1973-02-22

PRIVILEGE


Mr. Andre Fortin (Lotbiniere):: Mr. Speaker, I rise on a question of privilege.
I have noticed every morning, to my great annoyance and to that of each of my colleagues, that the French version of Hansard gets to us some hours after the English one. I should be grateful, Mr. Speaker, if this situation were put right immediately. This quite unacceptable delay holds up the work of members who speak only French.
I consider that bilingualism must be applied as efficiently as possible in the House if we are to set the example for all levels of the federal civil service. I believe that monolingual francophones have a right to get just as swift service in their own language as monolingual anglophones do, and that no technical obstacle should prevent the application of this principle.
Therefore, Mr. Speaker, seconded by the hon. member for Abitibi (Mr. Laprise), I move:
That the Speaker of the House of Commons be authorized to take whatever technical measures are necessary for the French version of Hansard to be published as soon as possible every day, like the English version, so that both versions may be available to all members early in the morning.


Mr. Speaker:: I would point out to the hon. member that his proposal is a formal motion and not a question of privilege. He may wish to move it on motions under Standing Order 43.
In any case, I acknowledge that the hon. member has raised a serious point which deserves the attention of the Chair; I will give close and conscientious study to the hon. member's suggestion that the French version of Hansard appear at the same time as the English version.
The hon. member will admit, however, that there is a certain problem and I suspect that the reason for the delayed publication of the French edition is that especially on some days, most speeches are delivered in English. Now those speeches must be translated before appearing in Hansard, which necessarily involves a delay.
It is possible, however, that there would be a technical way to cope with that difficulty and I will convey the hon. member's complaint to the attention of those who are responsible for the preparation and daily publication of Hansard in French as well as in English.



ROUTINE PROCEEDINGS


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, as has been the custom for the past two years, I should like to again this year inform the House, and then send information to all producers in the prairie region, about the initial payments for wheat, oats and barley for the 1973-74 crop year. The practice is to give this information to farmers now, prior to seeding, so that it can play a part in their plans for the next crop year beginning on August 1, 1973.
The initial payment for No. 1. western red spring wheat will be fixed at $1.76 a bushel, which is the same as in the current crop year. The initial payment for No. 3. western six-row barley will be $1.20 a bushel, an increase of 15 cents over the level presently in effect. This is in line with some of the requests from farm organizations. The initial payment for No. 2. western oats will be 80 cents a bushel which is an increase of 10 cents over the current crop year level. All initial payments are "basis in store Thunder Bay and Vancouver". The initial payments for the grades of wheat, barley and oats other than the basic grades I have mentioned will be established by the Canadian Wheat Board and announced at a later date.
It is our expectation that the higher level of initial payments for barley and oats, in addition to the higher level of assured deliveries which will be referred to in letters going to the producers, will encourage producers to increase feed grain acreage over the acreage sown in 1972 and that they will do this even though an increase is expected in the acreage that will be sown.
Producers are also being encouraged to increase production of rapeseed this year in view of the excellent market prospects for the sale of all of these grains and because of the importance of holding our customers in this area as well in making the best use of the acreage available in the Canadian production area now and in the future.


Mr. Jack Murta (Lisgar):: Mr. Speaker, in replying briefly to the minister responsible for the Wheat Board I would hope that on other occasions he would give longer notice to opposition members who are expected to comment on * such statements. This is only courtesy, and I would strongly urge the minister to take this course in the future. In this instance, the statement was received about two minutes before he stood up to make it.

February 22, 1973
Initial Payments, Wheat, Oats and Barley
As far as the prices are concerned, I think the initial payment for barley of $1.20 is in line with what we on this side of the House have been urging. I am disappointed, though, that there is no guarantee to purchase a set amount of barley and I think this is really the critical item of the three items the minister mentioned. I am also disappointed that he did not say anything about a cash advance in his statement. It seems that if farmers are to receive these amounts of money it will be very necessary for them this spring to have some funds by way of cash advances to help them put their crops in.
A guarantee, though, is possibly more important because I believe, after talking to a good many farmers in western Canada, that as markets are at the present time, unless the government can guarantee to take all or virtually all of the feed grain produced in western Canada we still face the possibility that there will be a very heavy emphasis on wheat production. I think this is very critical. I hope the minister will realize the importance of our feed grain markets being maintained this year in particular, since I think this will be a crisis year for the production of feed grains in Canada. We will hopefully see an enlarged market domestically, and over the next year or two the demand for feed grain will be even heavier.
I believe that the prices announced by the government are realistic. However, for this year at least I think the government should guarantee to take a set number of bushels rather than simply proceed on the assumption that in view of the price of the grain farmers will automatically grow the required amount.


Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, the initial price guaranteed by the government is not unexpected. If we are to have the amount of feed grain or barley we are going to need this year, this is the minimum that could be set as the initial price. It could be argued that the initial payment should be higher, because in the case of feed barley, which is the grade that moves best and is produced in greatest amount, the initial price will be less than the price announced. I hope the minister will announce the initial prices for other grades of barley very soon.
The critical area in crop production in western Canada is probably rapeseed. I notice that the minister says that producers are also encouraged to increase the production of rapeseed this year. That is a nice phrase, but in point of fact the government has done nothing to encourage producers to grow rapeseed this year in sufficient acreages and quantities to serve the markets that have been developing.
Surely the minister is aware that the pricing situation in regard to rapeseed is chaotic. Surely he is aware that one price is being paid at one point in Saskatchewan while a few miles away another price is being paid. Surely he is aware that delivery opportunities between the producers of Saskatchewan and those of other provinces are unequal, and that transportation of rapeseed by rail has not been satisfactory.
It is not good enough for the minister simply to insert that sentence in his statement and leave it at that. If we are to produce the amount we need I suggest the minister must come back to the House soon and announce the
policy of the government so that the farmers will plant the rapeseed acreages that we are going to need this year. In view of the guaranteed initial prices for wheat and barley and given orderly delivery for those grains and a clear road ahead for the farmer, and in view of the marketing of rapeseed in the past, one does not need to do a lot of guessing to know what could possibly occur.
Finally, the minister should clarify his position regarding the so-called two-price system for wheat. Instead of sending out questionnaires and trying to conduct a plebiscite by mail, which incidentally leaves out significant numbers of people with a stake in such payments, the minister had better come to the House and tell the House what his policy is, so we can then refer the matter to the standing committee where it can be properly discussed.


Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, first I must call your attention to the fact that we were given the minister's statement only a few minutes before the beginning of the sitting and we did not get a French translation of it.
By way of explanation the minister says:
I am sorry, but the French translation is not ready yet. As soon as it is completed, you will receive a copy of it.


An hon. Member:: Tomorrow.


Léonel Beaudoin: As usual, Mr. Speaker, we have to wait until tomorrow again and it will be too late to comment on it.
Mr. Speaker, we of the Social Credit party of Canada approve any proper action by the minister responsible for grain production as advance payments to western grain producers to encourage them to seed larger pieces of land so that grain crops are larger and especially to encourage barley and oats crops for cattle feed, to the point where feed grains are produced in large enough quantities at stable prices all across Canada. Also, that they be available on all Canadian markets at profitable prices for production and, finally, so that western producers respond to the demands of those producing cattle feeds all over Canada.


THE CANADIAN ECONOMY
[Stage Direction]
Mr. ]ean-Marie Boisvert (Drummond): Mr. Speaker, pursuant to Standing Order 43,1 solicit unanimous consent of the House to propose a motion in a case of urgent and pressing necessity of interest to all consumers in Canada.
In view of the many attempts made over the past few years to curb inflation, and the fact that such action and the substantial amounts invested to this end did not bring about the results anticipated, the population continuing to face an exaggerated increase in prices, and since all experts at the national and international levels recognize that it is no longer possible, nor human, to curb inflation

February 22, 1973
[Stage Direction]
by decreasing economic growth, a concept which created an alarming unemployment situation wherein all age groups in this country in the immediate past-
Mr. Speaker:: Order. I must interrupt the hon. member. Would the hon. member kindly resume his seat? I must invite him to bring forward his motion. The Standing Order and usage clearly establish that the hon. member can propose a motion, but that it must be quite explicit. If the hon. member includes in his motion arguments he cannot bring forward in the House, I believe he is bending the Standing Order.
I would therefore invite him to tell the Chair and the House as promptly as possible the substance of the motion he wants to put under Standing Order 43.


Mr. Boisvert:: Mr. Speaker, under Standing Order 43, I move, seconded by the hon. member for Richmond (Mr. Beaudoin):
That this House assign the Standing Committee on Finance, Trade and Economic Affairs the tasks of making an in-depth inquiry into the possible consequences of the application of a compensated discount on Canadian goods sold to Canadian consumers, especially with regard to standardizing price increases.


Mr. Speaker:: The House has heard the motion of the hon. member. Under the terms of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: The House is not unanimous. The motion may not therefore be put.


LAKE ONTARIO WATER LEVEL-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Reg Stackhouse (Scarborough East):: Mr. Speaker, pursuant to Standing Order 43 I ask leave of the House to move the following motion:
That the House deal with the need for action by the International Joint Commission to lower the water level of Lake Ontario because the present high level threatens property in the Toronto area and may become more dangerous by mid-summer if such action is not taken and the water rises even two more feet.


Mr. Speaker:: The House has heard the motion proposed by the hon. member for Scarborough East. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimity, so the motion cannot be put.
Lake Ontario Water Level
lTranslation]


FINANCE
Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, pursuant to Standing Order 43, I request the unanimous consent of the House to discuss a matter of the highest importance.
As indicated in the recent federal estimates, Canada has an indebtedness whose interest alone is of the astronomical amount of $2.5 billion for the fiscal year-


Mr. Speaker:: Order! I have just suggested to the hon. member for Drummond that hon. members who wish to move a motion pursuant to Standing Order 43 must do so without any argument, and I would invite the hon. member to indicate to the House as soon as possible-and I repeat, without any argument-the substance of the motion that he wants to put for consideration by his colleagues of the House.


Gilbert F. Rondeau: Mr. Speaker, in view of the fact that Canada will have to pay interest charges of $2.5 million on the public debt during the 1973-74 fiscal year, I ask leave, under Standing Order 43, to move, seconded by the hon. member for Kamouraska (Mr. Dionne):
That this House instruct the Standing Committee on Finance, Trade and Economic Affairs to study the possibility of financing the public capital of Canada through interest-free loans granted by the Bank of Canada at the administrative rates instead of the current rates, and to analyze at the same time how savings thus made could serve to give much needed impetus to the Canadian economy.


Mr. Speaker:: The House has heard the motion proposed by the hon. member. Under Standing Order 43 this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


LAKE ONTARIO WATER LEVEL-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Terry Grier (Toronto-Lakeshore):: Mr. Speaker, I rise under the provisions of Standing Order 43 to deal with a subject which the House has already considered this afternoon, I believe too hastily. I hope that upon reflection the House will agree to give unanimous consent. In view of damage to public facilities and private property as well as the possible danger to life which threatens as a consequence of the rising water level of Lake Ontario, I move, seconded by the hon. member for Broadview (Mr. Gilbert):
That this House directs the federal government to intervene before the International Joint Commission on behalf of the resi-

February 22, 1973
Lake Ontario Water Level
dents and authorities concerned, to insist that steps be taken immediately to relieve the threat of widespread and costly damage and danger to life and health, and further to inform this House what contingency plans it intends to activate in the event that the IJC does not act soon enough.


Mr. Speaker:: Is there unanimous consent to the motion proposed by the hon. member?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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



MANPOWER


André-Gilles Fortin: Mr. Speaker, pursuant to Standing Order 43, I wish to move, seconded by the hon. member for Kamouraska (Mr. Dionne):
That this House consider the possibility of transfering to the Local Initiatives Program part of the additional $200 million for National Defence of which $80 million will be used for useless capital projects, because the lack of funds to carry out useful LIP projects is obvious.


Mr. Speaker:: The hon. member has moved a motion pursuant to Standing Order 43. That motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: Since there is not unanimous consent, the motion cannot be put.



FLAGS OF CANADA BILL


Mr. Stan Schumacher (Palliser) moved: for leave to introduce Bill C-146, respecting the presence of the Flags of Canada in both Houses of parliament.


Some hon. Members:: Explain.


Stanley Stanford Schumacher: Mr. Speaker, the purpose of this bill is to give honour and recognition to the two flags of Canada which were recognized by parliament in 1964. One, of course, is the national flag, the maple leaf, and the other is the union jack, symbolic of our connection to and abiding belief in the monarchy as our system of government, the parliamentary system as the means of governing, and the value of the Commonwealth of Nations. The bill would legislatively ensure that both these honoured flags would be displayed in both Houses of parliament.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: The Chair will have to put the question. All those in favour will please say yea.


Some hon. Members:: Yea.


Mr. Speaker:: All those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Speaker:: In my opinion the yeas have it. I declare the motion carried on division.


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


Hon. Marc Lalonde (Minister of National Health and Welfare) moved: for leave to introduce Bill C-147, to amend the Old Age Security Act.


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


[Stage Direction]
Hon. Daniel j. MacDonald (Minister of Veterans Affairs) moved for leave to introduce Bill C-148, to amend the War Veterans Allowance Act.
Motion agreed to, bill read the first time and ordered to be printed.


Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Minister of the Environment of which I have given him ample notice, so I will expect an answer that will be both full and factual. In
February 22, 1973

view of the fact that the water level in Lake Ontario is between four feet and five feet higher than is normal for this time of year and as this has caused severe damage to property and installations on the whole of the Lake Ontario shoreline, would the minister advise the House what have been the results of the approach which he assured the House a week ago today he would make to the International Joint Commission to take action to reduce significantly the water level in Lake Ontario?


Hon. Jack Davis (Minister of the Environment):: Mr. Speaker, the Great Lakes Water Levels Board is meeting today in Chicago and our representatives are there, of course. I might add that the outflow from Lake Ontario is at a record high. It is at the maximum it has been for a number of months. Inflow into the Great Lakes system from Lake Nipigon is close to zero and leaving Lake Superior is the lowest in 50 years. There are no works which can control levels of either Lake Huron or Lake Erie.


George Harris Hees: As it is obvious that the government either cannot or will not take action-


Some hon. Members:: Order!


George Harris Hees: -to control the water level in Lake Ontario-


Some hon. Members:: Oh, oh!


Mr. Nielsen:: Dry up.


George Harris Hees: -has the government been in touch with the government of the province of Ontario to offer co-operation to that government in making available compensation to the residents of Ontario who have suffered severe financial losses due to the severe flooding that has taken place?


John (Jack) Davis: Yes, Mr. Speaker. Our government has been in touch with the government of Ontario in respect to dikes and other remedial works. Also, the government of Ontario is aware of the general formula that applies in all provinces of Canada. It includes a threshold-of course, with a larger industrial lease and a larger population the threshold is higher for Ontario-but a per capita formula applies and in the event that the province is prepared to pay compensation to individuals hurt by flooding, it can get financial assistance from Ottawa.


George Harris Hees: Mr. Speaker, I have one final supplementary question to the minister. Do I take it, then, that this government is willing to co-operate in paying compensation, and has the government of Ontario indicated that it is willing to pay compensation?


John (Jack) Davis: Mr. Speaker, this is a very co-operative government, as everyone knows.


HIGH WATER LEVEL IN LAKE ERIE-REQUEST THAT PUBLIC WORKS ENGINEERS DETERMINE WHAT WORKS CAN BE UNDERTAKEN TO PREVENT FURTHER DAMAGE
Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I have a supplementary question which I should like to put to the Minister of Public Works. In view of the fact that Lake Erie
Oral Questions
flooding is just as bad as that of Lake Ontario and even more property damage has taken place there, will the Minister of Public Works send engineers from his department to Lake Erie as soon as possible and request them to make recommendations as to what works can be undertaken at once to prevent immediate and massive further damage?


Hon. lean-Eudes Dube (Minister of Public Works):: Mr. Speaker, I have no objection at till to sending one of my officials to study the situation, but in reality I do not want to take over the responsibility of the province of Ontario. In any event, all federal efforts are co-ordinated under the leadership of my competent seatmate, the distinguished Minister of the Environment.


An hon. Member:: Send Joe Guay, the water expert.


Wallace Bickford (Wally) Nesbitt: A further supplementary-


Mr. Speaker:: Order, please. I trust that today we will try to get to the second question before half the question period has expired. Therefore I hope that hon. members will not ask too many supplementary questions on the very first question. The hon. member for Oxford has a supplementary question.


Wallace Bickford (Wally) Nesbitt: My supplementary question is also directed to the Minister of Public Works. It is my understanding that a cabinet committee is looking into this matter. Is the minister on the committee and, if not, would he request to be put on the committee if he is not already a member? Second, is the Minister of Public Works telling us that the entire responsibility for building works to stop Great Lakes flooding rests on the province of Ontario? It does not. I have letters from his colleagues to the contrary.


Mr. Speaker:: Order, please. Obviously the hon. member has a reply to the question.


HIGH WATER LEVELS IN GREAT LAKES-USE OF ARMED FORCES PERSONNEL TO CONSTRUCT PROTECTIVE WORKS
Terrence Wyly Grier: Mr. Speaker, I have a question on this subject which I should like to address to the Minister of National Defence. Has he consulted his colleague, the Minister of the Environment, and/or the provinces with a view to placing units of the Canadian Armed Forces at the disposal of the provinces or the other minister in order to construct bulwarks against possible flooding or to undertake such other works as may alleviate the threat?


Hon. lames Richardson (Minister oi National Defence):: Mr. Speaker, I have had consultations with my colleague but not with the provinces.


Terrence Wyly Grier: What has been the result of those consultations, and can the minister assure the House that in fact plans are now being made to make such use of the armed forces?


James Armstrong Richardson: Mr. Speaker, the armed forces are available for purposes of this kind, but there are no specific plans that we have arrived at yet.
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February 22, 1973
Oral Questions


HIGH WATER LEVELS IN GREAT LAKES-POSSIBILITY OF SITUATION WORSENING
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my supplementary question is directed to the Minister of the Environment. Is he in a position to tell the House if he has any estimate whether the situation is going to get much worse this spring from the International Joint Commission, the Great Lakes Water Levels Board, his own department, or even from a provincial agency?


John (Jack) Davis: Mr. Speaker, the engineers who represent us on the Great Lakes Water Levels Board say that the levels might go up another foot and a half this spring, that is, through to June or July. Even then the levels would be lower than those encountered in 1952. They would have been higher had it not been for the construction of the St. Lawrence Seaway which has in fact reduced the effective level by about one foot.


HIGH WATER LEVEL IN LAKE ONTARIO-STUDY OF EROSION EFFECTS
Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, I vish to direct a supplementary question to the Minister of the Environment. Can the minister advise whether the Centre for Inland Waters at Burlington, Ontario, more specifically the $60 million hydraulic facility at this location, is studying the erosion effects of high water in Lake Ontario and, if not, will he direct that such a study be undertaken immediately?


John (Jack) Davis: Mr. Speaker, I understand that a study along those lines has been under way for some time. It is being done in co-operation with the government of Ontario, and I expect that a preliminary report will be published some time in March.


EXTERNAL AFFAIRS
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. Does he propose to make a statement to the House on motions on the shooting down of a Libyan aircraft over Sinai, which follows a grim pattern of action and reaction, of reprisal and counterreprisal, and may lead to further tragedies of incalculable proportions?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, as the House is aware, on learning yesterday of this tragic event I, on behalf of the government and people of Canada, sent a message of condolence through our ambassador in Cairo to the foreign ministers of Libya and Egypt.

I know that all members of the House share my shock and sorrow at the destruction of a Libyan civil aircraft and at the loss of the lives of the majority of its passengers and crew. Many of the details of the tragedy are still obscure. What is all too clear, however, is that, as a result of a conscious act, up to 100 innocent persons aboard a regularly scheduled flight of a civilian airliner are dead. I am not satisfied that the destruction of this plane was unavoidable, and I shall be asking the Israeli government to clarify the reasons for this action.


Francis Andrew Brewin: Before asking a supplementary question, Mr. Speaker, may I say that we share the shock and sorrow expressed by the minister. I would like to ask him whether or not he will seek to have a full inquiry made by an impartial and, I take it, international tribunal or authority, so that the facts can be ascertained before final judgments are made on this matter?


Mitchell William Sharp: Mr. Speaker, I do share the point made by the hon. member that one should not jump to conclusions. I also share his view that there should be an inquiry that will establish the facts because we do not want an event like this, tragic as it is, to cause a further escalation of violence in the Middle East.


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, would the Secretary of State for External Affairs say whether or not Canada might take a lead, even though not on the Security Council, to bring about an immediate meeting between representatives of Egypt and Israel to the end that the deplorable awfulness of what took place yesterday will not become the beginning of tremendous potentialities against the peace of the world?


Mitchell William Sharp: Mr. Speaker, I do share the wish of the right hon. gentleman that something should be done to try to bring the parties to this conflict together. I am rather sceptical, however, that a request of this kind from Canada would produce the necessary results, and I feel we should continue our present policy of supporting action under Resolution 242 of the Security Council, which does provide a framework for negotiations.


CYPRUS-SUGGESTED WITHDRAWAL OF CANADIAN TROOPS FROM PEACEKEEPING FORCE
John George Diefenbaker: Mr. Speaker, I wish to direct a further question to the Secretary of State for External Affairs. With the situation the way it is in Cyprus, the degree to which unrest has broken out being unequalled in a matter of six or seven years, as a first step is the government taking action to do something about our peace force in Cyprus, which I think has earned the right to be removed, particularly in view of the fact Canada is the only nation that is actually financing all the costs of its participation in the peace force? This would do two things. It would save Canada $3 million, and would also do something to remove a danger that I do not want even to mention, so fearful is it, to the possibilities of peace.


Mitchell William Sharp: On a point of fact, Mr. Speaker, Canada is not the only country that is paying the costs of its own force.
February 22, 1973

All of the countries participating are contributing the pay and allowances of their forces.


John George Diefenbaker: But they don't pay the complete shot.


Mitchell William Sharp: Unfortunately there are other costs not being shared as equally as they should be among the nations of the world. I can assure the right hon. gentleman that we have been urged by all the countries concerned, and all of those who want to maintain peace in Cyprus, to retain our peacekeeping forces there. We should like to withdraw them, but we have been told that to do so might make the situation even more difficult than it is.


SHOOTING DOWN OF CIVILIAN LIBYAN AIRCRAFT OVER SINAI-SUGGESTED IMPARTIAL INQUIRY BY INTERNATIONAL TRIBUNAL
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I wish to direct a supplementary question to the Secretary of State for External Affairs. In his reply to the question put by the hon. member for Greenwood the minister suggested that he agreed in principle with the idea of having an impartial investigation into the shooting down of the Libyan aircraft, but he did not answer specifically whether or not he would take steps to initiate the establishment of such an impartial investigation. Therefore I would like to put that question to him. Will he take such action?


Mitchell William Sharp: Mr. Speaker, this is an event that took place in another country, and it is very difficult for us to initiate an impartial inquiry in an area under the control of another government. I do agree that it would be desirable to have an impartial inquiry, and I hope the Israeli government itself will ensure that the inquiry it makes is truly impartial.


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for Cochrane for one last supplementary on this subject.

Afterwards I shall recognize the hon. member for Champlain.


SHOOTING DOWN OF CIVILIAN LIBYAN AIRCRAFT OVER SINAI-CANADIAN POSITION RESPECTING UNITED NATIONS RESOLUTION 242
Mr. Ralph Stewart (Cochrane):: Mr. Speaker, I wish to direct a supplementary question to the Secretary of State for External Affairs. Since he said that Canada would support Resolution 242 of the United Nations and since this terrible act yesterday was initiated from occupied territory which should have been vacated as a result of Resolution 242, what is Canada's intention with regard to reiterating our stand in support of that resolution?


Mitchell William Sharp: Mr. Speaker, we are thoroughly in support of it, and we do support the principle that Israel should withdraw its forces to secure and recognized boundaries. I regret to say that there is not agreement on what are secure and recognized boundaries.
Oral Questions


MONTREAL OLYMPIC GAMES, 1976-STUDY OF IMPACT ON ECONOMY
Mr. Rene Matte (Champlain):: Mr. Speaker, I would like to ask a question of the Minister of Industry, Trade and Commerce.
Could he tell us if a study has been ordered by his department on the economic effect of the Olympic games in Canada in 1976?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, I am not aware of any study on that matter by my department.


MONTREAL OLYMPIC GAMES, 1976-GOVERNMENT FINANCIAL ASSISTANCE
Léonel Beaudoin: Mr. Speaker, I would like to put a supplementary to the Minister of Finance.
Account being taken of figures published by the Treasury Board, of publicity and other benefits accruing to the whole Canadian population because of the Olympic Games, does the government intend to resort to new measures to help the financial operation of the games or does he leave the taxpayers of Montreal and the rest of Quebec to foot the whole bill?


Hon. John N. Turner (Minister of Finance):: The government's position in this matter has already been announced, Mr. Speaker.


INDIAN AFFAIRS
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, I have a question to direct to the Prime Minister. Being a new member and having taken part in meetings of the Standing Committee on Indian Affairs, I am amazed at the lack of response from the government-


Some hon. Members:: Order!


Mr. Speaker:: Order, please. The hon. member has the right to be amazed, but in asking a question he does not have the right to say so. He should ask the question.


Frank Oberle: I should like to ask the Prime Minister how long it takes to respond to briefs of people from British Columbia, Alberta and Manitoba that were submitted in 1969?


Mr. Speaker:: Order, please. Perhaps the hon. member might like to ask a supplementary and rephrase his question. If he wishes to ask a question relating to a brief or a
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February 22, 1973
Oral Questions
matter going back to 1969, I wonder whether it might not be advisable to put the question on the order paper.


Frank Oberle: A supplementary question, Mr. Speaker. I agree with Your Honour that it has been a long time. Perhaps the Prime Minister has forgotten about the matter. I am simply asking if he is replying to submissions by the Indian people of those provinces made in 1969.


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, as the hon. member is new he might not have had occasion to read the statement of the government in 1969 and, of course, the response by his own party to that statement.


Mr. Baldwin:: Bilge!


Pierre Elliott Trudeau: The essence of it-


Gerald William Baldwin: Bilge!


Pierre Elliott Trudeau: Well, the response was partly bilge but the essence of the statement was that we were telling the Canadian people, both Indian and white, that they had arrived at a crossroads, that a decision was necessary, and that discussion must continue between the two parts.


George Harris Hees: And a decision would be made in due course.


Pierre Elliott Trudeau: These briefs and the court actions themselves are part of this ongoing discussion.


Frank Oberle: The Prime Minister referred to the white paper that was brought out by the government in 1969. The briefs I am referring to are the responses to that white paper and they contained definite proposals to which the people are awaiting a response.


Some hon. Members:: Hear, hear!


Mr. Joe Clark (Rocky Mountain):: May I direct a supplementary to the Prime Minister, Mr. Speaker. Will the Prime Minister explain to the House how he proposes to have discussions when one side will not respond for three years. Is this his definition of discussion?


Mr. Chretien:: Mr. Speaker-


Mr. Speaker:: Order, please. I would not think that a question asked in those terms is in order.


Gerald William Baldwin: You were not going to answer anyway, were you, Jean?


TRANSPORT
Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, may I direct a question to the Minister of Transport. In view of the urgency of re-establishing rail passenger service in western and southwestern Ontario, where many communities find themselves without any kind of public transportation to the detriment of many people who must depend on public transportation, can the minister inform

the House when he will take a definite step in this direction, as recommended last spring by the Standing Committee on Transport and Communications?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, on this matter I will have to meet with the government of Ontario and Metropolitan Toronto and with Mr. Carton, following the Soberman report, to study the whole problem of transportation not only in Metropolitan Toronto but in the entire province, although mainly in southwestern Ontario. As soon as those meetings have taken place I will be happy to indicate what the results are.


An hon. Member:: A supplementary question, Mr. Speaker.


Mr. Speaker:: Order, please. I can assure hon. members that it will not help them to try to shout louder than other hon. members. The hon. member for Grey-Simcoe.


Constantine George (Gus) Mitges: If I may respond to the minister's answer, he mentioned on January 15, as recorded on page 275 of Hansard, that he would have to meet with the Ontario government before any decision is reached. Can the minister inform the House whether steps have been initiated to set up such a meeting and, if not, when does he propose to do so?


Jean Marchand: Mr. Speaker, I think I said in the House somewhat later than the date to which the hon. member referred that as soon as the work of the House allows me to go, I will go.


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


CANADIAN CULTURE
Mr. Stan Schellenberger (Wetaskiwin):: Mr. Speaker, I congratulate you on pronouncing the name of my constituency correctly. I hope the hon. member for St. Boniface was paying close attention. My question is for the Secretary of State. Can the minister indicate what steps are being taken by himself in association with the Canadian Radio-Television Commission to promote positively and implement the concept of multiculturalism by way of the broadcasting media?


Hon. James Hugh Faulkner (Secretary of State):: Mr. Speaker, as the hon. member knows, there was a hearing before the CRTC recently in Montreal touching on this question. We are awaiting a decision from the president of that commission. On the matter of the work that might be done by the various cultural agencies in support of this important goal, I think I would prefer to deal with that question when these various agencies are examined before the standing committee of the House. I think it is important that we raise this question with each individual agency and ask each one what it is doing.
February 22, 1973


PRESERVATION OF RIGHTS OF MULTICULTURAL GROUPS IN WINNIPEG AREA
Mr. lake Epp (Provencher):: Mr. Speaker, may I direct a supplementary question to the minister responsible for multiculturalism. CRTC hearings have now been held in Montreal, as already mentioned, but only certain groups found it possible to go to Montreal. As there are no hearings scheduled for Winnipeg on this matter, can the minister indicate to the House what alternatives he is proposing which would preserve the established customary rights of multicultural groups in the Winnipeg area?


Hon. Stanley Haidasz (Minister of State):: Mr. Speaker, this is a matter of government policy and if anything is to be be done it will be announced in the usual way.


INCOME TAX
Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I want to ask the Minister of Finance, now that he has adopted the principle that he calls indexing in connection with income taxation, whether he is prepared to adopt the principle of indexing in the computation of capital gains for the purpose of taxation?


John Napier Turner: Mr. Speaker, perhaps when the hon. gentleman makes his speech in the budget debate he will wish to expand that a little more.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: When the matter is put before the minister and if he takes a decision on it, will he give the assurance that, following his usual practice, he will change his decision within a few months?


Some hon. Members:: Oh, oh!


STATUS OF NUTRITION SURVEY
Mrs. Grace Maclnnis (Vancouver-Kingsway):: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. In view of rumours now circulating to the effect that the Canada nutrition survey has been discontinued because of lack of funds, will the minister say whether this is true and, if it is not true, when the survey will be completed?


Marc Lalonde: Mr. Speaker, I am pleased to inform the hon. lady that this is not so and I believe we can expect the survey and report to be completed in the fall. However, I will inquire further into this matter in order to be sure that the information I am giving the hon. lady is exact.
Oral Questions


Winona Grace MacInnis: As we were promised originally that the survey would be available for this spring, can the minister say why it will be delayed until fall?


Marc Lalonde: I would certainly be pleased to do so, Mr. Speaker. I would assure the hon. lady that, unfortunately, this will not be the first instance when this has occurred with such surveys.


INQUIRY AS TO FEDERAL SURVEY OF HEALTH COSTS- REQUEST FOR STATEMENT OF GOVERNMENT POSITION
Gerald William Baldwin: I have a supplementary question, Mr. Speaker. In light of the survey just completed in the province of Quebec, which indicates that government health costs will probably rise by 150 per cent within the next ten years, would the minister say whether the federal government has made a similar survey? Is the minister able to advise the House about it? If not, will he, in due course, make a statement to the House of what the government's views are in this regard?


Marc Lalonde: Mr. Speaker, the federal government, as far as I know, has not made any similar survey, but I will certainly be pleased to expand on this when I appear before the standing committee at the appropriate time.


COMMUNICATIONS
Gilbert F. Rondeau: Mr. Speaker, I want to ask a question of the Solicitor General. Is the minister prepared to table in the House or at the Standing Committee on Broadcasting, Films and Assistance to the Arts a copy of the agreement concluded recently between the Association of Canadian Broadcasters and the chiefs of police?


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, there is no such agreement between my department and the radio broadcasters.


ROYAL CANADIAN MOUNTED POLICE
Gilbert F. Rondeau: I wish to ask a supplementary question, Mr. Speaker.


Mr. Speaker:: The hon. member for Shefford wishes to ask a supplementary question.

February 22, 1973
Oral Questions


Gilbert F. Rondeau: Can the minister tell us what is the role of the RCMP in the event that radio and TV stations facilities were occupied during civil disorders?


William Warren Allmand: Mr. Speaker, as I mentioned in the House the other day, there were discussions between the RCMP and the broadcasters regarding forcible occupancy. I can check to see if there is anything in writing. I do not think there is any written agreement but I will check and find out. There were merely discussions, to the best of my knowledge.


WHEAT-POSSIBILITY OF LOW FINAL PAYMENT IN LIGHT OF INITIAL PAYMENT FOR 1973-74 CROP YEAR-PAYMENT FOR FARM STORAGE
Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, my question is addressed to the minister in charge of the Canadian Wheat Board. As world wheat prices are over $3 per bushel, is the very low initial payment announced by the minister today an indication to the farmers by the government that there will be a very low final payment, as there was this year?


Otto Emil Lang: No, Mr. Speaker, it certainly is not. Of course, in terms of Thunder Bay prices, which is the basis for the initial price, the world price is not over $3 but some 30 cents lower than that. The initial prices which were announced today are for the crop year commencing next August 1. I assure the hon. member and other hon. members that I expect there will be a very good final payment for the crop year in which we are now. The final payment the hon. member was referring to was for the crop year which ended quite some time ago.


Francis Alvin George Hamilton: Will the minister indicate to the House if he has made any decision about paying the cost of storage to farmers for holding grain on the farms so that they can meet the commitments he is asking them to meet for next year?


Otto Emil Lang: Mr. Speaker, this question has been canvassed from time to time with farm organizations. The basic proposition adopted to this point is that the total amount of money available to the farmers, both from the sales of their grain and from the federal treasury, is realistically the important figure. The question of whether a specific payment for on-farm storage of grain should be paid is rather a matter of getting the right result in regard to the position of grain. There seems to be no problem about the farmers holding and building up stocks when they see adequate marketing opportunities. I am confident they will produce on a record number of acres this year.


HOUSING
Mr. Don Blenkarn (Peel South):: Mr. Speaker, my question is for the Minister of State for Urban Affairs. In view of the fact that spring is rapidly approaching-


Some hon. Members:: Hear, hear!


Donald Alex Blenkarn: -and that is the season when building normally commences in this country, has the minister any policy or plans to make available from his land bank fund any serviced lots for builders in metropolitan Toronto?


Hon. Ron Basford (Minister of State for Urban Affairs):: Mr. Speaker, my riding is Vancouver Centre and spring has already arrived.


Some hon. Members:: Hear, hear!


Stanley Ronald Basford: The budget for Central Mortgage and Housing Corporation for this coming year has been approved. Funds are available for land assembly upon application by municipalities or provinces. Where land has already been assembled in a number of areas, that land is being made available in the form of serviced lots, including metro Toronto.


Donald Alex Blenkarn: Has the minister used any of the suggested $100 million for this year to acquire any land that can be serviced for housing this year or next year?


Stanley Ronald Basford: Mr. Speaker, the purpose of that fund is to acquire raw land. We are in the process, and have been for some time, of acquiring raw land. Some of that is being serviced and some is being made available.


CRIMINAL CODE
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, my question is for the Solicitor General. In light of the fact that many people in Canada are concerned about the increase in crimes and the use of guns and weapons, while other people, such as sportsmen, are very concerned about controls, is it the government's policy to now toughen the regulations covering the sale and registration of guns and other weapons of that kind?


William Warren Allmand: This is being considered, Mr. Speaker.


Eldon Mattison Woolliams: I have a supplementary question, Mr. Speaker. I will make it brief. Do any of the amendments to the Criminal Code that were introduced in 1969 or 1970 empower the government to pass regulations respecting the sale or registration of weapons described in that act?


William Warren Allmand: Mr. Speaker, there are no new regulations at present.
February 22, 1973


AIR TRANSPORT
Mr. John Harney (Scarborough West):: Mr. Speaker, my question is for the Minister of Transport. In view of the fact the rates for advance booking charters have finally been set at the level of about $187, and in view of the fact these rates are some $80 more than the rates for a comparable trip originating in Britain, will the minister inform the House whether he has any intention of asking the Canadian Transport Commission to revise its rate-setting procedures so that Canadian travellers can benefit from the advantages of fair competition in this field?


Jean Marchand: Mr. Speaker, the competition that the Canadian Transport Commission governs is that which involves planes chartered for flights outside the country. However, we do not consider a plane chartered in England to bring passengers to Canada and take them back to England as a competitor, because the clientele involved is not the same. And so it can happen that English companies perform the service at rates that are patently lower than ours.


John Paul Harney: Considering that it would be very difficult for most Canadians to understand why it should cost almost twice as much for Canadians to travel from Toronto to London and return than for British residents to travel from London to Toronto and return, can the minister assure the House that he will ask the CTC to study the whole pricing procedure, particularly with a view to ensuring that there is competition in the pricing structure in Canada?


Jean Marchand: Mr. Speaker, the Canadian Transport Commission governs competition between charter planes leaving Canada for destinations abroad. It does not allow a company to charge less than the lowest price charged by Canadian companies. I think it is easy for the Canadian public to understand that it costs less to charter a plane in England, since labour itself costs less than here, and this makes it possible to offer cheaper tickets.


HOUSING
Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I wish to direct a question to the minister responsible for Central Mortgage and Housing Corporation. It arises out of the report prepared by the Nova Scotia fire marshall indicating 22 points of critical danger in a massive senior citizens' housing complex in Dartmouth, Nova Scotia. Has this matter come to the minis-
Oral Questions
ter's attention and, if so, what action has the government taken to ensure that these 22 points of concern to the provincial fire marshall have or will be met before our senior citizens are permitted to move into this building?


Stanley Ronald Basford: Mr. Speaker, the general rule of CMHC is that all buildings upon which they have loans must comply with applicable provincial and municipal bylaws and regulations, including fire regulations. This case has been brought to my attention. I am asking for a report on it. When I get it, I will submit it to the hon. member. Certainly the purpose of our intervention would be to ensure the safety of the senior citizens who propose to live in that building. I would point out that my understanding is that the Dartmouth fire commissioner is satisfied with the building construction, but that is a subject that is open to inquiry.


REGIONAL ECONOMIC EXPANSION
Mr. Roland Godin (Portneuf):: Mr. Speaker, I have a question for the hon. Minister for Regional Economic Expansion.
Has the hon. minister received a request from the management of Industries Valcartier Inc. concerning financial aid to prevent the factory from closing down? If so, can the hon. minister tell us what steps the department plans to take?


Hon. Donald C. Jamieson (Minister of Regional Economic Expansion):: Mr. Speaker, a great many applications flow through my office in the course of a week. I am not certain whether this is one of them. I would prefer to take the question as notice so that I could give a more complete answer.


RESTRICTIVE TRADE PRACTICES
Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, my question is directed to the Minister of Justice. It concerns a matter we discussed several weeks ago relating to the Pfizer Chemical Company of Canada Limited. Does the hon. gentleman's department not intend to initiate legal proceedings against this company on the advice of investigators from the Department of Consumer and Corporate Affairs?


Otto Emil Lang: When I last looked at this matter several days ago, consideration was still being given to the proper course of action to be taken.

February 22, 1973
Oral Questions PUBLIC BUILDINGS


CONCENTRATION IN OTTAWA-REQUEST FOR INCREASED NUMBER IN WESTERN CANADA
Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, my question is to the Minister of Public Works. In view of the fact this is the second year in a row in which the government is spending more on public works in the city of Ottawa than in the four western provinces, the Northwest Territories and the Yukon combined, can the hon. gentleman tell us how this disproportion can be reconciled with an effort to develop government services throughout western Canada?


Mr. Speaker:: Order, please. The question is very wide in scope and the hon. member is really inviting the minister to make a statement which would normally be made on motions. Perhaps he would like to rephrase it.


Douglas Roche: In view of the continued expenditure of public money for buildings in Ottawa, can he tell us what the policy of the government is with regard to spreading government services throughout western Canada?
Hon. ]ean-Eudes Dube (Minister of Public Works): This is a matter which would be better discussed when the estimates come before the committee. The quick answer would be that obviously there are more public services in the capital of the country than elsewhere. In principle I would agree with the hon. member that there could be some redistribution of power. But this is a difficult subject to deal with in the question period.


EXTERNAL AFFAIRS
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, my question is addressed to the Secretary of State for External Affairs. On February 13, the minister informed the House that the first substantive session in connection with the Law of the Sea Conference would be held in Santiago, Chile, in April or May of 1974. In view of the fact that Canada's continental shelf represents an area which is 40 per cent the size of Canada's continental land mass, is it the intention of the government of Canada to become a party to the 1958 convention on the continental shelf so that we, as Canadians, may make legal reservations with respect to any of the 15 articles of that convention which concern the exploitation of our natural resources on the shelf?


Mitchell William Sharp: I should like to have notice of that question so that I can give an adequate answer to a very careful inquiry.


FEDERAL-PROVINCIAL RELATIONS CLAIM BY QUEBEC FOR PAYMENT IN LIEU OF USE OF ROYAL CANADIAN MOUNTED POLICE
Mr. Roch La Salle (Joliette):: Mr. Speaker, I wish to direct a question to the Minister of Finance.
Some weeks ago, the Quebec Minister of Justice stated that he intended to claim from the federal government an amount of $230 million representing Ottawa's contribution to the maintenance of a division of the Royal Canadian Mounted Police as a provincial security body.
As it is important to know whether the Quebec minister was serious, I should like to ask the Minister of Finance whether he has received such a claim concerning the refund to Quebec of an amount of $230 million representing expenses in that respect.


John Napier Turner: Mr. Speaker, in answer I must tell the hon. member that I have received such a claim, but I must also add that under the equalization payments announced in the budget, the province of Quebec should receive $80 million.


Roch La Salle: Mr. Speaker, I should like to ask a supplementary of the Minister of Finance.
The minister having said that the province of Quebec will receive an extra amount of a few million dollars, will the $230 million claimed by Quebec be reimbursed to that province by the federal government, for the reasons given by the minister?


John Napier Turner: Mr. Speaker, I have just said that over the amount already granted Quebec in equalization payments, the province will receive an extra $80 million following the measure announced Monday night last.


Erik Nielsen: Mr. Speaker, my question is directed to the Solicitor General and it is supplementary to that directed to the Minister of Finance. Has a request been received from the government of the province of Quebec for $230 million with respect to police services, either directly or through the RCMP and, if so, has the minister replied, and to what effect?


William Warren Allmand: A request was made, Mr. Speaker. The matter was brought to my attention and it was pointed out that, as far as I am concerned, the RCMP provides police services which we are willing to provide to any province that wants them, but we are not willing to give out subsidies or grants.


AIR TRANSPORT
Mr.   Terry@: I have a further question to the Minister of Transport, Mr. Speaker, with respect to the reciprocal landing rights awarded to a Canadian air
February 22, 1973

carrier in Milan. In view of the fact the government said it would make an announcement on the subject before January 1, and in view of the fact the minister has told us twice in the House that such an announcement would be made soon, would the hon. gentleman indicate what factors and what circumstances are being considered that are causing such a delay in making the announcement?


Jean Marchand: Unfortunately I can only make the same answer on this occasion. I would hope I would have a decision from the cabinet very soon, but I cannot say whether it will be this week or next week.


Mr. O'Connor:: Has the minister estimated the immediate cost in lost revenues due to the delay and, second,'has he made any costing with respect to long-range losses due to passenger loyalties which are being acquired by Alitalia?


Jean Marchand: No, I do not have such figures.


FISHERIES
Mr. Elias Nesdoly (Meadow Lake):: I have a question for the Minister of Fisheries, Mr. Speaker. In view of the fact that Saskatchewan Co-operative Fisheries Limited has voted to break with the Freshwater Fish Marketing Corporation, in view of the fact that the Freshwater Fish Marketing Corporation has apparently suffered severe financial losses, and in view of the fact that Saskatchewan fishermen have called on the federal government to conduct a complete inquiry into the operation of the Freshwater Fish Marketing Corporation, may I ask whether Co-op Fisheries have been in communication with the minister and, if so, whether an inquiry will be held?


John (Jack) Davis: The Saskatchewan Co-operative in question has not been in direct contact with my office. However, I would expect it to work through the provincial government, since the provincial governments of the prairie provinces are joint partners with the federal government in the freshwater fish marketing venture.


REGIONAL ECONOMIC EXPANSION
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I have a brief question for the Minister of Regional Economic Expansion. Is the minister now able to table, or report briefly on, the joint federal-provincial report on the future prospects of the Goose Bay-Happy Valley area of Labrador?
Oral Questions


Donald Campbell Jamieson: Yes, Mr. Speaker. The report in question was prepared as a background document for the preparation of a federal-provincial committee. Copies of the report have been, or are being, made available to members of that committee which is made up of representatives of both governments and of municipalities in the area. If any hon. members, including the hon. member for Central Nova, are interested, we would be pleased to provide them with copies also.


ALLEGED DUMPING OF CANNED FRUIT BY AUSTRALIA- REQUEST FOR INVESTIGATION
Mr. Kenneth J. Higson (Lincoln):: Mr. Speaker, my question is directed to the Minister of National Revenue. Has the hon. gentleman received reports that Australian fruits, specifically canned peaches and pears, are being dumped on the Canadian market? Has he investigated such reports and, if so, can he tell the House what has been the result of his investigations?


Hon. Robert Stanbury (Minister of National Revenue):: shall be glad to check into it and report to the hon. member.


Mr. Speaker:: The hon. member for Calgary South on a supplementary.


INCOME TAX
Mr. Peter C. Bawden (Calgary South):: Mr. Speaker, I hope the minister will answer my question today. It is a very important one for a great many Canadians. On February 8 the Leader of the Opposition asked whether the Minister of Finance would be permitting deductions on the part of ordinary Canadians who have to spend money seeking tax advice. May I ask the minister whether the budget purposely overlooked this question, and whether individuals obliged to seek professional advice in filing their tax returns will be permitted to make deductions for the fees they pay?


Mr. Speaker:: I fail to see how that is supplementary to a question about pears and peaches.


Some hon. Members:: Oh, oh!


Mr. Speaker:: The hon. member would probably suggest that it is a question asked of the same minister. That hardly makes it supplementary. However, the question having been asked the minister might reply. We have just about reached the time when orders of the day should be called.


Robert Douglas George Stanbury: Mr. Speaker, the hon. member knows, I am sure, that

February 22, 1973
Oral Questions
questions about the budget are matters for the Minister of Finance.


AGRICULTURE
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, my question is for the Prime Minister. On May 19, 1970,1 asked the minister of agriculture of that day, the Hon. H. A. Olson, which of the recommendations of the Barber Commission on Farm Machinery Prices had been implemented. His response was that all the recommendations had been implemented except the one dealing with a reverse dumping duty. A similar question was directed to the present Minister of Agriculture on February 5 and his reply was that none of them had been implemented. Bearing in mind the conflict between those answers, I wonder whether the Prime Minister would clarify the situation for the benefit of the House and tell us whether or not any of these recommendations have been implemented and, if so, which ones?


Pierre Elliott Trudeau: Mr. Speaker, it would be helpful if the hon. member gave notice of this kind of question or placed it on the order paper. However, I will take it as notice and look into the matter.


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


Mr. Speaker:: The Minister of Agriculture is rising on a point of order.


Eugene Whelan: Mr. Speaker, the question is clear in Hansard and the way I answered it. I thought that the hon. member who was asking the question at that time was talking about the present Minister of Agriculture initiating any of the Barber Commission recommendations, and I have already discussed two since that question was asked. The former minister initiated four of the recommendations contained in the Barber Commission report.


Mr. Speaker:: Order, please. I am afraid that unless I recognize the hon. member for Lethbridge he will return in his scarlet coat. The Chair will recognize him before calling orders of the day.


POSSIBLE ENCOURAGEMENT OF FARMERS TO RETURN LAND FROM GRASS TO GRAIN
Mr. Ken Hurlburt (Lethbridge):: Thank you, Mr. Speaker. My question is directed to the minister in charge of the Wheat Board. In 1970 the government paid farmers $10 per acre to plant crop lands with grass. In the minister's statement on initial prices today he recommended that they replant their lands with grain. Is it the intention of
[Mr. Stanbury.l
the government to have these lands varied from year to year?


Otto Emil Lang: Mr. Speaker, the hon. member is quite inaccurate in suggesting that we are recommending any return of lands from grass to grain. Indeed, as the Minister of Agriculture indicated in the House a couple of nights ago, we propose to continue to encourage farmers to put additional acres into grassland this year. What the hon. member may have noticed is that we are talking of a much larger acreage in grain in the prairie region than in the past number of years. I refer him to the agricultural practice of summerfallow. We would foresee that farmers would reduce their summer-fallow to a much lower level than has been the case before.


Mr. Speaker:: Order, please. The hon. member for Lethbridge might ask a supplementary, after which, with my apologies to a number of distinguished frontbenchers and to equally distinguished backbenchers-


Some hon. Members:: Hear, hear!


Mr. Speaker:: -I shall call orders of the day.


Kenneth Earl Hurlburt: Thank you, Mr. Speaker. I should like to ask the minister in charge of the Wheat Board where we are going to get the additional acres in view of the fact that they were planted to grass in 1970 under the Lift program?


Otto Emil Lang: Mr. Speaker, may I go over it once again for the hon. member. Last year an estimated 29 million acres of grain land in the prairies was in summerfallow, which I believe was a near record for summerfallow. We are anticipating that the farmers may reduce this 29 million acres to as little as 20 million acres, and this will furnish the additional acres for barley, rapeseed and wheat.


Mr. Speaker:: Perhaps this question might be followed up tomorrow. Orders of the day.


BUSINESS OF THE HOUSE
Gerald William Baldwin: On a point of order, Mr. Speaker, I should like to ask the government House leader whether, in the unfortunate event that the government is still around to organize the business of the House after next Wednesday, he will tell us what will be the business for the rest of next week and the week following, after completion of the budget debate.


Mr. MacEachen:: Mr. Speaker, on Thursday of next week we will probably begin discussion of the Old Age Security Act followed by war veterans allowances. On Monday and Tuesday, March 6 and 7,1 shall probably call opposition days. I will be calling the 1972 budget bills at an early date also.


Gerald William Baldwin: the fact that it is highly important to try to activate the Standing Committee on Public Accounts and the joint standing committee on statutory instruments, can the government House leader indicate when these two committees will be set in motion so they can commence their work?


Allan Joseph MacEachen: Mr. Speaker, we hope to have the organizational meetings for these committees very early next week. In the case of the committee on statutory instruments, I hope to have an organizational meeting established very early next week, and also the public accounts committee set up as early as possible.
While I am on my feet, Mr. Speaker, may I attempt to request the House to agree to an arrangement in regard to time limits for speeches during the budget debate. There was a meeting of House leaders this morning and I hope to be able to explain what appeared even to me to be a complicated formula.
We have agreed that speeches will be limited to 15 minutes, with the exception of a 30 minute time allotment for three members of the official opposition; 40 minutes, however, if one of these members happens to be the Leader of the Opposition. There will be 30 minutes for five ministers, but 40 minutes if one of them happens to be the Prime Minister; and 40 minutes for the leader of the New Democratic Party and the leader of the Social Credit party, or the acting leader of the Social Credit party. [Translation]


Mr. Speaker:: Order. Before recognizing the hon.
member for Joliette who, apparently, rises on a point of order-

There might be a slight difficulty in connection with the hon. member who had the floor last night and who had just about reached the end of a very interesting 15 minute address. In fairness to him, it should be said that at the time he had the floor no order had been made at that point. Therefore, I think he should be allowed to go for a while yet.
With this fifth or sixth exception, as the case may be, perhaps an order might be made, as suggested by the President of the Privy Council. Is it so agreed?


Some hon. Members:: Agreed.


Roch La Salle: Mr. Speaker, I rise on a point of order.


Mr. Speaker:: The hon. member for Joliette (Mr. La Salle) on a point of order.


Roch La Salle: Mr. Speaker, my point of order has to do with the question I put to the Minister of Finance. I think it is important that the minister understand the true meaning of my question. He answered that Quebec would get a certain number of million dollars under the equalization payments. My question was whether the minister intended to repay the $230 million claimed by the Justice Minister of Quebec, in respect to the security measures
The Budget-Mr. Donald Munro applied in Quebec by the provincial Surete as opposed to the R.C.M.P. in other provinces?


Mr. Speaker:: Order. I must intervene at this point. The hon. member cannot rise on a point of order to put the question again, or to ask for an explanation on the answer given by the minister. It might be advisable for the hon. member to put the same question tomorrow; I shall cooperate to ensure that his question is allowed again.


Mr. Speaker:: The hon. member for Winnipeg North Centre is rising on a point of order.


Mr. Knowles (Winnipeg North Centre):: Mr. Speaker, I rise on a point of order with respect to the time limit arrangements that we have just made. I believe that the government House leader neglected to include the fact that we had agreed, as I understood it, that these time limits having been decided upon, no one would ask for or be given an extension of the indicated period of time.


Mr. Speaker:: Is that also provided by the House?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, February 21, consideration of the motion of Hon. John N. Turner (Minister of Finance) that this House approves in general the budgetary policy of the government, and the amendment of Mr. Lambert (Edmonton West) (p. 1526), and the amendment to the amendment of Mr. Matte (p. 1533).
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I do appreciate the kindness of the Chair since it was certainly my understanding when I began my speech last evening that this new rule had not come into effect. However, I do not propose to take more than five or six minutes of the time of the House. Thank you once again for the exception.
When my remarks were terminated last evening I was talking, in the context of the coast guard and general marine services, of the need to have international standards of seaworthiness and crewworthiness. The criteria which we ought to include in an international convention which I would like to see developed should be concerned not only with seaworthiness and crewworthiness but also with speeds on the high seas in various types of weather and for various types of ships, whether fully laden or in ballast. I think we should also contrive in such a convention to prescribe construction standards.


Donald Campbell Jamieson: Mr. Speaker, in the days since the presentation of the budget of my colleague, the hon. Minister of Finance (Mr. Turner), a number of comments have been made in various parts of this House concerning the correlation between the various budgeting measures that were presented and the emphasis which this government has placed over the past four years on programs to decrease regional economic disparity. Therefore, with the indulgence of the House, I should like to spend a few moments this afternoon indicating how, in my view, the budget is a significant contributor to the improvement of these

regional economic disparities, and how these programs when taken in concert with the items totalling something over $500 million listed in the estimates will continue throughout the coming year the thrust that was undertaken in 1969 in order to attempt at least to provide a greater measure of equity across this country and to level out some of the disparities which have plagued this country literally from its very beginning.
In connection with budget measures specifically, it is a fact, of course, whatever arguments may be put forward, some legitimate and some perhaps not quite so legitimate, that the Minister of Finance was on solid ground when he forecast there would be differences of opinion regarding the effectiveness of the various measures he introduced. Other speakers in all parts of the House will, I am sure, be commenting on these particular issues, but I should like to point out to the House that there are certain elements within the budget that, in fact, can be forecast with precision and accuracy. The first of these is that, given the concurrence of this House, and I have not the slightest doubt that this will be granted, as of the beginning of April our old age citizens will have a basic pension increase to $100 a month each and considerably more than that if in fact they are entitled to part or all of the guaranteed income supplement.
The second point is, of course, that there will be a very large number of Canadians, particularly in the lower earnings bracket, who will gain substantial tax relief from these measures. Here again, it is possible to make this kind of forecast with complete accuracy. The third point is that there will be considerable improvement, and I hope it will be considerable, in respect of the measures taken to reduce the high cost of living.
I mention these three because they have a direct relationship not only to my responsibilities as the Minister of Regional Economic Expansion, but also because I come from the province of Newfoundland where I am well aware of the value of these measures and of how welcome they will be. This, it seems to me, is as much a part of fighting regional economic disparity as are the industrial incentives and economic measures so frequently talked about and referred to-indeed, I regret to say, almost to the exclusion of any thorough examination of other aspects of the regional economic expansion program.
Those of you who come from the Atlantic provinces, and I am sure I would not find any disagreement from either my colleagues from Newfoundland or, indeed, from the Leader of the Opposition (Mr. Stanfield) on this score, will know that we have within the Atlantic provinces, apart altogether from the present problems which are very acute and very severe in terms of unemployment, what I call a significant residue which is a reflection of past industrial inequity. In other words, we have a great many middle-aged to elderly people who are dependent upon these kinds of measures and improvements to them literally for every mouthful that goes into their mouths and, in fact, for the roofs over their heads. Therefore, these significant improvements will, I know, be of more benefit in many respects to people in the areas for which I have a responsibility than in some other areas of the country, even though I am not, of course, discounting the benefits there either.
February 22, 1973

The second point where it seems there is an improvement, far beyond those improvements resulting from the budget of the Minister of Finance, is in that area where we have succeeded in turning over additional moneys to the provinces through the equalization formula. I have heard it said in this House that these amounts are perhaps not large enough. I suppose if one were talking about this in purely philosophic or abstract terms he would certainly have to agree that, indeed, seven of the 10 provinces will need even more in the way of assistance than the Minister of Finance is providing at the present time. Let me remind the House that over the past few years the degree of grants under the equalization formula has increased sharply from what it was even four or five years ago. Under this heading alone, leaving out the amount that will be provided through this particular budget, equalization in the case of Newfoundland today, and I use it because I am more familiar with the figures for that province, amounted to something in the neighbourhood of $130 million or $140 million, and now will probably be over the $150 million mark.
I mention these figures, in a sense, off the top of my head because there is no time for a detailed description. The figures are certainly in this area. Another interesting point when one asks what the federal government and federal agencies are doing in respect of regional economic expansion is that they are helping certain taxpayers across the country. Perhaps again I might refer to the province of Newfoundland and mention the fact that according to the statistics which are available for the year 1972-73, 52 cents of every dollar expended by the government of Newfoundland directly came in one way or another from federal spending. At the moment I am not arguing whether this is an adequate, inadequate or excessive amount. I might be prepared to argue with my colleague the minister in private that it might be greater, but I think it is significant to point out that it is still a very large expenditure in respect of any province of this country in the kind of program which the Minister of Finance has moved ahead on this particular occasion.
As Minister of Regional Economic Expansion, I recognize that one of the things which in fact has been most easy to identify is the plight of the municipalities in many areas where disparities are greatest at the present time. The municipalities have to assume a larger and larger portion of the burden of increased services and increased demands, so therefore any relief which is to be provided by the federal government to the provinces will we hope- and I am sure this will be the case-reflect on the position of the municipalities. In addition, however, there is also the fact that in several regions of this country, particularly those which by agreement with the various provinces have been designated as special areas, the federal government through the Department of Regional Economic Expansion has been making a significant input into the plant of the municipalities in these special areas. It might be surprising to hon. members to hear that in fact the emphasis-and it is understandable why this is so-has been on the industrial incentives.
The fact is that if one takes the infrastructure support provided directly by DREE in one form or another to the
The Budget-Mr. Jamieson
provinces, and couples it with the very important other matters designed to put in place a better social structure for these areas, and takes these two together, in the past year as in the coming year some three-fifths, roughly speaking, of the total budget for regional economic development will in fact be going into assistance to municipalities of various sizes but usually small to medium-sized municipalities where in fact the need and demand is greatest. It will interest hon. members to know that during the four years in which DREE has been in operation-and effectively it has only been three and a half years that the program has had an opportunity to start taking effect- just less than an amount of $1 billion has been provided to the provinces. The majority of this has been in terms of infrastructure support and the like, has been provided by the program I have talked about in the past few minutes.
In other words, we have recognized what has been maintained by a great many people, long before the concept of DREE was created, that is, that there is the necessity, if one is to draw industry to a particular area, to ensure there is the infrastructure support necessary to induce an industry to come into the area and, second, to help through the provision of the basic services necessary to make that industry grow. Therefore, I believe this is one of the more important parts. If one takes, as I say, the budgetary measures and couples them not only with the plans and estimates for the future but the expenditures to date, it can be seen that a very significant contribution has been made in respect of the reduction of regional economic disparities.
Let me go on to say that there are unquestionably major problems in respect of the program of regional economic expansion. We have been trying now for some months, indeed the review preceded my assumption of the particular responsibilities, to determine how we can make this whole program more flexible. Perhaps I will be permitted to go into some of these matters in more detail when I appear before the Committee later in the current month or in the month of March. However, I want to re-emphasize this point, because it has been suggested on one or two occasions in this House that perhaps we have not been recognizing the necessity for infrastructure support. I do not like that word, but I am sure hon. members know I am referring to such things as water and sewage systems, aid to land assembly, the building of schools and various other public facilities.
There is another way in which the budget is very significant in terms of what effect it will have in relieving regional inequalities in this country. I refer to the tax measures which the Minister of Finance mentioned on Monday night. When one looks at the difficulties we face in attempting to induce industry on a fairly significant scale into the so-called disparity parts of Canada, it will be seen that there are a number of problems one encounters which are clearly visible but which are very difficult to eliminate and which, in fact, have been with us in one way or another for years. I am sure the Leader of the Opposition in a completely non-partisan sense will probably recognize what I am speaking of because of the innovative steps taken by his government in Nova Scotia in terms of the Industrial Estates and various other agencies of this kind which have been copied in one way or another in other parts of Canada.

February 22, 1973

The Budget-Mr. Jamieson


Mr. Paproski:: Not only in other parts of Canada, but right here in Ottawa.


Donald Campbell Jamieson: In the short time I have, Mr. Speaker, let me give you what are in my view some of the problems with which we must cope and which I hope we can resolve. The first is in respect of the degree of entrepreneurial skills, talent and initiative which exists in a particular region of this country. If one looks at the disbursements which have been made under the incentives program it becomes perfectly obvious that one of the difficulties we face in many areas, even where we are not only willing but anxious to make expenditures in terms of attracting industry, is in respect of the very small number, relatively speaking, of applicants who come forward seeking this kind of aid. I think there are very good reasons for this. Some of them have to do with the fact that in the case of some small industry there might not be the capability in terms of talent, staff and the like to do the necessary projections, studies of potential markets and the whole range of things which are necessary before one can put a new industry in place.
Another significant point stands out very clearly when one looks at the incentives which have been provided. By and large, the DREE program has been most successful where it has had some direct application in respect of the upgrading of resource-based industry; in other words, where there has been a reasonably solid base such as in the fishing industry. It has been possible there-and there has not been a significant lack of initiative on the part of entrepreneurs-to put in additional funds to undertake expansion. However, the further one becomes removed from the resource-based industry the more one seems to attract what are sometimes described as footloose industries, that is those which can locate in one place in Canada as well as another, and it becomes apparent that the entrepreneurialship is one of the things which is badly needed in many parts of the country.
The next point-and here I return to my observation of a few moments ago about the assistance in the budget-is to try to determine what degree of assistance is necessary in order to change an entrepreneur's or a company's mind about a proposed location in favour of one where it is desirable to build up an industrial enterprise. This is again a very difficult question. I mentioned a few moments ago that we do have various agencies, somewhat comparable to those established in Nova Scotia but located across the country and also located in the "have" provinces as well as the "have-nots", which are also in the business of offering incentives and inducements of one kind or another in order to keep industry active in their regions and to expand. I would naturally assume that each province, whether or not it be more affluent than some of the others, will still want to get a large industrial base.
So, therefore, one of the things that becomes apparent is that this competitive situation which exists, not only between the larger and the smaller provinces but between the smaller provinces themselves, is in many respects detrimental to the whole attempt at getting some form of regional economic expansion. I believe that it will be and

is possible to pit, as it were, the more affluent provinces against the "have-not" provinces in this regard and to do a good deal of shifting, even within the depressed regions of affluent provinces. But one of the real dangers we have discovered, and it is perhaps one of the failings of our federal-provincial system, is that two or three "have-not" provinces compete amongst themselves, and the only winner in that kind of situation is the entrepreneur or the promoter. So one of the things which is important, and what we are seeking to do, is to try to bring some rationality to the industrial development efforts of the provinces, so that far from imposing our will on them we will nevertheless be able to arrive at some cohesive policy so that the poor regions will not be played off, as it were, against each other in this search for industrial expansion.
A third point which it is important to examine in detail in asking how the incentives program can be improved is to improve what I describe, for want of a better term, as the industrial intelligence that is available either to the industrial provinces or to other regions of this country. For a very long time, and certainly it goes back in my own memory to the earliest days of Newfoundland's entry into the Canadian union, there has been a tendency to play it by ear when it came to industrial development, to look to anyone who came forward with a proposal and to say: if you are willing to come in, certain assistance will be granted to you. But there has not been either a strategy or the degree of thorough examination necessary to determine whether that kind of industry will be able to survive in the particular milieu or area in which it is being located. Therefore, I see a need across the country for a very thorough job, particularly, for instance, within the Atlantic region and the western parts of the country, for this form of industrial intelligence.
I want to emphasize that what I have said is in no sense meant to convey any criticism of what some industrial organizations within the provinces are doing at present. Their efforts are very commendable and they have had indeed a good deal of success in one way or another in terms of attracting industry and in terms of getting additional jobs. But there is the necessity for some form of over-view to eliminate, if nothing else, this intense, one would almost describe it as exaggerated, competition that can sometimes develop between provinces. Therefore, there is in the programs that I am seeking now to develop in a comprehensive way an attempt on our part to discuss with the provinces how we can be more helpful to them in establishing this form of industrial intelligence.
Another difficulty in terms of regional development of industry is the growing tendency typified best of all perhaps by southwestern Ontario, but also by a few other regions of the country, for what I described in a speech in western Canada in December as industrial incest. In other words, the whole industrial development tends to become more and more interdependent throughout the country. Therefore, one has a situation in which, if you have a great deal of industry, there are many strong reasons why another one will attach itself to that particular complex, and the process grows. Of course, I should say in parenthesis that the transportation problem is basic to all of us and that any re-examination of the regional economic expansion policy cannot be undertaken effectively unless it also examines the transportation question.
February 22, 1973

But even more important than transportation, in the sense that I have been outlining it, is this tendency for industries to group together. Therefore, it is my judgment, and we hope to work in this direction, that we would get agreement with the provinces. This is in partial answer to a question asked a few days ago by the Leader of the Opposition. We would get, in co-operation with the provinces, the capacity to seek out those people who have a communality of interest in terms of a variety of related industries, so that instead of simply seeking to put a particular plant in a particular location we would do a thorough analysis in that region of what, to use the vernacular of the trade, now are referred to as spin-offs or value added, or whatever the case might be. In New Brunswick we are experimenting with such an approach with a good deal of success at present.
One of the things that is clearly necessary in the Atlantic provinces, for instance, is a complete metal working complex, not simply one factory making one part of a metal working complex but a total complex. So the Multiplex Corporation was established with that idea in mind. It will be very important in terms of a large section of this country that we have not merely the industrial incentives to which I have referred earlier but as well the maximum number of concessions of one type or another, be they depreciation, lower tax rates, or whatever they happen to be, because when one puts all of these things together, they are really the selling tools that we will have in order to induce industries to enter into these regions. I am satisfied for my own part that if we are to get away from the resource based industries in the regions of the country that are not in the centre-which is perhaps the best way to describe it-if we are going to get into manufacturing and processing, which I believe we have to do whether we are talking about agricultural products or fishery products, then it can only be done on the basis or in some variation of the routine that I have outlined.
It has been said, and I freely admit, that the incentives program needs re-examination and needs to be updated. I do not make any apologies for the past performance because I think that when we are before the committee it will be possible to illustrate that it has performed reasonably well, but I think it can perform better. There are questions which hon. members in all parts of this House will want to ask, and, incidentally, I would like to get from them advice on some of these things. For instance, it has been suggested that incentives should be paid earlier on in terms of the start of a new project. In its wisdom this House decided, when the DREE legislation was established, that the enterprise has to be 80 per cent in place in terms of its capital assets before it is entitled to a single cent from DREE. Furthermore, the enterprise must be in commercial production for a period of 30 days.
The reasons for having put these provisos in place are obvious, of course. They were designed to ensure that moneys would not be given out before the assets were in place or before there was pretty clear evidence that the project was going to go ahead. In other words, we were not speculating with the taxpayers money. There are those who say that perhaps this kind of policy should be changed, that in point of fact what is really needed is bridge financing, that we should be prepared to commit earlier and to put dollars in before the project gets to the
The Budget-Mr. Jamieson
point that I have outlined. I have some reservations on this score, but nevertheless it is something that is open to question. It may be that we can find a better formula that would help the small businessman in particular who may have difficulty in getting the bridge financing, even on the basis of an offer of assistance from the Department of Regional Economic Expansion.
The second way in which the program has to be improved is by decentralizing the decision-making processes. All of us are aware-


Eldon Mattison Woolliams: Are you getting ready for the next leadership convention?


Donald Campbell Jamieson: Mr. Speaker, the last time I rose in the House to speak I had an awful lot of fun with members opposite and they criticized me for not talking about the policies of my department. I think I am restraining myself admirably today.
On the matter of decentralizing, Mr. Speaker, one of the things I feel is important is that we should not think about decentralization in the conventional sense. In other words, when one normally talks about the decentralization of a department or agency one thinks about putting a headquarters in Halifax or Moncton and saying that we-are now decentralized in terms of the Atlantic provinces, or putting a headquarters in Edmonton or Winnipeg, and saying we are now decentralized in terms of the prairie provinces or western provinces. What I am looking for is a decentralizing mechanism that will not simply re-central-ize in another part of the country, but which will ensure that there will be trained, responsible people with authority to make the decisions, in the field, so that in particular the smaller entrepreneurs will be able to get assistance and to get it more quickly.
But once again I have to remind hon. members that one of the great concerns expressed in this House when DREE was established was that there be a solid and assured guarantee that public moneys were not being expended on projects which were, at the very best, of dubious value. As a result there has been a natural, understandable and defensible tendency to try to be careful, to centralize, and to take too long in many respects in the making of decisions. So, Mr. Speaker, I am now in the process of trying to find, in consultation with the provinces, just what is the best method by which we can resolve this particular problem.
One of the other difficulties which we can go into at committee stage, with regard to levels of expenditure on incentives, is that there is still not a sufficiently long history behind the program for us to be able to forecast with precision just how many dollars in incentives will actually be spent in a particular year. One of the related difficulties in that regard is, of course, that it is also hard, at any given moment, to assess how many jobs have actually been created, because the lead time may be as much as three years after a grant is offered before an enterprise goes into production. We will need some more experience on the basis of the past three years' records, before we are able to give the House and the public the clearer figures to which they are entitled.

February 22, 1973
The Budget-Mr. Gillies
There is something else that has bothered me since becoming the Minister of Regional Economic Expansion, and which I am hoping we will be able to correct in some other way. I believe that we ought to have a greater degree of advice from knowledgeable people in the various regions, first of all as to the kinds of enterprises which are most likely to succeed, something I have already alluled to, and second, advice on many of the specific applications for incentive grants that are received. I would propose that we expand the present National Advisory Board on Incentives, which has been of very great value to us, to the point where we have sources on which we can draw in all the regions-businessmen, various other people, labour leaders and the like-so that they too will have the chance to tell us in specific terms whether such and such an enterprise has a chance for success.
Of course one of the difficulties has been that we have to respect the confidentiality of the records of various companies that come to us, but I would hope there can be some way arrived at so that not only the members of this House but these advisory panels and the like can have the opportunity, under some form of confidentiality, to assess just how meaningful has been the contribution we have made, and how effective any new proposals we make are likely to be. I am aware that there are members of this House who dismiss the concept of regional economic expansion out of hand. I am aware that there are those who believe that the natural forces should be put into play, that they should be allowed to take their course, and that this country should in all probability be polarized around ten or twelve centres within the next ten to 20 years.
Indeed, there are those who say that any efforts such as we have undertaken, efforts both of this government and of provincial governments, in an attempt to change the normal demographic trends in this country are really, as we say in the vernacular of the sea, spitting into the wind. I cannot accept that, Mr. Speaker, and I do not believe that the majority of the members of this House accept it. I think there is a great deal more-


Mr. Deputy Speaker:: Order. I regret to interrupt the minister, but the 30 minutes allotted to him by the order of the House passed earlier this day have now expired.


Mr. lames Gillies (Don Valley):: Mr. Speaker, I rise to speak in this debate on the budget which is before the House fully aware of the fact that this budget has probably been awaited by Canadians with more expectation than any budget brought down in the last 15 to 20 years. I am not cynical enough to think that the reason for their impatience for it was simply because of the political implications of the budget, but rather because they, the Canadian people, have a great deal of concern about the way the Canadian economy has been managed in the past four years, and about the way that it is going to be managed during the course of the years ahead.
This concern is easily understood when we recall that we have had an unemployment rate for three or four years of 61 per cent, when we note that we have inflation at a rate of 5 per cent, and that it seems to be increasing, when we see that we have regional disparities increasing more and more, and despite the expenditure of millions of

dollars that they do not seem to be getting less, and when we see that we still have in this rich nation far too many people living in poverty.
The Canadian people are very concerned about these problems. Moreover, they are very concerned not only about these things that are so apparent and easily measured, but they are also concerned because they have a feeling that somehow or other economic policy making in Ottawa is out of touch with the reality of what is happening in the world. Canadians know and have seen that the world is changing dramatically. They know that no longer are we in a period of Kennedy Rounds when there was a great thrust for free trade. They know that we have entered a period in which we may well be moving to more protectionism, and when we do not know what is going to happen as a result of the development of the Common Market.
Canadians are aware that their own country has changed dramatically. They realize that more and more people are living in cities, and that more and more employment has to be found in manufacturing, and in service trades to provide employment for the people in urban areas. They recognize that over the last few years a nationalistic spirit has been developing in this country that wonders why such a high proportion of our resources is controlled by people who are not Canadians and who do not live within the confines of this nation. As a result of all these things throughout the country there is a feeling of concern about what our economic policies are going to be.
People hoped to find out in the budget brought down last Monday night that the government of Canada had entered a new period, a period of new ideas, that the government was really taking our problems seriously, and was willing to bring down measures that would solve them. Did they find that in this budget, Mr. Speaker? The answer is clearly no. This is a budget that could have been written in 1952, that could have been written in 1962, and indeed could have been written in any year since the publication of Lord Keynes work, "The General Theory of Employment, Interest and Money". This is a budget that holds together without a particular thrust, that does not represent or seem to understand the urgency with which Canadians want an attack made on the economic problems they face in the world today.
What is the purpose of this budget? At the start of his budget speech the Minister of Finance (Mr. Turner) said that the budget was designed to lower unemployment, slow down inflation, create faster economic growth, and increase the real standard of living of Canadians. It is the responsibility of the people of Canada and of this House to decide whether or not the budget can succeed in achieving those particular goals. Canadians will only know a number of months after this budget has been adopted, if unfortunately it is adopted, whether or not these goals can be achieved. We, in this House, do not have the luxury of waiting until that time before deciding whether or not we can support this type of budget. For myself, I see little likelihood that the goals espoused by the Minister of Finance in the budget will be reached.
February 22, 1973

How does the Minister of Finance suggest we solve the present unemployment problem in Canada? The basic assumption of the budget is that we can approach this problem in a global way by increasing the aggregate amount of expenditure in the economy. The minister says he is depending on an increase in export trade, on an increase in capital investment, and on inventory buildup as the basis of the thrust for creating the 300,000 jobs which this budget will attempt to create. He said there will be some increase in consumer demand, but he was not looking to it for the basic thrust of the budget in 1973. Mr. Speaker, can we have confidence in the predictions of the Minister of Finance when he says that 300,000 new jobs will be created? It seems to me to be very difficult to have confidence in that projection. We have no budget papers and nothing has been said in the budget about the way in which forecasts have been made. We are not told what proportion of new jobs will come through increases in manufacturing, what proportion will come through increases in export trade and what proportion will come through increases in investment. We must take on faith the projections of the Department of Finance and I, for one, find it hard to do so, given the fact so many projections have been wrong.
In addition given the fact that the Minister of Finance said only last fall that a cut in personal income tax and an increase in expenditure would bankrupt the nation, and that the Stanfield proposal for the constant dollar was an absolutely unworkable scheme, yet accepted these propositions in the budget further shakes my confidence. In view of this performance by the Minister of Finance, one can have little confidence in his statements.


Some hon. Members:: Hear, hear!


James McPhail Gillies: Even if there were not such a dismal record in the field of forecasting and performance, can one be sanguine about the budget when one looks at its thrusts and philosophy in the attempt to create 300,000 jobs? Can one realistically expect the people of Canada to accept a budget that says that one of the important ways of increasing employment this year is through an expansion of exports? There may be an expansion of exports from Canada during 1973, but it is far from certain in view of the recent breakdown in the international monetary exchanges and the devaluation of the American dollar on February 12. We know that there may be an increase in protectionism in the United States and in other countries with which we do business. We know that, in our own monetary policies, there are problems connected with our floating exchange rate, and I wonder if we can keep our dollar floating without creating serious inflation. We know that in Canada we have never had really high levels of prosperity since the dollar floated up in value. Under these conditions are we responsible in placing confidence in any budget that says that one of the major thrusts for increasing employment in 1973 will be through an expansion of international trade?
What are the other reasons for expansion? We do not know how large the increase in capital investment will be in 1973 but, according to indications at this time, it will not be extremely large. There is still a degree of uncertainty
The Budget-Mr. Gillies
among businessmen, an uncertainty resulting from the provisions of the tax reform bill, from the suggested Competition Act and from changes in labour relation laws. People in the business community still are not sure where the government is going. Consequently, we cannot positively count on substantially increased business investment to move the economy ahead. Certainly, we have been looking for an inventory buildup for the last two years, and that inventory buildup has yet to occur. But even if it does, it is an enormously cyclical factor. So, if we are to depend on increased international trade, on increased inventory buildup and increased capital expenditure to get this economy moving again after it had been in dead centre for three or four years, it seems to me we are expecting more than we have any right to hope for.
What do the budget figures actually tell us? They say that the government hopes, basically, to stimulate an expansion in consumer expenditure and, to do that, the minister has introduced a cut in personal income taxes, a cut which, I presume, the government introduced with reluctance, because, as recently as last May, the government thought that cutting personal taxes was not a good thing to do. However, even if one counts the cuts in personal income taxes introduced in this budget, the amount of money that will be taken out of the hands of consumers by the personal income tax system in 1973 will be higher, it is estimated, than the amount taken out in 1972 despite the cuts which have taken place.
In addition, the budget expects to introduce more purchasing power into the economy by cutting sales taxes and excise taxes by about $200 million, out of a total of $3.5 billion. So, that is a very modest cut indeed. The net effect of all these cuts in taxes will be that the total revenues of the government will be $1.7 billion higher than they were last year. Of course, expenditures have been increased throughout the same period; expenditures have a way of increasing faster than revenues. Consequently, this year the budget proposes a budgetary deficit.
The really fundamental question one has to ask in considering this budget and its effect on employment in the economy is: is the deficit large enough to really move this country ahead, to produce the sort of employment that Canadians have every reason to expect and to hope for within the economy. I would argue, that it is not. In the first place, the change in the cash base, as the minister likes to point out, between this year and last year is essentially nothing. Last year the cash needs of the government were forecast at $2 billion, and the cash needs for the government in the forthcoming year will still be $2 billion. We were to see 300,000 new jobs last year and we did not get them. Why would one think that there will be
300,000	new jobs this year, without any change?
On a national accounts basis, the deficit is less than it was last year. Yes, the deficit is actually less than it was last year. On a budgetary basis it will be only $975 million. I suggest to you that a deficit of this size has little likelihood of moving the country forward in the way in which it ought to go. Let us see what would happen in this country on the basis of our present tax system if there were high employment. Where would we be? If the country were operating on a basis of high employment, under the expenditure and revenue pattern suggested by the

February 22, 1973
The Budget-Mr. Gillies
Minister of Finance in his budget we would have a surplus in tax revenue in this country of approximately $1 billion. Even if we were operating today with an unemployment rate of 5.5 per cent, we would probably still be in a balanced budget condition. Considering the revenue and expenditure pattern that the government has brought forward, how can one ever argue that the economy will move ahead?
As I said many times, I do not like international comparisons, particularly those involving the United States. When United States authorities wanted to bring their unemployment rate down they operated with a deficit of 10 per cent on a national accounts basis and brought the unemployment rate down from over 6 per cent to about 5 per cent in 17 months. On a national accounts basis, the deficit which the American government is running with a 5 per cent unemployment rate is twice as high, proportionately, as the deficit projected by the minister for the forthcoming year. In view of this pattern, there is no reason to expect that a deficit of the size projected in this budget will do anything to move this country ahead in a major way.
How long must Canadians wait before a government takes the sort of action that will put the people of this country back to work? We do not need to have a 6.5 per cent unemployment rate in this country three or four years in a row. We do not need to have young people without jobs. What we need is the will and determination to make the economy work. Only a lack of spirit on the part of government has enabled the situation to continue. In Germany there is virtually no unemployment. In Japan there is full employment. In the United States the unemployment rate is down to 5 per cent. Why cannot we do something about the problem in this country?
I can assure you, Mr. Speaker, that if a Progressive Conservative government had been in power and had been given the responsibility of bringing down a budget, it would have brought down one that would get this country going again. That budget would have been substantially more expansionary than the budget the government is introducing at this time. Within one year and a half our unemployment rate would be down towards 5 per cent, revenues would be up and we would not be operating so far below potential. Just think what you could do with the extra revenue that full employment would generate. If you had an extra $1 billion in tax revenue, you could start to move old age security payments down from age 65. If you had an extra $5 billion or $6 billion in output, which would happen and which is the real value to the country from a full employment operation, just think what you could do with regard to housing, regionally depressed areas and so forth. It is inexcusable that, after three years, the government is not willing to go on a much more expansionary basis than they have at the present time. If the Conservatives had brought down the budget, we would have removed the 11 per cent sales tax on building materials-


Some hon. Members:: Hear, hear!


James McPhail Gillies: -to lower the high price of housing and construction and to get the stimulation of more employ-

ment right away. If we had brought down a budget, we would have removed the sales tax on all types of clothing, not just children's clothing, in order to avoid the bureaucratic problems that will develop in deciding which is which. If we had brought down a budget, we would have had a program-


Mr. Deputy Speaker:: Order, please. I regret that I have to interrupt the hon. member, but the time allotted to him by the House order made earlier has expired.


Robert Lorne Stanfield: Mr. Speaker, I rise on a point of order. Under the agreement reached, the hon. member has half an hour.


Mr. Lefebvre:: That is correct, Mr. Speaker.


Mr. Deputy Speaker:: The Chair is always glad to have advice. It had not been given to the Chair before. I apologize to the hon. member for Don Valley.


James McPhail Gillies: As I was saying, Mr. Speaker, if we had brought in the budget, we would have removed the sales tax on building materials, all types of clothing, not just children's clothing, and brought in a program to help the small businessmen of this country. We would have had the tax program that has been put forward by our party, a program that would really stimulate employment because the bulk of employment in this country is still in small business. To have a budget come down that does nothing more than correct the mistakes of the past as far as small business is concerned is quite inexcusable.
If we had done these things, the deficit we would be running on a national accounts basis would be somewhat over two and one half as much as the deficit which the Minister of Finance suggested. I say to the members of this House that this country at long last needs this sort of stimulation to move ahead in an effective and improved fashion. This is the sort of program we would have had if there were a Conservative government in power at the present time.


Some hon. Members:: Hear, hear!


James McPhail Gillies: The Minister of Finance says that with his budget he may overshoot; it is a budget that may be too strong. I do not know how it can be too strong. There is no way that there is sufficient stimulation in that budget to bring unemployment down to a level of 4.5 per cent, the figure for which we should be aiming. Even his own estimate is that the unemployment rate would be down to 5.5 per cent. I suppose what the minister is saying is that the budget may be too much stimulation in its inflationary impact.
There is no question that inflation is a very important problem in this nation. However, anyone who thinks that inflation in the nation today is coming from excess demand in the economy certainly is misinterpreting the inflationary situation in totality. That is unexcusable. It may well be a sort of interpretation that will rank with the earlier choice of the present government trying to stop inflation in this nation by creating unemployment. The inflation we have in this nation today, and a very serious problem it is, will be with us unless we take serious action to prevent it.
February 22, 1973

It is an inflation that is caused primarily by cost push, and an inflation that is created by cost push can only be solved by an action that is dedicated and directed toward attacking the particular problems that are causing it. If this party were the government, it would have introduced on budget night a program which would have called for a freeze on wages, prices, dividends and income. We would have an income policy for 90 days so that we could develop in this country a stabilization program that would really get to the heart of the inflation problem of this nation.


Some hon. Members:: Hear, hear!


James McPhail Gillies: The time has passed when we can ask the Canadian people to pay the cost of a continuing inflationary situation such as we have had for the past year. The time has passed when we can pretend to put our finger in the dyke and solve these problems. The time has come for action on these particular situations. We would have put on a freeze. We would have used the time of the freeze to consult with the provinces, labour leaders, business leaders and consumer groups to work out an economic stabilization program that would achieve controlling the price rises in this nation.


Some hon. Members:: Hear, hear!


James McPhail Gillies: It would bring down the inflationary rate in this country to close to 3 per cent in a year. This is the sort of thing we need. The Canadian people want action to solve the problems of unemployment and inflation. The budget before us tackles neither of these in a really responsible fashion. There is no chance of this budget solving the problems of unemployment and inflation. There is no way in which responsible members of this House can support this budget given the fact that we have these serious problems in the country today.


Some hon. Members:: Hear, hear!


James McPhail Gillies: The people of Canada want the problem solved. They know these problems were solved in the United States to a considerable degree. Why does not the government have some imagination and come forward with programs that will really work?
In addition to having an expansionary program of the sort this party proposes, and in addition to a freeze to tackle the problem of inflation, we would have been working on programs to solve some of the other economic problems that face this country. We would have had a task force working now to find out how to use funds in the exchange equalization for investment by Canadians. We would have had a tax program to support Canadian exporters-a program based on performance. We would have resurrected the Porter commission report and done something about regional monetary policies to stir economic activity in this depressed nation.


Some hon. Members:: Hear, hear!


James McPhail Gillies: By now we would have certainly had a reorganization going into the way in which economic policy decisions are made by this government so that we
The Budget-Mr. I. Pelletier
would not be making policy on forecasts that are wrong in direction.


Some hon. Members:: Shame!


James McPhail Gillies: The people of Canada deserve much more leadership in economic policy making than is even suggested in this budget. The people of Canada want these problems solved. Any member of this House of Commons who thinks this budget is going to reduce unemployment substantially, who thinks this budget can possibly solve the inflation problem and therefore votes for it is not responsibly serving the needs of the Canadian people at this time.


Some hon. Members:: Hear, hear!


Mr. Blais:: I was wondering whether the hon. member for Don Valley would permit a question? I am sorry for the delay, but the thunderous applause prevented my getting your attention, Mr. Speaker.
The hon. member has indicated that he espouses a policy of wage and price controls and controls on dividend payments. I should like to ask him when he came to that brillant conclusion was that decision formed when he appeared on the program Encounter on February 8, 1973 at which point he gave such an indication-


Mr. Grafftey:: That is not a question, that is a speech.


Mr. Deputy Speaker:: The question and the answer would have to be very brief. The hon. member for Don Valley is one of the members of the opposition who has been given 30 minutes for his speech. There was approximately a minute left at the conclusion of his observations and the applause attendant thereon. I think I am bound by the order of the House, since a question by the hon. member would take us past the time allotted to the hon. member for Don Valley.


Mr. Macdonald (Rosedale):: He failed to answer the question.


An hon. Member:: Don't you think he could?


Donald Stovel Macdonald: The question killed the whole speech.


James McPhail Gillies: I have the answer right here.


Donald Stovel Macdonald: He ran away!


Mr. Alexander:: You all look sick over there.


Mr. Deputy Speaker:: May we have order. The Chair has recognized the hon. member for Sherbrooke.


Mr. Irenee Pelletier (Sherbrooke):: Mr. Speaker, I am very pleased to speak at the beginning of the budget debate.
I would like to take this opportunity to discuss two subjects which are important both for the constituency I have the honour to represent and for Canada as a whole.

February 22, 1973
The Budget-Mr. I. Pelletier

Before dealing with these two important questions, may I say it is a very happy coincidence that I should be one of the first backbenchers on the government side to speak on the budget. I was offered this opportunity, probably, because the first minister of finance of this country was the Hon. Sir Alexander Galt, the member for Sherbrooke in Sir John A. Macdonald's first cabinet.
The county which I represent has been represented by many other distinguished members who have served Sherbrooke and Canada with high distinction. I might mention, for example, the Hon. William Ives, Charles Howard and Maurice Gingues in this connection.

Sherbrooke, often rightly called the Queen city of the Eastern Townships, is the fourth most important city in the province of Quebec. I am very happy, Mr. Speaker, to be able to draw the attention of the government and this House on the economic situation in Sherbrooke and the Eastern Townships during the debate on the budget, a budget which will allow the government to materialize its intentions.
Mr. Speaker, the two questions I chose to deal with are part of the two major objectives stated in the Speech from the Throne and that the government intends to pursue in the coming years in both the social and economic fields.
I will deal first of all with the economic situation in Sherbrooke and the Eastern Townships and, after that, with amateur sport in Canada.
In order to reach tne economic objectives stated, the government of Canada has launched a two-part program. As indicated in the Speech from the Throne, the first part consists of measures to provide more jobs immediately by strengthening and broadening existing programs. As an example, one can quote a substantial seasonal capital works project to be undertaken in co-operation with municipalities and provinces.
In the second part, the government intends to take measures that will add to the fundamental strenght of the economy and can be expected to have effect with a minimum of delay and, again, one can quote as an example the Speech from the Throne where it is said that the government intends to bring in renewed measures to reduce deeply-entrenched regional economic disparities and the Department of Regional Economic Expansion will be decentralized to allow a better identification of opportunities for regional development.
Among the measures which we could single out in that second part, there is one which seems to me to be important and that is the one dealing with already existing programs to encourage research and development in order to increase their efficiency by encouraging innovation in the private sector of the economy, a two-fold important step in a riding which has two universities-one English-speaking and one French-speaking-two community colleges, one French and the other one English, and several other educational institutions.
As to economic growth, and industrial progress in particular, we are well aware of the fact that the Canadian government in agreement with provinces makes a great contribution to the economic growth, because it has many controls which enables it to encourage investment.
[Mr. Pelletier (Sherbrooke).l
If we consider a map of the province of Quebec, Mr. Speaker, we see that the Eastern Townships region is perhaps one of the only regions in Quebec which has not benefited, during the past few years, from significant government assistance. It now ranks among the slower growth regions in this country.
It has to be emphasized that the federal government, under the designated area assistance program, invested several millions of dollars in this region. As regards industrial structures, however, we must admit that the main reason why we are lagging behind in terms of economy is that the amounts granted were far from being sufficient to create a substantial impact.
Considering data related to employment in the manufacturing sector, we see that Sherbrooke is in a position much worse than many other regions throughout Canada and increased government assistance would be very useful and have pretty good results.
Between 1965 and 1972, employment in the manufacturing sector in Quebec has risen by 7.4 per cent while it dropped by 10.8 per cent in Sherbrooke. Therefore, if the manufacturing sector is important, our region is becoming a marginal area and we can prove, in the light of available information, that the city of Sherbrooke can in no way expect to have an economic recovery without substantial grants from the federal government.
For several years, the Eastern Townships have been studied from a social, economic, cultural, industrial point of view.
In the recently published white paper on socio-economic conditions in the Eastern Townships, we find the main reasons why the Eastern Townships are behind on an economic level, in comparison with other areas of the country. It must be pointed out that the industrial structures are one of the reasons for that economic slump.
We all know that the textile industry as well as the pulp and paper industry have always been and are still among the most important of the district. Now, we know that though both industries have experienced a certain stability in recent years, it must be admitted thanks to the intervention of the federal government, they have not increased the number of jobs and it is easy to understand why there is at the present time a surplus of manpower in that area.
We see anomalies such as, for instance, where the average annual salary paid in the clothing industry of the area is $2,122 lower than the national average, which is $5,492.
This, I respectfully suggest, shows to what extent these traditional industries have paid such low wages in our area.
It is true that the Sherbrooke area has developed an important tertiary sector, but unfortunately the secondary sector has progressed so slowly in recent years that there has been practically no economic progress.
It is obvious that in order to restart the economy, there will have to be some quick and important government action.
The present Minister of Finance (Mr. Turner) said not so long ago that the tertiary sector cannot develop if the secondary sector is not in good shape.
February 22, 1973

Regional expansion programs should be timed in keeping with the national economic situation. The federal government has, on one hand, situation programs for the purpose of coping with cyclic variations and on the other hand, national expansion programs to change economic structures of a region at a given time and at long term.
As a result of delayed application of structural programs in many cases (regional development), the government now lacks significant possibilities for making public investments more profitable; businessmen are well aware that there is a strategic timing for investments, which is often determined by the situation.
I therefore believe that we should take these two important factors into consideration for our investments in industrial infrastructures, on the one hand the economic situation of the country as a whole and on the other the situation proper to a specific region at a specific time.
Nationally, 1973 should be a good year for private investments and consequently a good year to support efforts for economic expansion in the Eastern Townships.
It could be useless to think of investing industrial development funds in Sherbrooke without knowing whether or not there will be private investments, which as I have said, depend on the national overall sitation. Just as it could be useless to invest capital in places that are not prepared for them.
Ideal conditions exist in Sherbrooke at the present time, and there is urgent need for action, as a result of the national situation as well as the sad state of the regional economy and the rational requests expressed by the people of the Eastern Townships in the last few years.
Sherbrooke is the capital of the Eastern Townships; the riding encompasses an area which has seen an almost unique migratory movement in Canada. One can say that the Eastern Townships encompass eight ridings, of which seven are rural and one urban. The seven rural ridings are now losing their population to the urban riding of Sherbrooke. In addition, as a result of the stratification of ages, we must welcome a high percentage of young people who flood the labour market.
In 1972 alone, those two factors put together led to an increase in the number of employees in Sherbrooke from 49,244 in January 1972 to 59,100 in 1973. This increase therefore exceeds 20 per cent. Thus 7,449 jobs were created last year to employ this manpower, but as we can easily notice it was not sufficient and in January 1973 the unemployment rate in Sherbrooke was between 11.6 and 11.8 per cent.
Two firms among the most important in the region are now threatening to close down sometime during the year. The university hospital, otherwise recognized throughout Canada, would dismiss about 200 persons and nothing serious is provided as a replacement.
However, there is hope since three firms that would create about 400 jobs would come to Sherbrooke if they were attributed 45 acres of serviced land in a regional industrial park-which indeed has been seriously considered for several years-whose plans are now available.
The Budget-Mr. I. Pelletier
Other industries have expressed their intention to settle eventually in an industrial park in Sherbrooke. This industrial park was recommended in a $250,000 research report sponsored by the federal government in the riding of Sherbrooke. Without help, the city of Sherbrooke can absolutely not equip the industrial park or even provide 10 per cent of the $5 million needed for this project.
The rationalization works necessary to implement the project have come to an end; we have furthermore received a recommendation from the Quebec Planning and Development Bureau that would like to finance it through the special areas programs.
Mr. Speaker, there are also enormous touristic possibilities in the region that numerous studies made in recent years have always properly stressed. We have there unlimited riches if we know how to exploit them rationally. The intentions of the government, through the Department of Industry, Trade and Commerce, to stimulate this industry in Canada give new hopes to our region.
The situation which I just described raises, on the social point of view, a number of real difficulties which soon will have to be considered.
The white paper published by the Quebec Planning and Development Bureau stated that 20 to 25 per cent of the Eastern Townships population are now living in poverty. In other words, 50,000 people in this region are living below what is considered to be the subsistence level.
As I said earlier, the current unemployment rate has reached alarming proportions since it amounts to 11.6 or 11.8 per cent of labour, and over 40 per cent of the jobless are under 25.
From the annual report just published by the Department of Regional Economic Expansion, it is obvious that great progress has been achieved through the programs implemented by this department in the 23 "special areas" throughout the country.
In the recently published annual report of the Department of Regional Economic Expansion, one can read:
There are important signs that progress has been made in the effort to strengthen the economies of the slow-growth regions of Canada. A number of key indicators in these regions have begun to move in an encouraging direction,
And further on, the report reads:
The experience of the past three years has made it clear that any effective regional development policy must contain certain key elements. It is clear, for example, that regional development policies and programs require close and continuing intergovernmental co-operation. Such co-operation is essential if confusion and conflict are to be avoided.
And the conclusion is as follows:
One other important fact is clear. Regional development cannot be simply an effort to make all regions similar in their growth. There are important differences in the aspirations of people who live in various regions of Canada. Any effective regional development policy must not only take these into consideration, but also recognize that the quality of life desired by the people of the region can be-
-different.
The development approach taken in each region must recognize this key fact and build upon it.
These, I submit, are clear and specific examples of the type of intervention to which the federal government has

February 22, 1973
The Budget-Mr. Grafftey
resorted for the past few years and which have been successful. We have enthusiastically welcomed in the Speech from the Throne those proposals which are intended to reduce unemployment, check inflation and strengthen the economy.
Through our adoption of the present budget, we shall be able to carry out in many parts of the country projects on which the people have been consulted but which must also, from an economic point of view, be undertaken in the nearest future. This, I suggest, is the economic situation in the constituency which I have the honour to represent.
A joint intervention by the government of the province of Quebec and the federal government has become urgent. Whatever the government mechanisms used to correct the economy of this area, it is imperative that this be done as soon as possible.


Mr. Deputy Speaker:: Order. I regret to interrupt the hon. member but the time allotted to him by the House order passed earlier today has expired.


William Heward Grafftey: Mr. Speaker, at the outset of my remarks, I would like to congratulate my neighbour from Sherbrooke. I think his maiden speech in the House was in French and I would like to take this opportunity to offer my sincere congratulations to him. Even though his opponent during the last elections was a great friend of mine, I take this opportunity to wish him the best of success in his political career.
Mr. Speaker, at the present time, as well as during the last election, the most important problems for all Canadians are unemployment, inflation and regional expansion.
Our problems remain the same as they were at the time of the last election and they are the result of bad administration of the Canadian economy, whereas adequate policies which were proposed to everybody by our leader and our party should solve those problems.
I can only repeat most emphatically what has already been said. In my view the present debate is an important one because the questions that were important at the time of the election, notably those of unemployment, inflation and regional disparity, are the very questions of concern to the Canadian people at the present time. The same question that was concerning the Canadian people at the time of the election more than anything else, namely the maladministration of the Canadian economy by the present government, is of equal concern today. That is why the budget debate is of such importance not only to the members of this House but to all Canadians.
I would be the first to admit, along with many of my colleagues on this side of the House, that in the short term there are obviously many attractive items in this budget. They are attractive and desirable politically, economically and otherwise-


An hon. Member:: Wait for the "but".


William Heward Grafftey: Yes, there will be plenty of "buts". Members on this side of the House who have preceded me noted time and time again that there is nothing in this budget to alleviate, in the long run, basic problems of unemployment, the cost of living and regional disparity.
As I listened to the minister responsible for DREE a few minutes ago I could not help but feel his whole speech was nothing more nor less than an indication of why DREE has not worked. I repeat, as most members on this side of the House said before me, there is nothing in this budget in the long term that will alleviate unemployment, the cost of living and regional disparity. One might ask why. It is because the budget, in itself, is not expansionary enough to begin to correct any of these conditions.
There are other questions I should like to ask, Mr. Speaker. Where in this budget are the incentives to Canadians to invest in the Canadian economy? If we are really interested in creating a viable economy in this country, which in turn will create more good jobs and I mean good jobs for Canadians, we must do something about developing secondary industry. Surely, one of the first and basic things we do through a budget is to create an atmosphere which will encourage Canadians to invest in Canadian industry and in the Canadian economy. I ask the minister, as people will ask from coast to coast, not just those in this House, where are these tax incentives? This question will be repeated time and time again because there are no long-term solutions in this budget to the basic, economic questions facing the Canadian people.


An hon. Member:: It is a cosmetic job.


William Heward Grafftey: If there are no long-term solutions in the budget it is because, as was said by the speaker who preceded me, there are no long-term forecasting procedures in the Department of Finance. We have seen time and time again over the last few years that the United States has outperformed us in areas of regional disparity, inflation and unemployment. I suggest it is because the United States has exercised, not necessarily with bureaucratic control but with leadership, certain percentage guidelines in these areas of inflation and unemployment. Where is the leadership in respect of guidelines shown by this Minister of Finance and this government? I suggest they do not have any and that we will drift along in the same old unimaginative way. There are no long-term forecasts and no guidelines, and we compare very badly with what we see going on in the United States.
Let me remind this House of one of the things that struck me most forcibly, and this is an important consideration. While I have noted, as have other hon. members, that certain transfers are to be made to the provinces, basically speaking this budget does not realize that very often the action is at the provincial and municipal levels. This budget does not recognize the responsibility of the provinces. It is my contention that because of the lack of realization of provincial responsibility we are really not going to achieve any tax cut, because provinces will be forced, much sooner than later, to up provincial taxes. This government does not recognize the duty and responsibility of our colleagues and confreres at the provincial level. I want to stress the importance to hon. members of the House and the Canadian people of watching how this
February 22, 1973

budget, directly or indirectly, will force provincial Prime Ministers and Premiers to increase taxes. This will result in virtually no tax cut for the Canadian people at the end of the year.
Without getting too specific in this budget debate, although sometimes we can argue from a specific to the general by taking examples, I should like to touch upon three problems in my area which are national problems that faced this country during the last election. Very often politicians at the local or constituency level are accused of being narrow or parochial when they discuss what they think are problems of their constituency, but soon find out after coming to Ottawa that they are problems facing and harassing the constituencies of Members of Parliament from coast to coast.
I want to refer to designated areas, health care services and unemployment insurance. It was some time ago that Mr. C. D. Howe said "what's a million", and during the intervening time the government has wasted millions in faulty handling of an aircraft carrier and other things. I am talking about something much worse than that. In a short 15-minute budget speech I do not have the time or the right to document this waste with the Clerk of the House, but I categorically claim that in these three areas which affect not only my constituency but the whole nation, that is designated areas, health care services and unemployment insurance, because of the gross mismanagement of this incompetent and tired administration we are wasting annually over $4 billion in tax money.
Let me first of all refer to the unemployment insurance issue.


Some hon. Members:: Oh, oh!


William Heward Grafftey: You can sit over there and make fun of these things, but I am talking about some pretty serious matters.


An hon. Member:: Mai de tete.


William Heward Grafftey: I do not think I need comment on that sort of remark in this House, Mr. Speaker.
While we can talk about the run on the unemployment insurance fund and the maladministration of this fund, I simply talk about the main issue, as did the Minister of Labour (Mr. Munro), unemployment. However, there are some other things which must be brought to the attention of this House. There was a day about ten years ago when there were unemployment insurance commission offices well placed throughout this country. But to satisfy the bureaucrats much more than to satisfy the will of the people, many of these offices were shut down in the name of efficiency, decentralization or centralization if you like. The fact is that in many constituencies across Canada such as mine-constituencies containing towns with a population of 15,000 people-there is not one UIC office. However, in the present, as in the past, if one in order to qualify for unemployment insurance must be available for work how in the world, if there are manpower offices in the rural areas and UIC offices only in the large cities, can the fund be policed.
The Budget-Mr. P. Neale
In the province of Quebec and in many provinces of Canada, one has a long and painful wait in respect of unemployment insurance benefits because of the terrible administration by this government and by its inhuman administration. An hon. member laughs, but I suggest to him that the same situation exists in his area. People must wait for weeks and weeks to receive their cheques. Some of them have to go on welfare just because this government cannot administer the fund properly. I am concerned about the day-to-day administration of government services. People in my riding ask, if a government cannot get cheques to people who are out of work through no fault of their own, can it administer and govern in respect of other things in Canada. We might say the same thing about the mail services. It is my view that a $1 billion overrun in the UIC fund is an example of poor administration especially when it involves the shutting down of UIC offices.
It might be more difficult to expose les grandes lignes de ma pensee in a short 15-minute speech before this House this afternoon, let alone the next two items in respect of the $3 billion annual waste in the health and medicare field and in the field of designated areas. What is the background to this sort of thing? We were told in the Mackenzie King era that the members of the NDP were nothing more than Liberals in a hurry.


An hon. Member:: What era was that?


William Heward Grafftey: It could have been in the St. Laurent era or in both eras. We were told in the 1930's in respect of the new deal, and later in respect of the fair deal, that the best way to solve social and economic problems was to have a massive infusion of funds and that things would more or less look after themselves. But that approach does not go far enough. Very often it results in wastage. When you have waste in one program, often needed funds for other programs are denied. Now, what do we have? We have an alliance-I do not care what anybody calls it, whether a coalition or an arrangement, I call it an alliance-between the NDP and the Liberals with an obvious result. What will the result be? In the area of health care services and in the field of designated areas-


Mr. Deputy Speaker:: Order. I regret very much to interrupt the hon. member but the time allotted to him by the House order passed earlier today has expired.


Mr. Paddy Neale (Vancouver East):: Mr. Speaker, in view of the fact that I have been limited to 15 minutes, it is not my intention to take the time of this House with pious platitudes about this budget. Suffice to say that it is with considerable reluctance that I offer my support to it. My reluctance stems from the fact that while there is something in it for everyone, there is simply not enough of anything. In my opinion the minister, by his own admission in his budget speech, could have doubled most of the goodies without running short of funds.
The minister has said a number of times that his budget is aimed at creating jobs in Canada and he is talking about 300,000 new workers in the next year. As I understand it, there are some 260,000 jobs created per year in Canada by the natural demand of the market place, so really what he is talking about is some 40,000 additional

February 22, 1973
The Budget-Mr. P. Neale
jobs being created in the next year over and above the normal level. This is simply not good enough, and if this government is truly interested in knocking unemployment below 5 per cent or 5 i per cent in the near future, it must look at some other avenues.
Mr. Speaker, I would like to spend the rest of my time introducing a few suggestions which, in my opinion, would go a long way towards creating employment in this country. First, I would like to suggest that the government take a serious look at recreating a Canadian merchant navy. The ocean-going dry cargo merchant fleet has now been reduced to the lowest possible point barring complete extinction-one solitary ship, if we still have that ship. This does not include the shipping on the Great Lakes. In the past a Canadian merchant marine handled significant portions of our overseas trade. A report of the Canadian Maritime Commission shows that in 1947, 20.2 per cent of the total dry cargo Canadian trade-excluding trade of the United States-was carried in ships of Canadian registry. By 1953, this percentage had dropped to 4.3 per cent. The latest figures that I have seen show the absolutely ridiculous figure of .2 per cent. Meanwhile, ships of foreign registry have captured significant portions of our trade, including ships of German, Greek and Norwegian registry plus the fantastic number of runaway flag ships.
It is incongruous that the Liberal Minister of Veterans Affairs, the Hon. Ian MacKenzie said at the end of the World War II:
We are not going to repeat past mistakes. It is the determined policy of the present government that Canada is in the shipbuilding business for good. The navy and merchant marine that you made are going to be maintained and expanded. The ships you built will carry Canada's trade to the ends of the world, creating employment and opportunity for Canadian workers.
Here is a statement by a responsible government official that failure to build a merchant marine in the past was a mistake. It is also stated that we are to be in the shipbuilding business for good, and that the merchant marine is to be maintained and expanded. Employment and opportunity for Canadian workers are pledged by the solemn word of one of the highest government officials. What was said 24 years ago is still very true, even more so. The discrepancy between promise and actuality can not longer be tolerated. What is the state of affairs with regard to other shipping using Canadian ports to move Canadian goods? Here, Mr. Speaker, are a few glaring examples.
No one example better illustrates the situation than the case of the Canadian Pacific Railway. Having grown enormously rich over the years at the expense of our natural resources, this international company is now busily engaged in swelling its corporate treasury to the detriment of the vast majority of the Canadian people. How does this work in the case of ships? In the late 1960's, the CPR set up a dummy tax haven, a 100 per cent controlled subsidiary, called CPR Bermuda Limited. Why did the CPR go to this trouble? The answer is simple. There was a lot of dough in it for them, since in Bermuda the maximum annual corporation tax is a paltry $560. In order to take the maximum advantage of this fact and to demonstrate their dollar patriotism, CPR Bermuda Limited constructed in the past five years a merchant fleet of

871.000	dead weight tonnage and has on order an additional 360,000 dead weight tonnage.
Here are the details of this "CPR Bermuda Merchant Marine": Lord Mt. Stephen, a 71,000 dead weight tonnage tanker, on charter to Shell Oil and British Petroleum; Lord Strathcona, a 71,000 dead weight tonnage tanker, on charter to Shell Oil and British Petroleum; R.B. Angus, a 13,122 dead weight tonnage bulk carrier, to take lead concentrates and lumber to Japan; Pacific Logger, a
16.000	dead weight tonnage log and lumber carrier, on long term contract for service between the Pacific coast and Japan; T. Akasaka, a 58,000 dead weight tonnage bulk carrier, to carry ores and particularly coal from Australia to Japan; W.C. Van Home, a 58,000 dead weight tonnage bulk carrier, to carry coal to Japan; Port Hawkesbury, a 250,000 dead weight tonnage supertanker, on long term charter to Gulf Oil Limited; and T.G. Shau-ghnessy, a 250,000 dead weight tonnage supertanker. None of these ships were built in Canada. Not one flies the Canadian flag. None employs Canadian sailors. Most carry Canadian raw materials for the benefit of foreign manufacturing industries, and the profits from all this activity are tax free in Canada.
The largest forest products complex in the world, namely MacMillan, Bloedel and Powell River, has followed a similar practice in a smaller way in the province of British Columbia. This company has had three large ships built in Japan using subsidies and write-offs, so that the cost to the company is minimal. The ships have been named after the chief executives of the company, for example, the H.R. MacMillan, named after the past president, the J.V. Clyne, also named after a past president, and the N.R. Crump. I hope I do not have to explain who he is. These ships are all registered in Bermuda and the company pays minimal taxes to that country, some $560 per year according to my information. I am also reliably informed that there are no Canadians hired on any of these ships and that, in fact, all the crews are of foreign extraction, paying their taxes to a foreign country and spending their wages outside of Canada. This, to my mind, is despicable and a disgrace and these companies have the gall to fly Canadian flags from the poles on top of their office buildings.
It seems to me that I recall statements made by the Prime Minister (Mr. Trudeau) in the last election to the effect that he would seriously consider a Canadian merchant marine if there was no need to subsidize it. You know, Mr. Speaker, some people in this country have a funny idea of priorities. It is proper to subsidize, through the DREE program, large multinational companies which do not need the subsidies, but it is not proper for the Canadian government to build a merchant navy owned by the Canadian people if subsidies are necessary. I should like to point out that to my knowledge every country in the world which has a merchant navy subsidizes it, including even landlocked countries such as little Switzerland.
I propose to this government that it build a federal government sponsored and financed Canadian merchant marine, built in new, technologically advanced shipbuilding complexes on both coasts. Such a national investment would mean thousands of jobs for our skilled shipyard
February 22, 1973

workers and thousands more in other industries; the development of modern technology in heavy industry such as steel, the electrical industry, machinery, and the industrial use of computers; control of the disposition of our foreign trade, which is 25 per cent of our gross national product. Canada would then be in a position to become the vital link in an Asian-European land bridge. It would also mean the development of Canadian raw materials, such as coal, iron ore and copper in Canada, and the extension of secondary industry. It would mean the end of the huge drain in our international balance of payments, which totals $313 million in the 1965-67 period, because of our deficit in the ocean shipping account. It would mean permanent tax revenues, business for ship suppliers and merchants, and much less unemployment insurance expense. It would also mean increased personal income and corporation taxes in Canada. Truly, we cannot afford not to have our own merchant marine.
Now, I would like to raise the problems created by the lifting of the ceiling on interest rates in this country and the fantastic interest rates that finance companies are allowed to charge, a rate of 2 per cent per month on the unpaid balance. In round figures, the Canadian people owe $15 billion in consumer debt-this does not include mortgages on houses-upon which they are paying an average rate of 16 per cent, mostly to foreign owned finance companies which pay very low income taxes to the federal coffers. This means that the working people and the poor are losing $1 billion per year from their purchasing power, most of which is leaving this country in profits and dividends.
I specifically mention the working people and the poor because, in the main, they are the ones who have to buy on credit. The businessman, most of the time, has the cash to purchase consumer goods. He also has a wholesale card in his pocket and saves from 30 per cent to 50 per cent when buying from the wholesaler, and usually saves the sales tax. So once again, the workers and the poor are being ripped-off with the tacit acquiescence of this government. I would strongly urge that the government seriously consider rolling back interest rates to those charged by credit unions in this country.
There is another way that employment can be created and pollution controlled at the same time. I would like to give one small example. Those hon. members from the west coast know that there is a great fear that the Fraser River is on the way to total pollution, created, in the main, from the dumping of raw or primary treated sewage by the many cities and communities lining its banks. Some eight or nine years ago I wrote to the department of the interior of the United States for a report on the pollution and clean-up of the Willamette River in the state of Oregon. I learned that the river is less than one quarter the size of the Fraser and it cost some $400 million to reclaim it. You can imagine how much it will cost the taxpayers if we are stupid enough to allow it and the Strait of Georgia to become polluted. The cost will run to billions of dollars.
The latest figures I have seen on the cost of building secondary treatment plants on the Fraser River is $88 million, and sadly everyone says that that money cannot be raised. I suggest to the government that some of the 25789-27
The Budget-Mr. P. Neale
corporate rip-off funds be given to the municipalities as grants to assist them in saving that river and its valuable salmon runs, instead of waiting until it is polluted and then having to spend billions to reclaim it. This situation is probably true in other areas of this country.
I would like now to talk briefly about pension plans and how they could be used to create employment. There are, I understand, some $11 billion in funded pension plans in Canada and some $4 billion in non-funded plans. Most of these plans are beyond the control of the workers who are putting their money into them. These plans are either controlled by insurance companies or by the employers who arbitrarily set them up. I know that lately some unions have been able to negotiate trustee set-ups to administer their pension plans, but these plans only cover a small percentage of unionized workers. We all know that only one third of the Canadian work force belongs to unions in this country, so very few of them have this kind of protection.
The worst offenders in this respect are the CPR and the CNR. These two companies have absolute control of their employees' pension plans and callously and intentionally invest the moneys in low return areas. My understanding is that the return on investment for both these plans runs from 21 per cent to 3 i per cent a year. The companies are very happy with this set up because they do not put up their share of an employee's contribution until he reaches retirement age. They have been able to use this money for their own interests during all the employees working years and only have to pay retroactively an amount equal to their share, plus what that amount would have earned during the work life of the employee. You can readily see that it is to the advantage of these two companies to keep the return on investment as low as they possibly can.
The CNR is a publicly owned corporation, and it is a shame on succeeding governments of this country that this situation is allowed to persist. This government can set an example by ordering the CNR to allow the employees, through a trustee set-up, to have some say in the investment policy to be followed in respect of their money. Just think of the result, Mr. Speaker, if these pension funds were made available at only 6 per cent so that workers could borrow the money to purchase or build houses. Think of what this could accomplish. First, there would be an upsurge in housing construction in Canada, creating thousands upon thousands of jobs, not just in the construction of these houses but in the manufacture of all the component parts of the house. Second, it would double the return to the pension fund, thereby making it possible to pay higher pensions, which, in itself, would increase the purchasing power of the retired workers and would also allow for a reduction in their retirement age covered by the plan. This in turn would create more vacancies which could be filled by the young people who are presently drifting around this country disillusioned and frustrated, trying to find work.
The same principle could and should be applied to all pension plans in the country so that the contributors to the plans could receive some of the benefits accruing from the investment of their moneys instead of the monster corporations and foreign-owned insurance companies reaping them all.

February 22, 1973
The Budget-Mr. Railton
There are many other issues that I could raise, including improved facilities for bulk loading in the port of Vancouver to stop the drain of shipping and handling of goods now flowing to the ports of Seattle and Portland. But, Mr. Speaker, I have taken enough of the time of the House on this occasion. I just hope that the government will seriously consider some of the recommendations that I, and other members of the New Democratic Party, have made to bring unemployment down to an acceptable level. I want to assure the Minister of Finance that an acceptable level is not 5.5 per cent, not even 5.2 per cent, but a much lower figure than that.


Mr. S. Victor Railton (Welland):: Mr. Speaker, this is my official maiden speech, although I did give a short opinion on the subject of capital punishment some weeks ago. I would still like to congratulate you and your colleagues on your impartiality, and on the distinction which you all bring to the sittings of this House.
Today, we heard the new member of the official opposition who represents Don Valley (Mr. Gillies). I notice that he did not express his opinions in this House until the budget speech had been read. I think hon. members should make a note of that. The leadoff speeches for the Progressive Conservatives, the NDP and the Socreds have also been given. Regarding the first, we heard only criticism, this in spite of the fact that they claimed that our Minister of Finance (Mr. Turner) had stolen their ideas. It is obvious that that is not the case. They did not come even half way to meet our proposition, and they had no real method proposed for working out their scheme.
The NDP leadoff speaker supported us very well, but of course he claimed that we had stolen many NDP ideas. This may be so, but that seems to be the function of a party that is doomed to remain in the minority and which admittedly has left wing ideas. So far as the Socreds were concerned, we were blasted all the way. Their main cry was for the introduction of their peculiar economic philosophy, which would require the printing of funny money to put it into practice. So, although we must always impute the highest of moral qualities to other parties, we can see that the attacks of the Official Opposition are simply an attempt to confuse the electorate, and hopefully to bring down the government, in this way getting their chance to force an election. This is very obvious. They seem so desperate that it is becoming crystal clear that their chance of forming a government is getting slimmer by the hour.
The members of the NDP must be given credit for idealism. They are, in addition, a well disciplined party with an eye to the future. They have temporarily submerged their socialistic anchor, but to be credible they have taken to the marriage bed with a gun, threatening that this may be their last try to make a marriage of convenience work.
To me, the budget is the best one produced by any government, whether majority or minority. The reduction of tax is really 12 per cent. It is definitely a poor man's budget. It is unprecedented in Canada's experience to give a $5,000 a year man a 47 per cent reduction in his income tax, and an $8,000 a year man a 15 per cent

reduction in his tax. The sales tax is family oriented. The lightening of duties on fruits and vegetables is a big blow to high food prices. It is also, as the Minister of Finance stated, a friendly gesture toward our largest trading partner, and now it gives us some reserve for negotiations on all tariffs, and still will not hurt our producers.
My constituency of Welland is right near the Niagara frontier. It is agricultural in some portions, but very well industrialized also. It contains heavy and light industry, with large firms, Canadian owned, such as STELCO and Atlas, and also foreign owned firms such as INCO and Union Carbide.
We also have many medium and small industrial projects in the area. Recently I asked these firms about their reaction to Canada's tax program and to the government's budgetary direction. They have been unanimously in favour of our government's policy to date. They also show statistically that the tax reduction was one of the big factors in keeping unemployment in the area down to a 4 per cent or 5 per cent figure. We have American subsidiaries in our Welland-Niagara area. They employ a great many people. We should realize that we could easily lose all these plants if we use tax discrimination against them. Neither the Welland constituency as a whole not the labour unions in the area want any change in our tax policy. I spoke to several of the unions as recently as Monday last, and I say this House would do well to realize that organized labour in the Niagara peninsula is strong and has had excellent treatment. In addition, it is very co-operative with management and government.
I would like to make a plea for closer ties vis-a-vis Canada and the United States, if only on a friendly basis. In the Welland area many Americans own summer cottages. We have grown to like each other. Every slap in the face in our press hurts them. It must be evident to all hon. members that Americans came to our aid in two world wars. They have policed the world when it was in imminent danger of atomic warfare. Surely, any rebuke or rebuff from us, either verbally or financially, must be a very gentle one.
When speaking of our border with the United States along the Niagara River, I would like to emphasize that we have had in actual fact 100 years of peace. The war of 1812 and the Fenian raids are past. Incidentally, I would like to tell you, Mr. Speaker, that I still have my grandfather's homemade powder horn which he made before getting on the train to go down to fight the Fenians. He got there too late to fire a shot. Now, Mr. Speaker, Americans and Canadians pass each other in both directions over great international bridges at Queenston and Fort Erie. Visitors from the United States are happy to enjoy our beaches and northern lakes, while we press south to the great cities of New York, Cleveland, Detroit and Chicago, or head for the southern states and Mexico. What a wonderful continent we have, and what a marvellous heritage we have in Canada.
Just recently a dinner was held in this House supporting multiculturalism. I was unable to be present but I would like to draw the attention of hon. members to the terrific melting pot we have in the Welland riding. In the city of Welland we have 5,000 or more French Canadians. They take very prominent places in the life of the city and in
February 22, 1973

our municipal councils. This is only one race. We have close to 10,000 other people of various origins, Italians, Hungarians, Poles, Latvians, Croats, Estonians, Ukrainians, and representatives of all other middle European countries. They have mixed well with the old German, Dutch and British stock. We have an extremely interesting panorama of languages and cultures. I think it would do any member of the House a great deal of good to visit this area and see how well the principles of bilingualism and multiculturalism work in my constituency.
The area is remarkably prosperous. We have an agricultural economy of no mean proportions, with mixed farming of all kinds. We also have a great deal of vegetable farming, and we have the tender fruit areas. We are trying to retain the grand old orchards and vineyards in the area between the escarpment and Lake Ontario, and the Tender Fruit Association, known to all hon. members, is doing its best to bring the plight of the fruit and vegetable farmer to the attention of the government. We have a wine industry which is second to none in Canada, and which is becoming recognized throughout the world.
Because of our proximity to Lake Erie, a great many people were very worried about the high lake levels and the lack of provision for either public works, subsidies, or insurance to protect against the recent storm catastrophe. However, I have been able to assure these people that we are trying to do something to solve these difficulties.
One of the great public works in my area is the Welland ship canal. This is the fourth one that has been built during the last 200 years. The most recent addition is the bypass which straightens the canal and takes it out of the city of Welland. It now runs straight from Port Colborne to Port Robinson and allows much faster shipping movement. Formerly there were many traffic delays. There were irate citizens in both Welland and Port Colborne waiting for bridges which, in previous years, had to be raised and lowered every few minutes in an attempt to let the ships pass through the canal.
The Welland Canal is part of the great international seaway that takes shipping right up to Thunder Bay and Chicago. It is one of our greatest routes for the shipment of our wheat and ores. It is a tremendous freighting facility not only for internal trade but also for ships coming from every corner of the world. This seaway runs 2,000 miles into the heart of North America.
Building the bypass to avoid the city of Welland has brought troubles in its wake. Though it has provided two tunnels, at great expense, for our automobiles and our rail traffic and supplied a very fine new dock, and though it is going to open on time-thanks to all our efforts-next April, it has left the old canal, which is now abandoned, right in the centre of the city of Welland. The old canal does not flow. It is going to be a static ditch because of the causeway which carries heavy freight lines across the old canal after emerging from the tunnel under the new bypass. This means there is a great likelihood that the old canal will become polluted and unsightly.
So it is the job now of myself and the council of the city of Welland to make sure that the government sees clearly the plight in which the new bypass has left us and the city 25789-27*
The Budget-Mr. Railton
of Port Colborne. For this reason I have been making representations to the government and the St. Lawrence Seaway Authority, along with delegations from the local municipalities and the region, to settle this matter. The fate of unused or abandoned canals in Canada has never been particularly pretty. One of the most recent problems in this regard involved the canal at Cornwall, which concerns Mr. Speaker. After ten years of hard work which involved His Honour, the citizens of the area and the government, a solution was found. I think a solution in our case will be more difficult to come by. I have talked about our local situation, Mr. Speaker. I think all of us should look beyond the localities we represent even though we may come from such lovely spots as Welland, in the Niagara peninsula, which is really a continuation of the golden horseshoe running along Lake Ontario from Oakville to Burlington.
When we look at the world situation, we know that we must trade with the U.S.A. Seventy per cent of our exports go there right now. About 12 per cent go to Europe. There is a smaller percentage going to Japan and the undeveloped nations of the world in Africa and Asia. There is so far very little trade going to China and Russia, but let us not forget that it was our own Liberal government and its leader which initiated the rapprochement between the west and these two great countries.
It will be very difficult for us to export manufactured goods to that remarkable economy of Japan. It will be almost as difficult to find suitable goods to export to the European community. However, the people in our area as well as those in the rest of Canada, hope that if we implement all the parts of this budget there will be a great opportunity for us to continue trade with the United States, Europe and Japan and to find new markets in emerging countries as well as in the two great nations which formerly hid behind the iron curtain.
As a new member, Mr. Speaker, I feel privileged to be taking part in this lively and historic parliament. Frequently the action gets a bit rough. However, what good is a man who will not fight for something? We seem to be successful in channelling this basic human instinct into making this minority government work. All members of this House are obviously good Canadians, so I am confident that our national future is in good hands.
Recently, an hon. member opposite drew a good analogy about the short span of human life on this planet. He said that a length of rope stretching from Lake Ontario to the Speaker's chair represented the total span of life on earth. He showed that the very short, final end of the rope was the length of man's time in the evolutionary scale. For a few minutes I was worried that his rope might have a noose on the end which he might tighten around the necks of the government supporters.
This picture can be transferred from the past to the future. At some time not too far into the future our knowledge of astronomy and space technology will pierce the secrets of space, time and even immortality. In my mind there is no place in Canadian society for resigned acceptance of eventual human decadence. So, Mr. Speaker, even the trivia of party politics arid the present budget debate are small but necessary evolutionary steps in the upward progress of mankind.

February 22, 1973
The Budget-Mr. Blenkam


Donald Alex Blenkarn: Mr. Speaker, the budget speech we listened to the other night will do absolutely nothing to correct what I consider to be one of the most serious problems affecting young, newly married Canadians who want to raise a family. Hon. members on the other side suggest that the budget will deal with unemployment and inflation. They suggest that there are adequate proposals in the budget to handle those problems. For the few minutes allotted to me may I direct the attention of this House to the serious problem of housing, the cost of housing in our large urban centres, in particular in and around metropolitan Toronto.
When I raised this matter in the House the other day, the Minister of Finance (Mr. Turner) suggested that he had said nothing about housing in the budget and that Bills C-133 and C-135 would be helpful. Anyone who has read those bills will realize that they will do absolutely "zip" to solve the problem: they are just tinker bills. One bill creates an unworkable mortgage exchange, no doubt dreamed up by a foggy bureaucrat somewhere, and the other attempts, with a lot of financial salve, to do something about urban development; in other words, something about low-income housing. But it will not do anything that has not already been tried.
It became evident throughout the election campaign that municipal authorities, provincial authorities, people in apartments, people all over the country, including developers, had isolated the problem which has to do with lack of serviced land in and around the cities. The government has proposed nothing since the election, either in the budget or in any bills on the order paper, that will deal with this problem.
Municipalities encompassing growth areas, and the provinces, are clearly short of money. Because they are short of money they cannot build rinks, community centres, sidewalks, sewers, water mains, rapid transit and similar facilities; therefore, they are not able to approve plans of subdivisions presently filed, registered and ready to go. To be sure, under the Central Mortgage and Housing legislation provisions there is an arrangement whereby municipalities will be lent 75 per cent of the cost of constructing sewers. That provision is to help with the construction of sewer mains. But that kind of loan affects the debenture credit of a municipality; as a result, the provisions of the act in this respect are totally useless.
Developers such as the McLaughlin company, the Erin Mills company, the Markborough company and hundreds of others, have subdivision plans which are ready to be put into operation. They are ready to do something about this problem. And what has this government suggested as a solution? Land banking. We have all sorts of land banked around the metropolitan centres of this country, ready to go and ready to be developed-and this government has done nothing about it. It has done nothing about the $16,000 it costs for a half or semi-lot, or about the $18,000 or $20,000 it costs for a single-family house lot. Has this government done anything about the fact that, because we are only bringing onto the market less than one-third of all residential lots required, by next year the price of residential lots in Toronto will rise to about $24,000? No, Mr. Speaker, the government has not done a thing. It has no program. Right now in the metropolitan
[Mr. Railton.l
Toronto area, unless you happen to be privileged or wealthy, with money in the bank, you cannot afford a new house. Only 4 per cent of the citizens of that area can afford to buy a new home.
Something must be done. The government has suggested that $100 million a year should be used for land banking. They should be making grants to municipalities. They should be turning over to municipalities some of the money they have for programs that will service land and get land on the market. When I asked the minister about this during today's question period, he had no answer. He said maybe we will have some land available soon.
Let us talk about his land banking scheme for a moment. The minister will have land available. He is going to build new cities. Maybe in two years he will acquire the land. Maybe after five, six or seven years, when he organizes things, he will service some of that land. I suggest it will be at least ten years, and perhaps longer than that. It may take the 20 years that Malvern took before any of this land in his famous land bank gets on the road so far as development is concerned. This is the record of the government in dealing with this problem.
The social damage caused by this government in its housing program is probably the greatest it has ever caused. During the election campaign, I went into apartment buildings. I want to speak about one of them. This apartment building had on it the sign of the present Minister of Manpower and Immigration (Mr. Andras). It contained 360 suites, fronted two four-lane highways, was faced with red brick, sterile, with a playground which was a fenced-off part of an asphalt parking lot. You would not even put animals in a zoo in those playground facilities. The kids have to ride their bikes in crowded apartment corridors. That is the policy of this government with regard to low-income housing. We have not heard a thing from this government about a backyard for kids to play in, a park or facilities that will make life better for those who are in the less fortunate category of society. We have not heard anything about bringing down the cost of housing.
We should now be talking about the economic cost of housing and not just the social cost. The social costs are serious enough, but we must also talk about the economic costs. The other day I spoke to a man who came into my office and said he needed some help. He could afford to pay a man $130 a week; however, he could not get the man he wanted because he wanted to live in a decent house and drive a decent car, and therefore could not start at that wage level. Even though he would eventually earn $250 a week or more, the man said he could not live in the community with that kind of wage. Here is a man trying to build a business, get ahead and get other people involved in work. The whole problem boils down to inflationary high rents and high mortgages in our metropolitan areas.
I want to say a few words about one of the geatest national disgraces this government continues to allow. I refer to the 11 per cent sales tax on building materials-11 per cent on every brick, every piece of plumbing pipe,
February 22, 1973

every concrete block and every sheet of lathing. We do not now charge tax on food, and apparently this government says we do not even have to pay sales tax on the mix for a cocktail party; but we charge tax on building materials.
The party to my left is going to support a government that believes shelter costs should be taxed. Can they think of anything worse than that? This is a tax on growth areas. It is a regressive tax. It is principally collected from areas of Canada where growth rate and housing problems are most severe. This tax is maximized in areas where costs are already overbearing the price of a house. We need aggressive changes and suggestions. If we are going to tax buidling materials, some of the tax should be rebated to the municipalities or the purchasers of houses so they will at least have a little bit of equity. We did not receive such a proposal, or anything like it, from this government.
The area I come from is sometimes called the golden horseshoe. I suggest to the House that the government has used this area as its golden goose. This area is a source of tremendous tax revenues for this government. Any farmer knows that if you want to get eggs from a goose, you have to feed it. The government's attitude to this growth area, with its tax on building materials, is to take, take, take. It is about time that somewhere along the line the Minister of Finance did a little giving.
The minister must realize that if we are going to attack unemployment, the construction industry can supply more employment than perhaps any other industry. This government's program on employment has been unemployment insurance, LIP, Opportunities for Youth, and so on. However, none of the programs presented by this government have been to build anything that is useful and will get people organized, such as community centres. The other day I received a call from a lady in Malton. She asked if she could get a grant to organize a community centre. I told her that the federal government had pumped $40,000 into her community in the last year, but not a dime for building a facility that would have any permanent value. The programs this government produces do not have any permanent value.
If we are going to build Canada, it is time we looked ahead, took the kind of aggressive action suggested by the hon. member for Don Valley (Mr. Gillies) and attacked the social problems of the city, the problems of housing and the cost of housing. I speak on this matter with feeling. I speak on it because I have an element of self-interest in it. As the cost of residential houses keeps rising, and the only alternative of this government seems to be bigger and bigger high rise apartments with more subsidies, I can see the environment in which my own children will grow up. I had a back yard. I had a place to grow, a place to be. Through not having a concrete housing policy and not attacking the problem of making land available, my children will not be able to have a home. That, Mr. Speaker is my concern. That gives me a personal interest. Perhaps I should not be bringing personality into a debate such as this, but I am sure that is the personal interest of every member of this House.
We must get with it. We must demand from this government a concrete proposal for making available land for housing. The problem has been identified. It is time this
The Budget-Mr. C. A. Gauthier
government took aggressive action instead of just relying on old programs that have not worked.


Some hon. Members:: Hear, hear!


Mr. C. A. Gauthier (Roberval):: Mr. Speaker, I should like to start by explaining certain points, among them the reasons behind the sub-amendment moved by my. colleague, the hon. member for Champlain (Mr. Matte), who blamed the government for failing to take the steps needed to reduce the national debt and to set up a policy for financing provincial governments that does not lead Canadians at all levels of society and in all regions into constant and progressive debt.
The Minister of Finance (Mr. Turner) stated openly in his budget speech on Monday evening that the financial deficit in 1973-74 will be around $975 million, while the non-budgetary needs will amount to $1.25 billion. The overall requirements are estimated at about $2 billion, which is roughly equivalent to those of the current financial year.
At page 18 of the booklet "How your tax dollar is spent 1973-74", there is a table of past, present and future expenditures in connection with the national debt, i.e. what it costs the Canadian taxpayers every year to pay the interest on the national debt.
Here are the figures given in the booklet to which I have referred:
1964-65	(millions of $) $1,051
1965-66	1,111
1966-67	1,191
1967-68	1,301
1968-69	1,480
1969-70	1,717
1970-71	1,823
1971-72	2,010
1972-73	2,175
1973-74	2,581
It is alleged that the national debt is not a bad thing that it is current practice in all countries of the world to get indebted and pay interest to government bond holders because this, they say, keeps the money flowing and above all, these bonds are in the hands of Canadian citizens who profit by them.
Mr. Speaker, until recently the Creditistes were practically the only ones to criticize such a way of thinking and to refuse to consider as normal the indebtedness of the federal government, provinces and municipalities.
In the Labour Gazette of December, 1972, published by the Department of Labour, there is an article written by Mr. Richard Deaton and entitled "Crisis in Taxes".
Incidentally, Mr. Deaton is the director of the Canadian Union of Public Employees and holds a diploma in economics and industrial relations from Wisconsin University. On page 653 of the Labour Gazette, he describes in revealing terms that, from 1950 to 1970, provincial and municipal expenses have been higher than their revenues, whereas the federal government revenues have been higher than its expenses.

February 22, 1973
The Budget-Mr. C. A. Gauthier
In fact, from 1950 to 1970, these revenues totalled about $155 billion against outlays of approximately $125 billion. Provincial coffers took in about $65 billion, but expenditures soared to approximately $80 billion, which represents a total deficit of $15 billion. As for municipalities, their revenues amounted to almost $45 billion, while expenditures were about $65 billion, or a deficit of some $20 billion since 1950.
This is how Mr. Deaton explains the problem and here are the conclusions he draws from the article:
This table shows that at both municipal and provincial levels, total expenditures incurred between 1950 and 1970 exceed total revenues. Only at the federal level is the situation the reverse. Succeeding deficits only increase the debt of administrations and finally result in tax increases. If the "crisis" thus defined only affects municipalities and provinces, it is supported mainly by the federal government which, in part, stands surety for municipal and provincial administrations by consolidating debts and making transfer payments.
The Department of Urban Affairs formally stated: Municipalities have more and more trouble to finance their ever increasing budget. The expenditures of most urban areas exceed their revenue. They borrow or make drastic cuts in public services.
They find themselves in a vicious circle. Each time the property tax goes up, businessmen and "middle class" landlords move to the suburbs, and in order to keep on providing municipal services despite this shift in the tax basis, cities increase even more their taxes ...
May I call it six o'clock, Mr. Speaker?


The Acting Speaker (Mr. Boulanger):: It being six o'clock, I do now leave the Chair until eight o'clock.
At 6 o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Charles-Arthur Gauthier: Mr. Speaker, when the House adjourned, I was reading an excerpt from the publication which deals with deficit spending at various levels of government. The quotation goes on:
Provincial and municipal administrations mainly have blanced their accounts through deficits and by creating debt servicing. From 1950 to 1970, this has only caused the situation to worsen. Thus, the surpluses accumulated during this period, at the three levels of government reached $3.5 billion, while the deficit reached $6.6 billion.
Now with this deficit policy, governments borrow and the debt is growing. From 1950 to 1968, the indirect and direct debt of the federal government went up by 36 per cent; the debt of provincial governments, by 505 per cent, and the debt of municipalities, by 511 per cent. The economists ... keep saying: "The national debt? We owe it only to ourselves". They are missing the point: in fact, the interest on the debt uses up income we badly need for other things.
At present, the cost of servicing the debt alone is the third largest item in public expenditure;
-and when the article was published, we were in second place, but we are now lucky enough to be in third. I continue to quote:
-this money goes mainly to the banks, which are the large buyers of bonds issued by the State in order to cover its deficits.

In this connection, Mr. Speaker, I should like to stress the truth of Mr. Eaton's statements to the effect that the interest that we pay on the public debt goes mainly to the banks, which are the largest buyers of government bonds.
In the budget papers for 1971, table 14, page 56, shows an interesting situation about the distribution of this debt. The table indicates that in 1960, the banks were holding $1,381 million in Treasury bills and that this amount increased to $3,366 million in 1970, namely a $1,985 million increase in favour of the banks.
On the other hand, in 1960, $549 million in Treasury bills were in the hands of the general public, while this amount was down to $218 million in 1970, namely a $331 million drop in Treasury bills held by all Canadians. If you consider the bond market, you find the same tendency.
In 1960, the banks held only $4,421 million in bonds. This amount increased by $3,146 billion in 1970 and reached $7,769 million. On the other hand, in 1970, the general public was holding only $6,484 million in savings bonds, namely a $753 million slump in ten years. It is true that the public which held $3 billion in savings bonds is now holding $7 billion. However, the banks which were holding only $5,802 million of the public debt, are now holding $10,935 million, namely a $5,133 million increase. This means that in ten years, the banks have doubled their assets in savings bonds and are now holding over 40 per cent of the debt. Thus, of the $2 billion in interest that the Canadian taxpayers will pay this year, the banks will cash in over $800 million, which represents about $2,500,000 in daily profits made out of nothing by the Canadian bankers.
The minister himself admits it on page 56 of the budget papers. During the last decade, of the $7,900 billion collected through the issuing of government bonds, the banking system, namely the Bank of Canada and the chartered banks, absorbed all Canada bonds issued as well as a reduction of more than $1 billion of the securities held by other investors.
That is what the minister said. This means that the banking system benefits from the billions paid each year by Canadian taxpayers for the payment of the debt.
Now, Mr. Speaker, how would a Social Credit government finance this public debt? Here is a means available to the government to increase the standard of living of all Canadians without taking anything from anybody, without bringing the economy to a standstill, without bringing about inflation or deflation: it would be to finance public capital by credit advances without interest issued by the Bank of Canada.
One can see immediately that this kind of measure would result in reducing the taxes that the government levies in order to pay the interests on the public debt or its borrowings, and would increase the amounts available to consumers to obtain the goods which would meet their needs.
At this point in the discussion, Mr. Speaker, I would say that although the Creditistes do not get much support for their ideas on the introduction of a national dividend, for
February 22, 1973

instance, they do get some in favour of creating new interest-free credits for financing public capital.
In his book entitled Demain c'est Van 2000 (The Year 2000-Tomorrow), Mr. Gaston Bardet, a professor of applied economics at the University of Brussels, after having studied in depth the banking system, and in the light of the studies conducted in Great Britain by the MacMillan commission and those carried out in Canada in 1939 by the Committee on Banking and Commerce of the House of Commons, came to the following conclusions:
There are therefore two possible methods of financing which are diametrically opposed: one is based on savings, on excess money, the other on anticipating. In the first instance, with regard to private production, control is automatic and depends on the offer of existing capital. In the second instance, it depends on the demand for the most assured primary needs. Thus bank financing is really indicated for the construction of property equipment for the benefit of the entire country. When there is no danger of overproduction, demand really determines the supply. Such are the requirements for housing, roads, bridges, hospitals, schools, forestry, which this time become the regulators of anticipated script money.
It is a matter of consumer loans and no longer one of production. Interest is no longer involved. The country and the community cannot be usurers.
Another economist has considered the problem of government financing and has drawn the conclusions discovered by the Creditistes a long time ago, namely the financing of public capital through new interest free credit.
This principle is stated in The Challenge of Abundance by Mr. Robert Theobald, a book which can be found in the Parliament Library. Mr. Theobald writes as follows:
A government can use three different methods to obtain the funds it requires to meet its obligations. First, it can tax its citizens and institutions, thus gaining possession of their money. Second, it can borrow money from people and institutions and pay interest on the amount it borrows. Third, it can simply create money and use resulting funds to make its purchases ...
The one point on which everybody agreed before 1936 was that the government should never simply create funds. The prohibition against creating funds was based on the assumption that the demand for goods would always be equal to supply as long as government did not interfere with the economy. Keynes destroyed the validity of this assumption when he showed that there was no certainty that the demand for goods would always be equal to the available supply in the rich countries ...
There are other methods that could be used to close any gap between supply and demand. It would be possible to decrease the level of supply without greatly affecting demand by cutting hours of work and leaving wages unchanged. It would be possible to raise the desire for goods by making people feel that more products were necessary for the good life and a decent standard of living. The government could simply take up the slack between actual and potential production by building new schools, by demolishing slum housing and building new accommodation, and by controlling pollution. Because there would be unused resources in the economy, the government would not need to raise this money by taxation or by borrowing, the money could simply be created. The additional funds would not cause inflation, for there is-by definition-no shortage of goods.
This, Mr. Speaker, is the testimony of an American economist, Mr. Robert Theobald, who thinks that it is possible to make money more democratic and to use new interest-free funds for the development and social equipment of the country. If this not the right time to do what
The Budget-Mr. C. A. Gauthier
Mr. Keynes urged so strongly, namely, to "make financially possible what is physically feasible", and I quote:
As a first step, a national financing corporation should be set up in order to provide the funds necessary for the creation of assets for the benefit of society. Thus, jobs would be provided as long resources would last. In a free society, in peacetime, an excess labour force cannot be directed to different occupations, but with education, rehabilitation, a good salary, proper housing, it can certainly be attracted to other occupations, keeping in mind that the GNP can be increased annually.
Never before has our ability to produce, transport, communicate been so great, however, the government's admonitions to tighten our belts inevitably result in restrictions imposed upon producers in various ways. History will show if taxation was too heavy or too complicated. This is why we suggest that for what is called nonprofitable capital goods, a national financing corporation must be set up to meet those needs. This would require very specific terms of reference in order to avoid any conflict with the various financial organizations serving the private sector of the economy which is profit-making-The national financing corporation which would be one of the most important factors in government policies would provide a large part of the money or credits now collected through taxation. Even at the high rates we have at present, taxation is unable to use inactive resources to build a sophisticated road system for example. Moreover it adds an enormous burden to the cost society must pay in interests.
Mr. Speaker, last Friday the hon. Minister of Indian Affairs and Northern Development (Mr. Chretien) said to the House that he would like to be able to finance the building of a Canadian pipeline in the Mackenzie valley but that "he was not a Creditiste and he did not know how to print money".
If the minister does not know how money and credit originate, let him consult his banker who, if he is at all clever and honest, will tell him how the banking system creates credit out of nothing. And if his banker does not know, I will send him a copy of the explanatory brochure published by the Royal Bank of Canada so that he will learn that all that is physically desirable must be made financially possible, and that with a financial system that is true to facts, economic problems would not exist when there is no problem of production.
As the marquis de Serra has written in "Economic chaos and the coming revolution"-


An hon. Member:: He is a bastard!


Charles-Arthur Gauthier: Yes, but he did write some pretty good sentences. Sometimes, bastards do write something good. It is the dawn of art to express in terms of units called dollars the development of materials, natural resources and technological methods, and it is again the dawn of art to create purely monetary means, among which credit, to facilitate the exchange of various services which will carry out the plans.
Mr. Speaker, if I still have a few minutes, I would like to deal with another very interesting subject. I would have liked to have more time to deal with it thoroughly, but I only wish to touch on it lightly because we read in the budget headlines that its major objective is to reduce unemployment.
In brief, the Minister of Finance is at war with unemployment. He stated that his prime objective was to fight unemployment. But what are his tangible proposals? Nothing very serious, Mr. Speaker, because certainly the

February 22, 1973
The Budget-Mr. C. A. Gauthier
crumbs he gave in his budget will not go very far in solving the problem.
What I think was needed was a reform which would have produced massive shifts toward a more realistic guaranteed income such as, for example, pensions at 60. This would have had a direct effect on unemployment, allowing more than 400,000 unemployed to receive a family salary while at the same time effecting savings for the Treasury. Indeed, if you consider that sometimes it costs both levels of government up to $400 or $500 a month to keep a family going on social welfare-drugs, shelter, clothing and food-when it would cost only a maximum of $325 to pay a pension to a married couple of 60; by thus replacing pensioners between the ages of 60 and 65 by unemployed the government would save while at the same time perhaps reducing the number of unemployed which stands at more than 400,000.


Mr. Isabelle:: The provinces are against that.


Charles-Arthur Gauthier: Secondly, if the government had granted, for example, with the provinces' assent, since the member for Hull shouts at me: the provinces, the provinces-


Joseph Gaston Isabelle: The provinces are unwilling.


Charles-Arthur Gauthier: The provinces are unwilling and I think that the government is rather embarrassed because it follows a particular direction. But I admit that the provinces are not open to this problem. However, it can be suggested to them and this will form a new subject for study. In a second move, the government should have granted, for example, a salary to the mother who wants to stay at home but must work to tie both ends of the family budget. As a matter of fact, I have noted, following a personal inquiry, that 50 per cent of married women who work would be very happy to stay home again if they would be ensured of a family salary. If we could bring back in their homes the women who wish to do so, we would allow 200,000 unemployed to have profitable jobs, reducing accordingly the number of unemployed, and if one begins by eliminating 600,000 unemployed, the national economy would thus be relieved.
Thirdly, the implementation of the Opportunities for Youth Program should be done in a more responsible way, in order, for instance, to guarantee an income to students who at the present time rely on scholarships only and are often disappointed because these scholarships go most of the time to those who do not need them, but have wonderful political connections. In that field, we, of the province of Quebec, do not find too much fault with the federal government; however, we can criticize it since we have to foot 50 per cent of the bill.


Joseph Gaston Isabelle: And we also.


Charles-Arthur Gauthier: But from here, the federal government cannot see everything that is going on in the province of Quebec. In fact, in our constituencies, for instance, we come up against the patronage being dispensed in Quebec.

As concerns the local initiatives program, one day it will really have to serve the unemployed and not only enable some privileged people to double their salary, or still, enable two or three devoted organizers and supporters of a political party to share among themselves the whole amount of the project, since it is felt that in some cases, the program has resulted in the creation of only 15 or 20 new jobs, and this I can prove.
I would still have many suggestions to put forward, but my time is running short and I should like to leave it to the government to consider these practical proposals, because I have noticed that government members are wont to say over and over again that the opposition never proposes any remedial action.
We, of the Social Credit Party, always strive for objectivity in bringing forward concrete and clear solutions, expressed plainly, in order that the government may at last understand. However, since there will always be people who do not want to hear and who do not want to see, I am convinced that some government members will repeat, after hearing this very clear outline, that we will have proposed nothing concrete. However, I am certain that the people of Canada, upon reading the official record of my remarks, will all understand.


Mr. Fernand Leblanc (Laurier):: Mr. Speaker, together with all the Canadian people, I wish to extend my most sincere congratulations to the hon. Minister of Finance (Mr. Turner) for the budget he brought forward in this House, the primary purpose of which is to stop unemployment.
As I do not have too much time, I shall deal straight away with the matter I am concerned about, that of private retirement-savings plans in view of the difficulties experienced by Canadians 45 years of age and over when looking for a new job when, unfortunately, circumstances require it.
Now that people think of retiring at an earlier age, an appropriate planning of such a significant period in one's life is even more important. It seems to me that no worker will be able to consider his retirement to be secure as long as he is not sure to have a plan under which on the one hand pensions are universally portable, and which is based on the other hand upon a formula which enables him to remain a number of years out of the labour market, without being penalized.
Nowadays, one should always be in a position to prepare for a fair retirement, even though one remains a few years without work, for the present unemployment rate lays a new requirement on us. We must also be able to do so, if circumstances invite or compel us to leave our employment to accept another one, and therefore, a transferable pension plan has become necessary.
It is only since 1965 that provinces, and Ontario first of all, began to be concerned about part of this problem and to legislate accordingly in 1965, the federal government did the same for employees, businesses and activities under its jurisdiction, and which were not affected by provincial legislation.
It is remarkable that tax privileges granted by the federal government to registered retirement savings plans
February 22, 1973

prompted many employers to take advantage of them to register their own private plans.
I would like to draw the attention of the House to the fact that the federal government can still find other ways of approaching the problem and thus contribute to bring about certain changes in the position taken by the working world on this matter.
It is our responsibility to innovate in this sector and to try to identify as much as possible the problem because unemployment, manpower mobility and the lowering of the pension age are now a primary concern for the worker without forgetting that retirement plans represent an asset of some $12 million.
Since the pension age tends to be lowered, with the years, long-term planning of his pension becomes an important matter for the employee.
One of the major problems facing the employee who wishes to quit his job, as well as the one who is dismissed is that of the loss incurred because of the cancellation of the first pension plan.
In most cases, the employee is not even entitled to recover the contribution paid to his pansion fund if he has not yet reached the stage where, under the terms of the collective agreement, the pension money can be reimbursed to him on leaving his employer. Since union action has therefore resulted in dismissal according to seniority, when staff has been reduced by a particular company, the first ones to be fired are always those who do not yet have the right to recover their contributions to the pension fund because they have not worked long enough for the company. Therefore, the plan is basically unfair in terms of this practice and it invalidates the opinion according to which this is being done in order to discourage the new-scomers to leave the company of their own accord.
In order that pension credits become perfectly and universally portable from one job to the other, all private retirement schemes would have to meet some basic conditions.
As suggested in the Financial Post of November 4, 1972, we would also have to consider the possibility of establishing a central agency that would hold these credits on behalf of all firms, which would make it easier to plan the operation of schemes.
Furthermore, this idea of a central agency has already led to the setting up of union retirement funds in which a unionized employee contributing to such a fund can go from one employer to another without changing his pension plan, at least as long as he continues to belong to the same union. Here again, pensions are not universally transferable in this case although this system shows a definite improvement over the retirement plan of some companies. And for the non-unionized, as well as non-unionizable executives, the problem could not be solved this way. So this is a partied solution, and an imperfect one, even for unionized labour which can benefit from it.
However, the formula of union funds can serve as a basic model for the setting up of a central agency which would ensure universality of the plan.
If we want to have in Canada workers ready to move from one area to another according to the pace of the
The Budget-Mr. F. Leblanc
economy, ready to undergo retraining to learn a new trade while there is still time for them to do so, ready to work in a different field than the one they became used to initially, we must seriously consider setting up transferable retirement plans which will give them the security they will be giving up by leaving either the local area, or their initial trade, or the field they became used to.
One must remember that before constituting an incentive to move constantly from one company to another, the universally transferable plan would first represent a form of security for the employee who could finally plan his retirement. Since on the average the retirement age constantly goes down this planning becomes more and more important from the point of view of the employee.
The employer has no right, as it is often done today, to make his the funds by treating them as company property. Those funds belong exclusively to the employees who have earned their salaries on which the contributions were levied and for that reason, they must not be mistaken for company property.
Mr. Speaker, the best way to prevent this from happening would be to appoint a trustee who would hold the moneys and be empowered to invest them.
Retiring at an early age is costly because the prematurely retired person is losing not only with regards to public pension plans but also with regards to private pension plans. This is so, as explained by Mr. Donald Rumball in the Financial Post of last July 1st, and I quote:
The annual increase in the pension stops because he is no longer employed and no more contributions are being made by or for him.
He loses the interest that would have continued to accrue because the money must be used to start paying his pension.
The buying power of the assets held for him is diluted, because more pension payments will be made to him as a result of his having the extra years of retirement.

Those factors make it important for employees to accumulate maximum pension if they wish to enjoy a relatively easy retirement at a reasonable age, in spite of the continuing rise in the cost of living and the increased deductions which generally result from the decision to ancitipate retirement.
The federal income tax provisions concerning registered retirement and savings plans have encouraged many employers who were anxious to take advantage of those privileges to change their private plans to make them consistent with the standards established by the law; the employees have also been favoured by those changes.
The introduction of the Canada Pension Plan also had its impact on private retirement plans whether or not they were integrated into it.
Even if for constitutional reasons, the federal government cannot directly legislate in this respect, it can have significant influence on the standards prevailing in this field through federal legislation aimed at urging employers as well as employees to act in whatever direction they think is best.
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February 22, 1973
The Budget-Mr. F. Leblanc
The legislative power that the federal government may exercise is limited by the Constitution, but it certainly can suggest that the provinces adopt a policy consistent with certain measures being considered.
The federal government can certainly find a way to exert appropriate pressure in this field, whether it prefers to act through a penalizing tax measure, a tax exemption, the creation of a national pension plan fund that would administer or "supervise" the administration of private, unregistered pension funds anxious to benefit from any privilege bestowed by federal law, by systematically "educating" employee groups on the demands they could profitably make when negociating the conditions of their private pension plans, by amending laws under its jurisdiction, such as the Canada Labour Code or specific laws governing financial institutions under its control, or in any other way.
It seems safe for the moment to suppose that suggestions from the federal government would be well received in the provinces.
The provincial legislation governing private pension plans has set clearly insufficient minimum conditions, effective only in provinces where it is in force, and it does not offer any suitable solution to the non-transferable character of most private plans.
We should consider dealing with the unemployment problem under all its aspects and try to cope with all its disadvantages; in short, we should do more than fight against its direct effects, that is by creating employment.
If it is true that we have attempted up to now to cope w ith it by creating employment and by reducing as much as possible the period of unemployment, nobody has considered for example, at least to my knowledge, systematically legislating so that the period of unintentional unemployment will not dramatically extend the period which a worker must spend on the labour market to provide for adequate retirement. For want of being able to fight unemployment, it is at least time we go about "organizing" it. The protection of workers and unemployed implies that we are interested in their condition when they reach retirement age and they prepare that retirement today. It is certainly not normal that workers who acquired a vast experience over the years have difficulty in finding a job precisely because of their age since potential employers would have more contributions to pay in to the retirement fund in order to hire them at that age.
It is also true that retirement was not insured before but that people put money aside for that purpose. A single glance at the assets retirement funds constitute and we understand readily how important it is to take into account this financial contribution which grows and grows and which can represent an important source of investment funds.
It is probable that the provinces will go on legislating uniformly on the question and that negotiations engaged with the provinces would give excellent results; they would make it possible to elaborate in this area federal and provincial laws which are compatible and liable to direct the trade market and to encourage it to react in the desired direction.
I think naturally of a possible intensification of federal-provincial relations in this area. I suggest this to the Minister of Finance, to the Minister of National Health and Welfare (Mr. Lalonde), to the Minister of Labour (Mr. Munro) and to the right hon. Prime Minister (Mr. Trudeau), so that individually or together, they become interested in discussing this very important matter during the next federal-provincial conferences.
Let us cast a new glance on the modern problem involving the future and welfare of the unemployed, of workers and their family. In my opinion, such an attitude would comply perfectly with the wishes of the Minister of Finance and would also meet the views of all thoses members whose ambition it is to make sure that our people enjoy a standard of living increasingly in keeping with the needs of our times.


Stanley Kenneth Schellenberger: Mr. Speaker, on rising to speak in this debate I am conscious of the heavy responsibility incumbent upon every member of this House. The people of Canada are waiting and will judge us by our actions. For years they have been tired of a government which has stumbled from crisis to crisis, allowing hundreds of thousands of jobless Canadians to grow weary and cynical as month after month both unemployment and prices continue to rise, giving a combination of depression and inflation unparallelled in our history.
So now, finally it must be admitted that the government has made a partial deathbed repentance. I for one am happy that some mention was made of the removal of the capital gains tax on the family farm when it is passed on to a son or daughter after a farmer dies. I welcome the removal of the federal sales tax on children's footwear and clothing, and I am glad that some benefits are given to the senior citizens and veterans of our country.
My constituency, named Wetaskiwin after the largest trading and commercial centre therein, was so called due to the Cree Indians' name for the region, the Peace Hills. Wetaskiwin itself has a population of 6,000 and depends on farming and light industry for its existence. We have a population diverse in its origins, which perhaps comes as close as possible to pinning down that sometimes elusive Canadian identity-people of various backgrounds working together to better their own well-being and the interests of the community.
Wetaskiwin has a number of problems which are of concern to cities. Perhaps the major concern in my city is created by the Canadian Pacific Railway tracks which run through the centre of town. The result is a grave hazard to the lives of our people; the fire station is located on one side of town, and if a train is standing on the crossing, if a slow freight is passing through or if railway cars are being changed, our fire department is effectively cut off from attending any emergency which might arise in the other part of town. Applications have been made to the CTC for immediate action to be taken, possibly for the relocation of tracks. I was happy the Speech from the Throne mentioned that moneys are to be provided for the

February 22, 1973

relocation of rail tracks. I hope this provision will be included in bills that come forward after the budget debate.
I am fortunate to be in close contact with five Indian reservations in my constituency. I believe that often the native peoples tend to become too isolated from the mainstream of Canadian life and are encouraged to remain apart from the rest of us by the multiplicity of government programs. Surely we would prefer it if they felt like Canadians, the same as we all do.


Some hon. Members:: Hear, hear!


Stanley Kenneth Schellenberger: At the same time, the government should recognize the special problems imposed on communities by their proximities to reserves. For example, the facilities of Wetaskiwin municipal hospital are used to a greater extent every year by residents of the nearby Hobbema reserve. The administration of the hospital, seeking relief from soaring costs and trying to avoid the necessity of more taxes being levied on municipal residents, seems caught between the federal and municipal authorities in the search for funds to further the use of the hospital by native people. It would seem to me, Mr. Speaker, that treaty Indians are the responsibility of the federal government and that the two ministers concerned should get together soon and find a solution to this problem which is duplicated in other parts of Canada. At the moment, as usual, the local taxpayer is caught in the squeeze.
Now I want to turn to matters of agriculture. Most of the farms in my constituency are of the mixed variety, each of about 300 acres. The average age of farmers is 50. The net income of these farmers is a source of continuing concern to me. We know that farm income dropped by 34 per cent in the last five years. Farmers seem to have gained in the last year; because prices have risen for beef and grain, which is good for farmers. At the same time, costs of farming have risen. Input costs for farmers have risen by 75 per cent in the last decade. That is why so many farmers are having trouble making ends meet at the end of the year. Galloping food costs have affected farmers, as they have affected everybody else.
Farmers, as I have pointed out before, have less variety to choose from when shopping and there is less competition among stores in rural areas. Consumers tend to blame farmers for rising food costs. For example, the price of eggs zoomed upward last month. We should remember that the profits are not going to farmers but to the distributors and supermarket cartels, as I see it, because the farmer receives only 11 per cent of every dollar spent on food.
The continuing decrease in the number of census farms is one of the changes in Alberta agriculture which has gone almost unnoticed in the past two years. Figures show that in 1972 there were 67,702 farms in Alberta compared with 84,000 in 1951. This means we have suffered a decrease of nearly 1,000 farms per year. I believe the chief factor in this decline has been the ever-increasing amount of capital necessary to begin farming. In 1951 the capital figure was $21,000, in 1961 it remained a reasonable $37,000 and today it is estimated that one needs $80,000. As an initial outlay of this magnitude is needed, many
The Budget-Mr. Schellenberger
people, especially young people, who would like to begin farming are unable to do so. Consequently, farms are swallowed up by large corporate farmers or allowed to go to seed.
The provisions of the budget allow farms to pass to a son or daughter without the imposition of capital gains tax on the death of the farmer. How much more useful it would be, Mr. Speaker, if these farms were allowed to be passed to a son or son-in-law during the farmer's life- when he retires, for example. Such a provision, I submit, might effectively halt the decline in the number of census farms to which I have referred.
The statistics that bother me most are those showing that the average age of farmers has continued to increase, from 45 two decades ago to over 49 today. We are losing young people; they go to urban areas as soon as they can simply because they cannot see their way clear to making a decent living on their father's farm. There still is a capital gains tax on farm land and machinery. This ought to be abolished. I believe it is a mistake to take away any part of the retirement fund of a farmer, a fund for which he has saved many years in building up equity in his establishment. In this way, again, we are discriminating against young persons who want to establish themselves in agriculture. Natural phenomena are also important in farming. It is time the government undertook seriously its responsibilities in leadership by presenting a well defined insurance or stabilization program to cover farms which are hit hard by acts of God.
I have spoken before in this House on dairy matters, a subject on which my predecessor, Harry Moore, who was known for his interest in the subject and for his long service to his constituency, spent much time and energy. Suffice it to say that our dairy farmers look to the government to find new markets to replace those we have lost as a result of the expansion of the European Economic Community and our failure to obtain special concessions, such as New Zealand did, for butter.
At a time when young people make up a greater than ever percentage of the work force we must, as the work week declines to 35 hours, be concerned about recreation. As Canada is increasingly urbanized and as promotion of tourism increases, many more people will find themselves in an inelastic space-more in the fields, more in the parks, more on the mountains and more on the lakes and waters of our country. Recreation has become an industry supporting many whose jobs ultimately depend on natural resources which facilitate recreation. If we destroy or limit these resources, we will destroy or limit job opportunities. As tourism becomes more competitive, so does environmental management increase in importance. We can hardly expect tourists to beat a path to our country if they will find only crowded beaches, overused parks, logged-off or subdivided mountains and villages sprawled over with people.
Our expenditures, as individuals, on recreation need to be balanced by corresponding public expenditures. I was disappointed that the budget made no provision whatever for this matter. In my constituency there are the ability and the resources for establishing, privately and publicly, more employment and facilities in the field of recreation. Help is needed, however, and I would like to see that help
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February 22, 1973
The Budget-Mr. Schellenberger given both in terms of guidance and of finance. Any plan of action should include first, a decision as to who has responsibility for the recreation; second, effective tri-level organization for development; third, adequate planning studies as the basis of a development program; and fourth, citizen participation in development of recreational land use.
I now want to say a few words about the Local Initiatives Program. I think most hon. members would agree that there is room for improvement in this program. At the same time, I want to pay special tribute to Mr. Gairns and Mr. Meehan of the special information group. They have been unfailingly helpful and courteous to me. I think many of us, Mr. Speaker, would like to exercise greater input into these projects. We should like to know more of the real reasons for rejection. Some reasons, such as "Question ability of management" or "Doubt feasibility of project," are awfully vague for a Member of Parliament to forward to his constituents, to whom he must somehow explain the workings of bureaucracy and the mentality of civil servants. I was particularly distressed at the rejection of the Spruce Grove swimming pool and arena project and the Winfield recreation centre, as similar projects elsewhere were accepted. I also wonder why co-op projects were rejected out of hand, such as the Ste. Anne project in Onoway.
I also wish to talk about incentives to small businesses of which there are many in my constituency. I have seen them suffer over the past few years. Incentives to small business are one area this government has neglected, Mr. Speaker. We see that business failures rose dramatically, by 61 per cent, in 1971. It is obviously the small businessman who suffers most. We need the program my leader has advocated: to establish a Canadian investment incentive credit, available to any Canadian who makes a direct investment in the equity of a Canadian-owned small business. A credit such as this, to a maximum of $5,000 a year, might cost $300 million during its first year of operation but, as my leader pointed out, this could not begin to equal the more than $1 billion poured into the unemployment insurance fund to allow the government to pursue its heartless, directionless, incompetent fiscal policies and thus sustain a 7 per cent employment rate.
The family farm, about which I spoke a few minutes ago, would also benefit from this scheme; incentive credits would be available for new investment in such an operation. Small business encourages individual initiative and this is something which is stifled by the government's current reliance on big government, big business and big unions.
In conclusion, Mr. Speaker, I want to speak of my concern over the government's continuing intrusion into every level of society and life. Boards, committees and regulations seem to be the rule rather than the exception. Despite some tax cuts, the government's total tax take continues to soar. I believe the individual should have more freedom, especially when deciding how to spend his income. We need more freedom and less regulation; fewer laws, and not more boards. I hope that when this party comes to power and meets its new appointment with destiny, which not even the hon. member for York South

(Mr. Lewis) cannot much longer delay, it will help Canadians to free themselves from the bureaucracy which now entangles us and discover again the meaning of personal initiative and development. To this cause I pledge myself.


Some hon. Members:: Hear, hear!


Mr. Leg Benjamin (Regina-Lake Centre):: Mr. Speaker, in the four years I have been here I have listened to five budget debates. This is the first budget which I find myself, a little reluctantly, able to support. Possibly this is because there are a significant number of items in it that were put forward by individual members of the three opposition parties, as well as by the opposition parties generally on numerous occasions in the past four years, all of which the government scoffed at and refused to listen to or pay attention. They have finally been paid some attention as a result of what many citizens said to the government with "X's" on their ballots last October 30.
The pension increases are welcome. It is the minimum that could be done without the Minister of Finance (Mr. Turner) blushing in shame. However, I warn him-and I think this is felt by members on all sides-that it is still not enough by any means. The government can be sure that we will continue to fight for further increases until the old age pension is increased to $150 per month or the GIS and OAS combined are a minimum of $220. At least by moving up to $100 it puts the Liberals $7 a month ahead of the amount to which the Tories committed themselves.
That in itself is an excellent reason for preferring to support this Liberal budget rather than a possible Conservative one. If one looks at what has been happening with increases, not only in the cost of living but in the standard of living since the 1950s, it will be seen that the increase should be to $110 in order to keep up. The $40 basic pension of 1952, to which should be added the price increases and cost of living increases since then, totals $63.60. If you add to that the increase in the gross national product, in real terms, of 72 per cent, the old age pension should be $110 per month. The government will have to move within a year to make that further improvement in the old age pension.
Another suggestion that is receiving support, even from members on the government side, is that the government should move rapidly to reduce the eligibility age for the old age pension from 65 to 60. If this cannot be done in one move, it should be done on a year to year basis for five years, as was done when the eligibility age was lowered from 70 to 65.
The increase in the war veterans allowance is also welcome. Every member of this House handles dozens of veterans' cases a year, dealing with the Department of Veterans Affairs. This increase will not only alleviate the financial well-being of veterans but will also reduce some of the mail with which Members of Parliament have to deal.
I welcome the remarks of the hon. member for Wetaski-win (Mr. Schellenberger) regarding capital gains as they apply to family farms. Although I am grateful for this concession, I find it amusing because this particular matter was contained in an amendment moved by my colleague, the former hon. member for Regina East, a
February 22, 1973

year ago when we were discussing the tax bill. The government said it could not be done. It refused to even listen to it. It is amazing what they can do. We welcome that change in the budget. May I repeat what others, including the hon. member for Wetaskiwin, have said: the trouble is you have to die to get it. That is some improvement for the successor, the son or daughter who will continue to operate the farm, but we again submit that this provision should be available during the lifetime of the farmer. We all know that a farmer in his fifties or sixties who becomes disabled because of a heart attack, or for some other reason, has to retire early and turn the farm over to his son. That farm should be exempt from capital gains tax.
The New Democratic Party is not interested in capital gains on small, family operated farms and small business. We are after the ones that count, the big fellows.


Some hon. Members:: Hear, hear!


Leslie Gordon Benjamin: I submit that the Minister of Finance should extend this provision to apply not only after the death of a farmer but during his lifetime, and that it be further extended to the small, family-owned and operated business. Any enterprise whose assets run up into millions of dollars should be subject to capital gains tax at any time.
Reductions in sales tax and excise tax are fine, though some of the tariff reductions are so insignificant as to be almost meaningless. But they are welcome. They are timely. They were asked for last year, the year before that and the year before that. Finally, the Minister of Finance was converted on this item as well.
There is another item for which the government of Saskatchewan deserves full credit for its power of persuasion. I refer to the proposal to take into account the costs of education when determining equalization payments to the provinces. This idea was put forward by the provincial treasurer of the province of Saskatchewan and I am happy to note that the government and the Minister of Finance have adopted it. This means another $26.5 million for the province of Saskatchewan. It is a further incentive to me to support the budget.
While all of us welcome whatever cuts have been made in tariffs and sales and excise taxes, along with the increases in pensions, all of this will go for naught if people at the manufacturing, wholesaling and retailing levels do not pass the reductions on to consumers. If landlords are allowed to raise rents unconscionably, thereby absorbing some or all of the increase in pensions, the intention behind the budget will go for naught.


An hon. Member:: Speak to the provinces.


Leslie Gordon Benjamin: I have already spoken to some of my friends in Saskatchewan and I urge the Minister of Consumer and Corporate Affairs (Mr. Gray), the Minister of State for Urban Affairs (Mr. Basford) and the Minister of Finance to do the same. I should like them to make representations to all the provincial governments urging them to impose a rent freeze immediately so as to protect
The Budget-Mr. Benjamin
all persons aged 65 years and over living in rented accommodation. If an attempt was then made to raise their rents, all these people would need to do would be to pick up the telephone and call somebody in Regina or Ottawa. Here is an area in which the federal government should provide leadership. It should persuade the provinces to take action to ensure that the benefits in this budget are passed on to the consumers.
I note that one or two hon. members in the official opposition have called for the removal of the sales tax on building materials. We agree that this should be done. The difficulty about this-and it attaches to the other reductions I have mentioned-is seeing that the benefit is passed on to the public. We all remember the bitter experience which followed the removal of the 11 per cent sales tax on drugs. It was absorbed by the producers and retailers and the consumers received no benefit at all. Unless there is effective monitoring of prices charged by manufacturers and retailers, the reduction in sales tax would be meaningless; the government might just as well have left it on and redistributed the revenue through further increases in the old age pension. Hon. gentlemen to my right may wonder why I do not propose this by way of an amendment. But if they are right in what they have been saying, members of the New Democratic Party have no need to do so; I would only have to whisper into the ear of the Minister of Finance and he would do these things.


Some hon. Members:: Oh, oh!


Leslie Gordon Benjamin: I would only have to roll back the blankets and he would be only too willing to agree.


John Napier Turner: Not a nice thing to say.


Leslie Gordon Benjamin: I want to make one final proposal which would do a great deal to solve two problems which face this country, namely, unemployment and pollution. I have raised this subject ever since I first came here. What we need is a national policy under the leadership of a national government with some imagination, a policy which said: over the next five years, every town and city with a population of more than 5,000 will have an adequate tertiary sewage treatment plant. As things are, cities alone, even with the help of provinces, cannot handle this themselves; the costs are too massive. The federal government must provide the leadership and the major portion of the funds.
Think about it, Mr. Speaker. What would a program of this kind do in helping to solve the problems of unemployment and pollution? While there is some help available at the present time, it is entirely inadequate. On this basis, the problem will be dragged out for another 50 years before it is dealt with in a satisfactory way. Imagine the amount of useful employment which would be created for tens of thousands of people in the planning and construction of sewage treatment facilities. Imagine the work which would be involved in the expansion of existing plants with the manufacture of additional equipment needed. I hope the Minister of Finance will think about it, if the government really means business when it says it is determined to tackle pollution and, at the same time, to reduce unemployment.

February 22, 1973
The Budget-Mr. Whelan
Some provinces, some municipalities, might drag their feet but I submit they would not do so for very long before the wrath of their respective electorates descended upon them. Here is a goal which the country would support. Canadians generally would back the effort and the investment which would be required and the country would profit, too, from the creation of tens of thousands of jobs which are so urgently needed. At the same time, such a project would do more to halt pollution than any other single endeavour.


An hon. Member:: Who would pay for it? The taxpayers.


Leslie Gordon Benjamin: I submit it would cost about four or five billion dollars. The money is there. We have to use it.


Eugene Whelan: Mr. Speaker, I want to say-


Gerald William Baldwin: So you are going to read your speech, are you? Did John write that?


Eugene Whelan: John Diefenbaker? You would be surprised how often he calls me. There was news in the budget for farmers, and most of it was very good news.


Some hon. Members:: Oh, oh!


Eugene Whelan: Gains for farmers far outweigh any losses that may have to be borne. First of all, like all other taxpayers, farmers will benefit from the 5 per cent cut in income tax. I want to point out that tax reductions are much greater than 5 per cent for people who make less than $10,000 a year income. When we put the 5 per cent tax reduction together with the increase in exemptions, we come up with a 9 per cent tax cut for people with an income of $10,000, and 18 per cent tax cut for people with an income of $7,000 and a 47 per cent tax cut for people who have an income of $5,000.


Some hon. Members:: Hear, hear!


Eugene Whelan: Under this administration, in view of the way we are improving the income of farmers, there will not be that many farmers-


Mr. Madill:: You are right, there won't.


Eugene Whelan: -who would have benefited in former years because they will be earning more money than that.


Some hon. Members:: Oh, oh!


Eugene Whelan: This is a budget for little people. They have benefited a great deal from the budget, more than others. Secondly, farmers will benefit from the changes made in the capital gains tax as it applies to transfers of farms from a father to the mother or child. This is a major concession, one that I am very happy to see in the budget. I have had an extraordinary number of requests from farmers to have this change made in our tax legislation and I am glad that the Minister of Finance (Mr. Turner) was able to make the change at this time. There are a lot of farmers in Canada who are at the age where transfers will be taking place within the next generation. We will

need a lot of young farmers in Canada, so I am very happy the farmers are getting this tax break in the budget.
While we are talking of farmers, Mr. Speaker, there are probably more people over the age of 65 who are still productive in agriculture, their way of life, than in any other way of life in this country.


Some hon. Members:: Oh, oh!


Eugene Whelan: I hope some of the noisy members on the other side are on the consumers affairs committee-


Mr. Deputy Speaker:: Order, please. I hope it will not be necessary for hon. members to respond to everything that the Minister of Agriculture says. I know he is generating considerable excitement by his speech and perhaps if there were more order in the House he might excite me with it, but not too much of it is getting through to the Chair. I would therefore ask hon. members for their co-operation.


Eugene Whelan: As I was saying, Mr. Speaker, I hope hon. members on the committee examining food costs will remember just how productive these people are and how long they remain productive. I am happy to see that the budget aims at preserving the family farm. The tax concession does not apply to the corporate giants but to farm families who pass on their farm from one generation to the next.
I think the change is important enough that farmers should consult a lawyer-and even for a farmer this is a concession-or an accountant if they are planning a transfer of their farm to their son, son-in-law, daughter or whoever it may be. There are several methods of transferring a farm from father to son or daughter including gifts spread over a number of years. A good accountant can tell them how this can best be done. The change announced in the budget changes the rules of the ball game, to the benefit of the family farm, and I want every farmer to get the most he can out of these concessions that are rightfully his.
The third change involved livestock herds. Under the old system, farmers who chose to pay their taxes on an income basis had to count any increase in their herd as income and pay tax on it. They could not deduct any losses in the herd. Under the change announced in the minister's budget, any increase or loss in a herd can be counted as a change in inventory. This means that taxes on gains can be delayed until the herd is actually sold, or that a loss can be deducted from inventory. I think that is very important.
Fourthly, the budget offers a faster rate of depreciation on silos and on facilities to store fruits and vegetables under controlled temperatures. The change increases the rate of capital cost allowance to 20 per cent. That is of tremendous benefit to them.
Fifthly, there is some gain for farmers who buy quotas. Under the previous system these quotas had no value on valuation day, and if and when they were sold the total sale price was treated as a capital gain and subject to taxation. Under the change the Minister of Finance announced, farmers who buy quotas will be able to
February 22, 1973

deduct the purchase price in calculating the amount that is taxable on the sale of quotas. The same rule applies to any licences that farmers purchase or sell.
Sixthly, the dropping of the 12 per cent tax on items described as "near food" will help promote the increased consumption of these foods. This may be more important to some farmers than they now realize. For example, I know of one creamery in southwestern Ontario which developed a low-calorie dairy spread similar to butter. Because it was defined as a diet food, the 12 per cent tax applied. That will no longer be the case, and hopefully that creamery will be able to increase its sales thereby increasing the market for milk.
There is one point in the budget that 1 know concerns a lot of farmers, and that is the temporary reduction in tariffs on imports of certain foods. First of all, it is my belief that the changes will have little significant impact on farm prices. In addition, these changes are temporary and if difficulties arise for specific commodities I shall not hesitate to recommend appropriate changes.
I think these changes will have little or no significant impact on the returns of Canadian farmers because they fall into general categories. First, they are on items that are either non-competitive or mariginally competitive with Canadian production either because of their nature or because of seasonal availability in Canada. That is, they are commodities that enter the country at a time when they are not produced in Canada. Secondly, other changes simply adjust tariff rates where there was a difference between the British preferential rate and the most-favoured-nation rate. In these cases the change brings the most-favoured-nation rate down to a par with the British preferential rate, which remains the same as it was.


Gerald William Baldwin: Explain.


Eugene Whelan: The hon. member for Peace River (Mr. Baldwin) wants a little explanation, so I will make one. I will use as an example canned peaches. Before the change, the British preferential rate was 1 i cents a pound, the most-favoured-nation rate was 2i cents a pound, and the agreed rate for Australia was one-half cent a pound. In 1971 we imported about $9.2 million worth, of which $7 million worth was from most-favoured-nation countries, largely the United States, $1.4 million worth was from Australia and $800,000 worth was from other British preferential rate nations. As with apricots, the new arrangement is that these stay the same but subject to the maximum of 12 j per cent. For 1971, the most-favoured-nation rate represented 16 per cent, the British preferential rate was 15 per cent and the Australian rate 2 per cent ad valorem. Assuming prices remain the same, this would mean a reduction of 31 per cent which would amount to a reduction of slightly under half a cent per pound.
In the case of imports from most-favoured-nation countries, the reduction would be slightly over one-quarter cent per pound. There would be no change in imports from Australia. We import about 76.7 per cent of total consumption of peaches in Canada. I could give you other examples, Mr. Speaker, but I will not at this time.
The Budget-Mr. Whelan


An hon. Member:: You did not tell us about Australia.


Eugene Whelan: We did not change the situation with Australia. It stays the same as it has been for years.


Gerald William Baldwin: It is like a boomerang.


John Napier Turner: That's better than having a kangaroo.


Eugene Whelan: There were a few cases where the tariffs were so low they represented more of a nuisance than anything else. As I said before, I do not think the change will have a significant impact on farm prices; however, I am prepared to recommend appropriate changes in cases where difficulties arise in respect of specific commodities. I should like to add that farmers will benefit from particular tariff reductions on some items. There are a number of reductions that will include imports of items that farmers use in their business. It is a very long list but it includes, for example-


Some hon. Members:: Hear, hear!


Eugene Whelan: I will not give the whole list.


Some hon. Members:: Hear, hear!


Eugene Whelan: I know you do not want to hear all the good things because those are the things you do not like.


An hon. Member:: We are interested in what the farmers make, not what they pay.


Eugene Whelan: You do not like the good things, but I am going to tell you some of them anyway. This is a long list which includes, for example, a 5 per cent reduction of tariffs on antibiotics, hormones, medications and vitamins.


An hon. Member:: We are going to need lots of them.


Eugene Whelan: These are all used in animal and poultry production on the farm. There is also a 5 per cent reduction on tariffs for baskets, and a 5 per cent cut in tariffs-


Some hon. Members:: Oh, oh!


Eugene Whelan: Let me remind hon. members that we use hundreds of thousands of baskets in this country, so that is not a small thing to many people.


An hon. Member:: What about artificial insemination?


Eugene Whelan: There is a 5 per cent reduction in tariffs on a whole group of hardware items such as electric fixtures and appliances, vices, saws, hooks and eyes-


Some hon. Members:: Oh, oh!


Mr. Deputy Speaker:: Order, please. The hon. minister has a strong voice and a sunny disposition and perhaps his tolerance point is much higher than most, but the Chair finds it extremely difficult to follow his speech. I do not think that everything he says should draw comment from every corner of the House. I would ask that more of his speech be allowed delivery without encouragement. He is doing very well.

February 22, 1973
The Budget-Mr. Whelan


Gerald William Baldwin: I agree with you.


Some hon. Members:: Oh, oh!


Eugene Whelan: Mr. Speaker, these interjections do not bother me one bit. I am an old union man and I have attended the wildest farm and union meetings you can think of. These people here are quite tame.
As I said, there is a reduction on hardware items such as hammers, crowbars, screwdrivers, and so on, of 21 per cent to 17 per cent-


An hon. Member:: What about wheelbarrows?


Eugene Whelan: -on trickle-irrigation systems and sprinkle or trickle-watering systems used on the farm, in the greenhouse, and a 21 per cent reduction in the tariffs on air cooled internal combustion engines-


An hon. Member:: What about manure spreaders?


Eugene Whelan: -and parts for these engines. These will all be of benefit.
Mr. Speaker, I could go on and give that group over there a lot more information if I thought it would do any good, but I am of the opinion that it may be like the old saying-no, I won't say it.


An hon. Member:: Don't put your foot in your mouth.


Eugene Whelan: The point I am making is that tariff reductions cut both ways. They may hurt a bit in respect of some food items, but I do not think they will hurt even as much as normal price fluctuations with which we live all the time, and they will help reduce the cost of some inputs.
Above all, I want to emphasize that the tariff cuts on food imports do not-I repeat, do not-apply during our growing season. We have retained our present tariff structure on these items. For example, we keep a 10-week tariff for rhubarb, a 44-week tariff for onions, a 12-week tariff on green peas and a 22-week tariff on special things like cucumbers, and so on, down the list. So we will still protect these producers, as we always have, during the growing season.


An hon. Member:: The farmer is not going to hold his breath waiting for you.


Eugene Whelan: Our producers will continue to receive tariff protection during the in-season of the year and we will continue to work closely with the Canadian Horticultural Council in applying these tariffs. For the information of hon. members, I might add that I met with some of these people today and will meet with some of them tomorrow to consider some of the things I have mentioned tonight, as well as other things about which they are not too unhappy, I can tell you. They know this Minister of Agriculture is not going to sell them down the river as hon. members opposite would like to do.


An hon. Member:: The Minister of Finance sold them down the river.


Gerald William Baldwin: Where is Benson?


An hon. Member:: He is up the creek.


Eugene Whelan: I want to take a few minutes to deal specifically with sugar beets because they represent a special case under the budget the Minister of Finance announced. There is a rather complicated set of tariffs applying to sugar imports but, in general, there is a reduction amounting to 30 cents per 100 pounds of raw sugar.


An hon. Member:: How sweet it is!


Eugene Whelan: I have obtained authority from the cabinet to use our Agricultural Stabilization Act and the Agricultural Stabilization Board to offset any-I repeat, any- impact this change in sugar tariffs will have on the income of Canadian sugar beet producers. My authority to offset the impact of the reduced tariff applies even if the price of sugar beets stays above the support level.
I visited most of the farm leaders across Canada before the House started this session and I learned what they wanted and what they thought of our proposals.


An hon. Member:: You should have taken Turner with you.


Eugene Whelan: I might say that we have everything in this budget they wanted, and more. I do not think that some of them felt they would get this much.
We have talked about the family farm. It is easy for many people to talk about a family farm, people who really have no feeling in this regard. I think one has to be raised on a family farm to really understand what it means and to have the feeling of having produced crops. One must be in this position to know what it is to create things. I have been criticized before for saying I feel that farmers are the salt of the earth and closer to God because they create things.


Some hon. Members:: Oh, oh!


Eugene Whelan: God will not do everything by Himself and the farmers cannot do everything, so they must work together.


Some hon. Members:: Oh, oh!


Eugene Whelan: It would not hurt if some of my friends across the way were associated a little closer with one or the other.


Lincoln MacCauley Alexander: Yes, reverend.


Eugene Whelan: I say that in respect of the farming industry today we can be thankful we have the farmers who are here, some of the most productive people in the world. Not long ago we had a delegation from another country. Members of that delegation said they did not understand how the farmers in Canada could be so productive. They said they did not understand how the government could keep them as productive as they were. It is mainly because they are still in a free country and a free society where they can do what they wish. They can create what they want to create because the incentive is still there.
February 22, 1973

[DOT]	(2140)
When one thinks of the ten different provincial agricultural programs that we have across this nation, which are sometimes as different as they are between one country and another, it is very difficult to ask the Minister of Agriculture to be an equalizer. Sometimes I am told I should have been a westerner. If I were, I would be carrying two equalizers to do the things people want done. In summary, I say that I am confident that the changes announced in the budget offer major gains to farmers. When I was in Edmonton talking to the Unifarm people, one of the papers wrote on its front page, "He talks and thinks like a westerner".


Some hon. Members:: Hear, hear!


Eugene Whelan: But, Mr. Speaker, what they were really saying was that no matter what part of Canada farmers come from, they talk and think about the same things. With the changes announced in the budget which offer major gains to farmers, particularly in regard to capital gains tax on the transfer of family farms from father to son or daughter, and in the tax on quotas and licences as well as the tax change to allow livestock producers to count gains or losses as a change in inventory, I am sure there will be prosperity in the agricultural economy for the coming year.


Some hon. Members:: Hear, hear!


Mr. Deputy Speaker:: Order. It being 9:45 p.m. it is my duty, pursuant to section 6 of Standing Order 60, to interrupt these proceedings and forthwith put the question on the subamendment now before the House.
Those in favour of the amendment to the amendment will please say yea.


Some hon. Members:: Yea.


Mr. Deputy Speaker:: Those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion the nays have it.
And more than five members having risen:


Mr. Deputy Speaker:: Call in the members.
The House divided on the amendment to the amendment (Mr. Matte) which was negatived on the following division:
[DOT]	(2150)
Allard
Beaudoin
Boisvert
Caouette
(Charlevoix)
Alexander
Alkenbrack
(Division No. 11]
++YEAS
Messrs.
Dionne
Fortin
Gauthier
(Roberval)
Godin
Laprise La Salle Latulippe Matte
Rondeau-13.
++NAYS
Messrs.
Allmand
Andras
Andre
Arrol
Division
Messrs:
Atkey
Baker
Baldwin
Balfour
Barnett
Basford
Bawden
Beattie
(Hamilton
Mountain)
Beatty
(Wellington-
Grey-Dufferin-
Waterloo)
Bechard Begin (Miss)
Bell
Benjamin
Blais
Blaker
Blenkarn
Blouin
Boulanger
Breau
B re win
Broadbent
Buchanan
Caccia
Cafik
Campbell
Caron
Carter
Chretien
Clark
(Rocky Mountain) Clarke
(Vancouver
Quadra)
Clermont
Coates
Comtois
Corbin
Corriveau
Cossitt
Cote
Crouse
Cullen
Cyr
Danforth
Danson
Darling
Davis
De Bane
Demers
Dick
Dinsdale
Douglas
Drury
Dube
Dupont
Dupras
Duquet
Ellis
Epp
Ethier
Faulkner
Firth
Fleming
Forrestall
Foster
Fox
Frank
Fraser
Gauthier
(Ottawa East) Gendron Gilbert Gillespie Gillies Gleave
Goyer
Grafftey
Gray
Grier
Guay
(St. Boniface) Guay (Levis) Guilbault Haidasz Hales Haliburton Hamilton
(Qu'Appelle-Moose Mountain) Hamilton
(Swift Current-Maple Creek) Harding Hargrave Harney Hees Hellyer Herbert Higson Hollands Holmes Hopkins Horner
(Battleford-Kindersley) Howard Howie Hueglin Hurlburt Hymmen Isabelle Jamieson Jarvis Jerome Kempling Knight Knowles (Winnipeg North Centre) Knowles (Norfolk-Haldimand) Korchinski Kuntz Lachance Lalonde Lambert
(Edmonton West) Lang Langlois Laniel Lawrence Leblanc (Laurier)
LeBlanc
(Westmorland-
Kent)
Lefebvre Leggatt Lessard Lewis L'Heureux Loiselle Lundrigan MacDonald (Cardigan) MacDonald (Egmont) Macdonald (Rosedale) MacDonald (Miss) (Kingston and The Islands) MacEachen MacGuigan
Maclnnis
(Cape Breton-East Richmond) Maclnnis (Mrs.) Mackasey MacKay MacLean Macquarrie Madill Marceau Marchand (Langelier) Marchand (Kamloops-Cariboo) Marshall Masniuk Mather Mazankowski McCain McGrath McKenzie McKinley McKinnon McRae Mitges Morgan Morin (Mrs.)
Muir
Munro
(Esquimalt-
Saanich)
Munro
(Hamilton East) Murta Neale
(Vancouver
East)
Neil
(Moose Jaw) Nelson Nesbitt Nesdoly Nielsen Nystrom Oberle O'Connor Olaussen Olivier O'Sullivan Ouellet Paproski Patterson Pelletier (Hochelaga) Pelletier
(Sherbrooke) Penner Peters Portelance Poulin Prud'homme Railton Reid Reilly Reynolds Richardson Ritchie Roche Rodriguez Rompkey Rooney Rose Rowland Roy
(Timmins)
Roy (Laval) Saltsman Sauv6 (Mrs.)

February 22, 1973
(Division		
	Messrs:	Schellenberger Schumacher Scott	Stewart (Okanagan- Kootenay)	Turner (London East)	Mr. Deputy Speaker: I declare the subamendment lost. It being after ten o'clock, this House stands adjournedSharp	Stewart	Turner	until eleven o'clock tomorrow morning.Skoreyko Smith (Northumberland-	(Cochrane) Stollery Symes	(Ottawa- Carleton) Wagner	At 10:14 p.m. the House adjourned, without question put, pursuant to Standing Order.Miramichi)	Taylor	Walker	Smith	Thomas	Watson	(Saint-Jean)	(Maisonneuve-	Whelan	Stackhouse	Rosemont)	Whicher	Stanbury	Thomas	Whittaker	Stanfield	(Moncton)	Wise	Stevens	Towers	Woolliams	Stewart	Trudeau	Yanakis	(Marquette)	Trudel	Yewchuk-236.	
Friday. February 23. 1973