect we just choose to ignore them. It does not matter whether we are politicians, doctors, teachers, plasterers or painters, whether we are in the agricultural field or wherever else we work-except, of course, if we are on the old age pension or some other pension-the fact is that our salaries, through natural increases, are doubling every ten years. Somewhere along the line somebody will have to tie this whole thing into a bundle and bring us back to the world of reality.
It has been suggested that the introduction of controls would create a great bureaucracy. I am not prepared to accept that philosophy one little bit. I agree that past history seems to show that each time a minister is placed in charge of a completely new portfolio in the federal government or in the provincial government of Ontario or Quebec, he is no good if within one year he does not have 1,000 people working for him. History proves that to be the truth. My hon. friend from Quebec who sits on the front bench opposite would agree with that. He had 1,000 people working for him; he knows what it is all about. But this does not mean that in the serious situation in which we find ourselves-and surely every member would agree that it is a very serious situation-we cannot streamline the bureaucracy and instead of acting as Conservatives, Liberals, members of the NDP or Creditistes, for once, in a state of national emergency, we should start acting as Canadians.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: When controls were brought in during World War II they were not brought in by the Conservative party or by the Liberal party: they were not brought in just by politicians but by all Canadians working together to win a war. Mr. Speaker, we are at war today. We are in a financial war, an economic war. If we do not do something about it, we are going to be swept under the table, not by countries where there is great inflation, not by countries like the United States but by great countries which in the next 25 or 50 years will really show the way, countries which have controlled economies such as China, Russia and countries of the Far East.
The old ways of controlling inflation simply will not work. Hindsight is a great thing. It is not with any feeling of bitter criticism that I look back on what has happened in Canada during the last three or four years, because I respectfully say that if my hon. friends opposite had been in power, perhaps they would have done the same thing. Perhaps they would have cut back and caused unemployment in order to control inflation. But with hindsight we know that this simply does not work.
Through you, Mr. Speaker, I ask the government: If such cutting back does not work, then what will work? Are we just going to go along with the tide and end up, as one hon. member on the other side has suggested, in the year 2000 with the average house in Toronto costing a quarter of a million dollars? Are we just going to go along with this tide, or are we prepared to do something about it? Again I emphasize that when I say "we", I mean the members of the House of Commons who represent the Canadian people-and they, in my opinion, desire controls; they are crying out for controls because they just do not know what to do at the present time.
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Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: Mr. Speaker, in case I am criticized by some, and I expect I will be, but I do not mind constructive criticism at all-


An hon. Member:: We will look after you, Ross.


Ross Mackenzie Whicher: You fellows had better look after yourselves. I can look after myself. But in case I am criticized by someone immediately following me who asks what kind of controls the hon. member for Bruce is talking about, I want to say that I mean 100 per cent controls. I mean controls on wages, on salaries, on profits, on rents, on dividends and on prices.


Some hon. Members:: Hear, hear!


Ross Mackenzie Whicher: There is no easy way. Mr. Speaker, I listened to the hon. member for Don Valley (Mr. Gillies) this afternoon. He is a member for whom I have the highest regard, but I think there is a bit of politics in the attitude of the Conservative party when they urge temporary controls for 90 days because-


James Aloysius McGrath: A temporary freeze.


Ross Mackenzie Whicher: Or a temporary freeze.


James Aloysius McGrath: There is a lot of difference.


Ross Mackenzie Whicher: In my opinion, a temporary freeze of 90 days would simply not be long enough. We may as well let the Canadian people know the truth right off the bat. There should be controls for two years anyway, because 90 days will not even let us get going. It will give us time to conduct a study, but it will not be long enough.
It has been said that we live in a democracy, that the average Canadian citizen is not ready for controls and that the average Member of Parliament, wherever he may sit in this House, is not ready for controls. I remind you, Mr. Speaker, that sometimes in a democracy you have to give up a little bit of freedom in order to keep democracy in the long run. In my opinion, the citizens of Canada have to give up a little bit of freedom and accept controls, and I am sure they will, in order that we may remain a democracy for many long years to come.


Some hon. Members:: Hear, hear!


Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, if I believed that democracy could be saved by controls I would think more favourably of controls. But I should like to know of a single instance in world history where democracy has been saved by that route. That is the route not of democracy but of disaster and hysteria. There are times in a democratic society when controls are required, but let us not have any illusions about what those controls do over extensive periods of time. If I thought for one moment that controls of one kind or another would further the cause of democracy or assist our society, then as reluctant as I might be I would go along with it. But in my view, Mr. Speaker, there is no evidence to support such an argument.

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All of us would like to think that there is an easy way to end inflation. This afternoon I listened to the hon. member for Don Valley (Mr. Gillies) express the rather wistful hope, with an evangelical appeal, that all we need is good will amongst men and then this thing would work. I only wish it were so. I have the greatest respect for the hon. member but in this particular case I really must question his judgment. The things he suggested are not going to correct the serious problem that inflation has become, not only in Canada but internationally.
To suggest a 90-day freeze is to assume that inflation is a psychological problem-it is in our heads and therefore the Conservative party is going to knock it out of our heads in 90 days. It is sort of a couch for the whole nation on which we get security after 90 days. Surely those of us who have worked on committees dealing with economics know that inflation is a worldwide problem with deep roots, and is not going to be solved in 90 days or cured by psychological attacks on it.
We all read the polls, and it is true that the people of Canada are very much disturbed about the problems of inflation and their security. If you were to ask the people in a straightforward way, without any qualifications, if they want an incomes policy, if they want controls, I think because of this insecurity there would be a tendency to say that they want it. But it is important to follow that question with a series of questions asking to what extent they are personally willing to accept controls on their incomes. We would find then that the percentage of support would drop substantially. I did a poll of my constituents and asked this question. Many of them replied that they personally were not the problem. Mr. Speaker, it is always the other fellow who is the problem. For the worker, the boss is the problem; for the boss, the worker is the problem; for the consumer, it is the farmer; and the farmer remembers the lean years and thinks everybody else is the problem.
Knowing how the people feel, I think we do a terrible disservice to the nation to prey on their insecurity. At the very best, the suggestion of control is a futile gesture and at the worst a cruel joke that will end in frustration and anger. I am not suggesting for one moment that those who are advocating it see it in that light, but I hope hon. friends to my right will excuse me if I express myself forthrightly and say that I see it in that light.
How will it work? After all, some of the people who are advocating this policy are very intelligent. I do not for one moment discount the background and knowledge of the hon. member for Don Valley. I may have reservations about some of his colleagues, but none about him. So how will it work? Would somebody explain that to me because I, too, would like tranquility. I do not like to see prices rising and Canadians disturbed every time they go to the supermarket or buy a gallon of gasoline. I would like to have some kind of wand to wave over the situation- whether 90 days or 120 days-so that the whole thing would go away like a bad dream. I do not know how it would work, Mr. Speaker; all I know is that it would benefit relatively few people.
The first thing that comes to mind is that the old age pensioners must surely benefit from a price freeze. The old

age pension is now geared to the cost of living, so perhaps there is less urgency in that direction. But suppose the price freeze had been suggested two or three weeks ago when parliament was proposing to increase the old age pension-would the old age pensioners have benefited, or would they have been frozen into a situation that could not be corrected for a long time? What would have been the answer of government, Liberal or Conservative, in a case like that? We know the Liberal answer. Would the Conservatives have answered in a better way, or would they have said that the 90-day freeze would stick because if an exception was made for one group then another would want to be excepted, so there would be no increase in the old age pension?
I recall when the government of Canada, in one of its most confused states when it had a majority-that always tends to confuse the government of Canada-decided that the most serious problem facing this country was inflation and that they were going to fight it to the death. They did not care how many people they threw out of work, Mr. Speaker-and they threw a lot of people out of work. We kept asking, as did the Conservative party, for an increase in the old age pension, but it was refused because we were in a fight against inflation.
We saw the old age pensioners of Canada held as hostages in that silly and futile fight that could not be won. We might have had an increase in the old age pension two or three years ago had it not been for the attitude of the government that they could not give an inch in the fight against inflation. We think the last election cured the Liberal party, or at least some of them. Is it going to take another election to cure the Conservatives as well?
Take the problem of the poor. Are they to be frozen into a situation they do not deserve? Are they living in affluence now? Are they contributing to inflation? Are they to be penalized because of a freeze? How do you help them when you freeze them? Suppose the government exercised worse judgment than it has in the past and listened to the Conservative party and brought in a freeze. What would it mean to the family allowance? We are trying to get it introduced in July because we do not want to wait until the end of the year. It should be done now. If there were a 90-day freeze, there would be no increase in the family allowance or any kind of transfer payment no matter what the merits of the program. Is this what is being suggested to parliament as an intelligent proposition?
Then what about the farmer? We warned everybody about the problem two or three years ago when the farmer could not even cover the costs of production. Some other members spoke in this House on behalf of the farmer, but we raised the uproar here and in the country when the farmer could not get a decent return for his work. Now that he is starting to get it, are we to decide that he is to be frozen and has to pay the price? Perhaps it could be said that the industrial workers have strong unions and should be stopped because they are making more than other people. Every attempt in this direction has failed. We sometimes point to Sweden as a model of industrial peace and intelligent labour-management relations. Once a year everybody sits down to a discussion. That is all very well, except that in Sweden they have a disease called "creep". This means that if there is a tight labour market and a
May 10, 1973________________COMMONS DEBATES_______________________3645
particular worker wants a little more money, management will somehow find a way of paying it to him. So where is your freeze?
The only time the marginal worker in our society gets a break is when there is a labour shortage, when there is a tight labour market, at which time inflation rates may be somewhat higher. At such times management may look at the marginal worker and say, "Well, he does not see so well or hear so well and he is not quite as fast as he should be. But, damn it all, we need him and there is a job for him." Then the worker can bargain for better conditions even though he may not be in an organized group. Will you ask this man to pay the price of your intellectual freeze? I would not ask him to do it.
On the other hand, perhaps you will say that the economy benefits. Perhaps stepping on all kinds of people is worth it as long as the economy benefits. What is the evidence in support of that proposition? The evidence is that when Canada has done better than other countries in the fight against inflation, we have had a national disaster. Two years ago Canada had the lowest rate of inflation among industrialized nations, but what did we get for it? We got a rising dollar and the highest level of unemployment in the western world. That is what we got for our successful fight against inflation.
The important question to ask-as my leader pointed out this afternoon and as the hon. member for Don Valley must know-is, how well are you doing in relation to your chief trading partners? I take a serious view of inflation but I would take an even more serious view if our record in trying to control inflation was much worse than that of our chief trading partners, because then we would be in serious difficulty. If we operated under a fixed exchange rate, our position would be serious. However, that is not the case. We are operating under a floating exchange rate and we have been doing as well as, if not better than, our trading partners in this area.
In which way will our economy be helped if we try to control inflation beyond reasonable bounds and thereby impose intolerable burdens on the people as we fight this battle? That is the question I ask. I keep asking myself, what are you to do and how are you to do it? Let us talk about equity and business, and again I shall refer to something my leader said this afternoon. It is easy to control wages because they are open and above board and there is not much elbow-room for the worker. But what do you do about business profits? Who benefits from the freeze? Presumably you attempt to control everything. Are you going to control the businessman and his profits? How? There is no way to control a businessman's profit in that kind of situation.


An hon. Member:: What about taxes?


Max Saltsman: You cannot even do it by imposing taxes. We tried to impose additional taxes during the war.


An hon. Member:: There was the excess profits tax.


Max Saltsman: Yes, we had the excess profits tax. But many businessmen did not allow their profits to reach the
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high point at which they would be taxed. If you are a businessman you make a rational judgment. You see what is happening in your company, and if you find that the government will penalize you heavily if you make profits in excess of, say, 10 per cent you will make darn sure that you never hit the 10 per cent level. There are many ways of disseminating the benefits of profits. You can build nice new buildings with air-conditioned offices. People can have improved amenities; the company cars become bigger and the expense allowances more liberal. Holidays become more frequent. Before you know it, you have destroyed what is a valuable feature of the free enterprise system, perhaps its only valuable feature, the urge to become efficient in order to make profits.
The excess money is disseminated in this way because businessmen will want to make sure the government does not collect it in taxes. How will you force them not to do this? How do you force a doctor to work if he is not satisfied with what he is getting? How can you say to him, "All right, you can make $30,000 a year but no more." If the doctor knows he will not make more than $30,000 a year, he is not going to break his back in order to earn another $20,000 which the government will take. So do you think he is going to keep on working after he has made a certain amount? I hear somebody laughing in the gallery. There must be a doctor there. I wish human nature were otherwise. We in my party hope that some day human nature will be otherwise, but do not be a dreamer and do not tell tales which lack credibility and arouse false hopes in people.
In giving figures this afternoon the hon. member fcr York South (Mr. Lewis) showed what happens to profits. If they are not paid out in dividends, they go into retained earnings. There are all kinds of ways to get around this problem. For instance, how do you control the rate of return on money; in other words, interest rates? You cannot control them through the Bank of Canada because those rates are an international phenomenon. What would happen if you decided, for instance, to set interest rates in Canada at 3 per cent? What would the people with savings in Canada do? They would immediately take their money out of Canada to where they could get 8 or 9 per cent. In that case you would not be embarked on an incomes policy; you would be watching the border, introducing capital controls and monitoring society in a way that is intolerable. I should like to stop many of these things. Certainly there are many things wrong in our society. But every time I think of stopping them I ask what would be the price. That is the question hon. friends to my right are not asking.
There may be some who would benefit from the conception of a 90-day freeze. At the risk of being misunderstood, let me say there are some politicians who are so committed to power that they are willing to say anything that will benefit them. Some politicians are prepared to play on the legitimate fears of our society. They know people want stability. They know some people want wage and price controls, or think they want wage and price controls. I am not prepared to argue about that. What are you to say to the people? Should you not say, "I know how you feel and I know what you would like, but there are many, many problems associated with trying to do as you would like.
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Let me explain this matter to you so that you may know what price you will have to pay if we do as you want."
I suggest that that is the attitude responsible politicians should take to the question of wage and price controls. If you adopt an irresponsible attitude when you know the price that must be paid, but keep quiet and simply feed on the fears of our people, you are not serving society. Even if an election were to be won on that basis, it would be a Phyrrhic victory for the people involved.


Some hon. Members:: Hear, hear!


Max Saltsman: Recently the government of a country not far from our own embarked upon that kind of program in order to win an election, and the people of that country are now paying for it. I hope the people of this country will not have to pay the same kind of price.


Mr. Speaker:: Order, please. I ought to bring to the attention of hon. members that there are just about 40 minutes left before the end of this debate. I notice that three hon. members seek the floor, the hon. member for Lisgar (Mr. Murta), the hon. member for Joliette (Mr. La Salle), and the hon. member for Rimouski (Mr. Allard). I hope that, perhaps not necessarily as a result of any formal agreement, there might be an understanding among hon. members on limiting the length of their speeches so that we may bring these three distinguished participants into the debate before ten o'clock.


Mr. Jack Murta (Lisgar):: inflation the farmer is experiencing. Third, it is consistent with a new and comprehensive agricultural strategy that will assure improvements, and sustained improvements, in income for producers. In their briefs to the special committee on food prices the Alberta government and others urged this government to establish a food chain intelligence system. Their responsibility would be to maintain a continuing vigilance on the factors that contribute to food costs in all sectors of the food chain. That certainly is not being done at the present time.
In the first three months of this year farm input costs increased by 6.1 per cent, an increase of 10.2 per cent in the past year. How can a government suggest that rising food prices will mean income gains for the farmer, with costs rising at such a rate? How can the government suggest a food prices review board will be able to do anything while farm operating costs are increasing at such an accelerating rate? We propose that these input costs should be frozen for 90 days and a policy introduced to provide permanent relief against such cost pressure.
One very important feature of our proposed stabilization plan is that farm prices will eventually have a ceiling. This must happen if all other segments of agriculture are in the same position and are also frozen. As an example, the input of meat packers would be limited. After the live beef cattle move from the farmer to the packer, the price would be frozen at that point. The ceiling that would be imposed on farm commodities for the proposed three-month period would only be imposed under what this party considers to be emergency conditions such as we are experiencing at the present time. At the present time farm prices are at an all-time high. It should be stressed that there would be absolutely no move to impose temporary controls such as we are talking about tonight if prices of commodities were not at their present high. If prices were not high there would not be the need to take the kind of measures we are talking about this evening.
Food prices are not rising primarily because of accelerating demand and will not be abated by telling people to eat less nutritious food. In this affluent age it is not a luxury, it is not a privilege; it is a right to expect to be able to eat decently, to drink milk, to eat eggs and meat. The greatest single cause of escalating food prices is supply and industrial policies which have failed to assure food production at levels consistent with steadily increasing and predicted demand.
The main source of this failure is the government. In the area of marketing practices the government has displayed an incredible amount of shortsightedness. Instead of marketing boards promoting shortages, as has been the recent vogue, the government should be actively promoting an expansion of production. To ensure that farm incomes remain reasonable, marketing both at home and abroad should be more aggressive. This has been stated many times by hon. members on this side of the House. This is of particular importance in light of the recent emphasis placed by the United States on the expansion of agricultural production.
Canada will find it increasingly difficult to compete with United States' commodities unless our marketing
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system becomes much more active and much more responsive rather than allowing farmers and consumers to be at odds with each other, as epitomized in the statement by the Minister of Agriculture. Governments should take direct action to head off the major source of the farmers' problems by heading off rising costs. Perhaps the greatest failure has been the government's total ineptness to allay the inflation psychology in this country which is running rampant at the present time. Wage earners, expecting another year of high inflation, have during the first quarter of this year settled for a 7.5 per cent increase in wage rates.
The approach we have taken to the marketing of agricultural products in Canada is anything but market-oriented. Our static view of the market is out of step with a fast and dynamically changing world. Great rewards appear likely to farmers and to the agricultural industry as a whole if Canadians change their perspective in this regard. We on this side of the House have long advocated various methods of expanding the food supply by offering incentives to producers and ensuring, to the best of our ability, that their products will be sold not only inside Canada but in our expanding export market.
Looking at our total trade picture, I see there has been a steady narrowing of the trade balance in agricultural products over the past seven years. Canada exported about $1.4 billion worth in 1968 and imported about $1.1 billion worth. If one excludes wheat, Canada is a net importer of farm products. This situation has changed over the last year, but not as a result of a more aggressive approach to marketing. It is basically because we are running into a situation of short supply throughout the world. No one is talking at the present time about an abundance of farm products; there is a scarcity, as the Minister of Finance (Mr. Turner), continually reminds us. Has the government been working in the last three years to expand agriculture and make it more self-sufficient? No. The government has been working like mad to increase impediments to production.
The Minister of Agriculture delivered a speech on March 4 which, if it was read by many agriculture producers, would have quite a startling effect. He was talking about an area of Saskatchewan and said that pork aad beef producers in that area appeared to be gun-shy of marketing boards. He went on to say:
Frankly, I think producers would be much further ahead to take an objective look at what the system could offer to their industry, and see how marketing boards and agencies could be put to work for them, and not against them.
There has been a lot of controversy about marketing boards. The beef industry has rejected them. However, the Minister of Agriculture appears bent on moving toward a system under which all agricultural products would be covered by such boards. It was also mentioned this afternoon that the Minister of Agriculture, who has been talking so much and who has been the champion of the farmers to such a great extent-


Some hon. Members:: Hear, hear!


Jack Burnett Murta: -has been in agreement with some of the following measures which have been enacted over the past few years, measures which have restricted the marketing
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May 10, 1973
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ability of the industry. One of these was, of course, the Lift program. Another was the amendment to the Farm Products Marketing Act. At the present time this whole question is before the provincial courts. Last year the government spent $2.25 million to reduce egg production, and of course the situation at present is that supply is short. Is this an efficient way to improve the income of egg producers?


Stanley Ronald Basford: Yes. They are getting the highest prices in history.


Jack Burnett Murta: To sum up, Mr. Speaker, I think it must be stated again that farm prices would eventually be frozen at the present level. Prices at the farm gate, which would cover live cattle, hogs and so on, and possibly fresh vegetables-any product which had not reached the processor or was still in the hands of the producer-would not be affected. This would allow for any movement of products in North America, that is, the intercontinental movement of products, and in this way agricultural trade would not be impeded. This would last for a three-month period and would only apply if farm prices were at their present levels. As I mentioned earlier, there would be no need to use this formula if agricultural prices were low.
I have two more points. The agriculture committee will be fully involved in all stages throughout the duration of the total plan. Prices of all agricultural input such as seed, fertilizer and agricultural machinery would also be frozen. The selling price of products may be frozen, but on the other hand rising costs will also be curtailed. If our program is to work, all segments of society must be involved. Accordingly, I believe agriculture must play its part and must work along with society. In the present circumstances, having regard to the inflationary spiral which persists today I believe this program would be acceptable.
[ Translation]


Mr. Eudore Allard (Rimouski):: Mr. Speaker, since three thirty this afternoon we have heard hon. members of the opposition and the government speak about inflation. The Canadian people are aware of its existence; it is nothing new, neither to us nor to the Canadian people. But not one of those members was able to suggest a solution to the present problem or tell us how to remedy the situation otherwise than by freezing prices. We Creditistes believe that there is a better way.
The committee on food price trends presented its first report on April 2. It suggested no solution to the problem of increasing food prices. It was unable to do so because it did not tackle the fundamental cause of high food prices. Alerted by the general demands and protests of consumers who have a hard time making ends meet, the government has chosen to create a special committee of the House to fight against increasing prices. And as was to be expected, the committee has brought forth a first interim report advocating, as a solution, the creation of a "super committee" to inquire into price increases. We are not told how this committee will be created, who its members or what its powers will be, but anyway they wanted to give the Canadian people the impression that they had considered the problem of rising consumer prices.

So what happens now? To remain in business, any producer must sell his products at a price at least equal or superior to the total amount he must spend to market them: raw materials, manpower, transport, maintenance and depreciation. All costs and expenditures of the producer must be included in the price of the finished product.
In the course of production, the community has received in the form of payments for raw materials, wages, transport, telephone and heating costs a total amount equal to total costs. Theoretically, consumers can buy the whole production, because the sums expended in the course of production and which are now in the hands of consumers are equal to the total costs and therefore to the total prices. Indeed, this is why the opponent of Social Credit can say that production permits the purchase of consumption, for the moneys paid out during production are equal to the overheads, and are thus equal to the total prices.
Let us take the producer and state the problem as if the producer sold directly to the consumer, without going through any middlemen. The latter do not change the elements of the problem; at worse, they just complicate it a bit. In order to remain in business, the producer must sell his product at a price equal to at least the total production costs. The cost of the raw materials, the cost of financing, the depreciation of plants and tools, the cost of transportation and communications, the cost of insurance and manpower, all the costs involved go to make up the final price of the product.
Taken overall, the community has received during production, in the form of payment for goods, services or salaries, a total amount which is equal to the overall cost of production. This is what we mean when we say that production permits the purchase of consumption, because the moneys paid out during production are equal to the overheads, and thus equal to the sum of the prices.
What about the producer's profit? Let us suppose that the producer wished to receive, not just a sum equalling his production expenses, or overheads, but, by means of the prices he asks, a sum greater than the actual production costs, so as to make a legitimate profit. The total of the prices will then be greater than the total costs or the total production expenses. This means that the purchasers will not have enough money in hand to buy the total production, at the set prices.
The reason for this is that the producer, who is in business to make a profit, does not pay out this profit during production, but obtains it from the consumer, by means of the prices that he sets on his products.
In other words, the retail price of a product is always higher than its actual cost. As only an amount equal to the actual cost is distributed during production, there results a gap in the community's purchasing power equal to the difference between the retail price and the actual cost.
As the community needs the production offered and its purchasing power falls short of the overall cost price, it borrows money, it runs into debts. This is the true reason for the entire community running into debt with finance companies, loan companies and banks.
Thus, the economy manages to work somehow or other, rather badly than well. With the years, debts go on
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increasing and reimbursements become harder to make. The costs of those debts are in turn added to the new price aggregates which go on increasing and inflating to such an extent that authorities become upset and finally yield to the hues and cries of disapprobation and appoint an enquiry commission.
Is profit to be eliminated? We cannot control prices. Price is made up of costs. There is no use cooking up figures to lower a price from $10 to $9 if the final cost of a finished product is $10.
Some people suggest to restrain profits, even to eliminate them. It is the drastic solution of Marxists and mini-Marxists; let us abolish profits! But if a manufacturing industry does not allow its owner to make a living or does not allow its directors to issue reasonable dividends to stockholders who finance the industry, it is going to end production and direct its operations toward more profitable areas.
Profits kept within reasonable bounds are an incentive, and encouragement to produce. The effect of good competition is to keep profits within reasonable bounds.
Faced with prices which steadily increase, consumers need more purchasing power. Presently, they are trying to get it by higher wages or higher social benefits. Those higher wages and welfare payments are in turn reflected by prices which will increase proportionately. Therefore that is not the solution we seek, even if specific conditions have to be improved.
What we need is a purchasing power supplement that will go to the consumer without going into prices, namely a new purchasing power directly distributed to the consumer after having been directly created by the state's financial organization.
The other solution proposed by the Social Credit consists in having consumers pay only the actual cost of the product.
If the actual cost of a suit is $80 and it retails for $100, the consumer will pay only $80 for the suit which retails for $100, while the difference between the retail price and the actual cost, namely, $20, will be paid as compensation to the retailer by the central bank whose duty is to establish and maintain a balance between total expenditures related to production and the total cost or the purchasing power distributed in the course of that production.
The only compulsion element to be taken into account in that solution is the profit factor.
But nothing would be simpler than setting a rate of profit for any given type of products, or for any given class of producers.
So that would be a just and worthy solution to the problem, not only food prices but all consumer prices as well.


Roch La Salle: Mr. Speaker, in the few minutes that I am allowed, I wish to thank the member for Rimouski (Mr. Allard) who, I believe, cut short his speech in order to give me a chance to say a few words.
I should like to take part in this debate on the official opposition motion, which deserves the attention of the
Increased Cost of Living
House. Judging by the speeches I have heard, we are clearly still trying to find out who is responsible for the inflation.
We have heard hon. members making certain criticisms, some fair some not so fair, some rather harsh. I think that when the Minister of Finance (Mr. Turner) ran through all the legislation introduced by the government in the last four or five years, he was quite right in saying that the government had made great attempts to combat inflation, and I think also that we are quite right in saying that, in spite of all its efforts, it was completely inadequate, not to say a total failure to achieve their aim of stopping inflation, which is costing every individual a tremendous amount today.
The Progressive Conservative Party's motion certainly deserves our very close attention. I was very glad to hear the hon. member for Bruce (Mr. Whicher) say: We should not freeze prices for nine months, but for two years. It seems to me that the Progressive Conservative Party has put forward a limited proposal which, as I have said, nevertheless deserves consideration. However, one member claims that for a measure to take effect, it has to be implemented for at least two years.
As for the New Democrats, they naturally disagreed with the Progressive Conservatives. Just now they blamed the government for not having succeeded in fighting inflation, but I did not hear them suggest any real solutions.
The Social Credit Party also gave their opinion. Personally, I do not necessarily believe in the solution recommended by this party. I shall therefore not go too lengthily into the opinions expressed.
With limited time, it is of course difficult to make an in-depth study of the problem. However, I should like to express in this House the concern of Canadians about this problem and the feelings of all hon. members by saying that it would be urgent to refrain from criticism or partisanship regarding such an important issue. Canadians badly need a solution.
Who is in a better position than hon. members to find one? I feel the government has a major responsibility to assume, being in charge of governing the country. Of course, opposition parties, any of them, and hon. members should co-operate and submit the best ideas, the best opinions, the best suggestions to the government. But of course the government would have to be willing to accept suggestions voiced by different members or different parties.
It would be to the government's advantage.
I know it has been meeting businessmen; it should multiply those meetings with businessmen and make them understand that they are heading for disaster if they keep on anticipating such enormous profits.
I also think that the unions should be made aware of the danger involved in certain collective agreements and requirements which necessarily entail salary increases and so on.
We are perfectly aware of the fact that we cannot leave it to agriculture or a few small industries to solve the problem called inflation. We are quite aware that surely a small group is not responsible for it. Businessmen, indus-

May 10, 1973
Increased Cost of Living
trialists and the government are also to blame. The latter should apply the necessary controls. As mentioned earlier, we are always afraid of imposing controls and I think that because of the importance of this problem, the government, as the administrator of this country, should nevertheless discharge its responsibilities and will have to adopt unpopular solutions if we really want to serve the interests of society without partisanship.
It often happens that as members of Parliament, we know that a measure is unpopular but it is our duty as responsible people to adopt this measure. Even though a price freeze may be unpopular for certain groups, I must admit that some members are in favour of it and have the courage of proposing it.
Of course, one might reject this suggestion as inadequate, while acknowledging the major efforts made by the government. Once again we know that huge amounts of money have been invested to improve the unemployment situation, etc., but we also know that in spite of those millions spent over the last five years, unemployment is now three times as high as in 1968.
Is the government the only one to blame? Of course not. Due to circumstances, some problems arise; the economy is unsound but we would often be tempted to justify ourselves by saying that it is worse in the United States, that other European countries are in a worse position, that others have more problems than we do. We would be easily satisfied if we entertained such thoughts.
The government must assume its responsibilities. The whole country hopes that our Parliament, political parties, members of Parliament will succeed in finding again an objectivity which is not often seen in this House. In the face of such an important problem, difficulties and dangers involved, when we speak about inflation and economic uncertainty, which many people are understandably concerned about, I suggest that as members of Parliament, we must go beyond partisanship and try to convince the government and urge it to approve specific measures likely not only to reassure the Canadian electorates, but to introduce changes which might seem to be concessions on the part of the government to the extent that they would be likely to reassure people and strenghten our economy. I believe that we must act in this direction.
Therefore, any proposal, at present, must be seriously considered, because we must admit that the government, in spite of its efforts, has not succeeded in finding the right solution.
For my part, Mr. Speaker, I shall not boast that I have the right solution, but I suggest that important meetings with businessmen, industrialists and union members as well as a price freeze would not be enough, considering the very high level of prices. But I feel that a 90-day period of reflection could be extended, should it prove too short, as we know full well that a long period of price freeze should be accompanied by a wage freeze. I therefore believe that we should weigh carefully the suggestions that have been made. Above all, we tried to be objective, that our Canadian parliament might find a solution to this serious problem.

[ English]


Mr. Deputy Speaker:: Order, please. It being ten o'clock p.m., it is my duty to inform the House that pursuant to section 11 of Standing Order 58 the proceedings on the motion have expired.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, on February 26 I raised a question with the Minister of Manpower and Immigration (Mr. Andras) concerning the activities of the Unemployment Insurance Commission, more particularly the benefit control officers in the area I represent. While three months have passed since then, the whole question of unemployment and the way it is being administered is still quite relevant. As a matter of fact, we received just last month the interim report of the advisory committee on unemployment insurance, and I shall refer to that in my remarks tonight.
The matter about which I am most concerned is the treatment of seasonal agricultural workers in my riding. The county of Norfolk is a cash crop area, perhaps one of the most concentrated cash crop areas in Canada. We are heavy employers of seasonal labour to harvest our crops. A great many of these people are of origins other than Anglo-Saxon, many having come to our country from Belgium, Hungary, Germany, Poland and many other midEuropean countries. The people of the first generation of these immigrants are still active in the agricultural industry in this area and many are unable to speak English except in a very rudimentary way. Some can scarcely understand it when it is spoken to them, and they cannot read it let alone write it.
It is against this background that I wish to discuss with the government and the minister, or his representative, the problem that has arisen as a result of this situation. Seasonal agricultural workers have been forced into the unemployment insurance program. Some have been disentitled and disqualified almost on a wholesale basis, chiefly because they are seasonal workers. This is their type of work. They did not want to come under unemployment insurance in the first place, and previously they were excluded. The present situation is that if they work 25 days or less, they do not have to come under the plan, or if they earn $250 or less they are not included; beyond that they are included and have no choice.
I do not want to be critical all the way through, but I would suggest to the government that these people now be
May 10,1973

given the privilege they once had of opting out of the program. This would apply only to seasonal agricultural workers. They would have the choice either of coming under the plan or not. They did not want to come under it. They object to having deductions made from wages during the harvest season, which they consider to be found money. Many of them do not need the work too badly in the first place. The employers, largely farmers, detest the bookkeeping involved and if my request were adopted it would remove one of the great headaches that now plague the officers of the Unemployment Insurance Commission. I think this is a reasonable suggestion to make and I hope the parliamentary secretary-I am happy he is here and is paying attention-will take it to the minister, because I believe this could be done through regulation and without a major amendment to the act.
I now wish to refer to the other portion of the problem in my area, which relates to language among the ethnic groups. I refer to pages 8 and 9 of the interim report of the advisory committee on unemployment insurance. On those pages we have the findings of the benefit control officers. By and large they are given a clean bill of health. It is said that they are not harassing individuals interviewed and they try to be as helpful as possible. However, many of these people do not understand English. They do not understand the import of what is being asked. They do not understand the report or statement when it is read back to them.
I would suggest to the parliamentary secretary, and through him to the minister, that a claimant when being interviewed have the privilege of an agent to represent him, either to translate for him or to interpret the meaning of what is being asked and the statement he is making. Benefit control officers by and large try to be straightforward. I do not think they intimidate the people. However, their interrogation procedures are a little questionable. Sometimes the people are asked whether they have a babysitter in a home where the wife is a worker. The wife says that she has not. Obviously, she has not when she is not working. The report goes into the insurance officer stating that there is no child care arrangement, and she is therefore disqualified on the ground that she is not available for work.
A similar situation occurs when they ask whether or not a person has a car for transportation. The person concerned may not have a car now, but if work is available can obtain transportation. However, the person is not asked that type of question. The insurance officer who makes the decision is not the person who carries on the interview. All he sees is a sentence in the statement saying, "No child care arrangement". I do not think this is quite fair or above board. I think this problem could be cleared up if there were an agent with the claimant to advise and to translate for him.
Then on top of that, these people have the fear of many immigrants from iron curtain countries when a government agent comes into their home. They are petrified. They will say anything. They will answer anything and will sign anything in order to get the man out of the house. Then after talking to their neighbours they have a very grave doubts about what was said and done, but it is too
Adjournment Debate
late. Along comes the yellow slip from the Unemployment Insurance Commission stating that they are disqualified.
I wish to make one final point. In our area there are a great many people who are financially independent. They have no need of unemployment insurance or seasonal employment. They see their neighbours drawing unemployment insurance benefits because they are unemployed. This is not right. The public sees this and it creates a bad image for the Unemployment Insurance Commission and what it stands for. In order to weed out these people I think there would almost have to be a means test. I do not know whether that is practical; I will leave that to the parliamentary secretary, the minister and his officials to decide. It seems to me it could be done by regulation and that it would be very easy for a benefit control officer to decide whether a person was entitled to benefit. There is more I could say but I have used up my time. I appreciate having had the opportunity to state my case, Mr. Speaker.


Mr. Mark MacGuigan (Parliamentary Secretary to Minister of Manpower and Immigration):: Mr. Speaker, the Unemployment Insurance Commission does not have any program designed to deliberately and specifically disentitle any claimants. However, the commission does make investigations where there are indications that job vacancies do exist in the same or allied areas.
The situation with regard to the hon. member's constituency is that a number of seasonal agricultural workers have been interviewed since January 2 of this year. These persons were mainly employed in the tobacco industry where work is of a seasonal and unskilled nature. Labour force information indicated that job vacancies were available in the area and resulted in the commission's investigations. In other words, from our viewpoint we are not doing anything different with respect to unemployment insurance in the hon. member's constituency than we are in any other. If I understood his submissions, they were in effect that we should do some things differently in his constituency.
With respect to the language problem that the hon. member posed, I am fully in agreement with him. In all parts of the country, where it knows in advance that there are sizeable numbers of people who speak languages other than English or French the commission makes a serious attempt to have there officials who speak those languages, to enable the interviews to be conducted properly. I think this matter should be investigated with respect to the constituency of Norfolk-Haldimand to see if such language fluency is available to UIC officials there.
The other point the hon. member raises, to change the legislation so that these agricultural workers would not be included within the purview of the act, is a more difficult one. I will bring it to the attention of the minister, but I am sure the hon. member realizes that the intention of parliament was to include all people who were employed, and to make any exception might lead to difficulties because it could lead to claims for exemption by other groups. However, this matter will also be reported to the minister and to the commission.

May 10, 1973
Adjournment Debate


POST OFFICE-STEPS TO INCREASE COMPENSATION OF RURAL MAIL DELIVERY CONTRACTORS
Mark Willson Rose: Mr. Speaker, over the years in my responsibility as Member of Parliament for Fraser Valley West various problems associated with rural route mail contractors have come to my attention. In certain instances practices relating to tendering and to contract terms have caused frustration, and in other instances real hardship. To be more explicit, Mr. Speaker, because of the nature of tendering, in order to secure a contract often unrealistically low bids are submitted to and accepted by the Post Office Department. Only after the successful bidder has experienced the realities of daily hours demanded, costs required, and the inflation factor, to perform the mail deliveries in a satisfactory manner does he become fully aware of whether or not his bid accurately reflected a fair return for his financial investment and effort.
Should the contractor discover that he has underbid, the contract he has signed makes impossible any upward revision for two years following the signing date, save under exceptional circumstances as laid out in the contract. In a riding of extreme growth, such as Fraser Valley West, the limitations of the contract can so restrict the contractor that long before the termination date his number of stops might have doubled compared with those at the date of signature, with little or no corresponding increase paid for the extra work. In contrast, all construction contracts with the government contain escape clauses to deal with unforeseen circumstances.
The implication involved in the points I am attempting to make is that in some cases at least the local, rural mail contractor is subsidizing the Canadian Post Office Department. Certainly my information leads me to believe that rural contractors, and perhaps subpost office managers, are the only group in the postal delivery system that have no collective organization to bargain on their behalf with the government. The lack of such an organization has perhaps contributed to the fact that rural contractors generally have fallen behind the letter carriers and postal workers in coping with the rising cost of living.
Because I felt this to be of vital interest to many people in my riding, I went into it in some detail. About a month or six weeks ago the minister suggested that all members representing rural or semi-rural ridings should write to him and suggest methods to make the situation of the rural mail contractors more equitable. There are some 23 rural contractors both centrally and peripherally in my riding. I met with them, and I have a number of recommendations that I would like to deal with now. Because they are not organized, contractors suffer from the tender system and from inflation. They do not enjoy the fringe benefits afforded the organized section of the postal system such as UIC, transportation to points of delivery or uniforms.
One recommendation is that they be paid an hourly rate which might be equivalent to that of postal clerks, which at the moment is roughly $4 an hour. That should be part of any future formula considered by the Postmaster General (Mr. Ouellet) and his officials. Another recommenda-

tion relates to car allowance. These allowances are decided locally and vary from 12 cents to 20 cents a mile. I recommend a more generous car allowance, perhaps 25 cents per mile plus the additional 30 per cent insurance cost which must be met because the vehicle is used for business. It might be noted here that these people must be bondable; it is a responsible job and an important one.
There should be a fixed formula for the growth factor within a route. It is also seriously suggested that when a route has reached a certain size, it should be split. Perhaps the size should bring in about $10,000, or an average living wage. We should stop thinking of this as a part-time job, because in many cases it is not. It amounts to a full-time job because people have a substantial investment in the vehicles necessary to do the work. They also have duties additional to those of letter carriers because they have to sell stamps and money orders and take out parcels.
The matter of Saturday delivery was also mentioned. However, I am not certain that their customers would accept the deletion of Saturday delivery. Nevertheless, they are not recompensed for the extra time compared to other postal clerks or mail carriers. I think we should have an established tender floor in which no one could underbid. Because of the nature of the tender, too many people underbid and then find that they cannot fulfil the contract on those terms. If morale is low, even on the "mail must go through" theory they feel they are being exploited.
On May 7 I asked the Postmaster General a couple of questions about this matter. I know he has been considering the question very seriously and I am certain that the rural contractors, in my riding at least, look forward to his response.


Hon. Andre Ouellet (Postmaster General):: Mr. Speaker, I am extremely sympathetic to the problems currently encountered with respect to some rural mail. And I am in perfect agreement with what the hon. member said and the suggestions he made seem to me to be very appropriate.
However, I would like to remind him that those businessmen are bound by contract with the department and that contract was indeed awarded following the calling of public tenders. So they themselves originally set the amount of the contract. However, it is true that during the period of the contract the contractor can file an application to have his rates adjusted.
Unfortunately, we found that too often the contractor who has to file that application himself does not do so or does so too late and several contractors do not benefit as they could from an increase in their rates. So there is clearly room for improvement and I am prepared to ensure that we will soon come up with a new formula for adjusting rates which will be much more understanding and much more realistic.
Secondly, we will be prepared very soon to base the rates on amounts in line with those paid to members of the Postmasters Association.
Thirdly, it is also our intention to assess all routes as soon as possible in accordance with the new formula I referred to, and we will then make the necessary adjustments so that contractors receive the rates they deserve.
May 10, 1973

Finally, we think that the ceiling of $10,000 is no longer realistic and we are prepared to recommend an amendment to the act so the amount will be increased to $25,000.


CANADA DEVELOPMENT CORPORATION-REQUEST FOR TABLING OF DETAILS OF APPRAISAL OF POLYMER FOR SALE TO CORPORATION
Donald Alex Blenkarn: Mr. Speaker, on March 21 last, as recorded at page 2455 of Hansard I asked the Prime Minister (Mr. Trudeau) to file with this House details indicating that Polymer Corporation was sold to Canada Development Corporation at fair market value. The Prime Minister said he would look into the matter and reply in detail, and that he was informed that an independent assessment had been made which was the basis for the price. I assumed the Prime Minister would have filed that material with this House and I did not expect that I would need to appear on the adjournment debate at this time. I expected the Prime Minister to have some respect for this House and its members, to have the material here, or at least to come personally and explain to the House the matter raised by my question. I am disappointed that he is not here.
Finally, after considerable pressure being exerted, Polymer Corporation, through the Minister of Supply and Services (Mr. Goyer), filed its annual report for the period ending December 31, 1972. To give some indication of the profitability of this company and its hopes for the future, let me read an excerpt into the record from that report. In their report the directors of Polymer Corporation said, among other things:
Polysar has set strategic plans for growth and backed these with operational plans. They are designed to achieve world-wide sales in excess of $500 million, with accompanying gains in profits, in five years' time. The keys to both corporate and personal achievement-the environment, the organization and the systems-have been strengthened. We look forward now with confidence to fulfilling our expectations in the fourth decade in the Polysar story.
This was the corporation that, at a supposedly fair market value, was sold at half the book value. It was illegally sold by this government, Mr. Speaker, because I submit the Canada Development Corporation Act requires that if Polymer was to be transferred, it had to be transferred at fair market value. I repeat, this corporation was transferred at half the book value.
When I asked the question of the Prime Minister I had been led to believe that the deficiency in price below the book value was $42 million. However, after examining the statement of Polymer Corporation for the year ending December 31, 1972, I find that the book value of that corporation was $124,109,000. For $62 million it was transferred. I defy the Prime Minister, the President of the Treasury Board (Mr. Drury), the Minister of Supply and Services and, indeed, any member of the government to show the House one major corporation in the past 50 years of the history of this country that has been sold at half its book value.
Adjournment Debate


Thomas Miller Bell: How about the Bonaventure? That went for nothing.


Mr. Deputy Speaker:: Order.


Donald Alex Blenkarn: They do a lot of things. The Wood Gundy report is suppose to be around. That report supposedly indicates that Polymer was a sad shock and was not worth very much-only half its book value of $62 million, or maybe $72 million if the company was lucky enough to show a bit of profit over a four-year period.
The people of this country have been hoodwinked; they have been defrauded. This transaction is illegal. The Prime Minister does not even have the courage to come here and answer. This is what is called a rip-off. The leader of the New Democratic Party made great gains in the last election by talking about corporate rip-offs. I can understand why he can get into bed with the Prime Minister, because they are both pretty good rip-off artists.
We in this House have been given glowing reports of Polymer Corporation since it was incorporated in the late forties. We have been told of the tremendous investment in growth, patents, development and expertise. If this transaction was at fair market value, Parliament has been misled for many years. The statement given to the minister on December 31 setting out a glowing report of Polymer must be a phony. Presumably the buried report done by Messrs. Wood Gundy was correct and Polymer is a poor goose. I suggest that this House is being goosed and their goose is not being properly prepared. There is something goosey about the whole thing. It is time this House demanded a full accounting of this sorry mess so that we will know what happened to the assets of the people of Canada.


Mr. J.-Roland Comtois (Parliamentary Secretary to the Minister of Finance):: Mr. Speaker, one of the objectives of the Canada Development Corporation, as defined in the act, is to help develop and maintain companies which would be managed and controlled by Canadians in the private sector of our economy. Furthermore, the act requires that the CDC achieve its objectives to realize a profit and in the best interests of all shareholders. Given this undertaking to operate in the private sector to realize a profit and since the CDC must also offer Canadians the opportunity of investing in the Corporation and thus participating in this development, the CDC must operate so that all its operations constitute an attractive investment for all Canadians. It is therefore with this in mind that last year the CDC purchased Polymer Corporation from the government.
While there has been much talk about Polymer's profits, several of its operations were found to have made very little profit and some have led to deficits which have affected the efficiency of this company, to the point that they would be made less spectacular for the period preceding the sale to the CDC.
However, Polymer was to be sold to the CDC at a fair and reasonable price, under Section 39(1) of the Canadian Development Corporation Act which reads as follows:

May 10, 1973
Adjournment Debate
The Governor in Council may sell or cause to be sold to the company, at such fair and reasonable price as may be agreed upon by the Governor in Council and the company, the whole or any part of the capital stock of any or all of the following:
(a)	Polymer Corporation Limited;
(b)	Eldorado Nuclear Limited;
(c)	Panarctic Oils Ltd.; and
(d)	Northern Transportation Company Limited
but subject, in the case of the capital stock of Panarctic Oils Ltd., to any agreements relating to the sale of capital stock held by the Crown.
A fair and reasonable price being stipulated, the government requested that an independent appraisal be made of Polymer. This was done by Wood Gundy which made its appraisal on the basis of strictly financial and economical factors. The Wood Gundy report did suggest an order as to
size for the value of Polymer which was not different from other internal appraisals made by the Department of Finance and of Supplies and Services. On the basis of these reports, the government negotiated with the CDC management and a fair and reasonable price was arrived at.
The Wood Gundy study once completed was to provide a lot of confidential information. As a result, making this information known to the public would be detrimental to Polymer which could incur considerable damage due to the fact that its competitors would have such information.
I hope, Mr. Speaker, that this House will appreciate that the confidential nature of these appraisals reflects among other things the sincerity of the government and their wish to arrive at a fair and reasonable price.
Motion agreed to and the House adjourned at 10.29 p.m.

Friday, May 11, 1973