1973-04-13

BUSINESS OF THE HOUSE


Mr. Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the second report of the Clerk of Petitions.



ROUTINE PROCEEDINGS


[Stage Direction]
First report of Standing Committee on Finance, Trade and Economic Affairs in the two official languages-Mr. Trudel.
[ Editor's note: For text of above report see today's Votes and Proceedings.]

Hon. Gerard Pelletier (Minister of Communications):: Mr. Speaker, under Standing Order 41(2), I should like to table, in both official languages, the Green paper entitled "Computer/Communications policy; a position statement by the Government of Canada".


EXTERNAL AFFAIRS
Mr. Mark Rose (Fraser Valley West):: Mr. Speaker, under the provisions of Standing Order 43 I wish to move a motion of urgent and pressing necessity. If the House is disposed to deal with this motion, I feel it could be passed without debate. In view of the fact that Australia is sending its attorney general and New Zealand is sending its deputy prime minister to France and are contemplating
international court action to persuade France not to proceed with its planned Pacific nuclear tests, I move, seconded by the hon. member for Kootenay West (Mr. Harding):
That this House calls on the government to launch an immediate protest against these planned atmospheric nuclear tests preferably by sending a high-ranking government representative to the capital of France and also to the People's Republic of China to protest that country's forthcoming tests as well.


Mr. Speaker:: 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 unanimous consent. The motion cannot be put.
* *
*


OFFICIAL LANGUAGES
[Stage Direction]
T\K(~W7TP 7\/TT1 TNT
Mr. Rene Matte (Champlain):: Mr. Speaker, under Standing Order 43, I request the unanimous consent of the House in order to move a motion concerning a matter of urgent and pressing necessity.
In view of the fact that the Prime Minister's notice of motion concerning the official languages, is unacceptable especially with respect to the French-speaking people of this country, I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That this notice of motion be withdrawn and replaced by a more adequate and appropriate one.


Mr. Speaker:: The Chair entertains some doubts concerning the admissibility of the motion, but it is simpler for me to inquire of the House and determine whether there is unanimous consent.
The House has heard the hon. member's motion. Under Standing Order 43, this motion requires the unanimous consent of the House. Is there such unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not, and the motion cannot therefore be put.

April 13, 1973
Official Languages
[ English]


PROTECTION OF PRIVACY BILL
Hon. Otto E. Lang (Minister of Justice) moved: for leave to introduce Bill C-176, to amend the Criminal Code, the Crown Liability Act and the Official Secrets Act.


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

[Stage Direction]
On the order: Government Notices of Motions:
April 11, 1973-The Prime Minister:
That this House,
(i) aware that, as provided in the Official Languages Act, the English and French languages possess and enjoy equality of status and equal rights and privileges as to their use in all the institutions of the Parliament and Government of Canada;
cognizant that it is the duty of departments and agencies of the Government of Canada to ensure, in accordance with that Act, that members of the public can obtain available services from and communicate with them in both official languages; while
recognizing that public servants should, as a general proposition and subject to the requirements of the Official Languages Act respecting the provision of services to the public, be able to carry out their duties in the Public Service of Canada in the official language of their choice;
do hereby recognize and approve the following Principles for achieving the foregoing:
(1)	that positions which are seen, under present circumstances, as requiring the knowledge and use of both the French and English languages will be first identified, and then designated, as bilingual in the course of the period ending December 31, 1978;
(2)	that positions will also be identified where English is an essential requirement of the job, where French is essential, or whether either French or English may be used;
(3)	that a knowledge of English and French is one of the elements of merit in the selection of candidates for bilingual positions;
(4)	that competitions for bilingual positions will be open both to bilingual candidates and unilingual candidates who have formally indicated their willingness to become bilingual;
(5)	that competitions for unilingual positions will continue to be open to unilingual or bilingual candidates who meet the language requirements of the job;
(6)	that unilingual incumbents of bilingual positions may elect to become bilingual and undertake language training, or transfer to another job having the same salary maximum, or, if they were to decline such a transfer, to remain in their positions even though the posts have been designated as bilingual;
(7)	that employees who, as of April 6, 1966, had at least ten years of continuous service and who, since that date, have been employed continuously in the federal Public Service, will be entitled to apply for any job that has been identified for future designation as bilingual without having to indicate their willingness to become bilingual;
(8)	that unilingual French-speaking and English-speaking persons from outside the Public Service who are willing to become bilingual may apply for bilingual positions open to public competition;

(9)	that language training, at public expense, will be provided to unilingual public servants as well as to persons who are appointed to the Public Service to bilingual positions;
do further approve the Government of Canada, and, in particular, the Treasury Board and the Public Service Commission, taking the measures required to give effect to the aforementioned Principles; and
(ii) do further approve the taking of measures, after consultation with employee representatives, designed to produce a greater use of the French language at all levels in the Public Service, through increasing where practical, the number of French language units, through further recruitment efforts by the Public Service Commission, through training programs offered in the French language and by developing proposals, in conjunction with the governments of the provinces of Ontario and Quebec, to enhance the bilingual character of the National Capital region, thus helping to realize the objective of achieving, within the merit principle, full participation in the Public Service by members of both the anglophone and the francophone communities.
Mr. Speaker:: Pursuant to Section 2 of Standing Order 21 this notice of motion stands transferred to and ordered for consideration under government orders at the next sitting of the House.



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I have a question for the Minister of Finance. Since the House yesterday disposed of the income tax bill affecting 1972 personal income tax and will be engaged in dealing with the excise tax and customs tariff bills for
1972	today, can the hon. gentleman tell us whether on Monday he will be presenting notices of ways and means motions relating to the 1973 budget measures and anything left over from 1972, particularly the measure relating to personal income tax?


Hon. John N. Turner (Minister of Finance):: Not on
Monday, no, not until after the Easter break.


Robert Lorne Stanfield: Mr. Speaker, I have a question for the Prime Minister. In view of the fact that some of these measures have been around for a year, and since it is only now that measures relating to 1972 changes announced as long ago as last May are being dealt with by the House at the instigation of the government, I must ask the Prime Minister whether he will not exercise his responsibilities as leader of the government and put before the House notices of the ways and means motions arising out of the
1973	budget, as well as what is left over from 1972, rather than leave the House, the country and personal income taxpayers-


Mr. Speaker:: Order, please. I am under the impression that the Leader of the Opposition had asked a supplementary question. Perhaps that might be answered and then the Leader of the Opposition might ask a further supplementary.
April 13, 1973


Right Hon. P. E. Trudeau (Prime Minister):: The hon. Leader of the Opposition had not reached his question mark. I should like to know what he had in mind.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: Mr. Speaker, it is all very well for the Prime Minister to be funny. I had reached the question mark, and a lot of other people have reached the question mark.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: I ask the Prime Minister of this country whether there is any reason why parliament and the people are not being presented immediately with the ways and means motions arising out of those two budgets and are being left in doubt as to the intention of the government despite the fact that some of these measures have been lying around for more than a year.


Pierre Elliott Trudeau: Mr. Speaker, I want to thank the Leader of the Opposition for a very worth-while suggestion. I will give it the most serious consideration.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: I simply want to ask the Prime Minister whether he believes the people of this country should be left in doubt in this way, particularly since they have already gone through a year of doubt with regard to fiscal measures? Does he believe the people should be left in doubt as to the tax proposals, which are ordinarily presented in a very firm way to the House and the country immediately following the budget, and does the government have any excuse other than political manoeuvring, arrogance, or something like that?


Mr. Speaker:: Order, please. The right hon. Prime Minister seeks to reply to the Leader of the Opposition's question. It seems to me we are getting involved in debate rather than in questions and answers. However, if the right hon. Prime Minister can reply briefly he may do so and I will then recognize the hon. member for Nanaimo-Cowichan-The Islands for the purpose of asking a supplementary question.


Mr. Hees:: Try to be straightforward for once.


Some hon. Members:: Oh, oh!


George Harris Hees: It would be a new experience and a very refreshing one.


Pierre Elliott Trudeau: Mr. Speaker, I see the members of the opposition are not treating this question seriously.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. May we have order, please. We are certainly not starting the question period on the right foot this morning. I wonder whether we might try to have some order and proceed in a more quiet and dignified way.


Robert Lorne Stanfield: Mr. Speaker, I just want to assure the Prime Minister that, as he could see, I was waiting with
Oral Questions
bated breath to hear what he was going to say, as were hundreds of thousands of people in this country.


Mr. Speaker:: The hon. member for Surrey-White Rock.


Mr. Mather:: I do not have a supplementary question, Mr. Speaker.


Mr. Speaker:: We will return to this question in a short while. Perhaps we might try to complete the first round of questioning. If hon. members then want to continue this debate we will do so with the hon. member for Nanaimo-Cowichan-The Islands. For the moment the Chair will recognize the hon. member for Surrey-White Rock.


CONSUMER AFFAIRS
Barry Mather: Mr. Speaker, I have a question for the Minister of Transport concerning motor vehicle safety. Having in mind the hundreds of complaints from unfortunate owners of Firenza cars in regard to the safety-related defects of that car which has now been taken off the market by General Motors, is the Minister of Transport giving consideration to the request of the Automobile Protective Association that his department conduct an investigation or inquiry into the safety hazards of Firenza cars?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, to my knowledge, the department has in at least ten instances requested this company to withdraw some of their cars from the market and to return them to the plant for correction of certain flaws in design or construction. On each occasion, we do advise the provinces and publicize such faults as have been detected, and I feel the safety division of the department is most active and deserves the praise of the people of Canada.
[ English]


Barry Mather: Mr. Speaker, I have a supplementary question which I should like to direct to the attention of the Minister of Consumer and Corporate Affairs. Would the minister indicate what, if any, policy of consumer advocacy his department is adopting to help the owners of many of these cars who have suffered a very substantial economic loss through their purchase of Firenzas?


Hon. Herb Gray (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I did indicate to the House a few weeks ago that the department was, on behalf of Firenza owners who had brought their complaints to us, dealing with General Motors to try to find satisfactory solutions to their complaints.
3278

April 13, 1973
Oral Questions
[ Translation]


REGIONAL ECONOMIC EXPANSION
Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I have a question for the Minister of Regional Economic Expansion.
Last week he told me that he was meeting provincial authorities in order to discuss the possible reopening of the International Paper Company plant in Temiscam-ing. Has there been such a meeting or such discussions this week? Can the Minister say whether the plant will be reopening, and when?


Hon. Donald C. Jamieson (Minister of Regional Economic Expansion):: Mr. Speaker, I have had conversations with the appropriate minister, I believe the minister of forestry, of the province of Quebec and yesterday a meeting of officials was held in Quebec City. I only had a brief chance this morning to get a report, but I am told that the meeting yesterday went very well, that considerable progress was made and that there is what I might describe as a federal-provincial position on which we are both agreed and which will now be brought to the various promoters of the project in the hope that this might result in the reopening of the mill as quickly as possible. It looks promising.


Mr. Speaker:: The Chair will recognize the hon. member for Nanaimo-Cowichan-The Islands on a supplementary to the first question.


THE CANADIAN ECONOMY
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, may I direct a supplementary question to the Minister of Finance. In view of the fact the minister claims that his budget is expansionary in intent, may I ask him what steps he intends to take to offset the negative effects of the increase in the province of Ontario sales tax to 7 per cent and the imposition of a consumers' energy tax on people who use energy for the heating of their homes?


John Napier Turner: Mr. Speaker, that is something we would have to consider particularly in terms of stimulus. The personal income tax reduction proposed in February here was equivalent to about a 12 per cent or 13 per cent tax cut. If you take the increase in the sales tax in Ontario from 5 per cent to 7 per cent and the expiry of the 3 per cent reduction, that is equivalent in Ontario to about a 19 per cent income tax raise.


Thomas Clement (Tommy) Douglas: In view of the fact that home heating is an important item in the budget of most families, does the Minister of Finance or any other minister intend to carry

on discussions with the provinces to see what steps can be taken to offset both the increase in the price of gas instituted by the province of Alberta and now the imposition of a consumer tax on energy in the province of Ontario?


John Napier Turner: Mr. Speaker, I will take that into consideration in view of the substance of the preamble of the hon. gentleman's question.


FACTORS DETERMINING UNEMPLOYMENT RATE IN 1973-MINISTER'S FORECAST
Mr. John Lundrigan (Gander-Twillingate):: Mr. Speaker, I should like to ask the Minister of Finance a question concerning the economy and unemployment. In view of the government's annual economic review wherein it is indicated that the unemployment rate for 1973 will depend in part on the participation rate and also the willingness of people to involve themselves in the work force by actually seeking jobs, can the minister say whether he feels these will be the reasons unemployment will be high or low, depending on what he predicts will happen, and, finally, will he indicate to the House whether he has made any prediction about this year's unemployment rate expectation, whether it is approaching the corner, rounding the corner, on the straightaway or whatever he would like to indicate?


John Napier Turner: Mr. Speaker, I have attempted to forecast what the total number of new jobs will be for 1973, given reasonable industrial stability, a reasonable international trade position-


An hon. Member:: Good weather.


John Napier Turner: -and reasonable crops.


George Harris Hees: Good luck.


John Napier Turner: To arrive at the eventual unemployment figure, of course-


An hon. Member:: And the grace of God.


John Napier Turner: -a number of assumptions would have to be made, including the participation rate as the hon. gentleman suggests. It is because of the variables involved that I have hesitated to give a figure which might be confused by the public and the hon. gentleman as either a target or a forecast or something which would not give the firmness the hon. member expects.


John Howard Lundrigan: I have one final supplementary, Mr. Speaker.


Mr. Speaker:: Order, please. I would remind hon. members that we are still on the first question asked this morning. I would hope we might go to another subject soon. The hon. member may ask a further supplementary and then I will recognize the hon. member for Prince Edward-Hastings.

Oral Questions HOUSE OF COMMONS


John Howard Lundrigan: With due respect for the minister's answer, and not wanting to be unfair to him, is he telling the House and the Canadian people that the government has not made a prediction, a forecast or prognosis about unemployment expectations for 1973?


John Napier Turner: Mr. Speaker, I think the House is well aware of my views on forecasts and targets. If the hon. gentleman wants to take that up in more detail, I am again on my estimates on Monday night.


NATIONAL DEFENCE
George Harris Hees: Mr. Speaker, I have a question for the Minister of National Defence. I asked this question about two months ago and the minister said he would give it consideration. I wonder whether he is now ready to give the answer. In view of the tremendous advantages afforded young men wishing to go into the armed forces as a career, is the government now willing to provide the same advantages to young women by allowing them to attend military colleges and attain the same standards with the same advantages?


Hon. James Richardson (Minister of National Defence):: Mr. Speaker, although I have explained to the House that it is not now our policy to admit women to military colleges-


Some hon. Members:: Shame!


James Armstrong Richardson: -I would say that personally I believe the time may now be appropriate for us to re-examine that policy and I will do so following the suggestion of the hon. member with which I agree. If I could have a moment longer, Mr. Speaker, I would like to say that even though we do not have women enrolled in the military colleges we do provide opportunities for training at the universities. There are now 42 women enrolled in officer training courses at civilian universities on an equal basis with men.


Mr. Speaker:: Order, please. The hon. member has a supplementary and he will be recognized for that purpose. I believe the Minister of State seeks the floor on a point of order but I will first recognize the hon. member.


George Harris Hees: Mr. Speaker, I was not referring to those who wish to upgrade their education and are allowed to go to university because they do not get these advantages at all. As a graduate of RMC I can tell the minister that women would be very welcome at these colleges.


Mr. Speaker:: The Minister of State on a point of order.


PRESENCE IN GALLERY OF HIS BEATITUDE MAXIMOS THE FIFTH, GREEK MELCHITE CATHOLIC PATRIARCH
Hon. Stanley Haidasz (Minister of State):: Mr. Speaker, in view of the shortage of time I would like to call your attention to the presence in the visitors' gallery this morning of His Beatitude Maximos the Fifth, the Greek Melch-ite Catholic Patriarch of Antioch, of all the East and and of Alexandria and Jerusalem, and wish him a warm welcome to Parliament Hill.


Some hon. Members:: Hear, hear!


EXTERNAL AFFAIRS
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Secretary of State for External Affairs. In view of the fact that on July 1, 1973, the five-year old Caribbean Free Trade Association, CARIF-TA, will officially become the Caribbean Common Market, a union of 13 former British possessions with a common external tariff and unified economic trade and fiscal policies, what efforts are being made by the minister's department to protect the $100 million Canadian market in the CCM, and are efforts being made to open up new markets in this area for Canadian capital goods and raw materials which will be required as industrialization in the CCM creates new demands?


Mr. Speaker:: Order, please. I am sure the hon. member will recognize that his question is very wide in its scope. Certainly the House cannot expect the minister to reply to a question such as that. If the minister wants to indicate that he would wish to make a statement on motions or give the House the information in some other way, he will be recognized for that purpose.


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, I take advantage of this occasion to wish the Caribbean organization the very best. It is my view that co-operation among these islands is very much in the interests not only of these islands but also of Canada and will provide greater markets than would otherwise exist which we are exploring as a means of expanding our exports.


VIET NAM-REQUEST FOR INFORMATION ON LOCATION OF HELICOPTERS CARRYING ICCS PERSONNEL WHEN SHOT DOWN
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is addressed to the Secretary of State for External Affairs. In light of reports that an inspection team of the International Commission of Control and Supervision on the spot has made a finding that the helicopters which were shot down in Viet Nam recently in fact were 15 miles off course, which seems to be inconsistent with information given to the House, will the minister make a further
26087-61i

April 13, 1973
Oral Questions
statement on motions or otherwise clearing up this matter?


Mitchell William Sharp: Mr. Speaker, we have not yet received an official report from our representatives at Saigon about this incident. I have seen, as has the hon. gentleman, the reports that have come through the press. I have reason to believe they are broadly accurate, but we have not yet had a complete report and I would prefer to make a statement or table the report when it is received.


UNEMPLOYMENT INSURANCE
Mr. Roland Godin (Portneuf):: Mr Speaker, I would like to ask a question to the Minister of Manpower and Immigration.
Owing to the present Unemployment Insurance Act regulations, thousands of Canadians will never be able to qualify for benefits if they are unemployed. Could the minister tell us if he contemplates bringing in soon an amendment to this act so as to make contributions optional?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: I do not accept the premise of the question, but I will examine it in case I missed some nuance.


POSSIBLE AMENDMENT OF CANADA LABOUR CODE TO RE-ESTABLISH 48-HOUR WEEK
Roland Godin: I would like to ask a supplementary, Mr. Speaker.
I have in hand a document which I received from someone who is having difficulties with the Unemployment Insurance Commission. Benefits were refused because that person has limited his availability to five days a week.


Mr. Speaker:: Perhaps we should now hear the
supplementary.


Roland Godin: As the minister indicates that he does not want to amend the Unemployment Insurance Act, could he tell us if he contemplates amending the Canada Labour Code in order to restore the 48-hour week?


Robert Knight Andras: I would ask the hon. member to send me the details of the particular incident he has described and I will see what I can do about it.


IMPORTATION OF MARIJUANA-SUGGESTED REDUCTION OF CHARGES TO TRAFFICKING OR POSSESSION
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I wish to direct my question to the Solicitor General. It arises out of a question I asked him last week in reference to the act under which the minimum sentence for the importation of soft drugs-I was dealing with university students or other young people who are caught bringing in drugs such as marijuana-is seven years. Can the minister say whether any special instructions have now gone out to his legal officers with reference to that kind of charge and whether the proper prerogative could be used to charge these people with either possession or trafficking?


Otto Emil Lang: Mr. Speaker, no further instructions have gone out. I indicated to the hon. member when he raised the matter last that the instructions which were already in the hands of agents seemed to me to be completely appropriate.


Eldon Mattison Woolliams: Can the Minister of Justice say, without naming anyone on a particular charge, that the present charge which carries a minimum penalty for a first offence of seven years will be changed to either a charge of trafficking or simple possession?


Otto Emil Lang: I will not speak about an individual case, Mr. Speaker.


Eldon Mattison Woolliams: It seems like discrimination to me.


IMMIGRATION
Mr. Jim Fleming (York West):: Mr. Speaker, my question is for the Minister of Manpower and Immigration. Considering the government's so-called "gentle hand policy" to visitors coming to Canada, could the minister explain why Mr. and Mrs. Sanchez from Argentina were forbidden to work and threatened with deportation by government officials, as reported by various sources yesterday?


Robert Knight Andras: Mr. Speaker, Mr. and Mrs. Sanchez came to Canada last fall and had permission to remain until March 31 of this year as visitors. On March 5 they appeared at the Toronto Immigration office to apply for landed immigrant status. They were told that this was not possible and arrangements were made for them to appear at a special inquiry on a date to be later specified. On April 11 they appeared at a Canada Manpower centre in suburban Toronto, were identified as people awaiting an inquiry, and an immigration officer stamped a prohibition to work in their passports. This was stamped in error.


Mr. Speaker:: Order, please. I suggest to the minister and to the hon. member that it is somewhat irregular to try to make statements to the House by way of questions during the question period.
April 13, 1973


Some hon. Members:: Hear, hear!


James Sydney Clark Fleming: Mr. Speaker, I have a supplementary question through you to the minister. Could the minister indicate whether this problem has been resolved for these people?


Robert Knight Andras: Yes, Mr. Speaker. The inhibition has been removed and the couple may be permitted to work. There was no threat of deportation whatsoever.


INCOME TAX
Mr. Don Blenkarn (Peel South):: Mr. Speaker, my question is for the Minister of National Revenue. In view of the fact that the changes in capital cost allowances suggested in the May, 1972, budget have not yet been invoked by order in council or by amendments to the Income Tax Act, will the minister advise the House how he is handling returns made by corporations whose year end is now over and who have filed returns and have used the capital cost allowance suggestions in that budget?


Hon. Robert Stanbury (Minister of National Revenue):: Mr. Speaker, the question does not arise unless the corporation is anxious to have an assessment established immediately. In that case, of course, the assessment would have to be established on the basis of the law as it exists.


ROYAL CANADIAN MOUNTED POLICE
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Solicitor General. This being the centennial year of the Royal Canadian Mounted Police, is the Solicitor General considering a bonus to the pensions of the surviving members of the Royal Northwest Mounted Police, and can he also say what progress he is making in securing the necessary arrangements so that retired RCMP personnel not yet 60 will have their pensions escalated annually?


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, these matters are under study. I do not have any details for the hon. member right now, but I will be pleased to get them for him.
Oral Questions NATIONAL DEFENCE


ANNUAL ESCALATION OF PENSIONS OF RETIRED ARMED FORCES PERSONNEL NOT YET 60
Stanley Howard Knowles: May I
direct a supplementary question, which is parallel to the one I just asked, to the Minister of National Defence. Can he say what progress he is making so that retired armed forces personnel not yet 60 years of age will receive the annual escalation in their pensions?


James Armstrong Richardson: Mr. Speaker, the matter is under consideration.


TRANSPORT
Hon. J. A. MacLean (Malpegue):: Mr. Speaker, I should like to address my question to the Minister of Transport. I regret that I have not been able to give him notice, but perhaps he could take the question as notice if he is not in a position to answer it now. Will he take action, preferably before June 1, to amend or reinterpret the well intentioned but completely impractical safety regulations which require small inshore fishing boats that take people sports fishing to carry large, inflatable life rafts?


Jean Marchand: Mr. Speaker, I will look into this problem and answer later.


NATIONAL DEFENCE
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, I should like to direct a question to the Minister of National Defence. In view of the fact that the Department of National Defence personnel are working as long hours and under conditions that are as dangerous as the conditions under which employees of the Department of External Affairs are working in Viet Nam, is the minister going to announce an increase in pay rates for the defence personnel equal to that paid to external affairs and other civilian personnel serving in Viet Nam?


James Armstrong Richardson: Mr. Speaker, the arrangements for foreign service pay are determined by the Treasury Board, not directly by the Department of National Defence or the Department of External Affairs.


Walter David Baker: Would the minister care to enlighten the House now as to what the minister's recommendations are to the Treasury Board with respect to this matter and with respect to pay for Department of National Defence personnel equal to that of members of the Public Service of Canada?

April 13, 1973
Oral Questions


James Armstrong Richardson: Broadly speaking, we have achieved equality of pay for the armed forces and the public service. When we look at something specific, such as the matter mentioned by the hon. member, foreign service allowances, we have to consider other elements in the total package of allowances and benefits. We have to look at the pension plan, at housing conditions and even medical care. There is a lot in the package that has to be weighed, not just one item.


HARBOURS
Mr. Gilles Caouette (Charlevoix):: Mr. Speaker, I should like to put a question to the hon. Minister of Public Works.
On March 23, a ship damaged the wharf at Pointe-au-Pic. Since that accident there has been no traffic in the port in order to allow repairs to be made. Can the minister advise us whether the work has in fact started and, if so, when it is expected to be completed?


Hon. Jean-Eudes Dube (Minister of Public Works):: Mr. Speaker, I shall have to inquire as I am not now in a position to answer this question. It was probably very difficult to do the work during winter months, but I shall look into the matter and advise the hon. member at the first opportunity.


RESEARCH
Mr. Harvie Andre (Calgary Centre):: Mr. Speaker, my question is for the Minister of State for Science and Technology. In view of the statement made in the speech prepared for delivery by the Minister of Industry, Trade and Commerce in Calgary on April 5 that 25 per cent of all research and development incentive grants are made in western provinces, which contrasts with the statement by the Minister of National Defence reported on page 363 of Hansard that 91 per cent of all such research and development grants are given in Ontario and Quebec, and therefore only 9 per cent for all the rest of Canada, my question is-


Mr. Speaker:: Order, please. The hon. member should ask his question, he should not present an argument.


Harvie Andre: My question is, which of these two ministers' statements is correct?


Mr. Speaker:: The hon. member for Sault Ste. Marie.


PUBLIC SERVICE
Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, my question is directed to the President of the Treasury Board. In view of the minister's stated intention to keep salaries of federal employees in the general services category competitive with those of non-government employees, can he explain why federal government employees in this category in Sault Ste. Marie must work for 70 cents less an hour than their counterparts in the public school system?


Hon. C. M. Drury (President of the Treasury Board):: Mr. Speaker, I am not aware of the details of this case. I think that currently these rates are under negotiation.


CANADIAN BROADCASTING CORPORATION
[Stage Direction]
BROADCASTING OF GOVERNMENT AND H. and R. BLOCK COMMERCIALS RESPECTING 1972 INCOME TAX FORM
Mr. Donald Maclnnis (Cape Breton-East Richmond):: Mr. Speaker, I have a question for the Minister of Communications. Does he feel that the Canadian Broadcasting Corporation is acting in the best interests of Canadian citizens in running commercials by Fred Davis about our so-called simple tax form and other commercials by the H. and R. Block Company calling attention to the need for their professional services because of this same tax form?


Gérard Pelletier: Mr. Speaker, the CBC does not report to the Minister of Communications.


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


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker-


Mr. Speaker:: I apologize to the hon. member for Bellechasse.

The hon. member for Cape Breton-East Richmond is rising on a supplementary.


Donald MacInnis: Mr. Speaker, my supplementary would be to the responsible minister, but with the way things are going on that side of the House we never know who is responsible for what.
[ Translation]


Joseph Adrien Henri Lambert: Mr. Speaker, in view of the absence of the hon. Minister of Agriculture, I would like to put my question to his parliamentary secretary who was here a moment ago. However, if you will allow me to do so, I shall put my question as soon as he is back in the House.

[ English]


AIRPORTS
Mr. John A. Fraser (Vancouver South):: Mr. Speaker, my question is directed to the Minister of Transport. A month and a half ago the Minister of the Environment assured the House that environmental studies relating to Vancouver Airport expansion would be concluded within 12 months. Can the minister assure the House that these studies have in fact now been started?


Jean Marchand: Mr. Speaker, I think it would be preferable to put this question to the Minister of the Environment.


John Allen Fraser: Mr. Speaker, since this is under the jurisdiction of the Minister of Transport, can he tell us whether these studies, which apparently have to be completed within 12 months, have been started? If he does not have the information, would he undertake to let us have it as soon as possible?


Jean Marchand: Mr. Speaker, I think that the Minister of the Environment acts for us in this matter. We asked that department to make the studies. What stage the studies are at the moment I do not know exactly, but I will make inquiries.


COMMUNICATIONS
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, I wish to direct a question to the Minister of Communications. In view of the computer communications green paper tabled today, or another chapter in the green paper policy, is this subject also to be included on the agenda of the federal-provincial conference the minister has called, and what has been the response of the various provinces to his invitation?


Gérard Pelletier: Yes, Mr. Speaker, computer communications is obviously one of the subjects covered under a national policy on telecommunications. The provinces' answer on a proposed federal-provincial conference on telecommunications was positive. However, they feel that the proposed agenda for the beginning of July is premature. Most provinces would rather have a conference in the fall, in early October.


John Patrick (Pat) Nowlan: Along with the issue of general policies and principles which will be on the agenda of this federal-provincial conference, will the question of the political balance of the Canadian Radio-Television Commission also be an item for discussion at the conference?
Oral Questions
[ Transla tion]


Gérard Pelletier: Mr. Speaker, whatever suggestions the communications ministers make, I do not think any of them is interested in the make up of the Canadian Radio-Television Commission the way the hon. member seems to be suggesting.


CONSUMER AFFAIRS
Robert Lorne Stanfield: Mr. Speaker, I wish to direct a question to the Minister of Consumer and Corporate Affairs. Has he now established the monitoring devices with regard to price reductions, following the sales tax and tariff cuts announced in the budget, that he said he was studying a few days ago and which the Minister of Finance later said were already in place in several departments?


Herbert Eser (Herb) Gray: Mr. Speaker, a mechanism for this purpose has been established within my department and I hope to have further information about the results of its work available to the Minister of Finance and to the House in due course.


Robert Lorne Stanfield: Mr. Speaker, in view of the fact that the House will presumably be recessing on Wednesday next, will the minister undertake to make a full statement as to the monitoring methods being used and the results of such checks before the House recesses?


Herbert Eser (Herb) Gray: I do not think I am in a position to do that.


Robert Lorne Stanfield: I guess you are not.


Herbert Eser (Herb) Gray: I will examine what information I can give. I want to leave the Leader of the Opposition something to look forward to when the House resumes.


AIRPORTS
Mr. John Harney (Scarborough West):: Mr. Speaker, I rise to direct my question to the Minister of Transport. It is my fortnightly question on the subject of a second international airport at Toronto. Could the minister report what progress is being made on establishing the commission of inquiry with regard to the expropriations surrounding the second international airport at Toronto, and also with regard to setting the terms of reference for this commission?


Jean Marchand: Mr. Speaker, as I stated in the House previously, I have to

April 13, 1973
Oral Questions
meet with the Premier of Ontario, Mr. Davis. This has not been done yet, but I hope I can meet with him very soon.


John Paul Harney: In view of the fact that officials of the Ontario Department of Transport and Communications recently stated publicly that the second international airport at Pickering will probably not be built in the sense that it has been proposed, is the House to expect that there have been significant changes in the plans for the Pickering airport?


Jean Marchand: Mr. Speaker, the only thing I can say is that nobody has been authorized to make such a statement on behalf of the federal government.


Mr. Speaker:: Order, please. We are running short of time. The Chair will recognize the hon. member for St. Paul's on a supplementary.


Mr. Ron Atkey (St. Paul's):: Mr. Speaker, in view of the fact that the announcement by the government on January 30 with respect to the Pickering airport expropriations indicated that the independent study group would be required to report within one year, and in view of the fact that some ten weeks have passed since that announcement, is the minister still sticking by his commitment to have that group report within one year?


Jean Marchand: I still hope so, Mr. Speaker.


POSSIBILITY OF PROVISION OF SECRETARIES FOR MEMBERS IN CONSTITUENCIES
David Réal Caouette: Mr. Speaker. I wish to direct a question to the right hon. Prime Minister.
I asked him a question on Monday about the possibility of setting up secretarial facilities in each riding, so as to provide better service for the general population. Have there been any further developments on this this week? Does the right hon. Prime Minister intend to recommend or take steps towards setting up such offices in each federal riding?


Pierre Elliott Trudeau: Mr. Speaker, since the Social Credit leader asked that question, I have consulted the government leader in the House, who reported to me on discussions he has had with representatives of the other parties.
The hon. member is aware that this is a measure that we would be unwilling to pass if a large number of members were opposed to it, since its aim would be to provide a federal presence in the various parts of Canada that are a long way from Ottawa.
The reports I have had to date are encouraging, and it would seem that the House leader will soon have the support of almost all the parties for this measure; once he has, we will be very glad to implement it.


EXTERNAL AFFAIRS
Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I have a question for the right hon. Prime Minister. In view of the government's apparent refusal to grant any variety of credit to the government of Chile, and the unpleasant appearance of complicity in some sort of pressure on that government, would the Prime Minister immediately revoke the order apparently issued by some branch of government, external affairs or trade and commerce, and remove this refusal of a discriminatory nature against the government of Chile and allow that government to obtain normal credit, as other governments in South America do, particularly in view of the fact that this is seriously interfering with Canada's trade-


Mr. Speaker:: Order, please.


Mitchell William Sharp: Mr. Speaker, if I may be permitted to reply, there is no substance whatever to the allegation made by the hon. member.


Wallace Bickford (Wally) Nesbitt: Mr. Speaker, I rise on a question of privilege. The reply to the question I asked a few moments ago was made by the Secretary of State for External Affairs and, if I may say so I believe the minister has quite innocently misled the House. When an inquiry was made by myself of the Export Development Corporation, I was informed that there was a government order that no credit was to be extended to the government of Chile. That is the question of privilege.


Mr. Speaker:: Order, please. That is not a question of privilege but perhaps a point of debate between the minister and the hon. member.


INCOME TAX
Mr. Peter C. Bawden (Calgary South):: Mr. Speaker, my question is for the Minister of National Revenue. As the minister is now likely aware that his department will not stand behind the advice it is giving to taxpayers, will the minister tell the House whether refusal by employees of his department to identify themselves on the telephone is an official policy of his department?


Robert Douglas George Stanbury: No, Mr. Speaker, but the hon. member should know, and I think he does, that it has been well established in law that members of the public service or members of the government, for that matter, cannot bind the Crown. Therefore they cannot be expected to guarantee information given over the phone to the extent that it can be used as evidence in court.
April 13, 1973


Mr. Speaker:: Order, please. The hon. member rises for a supplementary. He will be recognized for that purpose. I will then recognize the hon. member for Churchill and call orders of the day.


Peter Colwell Bawden: Mr. Speaker, the minister did not answer my question, but I hope he will. Is the reason for withholding names the fact that employees of his department are uncertain about the advice they are giving because of the complexity of the tax laws or fear of being prosecuted by taxpayers who have received bad advice?


Robert Douglas George Stanbury: Mr. Speaker, I answered the question. The answer was no. There is no such instruction and there is no such fear.


MANITOBA HYDRO DEVELOPMENT-INQUIRY AS TO APPLICATION FOR DIVERSION OF SOUTH INDIAN LAKE AND REGULATION OF LAKE WINNIPEG
Mr. Keith Taylor (Churchill):: Mr. Speaker, my question is for the Minister of Transport. In view of a previous question asked of the minister concerning Manitoba Hydro development, may I ask the minister now whether he has received an application for the diversion of South Indian Lake in Manitoba from Manitoba Hydro and whether in fact he received an application in respect of the regulation of Lake Winnipeg over three years ago from Manitoba Hydro?


Jean Marchand: Mr. Speaker, I am not aware personally if we have received such an application, but I will inquire of the department and answer.


Mr. Speaker:: Orders of the day.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Thursday, April 12, consideration of the motion of Mr. Turner (Ottawa-Carleton) that Bill C-171, to amend the Excise Tax Act, be read the second time and referred to Committee of the Whole.
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, Bill C-171 is a relatively short bill. The commodities to which it refers have long since been forgotten by members of this House. Actually, many members of the House never knew of the proposals in the budget which gave rise to these changes. These changes are limited to those that the minister announced in the budget of May 8, 1972. Basically they cover a limited number of commodities on which taxes have either been eliminated or on which they are to be reduced.
Before I deal with the particular provisions of the bill which apply to such things as, contact lenses, crates used
Excise Tax Act
in transportation, eel traps and a few things like that, I should like to say that the House, I am sure, was very disappointed that even in his last budget address the minister did not announce that there was being undertaken a general review of the entire sales tax, as that applies to the government of Canada. We know that the Carter Commission made some proposals about the whole question, but we have not heard anything about them for seve.-al months. I will wait until the minister pays attention.


An hon. Member:: He is not paying attention to you.


Marcel Joseph Aimé Lambert: Perhaps I could have the attention of both hon. gentlemen who are now conferring, since they are the ones to whom I should like to make these remarks.


An hon. Member:: Send the minister a letter, Marcel.


Marcel Joseph Aimé Lambert: An hon. member suggests that I should send a letter. It would never get there on time. I am not satisfied that the Postmaster General (Mr. Ouellet) could get it there on time.
The point I was hoping to impress on the minister, and on the Prime Minister (Mr. Trudeau) if he had stayed in the chamber, is the necessity of a total review of the sales tax provisions that apply at the federal level. Over the years the act has become a mishmash of parts that were repealed, of additions, and of many schedules that are a jungle of inconsistencies. Actually, there is in my mind a very grave question about the efficacy of flat rate consumption taxes. These are imposed on an ad valorem basis. As prices rise, the revenues of the government rise. The federal sales tax is a regressive tax in that it hits more heavily-


John Napier Turner: How about provincial
sales taxes?


Marcel Joseph Aimé Lambert: -the persons in lower income brackets. The minister asks, what about provincial sales taxes? I agree with him. That, however, does not alter the fact that leadership for a total review of consumption taxes, such as sales taxes, must be given in this country if tax reform is to have any meaning. If the subject of tax reform in this country has been abandoned by the Liberal administration because it has exhausted in producing the new Income Tax Act, I can readily understand the apparent lack of progress. The Minister of National Health and Welfare (Mr. Lalonde) is talking now about a guaranteed annual income. This administration more and more seems to be moving in that direction, even though the Prime Minister in 1968 had rejected the whole idea. Before there can be any element of justice with regard to a guaranteed annual income, the question of sales and consumption taxes at both federal and provincial sales levels must be considered.
Having said that, I should like to ask the minister to say what steps have been taken since his predecessor many months ago indicated that this action was to be organized. Has anything been done to undertake the planning for a review of the general sales tax picture? That is the point I now wish to make. I will have something to say about it
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April 13, 1973
Excise Tax Act
when we consider the bill in committee of the whole. I will talk about certain principles underlying this bill. After we have heard from representatives in the House, I hope that we will move into committee of the whole to deal with the particular points.


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, like the hon. member for Edmonton West (Mr. Lambert) I; too, intend to be very brief in speaking on Bill C-171. This bill also deals with legislation proposed in the budget of last year. It removes the sales tax from a number of items which help people such as farmers. In my area, this measure will be helpful because it removes the sales tax on crates for live poultry. After all, Yorkton is the turkey capital of the world. Therefore, I enthusiastically support this part of the legislation. In answer to the hon. member for Fraser Valley West (Mr. Rose), I maintain that Yorkton is the turkey capital, not the Fraser Valley. This bill exempts a whole series of items from sales tax such as chicken and turkey crates, eyeglasses, contact lenses and so on.
I listened with interest to the hon. member for Edmonton West (Mr. Lambert). He questioned the wisdom of sales taxes in general and asked the government to review the idea of a sales tax because it is regressive. I agree that sales tax is extremely regressive. I wonder what the Progressive Conservative party thinks about the Ontario government which yesterday implemented a 7 per cent sales tax across the board.


Marcel Joseph Aimé Lambert: What about Saskatchewan where it started?


Lorne Edmund Nystrom: In Saskatchewan, the sales tax is now 5 per cent. In Ontario, it is 7 per cent, one of the highest in the country. That really indicates where the hearts of the generous Tories are when it comes to the average citizen. It strikes me as funny to hear the hon. member for Edmonton West question the wisdom of sales tax and suggest that it is regressive when his own party in the province of Ontario is increasing the sales tax.


Some hon. Members:: Shame.


Lorne Edmund Nystrom: I say sincerely that sales tax is regressive. It is imposed across the board and hurts in particular those in the lower and middle income groups. The sales tax in this country should be lowered rather than increased, such as is being done in Ontario. Therefore, I support the bill before us. I am happy to see that a number of items are now being exempted from sales tax. The clause dealing with eyeglasses, contact lenses and other items connected with eye problems is worth-while. The clause dealing with crates for live poultry is very worthwhile, especially in an area like mine, as are other clauses in the bill.
The only question I want to raise at this time concerns providing more exemptions for mining companies in the exploration and drilling for oil and gas. I again want to make the point that the government is handing out another tax exemption to the resource and extractive industries. These industries are already receiving a lot of tax. breaks. They are capital intensive. They do not provide jobs. We

should look in the opposite direction, plug some of the loopholes and increase taxation for the mining and oil companies. This would entice more money into the manufacturing industry as well as the development of service industries which in turn, would provide more jobs for the people of this country.
The hon. member for Edmonton West may think this rather frivolous. I understand his thinking. He represents, in a very profound way, the thinking of the economic neanderthals of the Conservative party in Alberta, the people who represent the oil and gas companies in this country. What we need in this country is a real change in the tax policy regarding the extractive industries. It is time we did more processing of raw materials in this country. There should be more development in this area. If we did that, we probably would not have the high rate of unemployment that we have today.
In conclusion, we will support the measure before us. During the committee stage, one or two members of this party may have a question or two for the minister.


David Réal Caouette: Mr. Speaker, the bill now under consideration will surely encourage a few sectors of the economic activity in Canada and will not do much for others, while the federal government is on the verge, as an hon. member pointed out a while ago, of abolishing the sales tax on certain drug products and certain other items to help large families. However, at the same time, we hear about tax increases at the provincial level. For example, the Ontario government announced last night that the sales tax would go up from 5 to 7 per cent, while it already stands at 8 per cent in Quebec.


Marcel Joseph Aimé Lambert: And the Sacreds in British Columbia raised it to 6 per cent.


David Réal Caouette: And the Conservatives in British Columbia have raised it to 6 per cent.


Marcel Joseph Aimé Lambert: No. The Conservatives are not in power; it is an NDP government.


David Réal Caouette: The New Democratic Party is in power. In Alberta where the Conservatives are in power, there is talk of a soon to be established sales tax and the hon. member for Edmonton West will probably soon have to confirm it.
Mr. Speaker, oil reserves are all being devoured in Alberta since the Conservatives took over.
The sales tax hits directly big families which naturally have to buy more than small families. Big families are usually those with low incomes; they are the families hardest hit by tax increases in Ontario. But it is not up to the Minister of Finance to tell the government of Ontario not to impose taxes.
This morning I heard the hon. member for Nanaimo-Cowichan-The Islands (M. Douglas) ask with respect to the tax on gasoline or the 2 cent increase in the price of gasoline if the federal government intended to do anything about it.
Mr. Speaker, I was tempted to ask a question at that time to see if in 1944 when the hon. member for Nanaimo-
April 13, 1973

Cowichan-The Islands was premier of Saskatchewan, the tax on gasoline was removed. Was private entreprise not taxed? For example, were there not oil companies which refused to settle in Saskatchewan because they feared they might be nationalized or controlled by the government? Those are questions which might have been asked this morning had the hon. member been a minister in this government. It may soon come true judging from the way we see the New Democratic Party walk hand in hand with this government. What is now held against the government was applied in Saskatchewan not too long ago and it is still being applied today.
Mr. Speaker, it is not a solution to say: you are blamed for imposing such a tax while everybody is asking for better services in all fields; everybody, especially the New Democratic Party, is clamouring for assistance, as did a while ago the member for Winnipeg North Centre (M. Knowles) who spoke about public servants who. should be granted a pension raise, etc. We agree. Why should they get higher pensions? To have more purchasing power!
Nevertheless, Mr. Speaker, we are drawing those increases from the pockets of the taxpayers; we reduce the purchasing power of the general consumer to help a certain class of society. Help a group of citizens, fair enough, but not at the expense of another which is sometimes poorer than the one we are trying to help.
Mr. Speaker, changing the taxation procedure is not new; it has been invented, not by the government, nor by the member for Nanaimo-Cowichan-The Islands nor by myself, but by economists who say that the tax basis should be better distributed in order to reach a given social class.
Mr. Speaker, whether they be Liberals, Progressive Conservatives or New Democrats, most economists have studied in the same universities, yet they contradict each other and confuse governments instead of enlightening them.
I do have a grudge against such economist who dwell in the clouds, get lost in the fog and want to distribute taxation through additionnal bureaucracy, which means more administration expenses and fewer services than ever before.
Mr. Speaker, this is why me should not always rely on taxation; from time to time the Minister of Finance (Mr. Turner) says; the only way to get money is to tax or borrow. How empty those words sound, coming from a sovereign government! It does not enjoy sovereignty; then, where does it find sovereignty? In taxation and borrowing. But why does sovereign government, strong legal and able in a country such as Canada find itself unable to create the credit it needs to serve the people?
Mr. Sepaker, after getting up in the morning and saying the "Lord's Prayer" and the a "Hail, Mary", the Minister of Finance should learn by heart the statement made by Abraham Lincoln in the 1860's when he was President of the United States. This would complement his prayers.
Excise Tax Act Abraham Lincoln said, and I quote:
I have two great enemies-the southern army in front of me and the financial institutions in the rear. Of the two, the one behind me is my greatest foe. The government should create,-
[ Transla tion]
The Minister of Finance is looking at me; these words are not mine but those of Abraham Lincoln; the minister willingly follows the example of this great stateman in other fields, but not in the financial field. No, we must not talk about that.
I resume the quotation:

-the government should create, issue and circulate all the currency required to satisfy the spending power of the government and the buying power of consumers.

The hon. member for Nanaimo-Cowichan-The Island has used the same words in western Canada. In 1934-35, the hon. member drove in Saskatchewan in a 1929 model car; I saw the picture. On the one hand, he was saying: Vote CCF, and on the other hand he was saying: Vote Social Credit. At the time of William Eberhart, he almost became a member of the Social Credit Party.
Mr. Speaker, the hon. member none the less recognizes that he used Abraham Lincoln's words.


An hon. Member:: Was he not a student that time?


David Réal Caouette: He was not a student but I must admit he was very clever. Only when he joined the ranks of the CCF did he lose some of his ability.
Mr. Speaker, Abraham Lincoln said, and I quote: [English]
The privilege of creating and issuing money is not only the supreme prerogative of government-
[ Translation]
I hope the Minister of Finance understands. I go on quoting:

-it is the government's greatest creative opportunity. [Translation]


John Napier Turner: Is the hon. member suggesting that he was an advocate of Social Credit?


David Réal Caouette: No, but I can say that I agree with him. I wish the minister would agree with him as well. If he did and undertook exactly what Abraham Lincoln suggested, the minister might conclude by saying: At last, that is Social Credit!

The people can and will be furnished with a currency as safe as their own country. Money will cease to be master and become the servant of the people. Democracy will rise superior to the money power.
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April 13, 1973
Excise Tax Act

Those were the words of Abraham Lincoln. When will the Minister of Finance start saying and repeating those words and, above all, putting them into effect? I am looking forward to that. The sipritual leader of the present Minister of Finance was the Right Hon. William Lyon Mackenzie King. That is true!


John Napier Turner: That is tough!


Mr. Speaker:: Order, please. May I remind the hon. member that we are considering a specific bill, Bill C-171, an Act to amend the Excise Tax Act. I assume that the remarks of the hon. member are introductory to his statement, but I hope that he will soon come to the subject matter of the bill now before us.


David Réal Caouette: Mr. Speaker, I am quoting the former president of the United States Abraham Lincoln, and one former Prime Minister of Canada, the Right Hon. William Lyon Mackenzie King, because they were definitely opposed to this excise tax which is dealt with in Bill C-171.
This tax is to a high degree responsible for inflation in Canada; even if we abolish the tax on candies and on some drugs, it will not do much to improve the financial situation.
Let us take, for example, the effects of excise tax in the field of automobiles. Mr. Speaker, I am an automobile salesman. On a $4,000 car, the excise tax is just under $300; the federal sales tax comes to between $500 and $700 and on top of that there is the provincial tax. What an agglomeration of taxes-


An hon. Member:: They benefit the salesman!


David Réal Caouette: An hon. member says: "They benefit the salesman"! Mr. Speaker, if our profits were that much, we would be rich. Then we would be able to pay more income tax! The excise and other taxes on automobiles and other products are enough. We should at least have exemption from the provincial sales tax.
To come back to what I was saying just now, I know that the Right Hon. Mackenzie King is not behind Bill C-171, but his spirit is there. The Minister of Finance could abolish the excise tax on a number of products if he took the advice of his "spiritual father".
I quote again:

Once a nation parts with the control of its currency and credit, it matters not who makes the nation's laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of parliament and democracy is idle and futile.
Mr. Speaker, it was a Liberal prime minister of Canada who made such a statement in 1935, nearly forty years ago. And today, we still have to deal with the same system. Taxes are distributed instead of abundance. We forget the products which exist in Canada; we still hear stupid

economists say that there is not enough production in relation to the purchasing power, while exactly the opposite is true. Today, in order to stimulate employment, they say that private enterprise is going to be subsidized, that the excise tax will be removed on some items, holding out to the people the prospect of an increase in the purchasing power and of new jobs.
Yesterday evening, I saw the advertisement for 300,000 jobs. The Canadian Broadcasting Corporation was wrong as usual and advertised three million jobs. The bureaucrats who do not even have enough time to think what figures they must write down are as strong as 10 years ago. They are irresponsible, as usual.
Mr. Speaker, 300,000 jobs will be created by the Minister of Finance, but they do not say how many new Canadians will join the labour market. The 300,000 jobs of the Minister of Finance remind me of the 100,000 jobs of Mr. Bou-rassa, in the province of Quebec, where 100,000 jobs became 100,000 layoffs. There are more unemployed in the province of Quebec than at the time when Mr. Bourassa came to power in 1970, and at the national level, there are more unemployed than 3 or 4 years ago. This is the result of such a system! They think that they will improve the well-being of Canadians by giving goodies.
Moreover, automation is increasing every day and shows that we need less and less labour, and human capital. What is needed is automatic capital and I would like the Minister of Finance to find automatic financial capital. Financial capital must work as automation does and then the excise tax would not have to be abolished or altered since the minister would have found a concrete solution. We want to get the economy moving again. There is only one way of making it work: we must increase the consumers' buying power without increasing prices. This is the only way. We will not succeed through the excise tax but through the Bank of Canada and by compensated retail price discounts.
The federal government could use the Bank of Canada so this would not be reflected in prices and in production costs; by decreasing consumption prices, compensated by the federal government, by the Bank of Canada or by a national credit commission, the products would reach consumers and create new jobs through increased demand. Those products would then be made in Canada and not in Japan or Jamaica.
The abolition of the excise tax on certain products is only a drop of water in the ocean. This is not a solution to the problem and if the other parties are happy with that, we are not. We will of course accept the removal of the excise tax on certain products, but this is not enough and the Minister of Finance knows it.
Therefore, I wish, as I said earlier, that in addition to saying his "Hail Mary" or his "Our Father", morning and night, the minister should learn by heart what Abraham Lincoln said in the United States, so that we may establish in Canada a system respectful of all citizens.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. McCleave in the chair.
April 13, 1973
The Chairman:: Order. House in committee of the whole on Bill C-171, an act to amend the Excise Tax Act. Shall clause 1 carry?
On clause 1.


Mr. Scott:: Mr. Chairman, I have a suggestion I should like to pass on to the minister at this time with regard to a matter I am disappointed to see is not included in this measure. I refer to educational material not available in Canada and imported from other countries, especially the United States. Books and other material come in free of charge, but when we come to print-out cards which are used for testing students, these have to be processed in the United States, not in Canada, and are subject to tax on re-entry into this country. This tax is, of course, passed on to the taxpayer in our already overtaxed educational system.
I should have thought the minister would have seen fit to bring in an amendment to the act so as to include these materials under the free entry provisions. Therefore, I ask him to give consideration to exempting the materials I have referred to from the provisions of the act. I know the minister is busy with his officials, but this is a very serious matter and certainly affects the cost of education for the municipalities. The people who distribute this material find they are not at all competitive as they have to pay this tax on these test forms and other material when they re-enter Canada. This is discrimination when books that are bound can entry this country duty free.


John Patrick (Pat) Nowlan: The minister should pay attention.


William C. Scott: I do not know whether the minister has been paying attention to me.


Robert Jardine McCleave: Order. The hon. member is entitled to be heard.
Mr. Scott. Perhaps I should make my case again, Mr. Chairman; I hope his officials will also pay attention. My point deals with books and test cards for computers entering Canada. These are distributed to schools and are used to test pupils. They are then sent to the United States to be run through a cojmputer, and on their return to Canada they are charged tariff entry. This, in turn, is passed on by the different companies to the departments and boards of education in Canada. My plea to the minister is that he see fit to classify this material as he classifies bound material, and admits it in leaf form duty free into Canada.


[Stage Direction]
Clause agreed to.
On clause 2.
Mr. Barnett:: Mr. Chairman, in clause 2 there is an amendment to Part IX of Schedule III having to do with marine and fisheries. I have been examining the proposed amendments in relation to the Part as it now stands, and my interpretation of the amendments is that, generally speaking, they are designed to provide exemption from sales tax for the commercial fisheries. In the present section 1 of Part X there is a rather general description of boats bona fide purchased by fishermen for use in the fisheries and articles and materials for use exclusively in the manufacture of equipment or repair thereof.
Excise Tax Act
I have had one or two questions about this asked of me, and I should like to have an understanding that section 1 does, in fact, include an exemption for gill nets, seine nets or trawl nets. I ask this question because one reads down through this part into Nos. 2, 3, 4, etc., certain specific things are spelled out in detail, but nowhere in the present bill are nets of any kind specifically mentioned. I would just like to have confirmed, if I can, that commercial fishermen's nets are in fact sales tax exempt.


John Napier Turner: Under Item 68200-1 fishing nets of all kinds are exempt, and that ties in with the list to which the hon. member referred.


Thomas Speakman Barnett: That answers that question. Would the specific amendment contained in Bill C-171, which has to do with the amendment to No. 4, cover this? Certain things are added, namely cod traps, eel traps, articles for binding or wedging lobster claws. As I understand it, this is an attempt to close a gap which has existed in the details of exempt items, possibly because of the development of new kinds of fisheries. I wonder whether the general intent is to exempt all of the items required to engage in a commercial fishery, and whether this form of dealing with it is necessarily the best one. The section would include traps and pots used for catching lobsters, crab and shrimp and the proposal is to add cod traps and eel traps.
The question occurred to me immediately, what about the prawn fishery? If one is going to go into that kind of detail, is it necessary for someone engaged in the prawn fishery, as distinct from the shrimp fishery, to go through the rather exhaustive process of making representations to the government in order to find out that a particular type of gear which may be used is exempt? As I understand this part of the section, it is the gear not attached to or necessarily part of the regular equipment of the boat that is exempt. Must this happen every time some new form of fishery is developed and, if so, has consideration been given to what I might describe as a more generic approach being taken, setting out these items? Can the minister shed light on this question?


John Napier Turner: We have a serious problem here but, as is customary, parliament likes to have a review of specific items with amendments on the floor of the House. These are the only items that have been drawn to our attention in the last year. We have taken care of them, and I have not been informed of any other problems.
As the hon. gentleman anticipates, this is a widening of the exemptions in the whole fisheries situation.


Thomas Speakman Barnett: In light of the minister's response I am not going to really press the matter at the moment, but he did refer to items drawn to his attention. Perhaps I could preface what I want to say by reminding the minister, in case it escaped his attention and I know he has not served on the Fisheries Committee as I have, that when the last amendments to the Fisheries Act were before the Committee, we moved an amendment which was approved by parliament as a whole to include all marine plants as being, by definition, fish.

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Excise Tax Act
Just to point out the relationship to this particular schedule, in No. 2 we have a reference to Irish moss. This is a form of marine plant which is harvested commercially on some parts of the Atlantic coast. There is an attempt being made, for example, to develop as a commercial fishery operation within the context of the Fisheries Act, the harvesting of what we commonly refer to as kelp on the west coast. This is a product which is used in commercial manufacturing. I know there is a plant, for example, in California, which produces some quite valuable products from this particular marine plant. As the matter stands, it seems to me that kelp, not being mentioned, would not be covered. If the experimental operation which is or has been underway in British Columbia, involving the leasing of certain areas for kelp harvesting and so on, is successful, it would not be covered by this bill. The problem may not have become acute enough for anyone to bring it officially to the attention of the minister, but I cite this as an example of what could happen.
Somebody might assume he was in a fishery if he were dealing in Kelp, but when dealing with the minister's officials, and getting down to the nitty-gritty of dealing with exemptions, might find that this is not included under the schedule of exemptions. Perhaps the minister would agree, since he is widening the area of exemption by way of this amendment, to keep in mind that particular kind of question.


John Napier Turner: Yes.


Marcel Joseph Aimé Lambert: Mr. Chairman, I wish to speak particularly about sub-clause (8) of Clause 2, which is the introduction of new Part XIV of Schedule III and covers goods manufactured in institutions. This is one of the principal applications of the minister's proposal and it would eliminate entirely the sales tax from goods manufactured within institutions caring for the blind, the deaf and dumb and.the mentally retarded. I would put it to the minister that this is a step in the right direction but, quite frankly, does not go nearly far enough to cover the present day situation. There is a different method of looking after people who are mentally retarded. They are no longer locked up in institutions or, shall we say, confined to mental institutions. This has reference to the blind and the deaf and dumb, but what is being done about the physically handicapped?


John Napier Turner: I rise on a point of order. I wonder if I might help the hon. member by referring him to the later ways and means resolution which I tabled on February 19 of this year, in which there is a further amendment proposed to this part of the schedule to include goods produced by the labour of individuals who are in any other manner mentally or physically handicapped.


Marcel Joseph Aimé Lambert: All right, that meets part of the question. That meets the part in respect of the physically handicapped, but I am talking about the sheltered workshops which exist throughout the country where we have those who are not severely retarded. I am referring to people who do not live in an institution but live in a home and go to a sheltered workshop. This is not covered under this particular amendment.


John Napier Turner: It is.


Marcel Joseph Aimé Lambert: It is not covered unless the minister is referring to the February one. I do not have it before me. I thank the minister for reminding me what he did in February. I am referring to the sheltered workshops and also the rehabilitation centres.


John Napier Turner: That is in the February one.


Marcel Joseph Aimé Lambert: That is good. I think this will shorten the debate a good deal. A number of my colleagues were concerned about this. This is part and parcel of the difficulties of the dog's breakfast type of budget proposals we have to consider.
Now I shall come to the sales outlets. We have a series of shops in Edmonton known as the Marina shops. They handle goods made exclusively by a group of handicapped persons, and are the sole outlets for these products. Naturally sales amount to more than $3,000 a year and therefore Marina does not have the small manufacturers' license. Incidentally, while on that point I hope the minister will do something about the $3,000 limit on a small manufacturers' license. That should have gone out the window ten years ago because the limitation of $3,000 for total output in a year is ridiculous. It was ridiculous ten years ago and now is even more so. These outlets to which I am referring are not for private gain. The proceeds are strictly for the benefit of the handicapped persons whose goods go through these shops. The staff is comprised primarily of volunteers.
However, the goods handled by these outlets are subject to sales tax. There is much correspondence on file relative to this. I have written to the minister, to his predecessor and to others in respect of this particular type of operation. As I have said, there is much to be done in respect of this particular item. If the minister wants to do an efficient job in respect of handling these sheltered workshops, he should clarify the situation in respect of these "rehab" societies as well as organizations such as the Institute for the Research and Training of the Physically and Mentally Handicapped. This institute was originally started through the Edmonton Foundation for the Mentally Retarded. It developed as an offshoot from the Winnifred Stewart School for the Mentally Retarded. Through participation of the province of Alberta, also grants from the government of Canada, and much private help, this major research and training institution for the physically handicapped was established. I have been there. They do a great deal of printing, monotonous and repetitious work. However, this is exclusively for the training of mentally handicapped persons and so on.
This is a program for the development of human resources. I cannot make a strong enough plea for assistance in respect of this particular type of program. We have all sorts of development programs concerning agricultural land, resources and so on, but what do we actually do for the totality of human resources in this country? We have educational programs, training programs and retraining programs for all those people who are physically and mentally able. But what do we actually do for so many of
April 13, 1973

our mentally handicapped people? At one time these people were locked away in a closet. They were placed in institutions by the thousands to live a vegetable-like existence. Society tolerated these people at a minimum level. It was a shame for a family to have a Mongoloid or retarded child in an institution.
Today we have evolved. I have seen the work done in many parts of Canada and by the Winnifred Stewart School. Mrs. Stewart started this school and received help from many people. Her work has been recognized, and is now a member of the Order of Canada. It is surprising what these people can do. When I was a much younger person I saw Mongoloid children whose potential was absolutely zero. But now that has changed. They now know how to readily answer telephones, do printing and all sorts of work. They are great at swimming and bowling, and can lead almost a normal life. We are just entering on the threshold of, shall we say, the development of our total human resources. Not only have we these people, but also the physically handicapped and the aged persons.
So, I make a plea to the minister. One step was taken in the budget of May 1972, a further step was taken in the budget of February 1973, so now let us explore the remaining areas to see whether, either this minister or someone else, in the next budget will take appropriate steps to clear any hurdles from a tax point of view in respect of the development of our human resources.


Lorne Edmund Nystrom: Mr. Chairman, I would just like to ask the minister one question without really flogging the point. It is in respect of clause 2(6) which provides for the new exemptions for machinery and apparatus, including wire rope, drilling bits and so on for exploration and mining. I should like to ask whether or not the minister knows offhand how much this exemption will mean in terms of lost revenue to the government. I am interested particularly in view of the Ontario government's increase in the sales tax on home fuels.


John Napier Turner: 

Clause agreed to.
Clauses 3 and 4 agreed to.


Robert Jardine McCleave: Shall the title carry?


Some hon. Members:: Agreed.


[Stage Direction]
Title agreed to.
Robert Jardine McCleave: Shall the bill carry?


Some hon. Members:: Agreed.
Bill reported.


Mr. Deputy Speaker:: When shall the said bill be read the third time?


Stanley Howard Knowles: By leave, now.


John Napier Turner: that the bill be read the third time and do pass.
Motion agreed to and bill read the third time and passed.
Customs Tariff


CUSTOMS TARIFF
John Napier Turner: that Bill C-172, to amend the customs tariff, be read the second time and referred to the Committee of the Whole House.


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


John Napier Turner: May I call it one o'clock, Mr. Speaker?


Mr. Deputy Speaker:: Is it the pleasure of the House to call it one o'clock?


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: It being one o'clock, I do now leave the chair until 2 p.m.
At 12.55 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
John Napier Turner: Mr. Speaker, first I want to thank the House for its co-operation in passing the two prior bills so expeditiously. We are now on the third bill relating to the budgetary matters affecting the 1972 calendar year. Bill C-172 is an act to amend the Customs Tariff.
I think it would be fair to say that the most significant provisions of this bill are those relating to the establishment of a general preferential tariff for imports from developing countries. As I said in my budget speech last May, this measure is Canada's contribution to a global effort to help the developing countries improve their exports to world markets. This broad international initiative, known as the generalized system of preferences, has been endorsed by the United National General Assembly as an important element in the international development strategy for the second United Nations "Development Decade" which began in 1971.
Tariff preferences in favour of developing countries have been under discussion internationally for a number of years, beginning in 1964 at the first United Nations Conference on Trade and Development, UNCTAD. At that time a number of industrialized countries, including Canada and the United States, were not convinced that the creation of tariff preferences was an appropriate way of assisting the industrialization and economic developing countries. It seemed doubtful that the developing countries would obtain much more in the way or real benefits from a new preferential system than they would from continued progress towards trade liberalization on a multilateral or most-favoured-nation basis. Of course, not even the developing countries were under any illusion that tariff preferences would solve all their problems or obviate the need for more conventional forms of development assistance. These countries, and particularly the

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Group of "77" in UNCTAD, were nevertheless convinced that tariff preferences offered them the best prospects for achieving better access to foreign markets, and hence increased exports and higher standards of living.
The issue became as much a political one as an enonomic one, and by the time of UNCTAD II in 1968, attitudes had changed to the point where the conference was able to reach unanimous agreement, in principle, to the early establishment of a system of generalized, non-reciprocal and non-discriminatory tariff preferences for the manufactured and semi-manufactured exports of the developing countries. The details of the system were left to be worked out at subsequent meetings and indeed it was not until the fall of 1970 that a mutually acceptable system was agreed upon in UNCTAD. The system in fact consists of a number of different preferential schemes, each reflecting the particular circumstances of the individual preference giving country. A common feature, however, is that they all contain safeguard provisions under which the preferential rates can be withdrawn when imports reach certain levels or threaten injury to domestic producers. Most of these preferential schemes have now been implemented, and indeed Canada and the United States are the only countries that have not brought their schemes into force.
The details of Canada's proposed new preferential tariff are set out in Clause 2 of the bill that is now before the House, but perhaps it would be useful if I were to summarize its main features. First, it will provide for lower tariffs on most manufactured and semi-manufactured goods imported from developing countries. Certain primary products are also covered by the scheme but these are for the most part already duty free on a mostfavoured-nation basis and so, of course, there is not the same scope for tariff reductions on them. The tariff reductions for industrial goods are spelled out in subsection (1) of proposed new section 3.1 of the Customs Tariff. Hon. members will note that general preferential tariff rates will be set at two thirds of the most-favoured-nation rate or at the level of the present British preferential rate, whichever is lower. This will mean free entry under many tariff items. It also means that the general preferential tariff will go a long way towards eliminating the discrimination that has existed in our tariff treatment of developing countries as between those that are members of the Commonwealth and those that are not.
Second, there will be tariff reductions on a selected list of agricultural products. These are set out in the schedule to subsection (3) of proposed new section 3.1 of the Customs Tariff.
A third feature of the new preferential system is the "safeguard" clause which will authorize the governor in council to withdraw the benefits of the general preferential tariff in particular cases. This will be used to deal with any case where imports at preferential rates cause or threaten market disruption or injury to Canadian producers. It is the government's intention to use this authority to exclude from the preferential system at the outset a limited number of sensitive products-mainly textile products for which we have negotiated export restraints or which have been placed under import control. When the legislation is proclaimed, a complete list of the

products to be excluded on this basis will be published by order in council.
Finally, the bill would authorize the governor in council to decide what countries should be considered to be developing countries for purposes of the new preferential system. Final decisions in this regard have still to be taken but, as a general rule, any country, area or territory entitled to MFN or BP tariff treatment which claims to be a developing country and which receives preferences from other preference-giving countries will be eligible under the Canadian scheme. Of course, we know what countries are eligible for the preferential schemes that have already been implemented.
None of the countries that have implemented their schemes has extended the preferences to all the countries that claim to be developing countries and some beneficiary lists are longer than others. Most of the members of the so-called Group of "77" developing countries, who now apparently number 97, are receiving preferences under the schemes that have been implemented and dependent territories are also eligible for several of them. However, there is considerably less unanimity as to whether the preferences should be extended to such countries as Spain, Portugal, Greece, Turkey, Taiwan, Israel, Bulgaria and Roumania, all of which claim developing country status. Japan is the only donor country that has given preferences to all these countries.
It is of course difficult to estimate the volume of trade that will be affected by the Canadian scheme. If the preferences were extended to the 88 countries of the Group of "77" who are entitled to BP or MFN treatment, as well as to dependent territories, it is estimated that there would be tariff reductions on around $160 million worth of imports. This estimate is based on 1971 import statistics and does not, of course, include imports from Commonwealth developing countries under those tariff items where the general preferential tariff rate will be equal to the current BP rate. If this figure appears small, it should be borne in mind that close to 70 per cent of our imports from developing countries are already free of duty.
There are three other amendments I should like to mention at this time. The first relates to two textile items in the schedule to the Bill. The British preferential rate for rubber coated woven cord tire fabric under item 56235-1 is increased from free to the 12 VS per cent rate which applies under the most-favoured-nation tariff. The duty on knit goods from Britain is increased from a net rate of 18 per cent to 25 per cent under tariff item 56805-1. Both these proposed increases follow upon the implementation by Britain on January 1, 1972 of increased rates of duty on cotton textiles from Canada. These Canadian goods were previously entitled to free entry. The tariff increases which have been the subject of negotiations with the British government were intended to restore the balance of concessions with Britain.
The second change arises out of a Tariff Board decision in May, 1971 on an appeal relating to tariff item 69605-1. This item provides for free entry of certain goods for the use of religious and educational institutions. As a result of the Tariff Board decision, the coverage of the item was considerably reduced. The amendment to item 69605-1 will restore its scope to approximately what it was formerly.
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The third change is also the result of a Tariff Board ruling on an appeal. The Board held that live yeast in granular form should be dutiable at an MFN rate lower than had been levied by the Department of National Revenue under tariff items which provided for "compressed yeast". Representations were received from Canadian producers of yeast stating that the Board's decision would have a serious impact on their operations. On the other hand, it was argued that the previous rates were too high. The proposed item 3600-1 will provide for a 121/2 per cent MFN rate on live yeast, irrespective of the form in which it is imported.
Those are the main features in terms of importance of the bill and, certainly, when we come to the clause-byclause analysis in committee I will be glad to expend upon that.


Marcel Joseph Aimé Lambert: Mr. Speaker, the minister having made a fairly detailed explanation of a fairly short customs budgetary amendment, I do not think it is necessary for me to dwell at length on the contents of this bill or on the principles involved in its presentation and consideration. I will repeat what I said when Bill C-171 was considered. It is anti-climactic to deal with this particular bill now. It is 11 months since the budgetary proposals were made. At least half the members of this House have never heard of them, and I suppose most of the others have more or less forgotten what the minister proposed. Actually, I do not suppose anybody in this House outside of a small handful have ever known of a class of tariffs known as General Preferential Tariffs.
The minister indicated that there is to be considerable relief for some of the developing countries. I am not too sure about that suggestion, especially when I look at clause 2 which establishes the general preferential tariff. Subclause (2) of Clause 2 reads in part:
The following goods are excluded from the application of subsection (1):
(a) the goods enumerated in any of the tariff items in Groups I,
II, III, IV and VI of Schedule A . . .
I have before me most of the customs Tariff and the five groups that come under Schedule A comprise the bulk of the tariff. Some exceptions are noted; one is a classical one. Let me refer to the first one that comes under item No. 1210-1, which appears under Part I. Why we are maintaining tariff protection with regard to this item I do not know. It is listed as "sausage casings, synthetic, of paper" and there is a 10 per cent and 15 per cent tariff on that. Somehow we have decided that we cannot import these types of sausage casings free of charge. We cannot extend to them the benefits of the general preferential tariff. There are other things that appear in the tariff, and I know some are of greater strategical importance than others. One sees, on examining this, that there is a reduction to zero under the general preferential tariff with regard to a number of things that one associates with, shall we say, developing countries. Sometimes Canada, for certain purposes, decides that it is a developing country. In terms of our relationship with the United States and our capital requirements, we seem to think we are a developing country.
The free entry of such things as chicory, pepper, cloves, cinnamon, ginger, spices, and spices, nutmegs and mace, nutmegs and mace ground, ground mustard, rice meal, sago and tapioca, fruits and nuts, preserved ginger and coconut loom very large. They have been reduced to zero. Frankly, that is because the rate that would be left would only be 1.5 per cent or 2 per cent. Even unstemmed and stemmed Turkish tobacco comes in at zero rate under the general preferential tariffs. Be that as it may, we do not have much more to say about these changes. We will have a great deal more to say when we are considering the proposals the minister made in February which will affect the horticultural industry and a number of other industries in this country. The sooner we have that bill before us and are able to discuss and clarify the matter, the better off we will be in this country. I do not know whether the minister puts this measure in the same category as some of the very touchy income tax subjects. At the moment, I think he is handling them with 10 foot or 20 foot poles. Which is it? The minister remains discreetly silent.


Stanley Howard Knowles: Are 20 foot poles tariff free?


Marcel Joseph Aimé Lambert: At the present time, the clarifying items are of very little concern. One point we may hear more about is the adjustment vis-a-vis the British preferential tariff arising out of Britain's entry into the common market and Britain's necessary adjustment within that framework. When Britain removes certain preferential tariffs on Canadian commodities, it is only fair to expect that we will do the same. In many ways, I regret this. Lower rates mean a great deal. While events have changed, in many ways we are being left behind in this move. With Britain joining the European common market, we in Canada are standing aloof.
Reports from Europe indicate that the president of Mexico is having a considerable impact on the common market members in so far as Mexico is concerned in this issue. Mexico is in much the same position as Canada, only on the other side of the United States. However, the North American continent is a particular zone, merely three countries in so far as trading is concerned.
Canada should be endeavouring to present a very high profile in Europe vis-a-vis the common market countries today. No matter how good our ambassadors may be, they are still diplomatic representatives. This calls for the highest possible level of representation by Canadians, perhaps a full fledged policy tour this year by the Prime Minister (Mr. Trudeau) of Canada, whoever he may be. The matter of trade relations with our European counterparts should be very seriously considered. There are no two ways about this; it has to be done. If I were to make this suggestion to the minister, I am sure he would admit that he doubts very much that the Prime Minister of Canada would be received in France with open arms at this stage, but something has to be done. The necessary steps must be taken to remove some of the underbrush, thaw some of the ice that exists and remove some of the slick patches on which people have slipped in the past. In so far as my advice to my leader is concerned, it would be and is that

April 13, 1973
Customs Tariff
Canada's presence at the very top level must be made in Europe.
This may be a bit removed from customs tariffs, but it is related to our trade relations with our partners. As a result of Britain's entry into the common market, we will be in an unsettled period for five, eight or 10 years. We should not sit in the reeds moaning and groaning or run to London or Paris cap in hand to beg for special consideration for a special position. If it takes the necessary steps at the top level, Canada will be in a position to broaden its trade. We need positive action. No one is going to help us. We have to help ourselves. The only way to do that is to go out and state our case. People in Europe are interested in trading with Canada, not merely for sentimental reasons, and we are interested in trading with them, not just for sentimental reasons, but because it is good for business. It is good for the economies of their country and ours.
That is all I want to say at this stage of the bill. When the next tariff bill is before us, we will have considerably more to say.


Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, speaking on behalf of my colleagues in the New Democratic Party, we are very pleased to see a trend toward lower tariffs. It has been a long standing position of our party, that not only Canada, but the world should be moving towards less restricted trade patterns. It is natural that we in this party should be concerned about lower tariffs because of the large contingent of members from British Columbia and Saskatchewan who never cease to remind the caucus of the grievances of the western provinces.


Some hon. Members:: Hear, hear!


Max Saltsman: As Your Honour will notice, a couple of western members have been appointed to keep their eye on me so that I will say the right things.
It is important that a country like Canada move in a direction of freer trade for two reasons. First, we have to be competitive in the world. The sooner we come to grips with competition around the world, the healthier it will be for our economy. Second, from the viewpoint of national unity, we must take into account the grievances of the Canadian west. It is important to have the tariffs removed as expeditiously as possible. For a long time the west has felt that while tariffs may have served to promote the so-called industries of Canada, they have continued long past the point of the infant in swaddling clothes. For those reasons, we are generally in support of the proposals in this bill.
I am particularly glad that our country is taking this position. When we look around in the world, we see that our neighbour to the south is moving in the opposite direction. Every indication is that the United States is going to be more restrictive in terms of its trade pattern rather than less restrictive. While Japan does not operate the tariff system as a restrictive system, the effect is as great or greater than if it had high tariffs. I wish I were as sanguine about the possibility of getting into the European Common Market as is the hon. member for Edmonton West (Mr. Lambert). The Common Market was set up under conditions which make it very difficult for other

countries to participate. In some ways, tariffs are becoming less important than they were as an indicator of the movement of goods. There are other kinds of restriction imposed on the free passage of commodities. For example, in recent years we have seen countries contriving to keep the value of their currency unnaturally low. Today, this is of more significance than tariffs. In Japan, difficulties are obviously put in the way of imports. They are not spelled out, they are not obvious, but somehow or other nobody can meet the right person in order to reach an agreement. So, as we look round the world, despite diminished tariff restrictions there are still many obstacles in the way of the free movement of goods from one country to another.
It is popular at the moment to talk about wage and price controls as a means of reducing prices to the consumer. There is very little evidence to support the contention that this would indeed be the effect. But there is evidence to show that the consumer could be helped by the removal of some of the tariff restrictions which presently exist. This help goes beyond the mere saving of the amount of money which the government forgos by way of revenue. He is helped because goods entering Canada free of tariff produce a situation which calls for competitive action in our own marketplace and helps keep the price of goods produced in Canada at a low level. Thus, excise tax reductions would have a greater effect on prices than some of the suggestions which have been made in favour of wage and price controls.
Having said this, I will admit there are dangers facing us as we lower tariffs-dangers the government should take into account. If the government continues, as in the past, to encourage the export of raw materials, non-renewable resources, energy supplies and so on, it will be doing a terrible disservice to the nation. A reduction in tariffs could become a menace, for if we continue to export large supplies of raw materials and energy resources, and the value of our dollar rises as a consequence, the entire trade pattern of imports into Canada will be distorted. It is, therefore, of enormous importance that, in conjunction with tariff reductions, the government should ration in one way or another the export of raw materials and energy supplies. If this is not done, the value of our dollar will rise and a double threat against our industry will develop. If anything, our dollar is over-valued now, for the very reason that we have exported unfinished goods too extensively. In some ways all this has little to do with tariffs, yet it is a necessary part of state policy if we are to fight the dangers which could flow from tariff reductions. There are benefits attaching to tariff reductions, but there are also dangers.
The proposals now before us may constitute one of the most significant parts of the budget as an indicator of the way this country is going. Tax reductions and exemptions are very important, it is true, and I do not want in any to detract from their importance. But as an indicator of the direction in which Canada is going these tariff reductions are even more important. I hope we shall see continued reductions in tariffs. I also hope the government will take counter action to make sure that the value of our dollar does not rise too high as a result of our exporting unfinished goods.
April 13, 1973


Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, I listened closely to the minister's statement on Bill C-172 announcing a reduction in customs tariff that will apply to developing countries.
Mr. Speaker, on behalf of my party, I say that we are fully support this bill precisely because while protecting the interests of the producers it will certainly meet the wishes of the consumers in that we have found three ways of helping less fortunate countries.
We can help them by granting them interest-free loans. We do this fairly regularly every year. When those loans are granted through new credits from the Bank of Canada we are very happy because they do not affect the worker, industry, or the consumer; they are merely new credits intended to help developing countries.
Secondly, we help them by granting them interest-free loans on money taken out of the budget of Canada. In that case, Mr. Speaker, it is a matter of greater concern to Canadians, because it would mean lending their tax money without interest to developed countries. It is to a good end, but the means are rather coude when you consider what has happened in the last few years. On one occasion, for example, we realized that we did not have enough money to lend to a certain underdeveloped country-which I will not name here, but all hon. members will recognize it. And so we had to borrow $25 million at 8 per cent, to lend to the underdeveloped country without interest for 60 years. That is really smart, Mr. Speaker! But is has happened here, in Parliament: we borrow money abroad for no-interest loans to countries we want to help.
I am very pleased about the hon. minister's announcement this afternoon, because I think that the best way to help the underdeveloped countries is not just to reduce our customs tariffs by two thirds, but to abolish them altogether, so that these countries can trade with ours, to the benefit of the whole of Canada, and especially to that of the consumer.
It is well known that some customs duties double the price of food products coming from those countries. If the consumer could buy imported products at half price, I think he would be very happy about it. When the committee on trends in food prices carried out its study, we observed that high customs barriers were one of the major causes of the high prices of imported foods. They sometimes increase food prices by 20, 25 or 30 per cent.
Mr. Speaker, this is a fine opportunity for the minister to abolish them completely, on a trial basis.
The minister says that we can trade with 77 countries. It would be possible to eliminate all customs duties; the minister has announced that they would be reduced by two thirds. I argue that these countries could be exempted from all customs duties on food, fruit, and meat. I shall say a few words about it later on.
I suggest that these would mean a healthy competition for our Canadian producers without doing them any harm. Of course this will not come about. If the consumer does not want any competition on the pretent that we are going to protect our industries and Canadian producers, what
Customs Tariff
will happen to a product unable to be fairly competitive? It is allowed to enter our country, but its price will be doubled or tripled in order to protect producers. But who is paying, Mr. Speaker? It is always the consumer. We are going to protect 100, 125 or 200 people at the expense of 20 million Canadians. It is to this point that I wish to draw the minister's attention and even encourage him to entirely eliminate customs duties in our relations with these countries.
As far as the protection of our industries is concerned, I believe that the list which is proposed here, especially as regards agricultural products, is very reasonable. There may be a few farmers will wonder about. I am referring to canned meat. I cannot say for sure, but I think that most of these products, according to a serious analysis, are not competing with similar Canadian products.
Once more, if the minister allows these products to enter our country, as I said earlier, this will serve the consumers' interests. A little earlier, I heard the previous speaker deal with the British preferential tariff. I do not know to what extent England benefits from the preferential tariff, but as far as I know, England is not an underdeveloped country.
That is why I am trying to find out what countries are involved. There was a mention of Spain, Portugal and so on. The main analysis will be made at this stage and I fail to understand, like the previous speaker, that it is normal to forever extend the preferential tariff to England and never to France.
If it is normal, it is a quite irregular normal thing.
Once again, I do not wish to discuss this further. I only wish to beg the minister to push a little further ahead and not to fear to deal with developping countries. This would be a good occasion for Canada to do something for them and to sell our products. Besides, this will prevent Canada from granting them interest-free loans for a 60-year period, when we have to pay 8 per cent interest on the money used for interest-free loans to them.


Mr. Reg Stackhouse (Scarborough East):: Mr. Speaker, I should like to rise in support of the measures that are before us, particularly since these changes in our customs tariff will assist parts of the world that are greatly in need, not simply of material aid but of this kind of help. We have moved to a time in our relationship with the developing countries when we should give priority to trade rather than aid, as understood in the sense that was appropriate a generation ago.
The move the government is making through the proposals in this bill is one that I think will receive support from both sides of the House as well as throughout the country. We are part of one world and we want to express this fact in our economic policies as in other things, particularly at this time when we think of the call of some of our spiritual communions and leaders throughout the country for ten days of development. This is a political measure which I think can be taken as a positive response to that summons. One of the best ways we can help developing countries in the world is by giving those countries the opportunity to trade with those who can be their customers.

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Customs Tariff
But we have to think about another side of the coin as well, and that is the way in which the administration of our customs and tariff policies bear upon Canadian business and Canadian working people. This afternoon I want to focus the attention of the House precisely, though briefly, upon one aspect of this, namely the way in which our so-called duty free stores along the border of Canada are administered. I believe they are administered in ways which are injurious to Canadian business and particularly to the gift industry.
We have several of these duty free stores in Canada, chiefly at international airports though also at two seaports. The way in which these stores are administered prevents the sale of many manufactures, particularly the products of the gift industry. Representations have been made by members of that industry to the government over the year, and at times members of the industry have been persuaded that they were being listened to by the government-I think better listened to than this debate is being listened to by the government. Companies participating in the gift industry have still not seen any positive action or remedies taken by the government. Therefore, I am disappointed that the proposals of the government for tariff and excise reform will not, as far as I can see, make any provision for solving the problem to which I have referred. If we were to open up our duty free stores to Canadian manufacturers, particularly to products of our gift industry, we would be increasing the possibility of their development and increasing job opportunities in Canada, because one of the most labour intensified parts of our economy is the tourist industry. With the gift industry dove-tailing into that, the House can readily see how this could be beneficial in helping to solve our unemployment problems.
I would very earnestly suggest that the government listen with renewed seriousness to the appeal of the gift industry throughout Canada that steps be taken to open up our duty-free shops so more Canadian manufacturers can avail themselves of them. I hope as well that they can be opened at more of our border crossing points; that is the kind of duty-free store to which I have referred. At the present time they are located almost exclusively at international airports, yet there is a tremendous amount of tourist traffic across the border by car, by bus and by railroad.
I think the government would be doing more to help Canadian business, the Canadian economy and working people if it took a positive step in this direction. This is not in contradiction to the kind of ideal to which I referred in my opening remarks, also referred to by the minister. The more we can do to stimulate Canadian business, the more we can do to help strengthen our own economy, the better position we are in to reach out a helping hand to other parts of the world.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. McCleave in the chair.
Robert Jardine McCleave: Order. The House in committee on Bill C-172, to amend the customs tariff.
Shall Clause 1 carry?


Some hon. Members:: Agreed.


[Stage Direction]
Clause agreed to.
On Clause 2-General Preferential Tariff.
Marcel Joseph Aimé Lambert: Mr. Chairman, I should like to say a word or two only about paragraph (b) appearing at the top of page 6. In dealing with regulations, may I again make a plea that we do not use general terms such as "prescribing anything that is to be prescribed by regulations". Parliament does not give carte blanche. All I can say is that perhaps now with the committee on statutory instruments we will be able to watch this situation much more closely. Frankly, this is merely the tip of the iceberg when provisions are described in that way. I do not know how often this has to be repeated, but the drafters of the administration must come up with something that is less general, less accommodating and less free wheeling than these provisions.


[Stage Direction]
Clause agreed to.
Robert Jardine McCleave: Shall the schedule to Clause 2 which is found on pages 3 and 4 carry?


Some hon. Members:: Carried.
Schedule to Clause 2 agreed to.
Clauses 3 to 5 inclusive agreed to.


Robert Jardine McCleave: Shall the schedule to Clause 5 as found at pages 8 and 9 carry?
'


Some hon. Members:: Carried.
Schedule to Clause 5 agreed to.


[Stage Direction]
Title agreed to.
Robert Jardine McCleave: Shall the bill carry?


Some hon. Members:: Agreed.
Bill reported.


Mr. Deputy Speaker:: When shall the said bill be read the third time?


Marcel Joseph Aimé Lambert: By leave, now.


John Napier Turner: that the bill be read the third time and do pass.
Motion agreed to and bill read the third time and passed.


CANADIAN NATIONAL RAILWAYS AND AIR CANADA
John Napier Turner: that Bill C-164, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways System and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railways
April 13, 1973

Company and certain debentures to be issued by Air Canada, be read the second time and referred to the Standing Committee on Transport and Communications.


Mr. J.-Roland Comtois (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, first I should like to thank the Minister of Finance (Mr. Turner) for having given me the responsibility of piloting this bill in the House and I wish to assure him that I will do my best to have it passed in the shortest possible time. Mr. Speaker, bills on financing and guarantee were tabled every year with the exception of the 1963 bill which applied to 1962-63 and that of 1966 which applied to 1965-66 as well as this one which applies to 1972-73. Hon. members will remember that the 1971 bill-which included certain provisions for 1971 and 1972-had not been read for the second time when the twenty-eighth Parliament was dissolved. This bill brings back those provisions.
This bill for 1973 is basically the same as those for previous years. It sets out in a concised form the capital expenditures of the Canadian National Railway Company for 1973 as outlined in its capital budget for that year which amounts to $225,500,000. This bill also authorizes the company to make expenditures not exceeding $75 million between January 1 and July 1, 1974 for the purpose of discharging obligations incurred prior to January 1, 1974, and to enter into contracts prior to July 1, 1974 for capital expenditures not exceeding $167,500,000 that become due and payable after 1973. These expenditures and commitments are according to the investment budget of the company for 1973.
The bill aims at fulfilling six major objectives most of whom have already been similarly outlined in the previous bills on financing and guaranteed.
First, the bill includes provisions allowing the Canadian National Railways Company to borrow up to $21 million to finance the construction of sidings. This amount includes the financing of sidings more than 20 miles long whose construction is authorized by a special act, as well as the financing of tracks less than 20 miles long whose construction does not require any authority under a special act. By including all sidings, this provision reflects the intention of taking into account, in the bill on the financing and guarantee, all the funds that the Canadian National Railways Company may require.
Second, the bill provides for the Department of Finance to continue purchasing Canadian National preferred shares bearing interest at 4 per cent during 1972 and until the end of calendar year 1973. This provision perpetuates the practice established by former financing and guarantee, legislation. The 1970 act postponed to December 31, 1971 the expiry date of the authorization granted by the 1952 Canadian National Railways Capital Revision Act for the purchase of such shares to the extent of 3 per cent of the company's gross income.
Third, as in former years, the bill authorizes the government to extend temporary advances to Canadian National and Air Canada in order to meet operating income deficit for the period of January 1, 1973 to June 30, 1974. These advances will be reimbursed later on in the year from company income. Should such income prove insufficient,
CNR and Air Canada
the outstanding balance will be met through deficit appropriation by parliament.

In closing, Mr. Speaker, I should like to call your attention to a proposal for a change in the policy relative to appointment of auditors.
Since auditing the books of the CNR and Air Canada represents considerable work, the government came to the conclusion that this work should not be entrusted to a single firm of auditors, to the exclusion of all others. The government considers rather that this job should be periodically assigned on a rotation basis to large Canadian auditing firms. Thus new method and approaches would come to bear on the operation of these two companies which, according to the government, would be beneficial for all concerned.
If the policy of rotating auditors were adopted, we should have to study carefully the frequency of the rotation. Evidently, the duration of the assignment should not be too short, because, otherwise, the auditors would hardly have enough time to familiarize themselves with the operations of the company and the intricacies of its accounting system, not to mention the special accounting requirements of the Canadian Transport Commission.
On the other hand, the long-term appointments made in the past covered far too long periods. Consequently, it was agreed that a five to six years' appointment would be an acceptable compromise, the first year and the last year to be overlapping periods during which two auditing firms would be hired. That way, during the overlapping period, the incoming auditor for a new term could progressively take over the work of the outgoing auditor, ensuring the necessary continuity of auditing. Section 14 of the bill deals with that situation.

April 13, 1973
CNR and Air Canada
In conclusion, I should like to add that the government intends, every five or six years, to recommend to parliament rotation of the independent auditors.


Mr. Charles H. Thomas (Moncton):: Mr. Speaker, once again parliament is faced with a bill which purports to ask parliamentary approval for moneys used in financing Canadian National Railways and Air Canada. Before I come to my main remarks I should like to refer briefly to some of the comments the parliamentary secretary just made. He started by asking that parliament adopt this bill as quickly as possible. When we dig into the bill and the circumstances behind it, I can well understand why the government would like to have it passed as quickly as possible and thereby put an embarrassing piece of legislation where it perhaps belongs, under the rug. I say to the minister there is no real urgency to pass this bill. There was no urgency last year to pass it; the government in effect ignored it. This bill provides for expenditures to the end of June, 1974. Therefore, I for one will not be beguiled by the government's plea of great urgency in respect of passage of this bill.
The government has many questions to answer before we on this side of the House would agree to grant it the amount of money involved in a bill such as this. I have not totalled the amounts but I believe they run close to $1 billion. I know $1 billion does not mean much to the government, but in talking of an amount of money of this size I feel it is incumbent on the opposition to examine very closely what kind of monkeyshine has been going on here.
The parliamentary secretary said this bill takes up where the last one left off. We know better than that. It does not take up where the last one left off. The last bill of this kind which passed through this House was the 1970 financing bill. That is the only piece of legislation we have had. Certainly this bill does not take up where that one left off. As a matter of fact, it does not even take up where the aborted Bill C-4 left off, because there is a six months' lapse there which is not included in this bill.
When I first looked at Bill C-164, my immediate reaction was that it was the usual financing bill with the same old wording, and there were no changes except perhaps slight ones in respect of the amounts required. I read the bill through and could not find too many changes until I went back to the preamble. Suddenly the meat of the whole thing struck me. It is in the preamble, which say that Bill C-164 is-
An act to authorize the provision of moneys... for the period from the 1st day of January, 1973, to the 30th day of June, 1974-
My first reaction on reading those words was that obviously there was a misprint, that it must be intended to be from the 1st day of January, 1971. However, I checked the bill throughout and found that in every place where there was any reference to dates, the same dates appeared. Obviously, the government's drafters are not so stupid as to have made such drafting errors; therefore, the government is asking us now to approve appropriations for the CNR when for the last two years, we have not approved any.
[Mr. Comtois.l
In my remarks last year on Bill C-4 I described the debate on that bill as an exercise in futility. Had I known then what was going to happen, I would have used much stronger language. This is much more than an exercise in futility. It is a downright, deliberate degradation of the rights of parliament to bring in such a bill.


Some hon. Members:: Hear, hear!


Charles Humbert Thomas: I think the government wants to forget about Bill C-4, but I do not believe we can discuss Bill C-164 properly unless we discuss it in the context of Bill C-4. Bill C-4 was never enacted. It was introduced in the last session of the last parliament. It was entitled "Canadian National Railways Financing and Guarantee Act, 1971". It is rather interesting that the parliamentary secretary made only a casual, fleeting reference to Bill C-4, but he dealt at length with the financing bill of 1970. He probably did that because the financing bill of 1970 was the last bill to give this government any right to appropriate moneys.
Ever since parliament passed that bill, the government has either been breaking the law or circumventing it in such a way as to destroy the rights of parliament to control the spending of money. Whether this was a deliberate attempt to have the cabinet gradually take over all control of spending, or whether it was just a continuation of the slipshod handling of legislation which we saw in the last parliament, is not for me to judge. But the fact remains that this government is continuing the practice which was developed in the last parliament and continued now in many areas. It is an attempt to take away the control of money bills from parliament, where such control rightly belong, and give it to the government and treasury board.
This bill is a crude attempt to fool us into believing that the control of the purse-strings still rests with us. It is a crude attempt to hide the fact that this government is deliberately eroding the right of parliament to control moneys. It is a desperate attempt to camouflage what has been going on ever since this government came into office. There are many examples of this type of action that I could refer to, but I will not go into them now. They have been the subject of debate in this House. My colleague, the hon. member for Yukon (Mr. Nielsen) has mentioned some of them.
I should like to refer briefly to glaring examples of the type of procedure this government is following. One, of course, is the famous Polymer fiasco where the government asked parliament to give approval to action which they had taken without even letting parliament see the annual report or the audited statements of the company in question. It was interesting to hear the minister state at the time that since Polymer was losing money, the government would bail it out. But it was much more interesting shortly thereafter, when the audited statements of Polymer came out, to see that instead of losing money the company was showing an increase in profit.
The second glaring example was the horrible fiasco created in the Unemployment Insurance Commission's accounts. We all know what happened there and I will not dwell on it. I have spoken on it before. Here, again, is a deliberate attempt by the government to do by subterfuge
April 13, 1973

what they could not do by law. This bill wants us to approve expenditures past and future for two Crown corporations, and in neither case do we have either an audited statement or an annual report.
Some hon. members are businessmen and a good many of them are lawyers. I ask them a simple question: What would happen if they, as directors of or legal advisers to corporations, were faced with a request from the board of directors to appropriate, say, $1 million dollars and they were not given an annual report as to what had happened the year before, or an audited statement? This government asks us to do something we certainly would not do in our own businesses. We are being asked now to approve a large amount of money for these two corporations, but we have neither their annual report nor their audited statements. We do not know what has been done with the money that was granted previously.
After I read the preamble to this bill I wondered what had happened in the two previous years. If these companies need the money to operate-and we know the government always had to bail both of them out so they could at least meet their loan payments-where did they get the money with which to operate? As I remember, in other years we were told the same as we were told today, that there was a great deal of urgency and that if we did not pass the bill the CNR would not be able to meet their payroll, would not be able to buy new equipment, and Air Canada would not be able to buy new aircraft. We were told we had to pass the bill otherwise the wheels of these two great corporations would stop turning.
Therefore I began to investigate where these two corporations got the money to keep them going in 1971 and 1972. This is why I went back to Bill C-4 and reviewed what had happened. Bill C-4 covered the financing period from January 1, 1971, to June 30, 1972. The summary of events is very interesting in light of recent statements by the Prime Minister (Mr. Trudeau) and others on the government side that the opposition has been holding up the business of the House. Here is a classic example of a government with an absolute majority which nevertheless refused to bring in legislation, for what reason we do not know. They refused to allow the legislation to proceed through to passage. When you read the history, it seems there was something about which the government were so embarrassed that they did not dare bring the bill back.
The bill received first reading on February 21, 1972. It came back for second reading on March 6, 1972. On April 21 the debate on second reading was adjourned. The government never again brought the bill before parliament during the life of the last parliament. The annual report and audited statements of the CNR were not tabled by the then minister of transport until May 11. This may be just a coincidence, but it was after the government had cut off proceedings on April 21.
The Air Canada report and audit were tabled only on April 17, four days before the bill died effectively on the order paper. On June 21 the hon. member for Crowfoot (Mr. Horner), as reported at page 3348 of Hansard, asked the then minister of transport to have the government refer these two reports of CN and Air Canada to the
CNR and Air Canada
Standing Committee on Transport and Communications. The minister replied that such action was for the government House leader to determine, but that he had no objection. The government never made any reference to the committee. This was a bill, we were told at that time-just as we are told today about Bill C-164-that was a matter of some urgency, and we would have to get the bill through the House or these two Crown agencies could not operate because their funds would dry up. But that bill died at the end of that session.
In this session, Bill C-164 was introduced on March 19 of this year. This bill, as the parliamentary secretary has outlined, relates to the financing period from January 1, 1973, to June 30, 1974.1 emphasize those dates because they carry a great deal of significance. The only retroactive provision with respect to the year 1972 appears to be in clause 13, but this is not clarified in the explanatory note. I will deal with clause 13 a little later in my remarks, but I would point out to the House now that it has to do with the appointment of auditors. I have been involved in business a little, Mr. Speaker, and never have I heard a board of directors ask for the appointment of auditors after the year has elapsed. The normal thing is to appoint auditors before the year begins. Here we are being asked to appoint them retroactively to January 1, 1972.
With all this time lapse, we have had no bill on CNR financing since the 1970 bill was passed; and the government has not yet tabled the annual report and audit of the CN for 1972. This is why I want to refer to clause 13. Maybe there is a reason for that. Who were the auditors? By what authority did they act? Maybe this is why we cannot get the CN annual report. The annual report and audit of the CN have not been tabled here, but the government did table the CN operating and capital budgets for the calendar year 1972. However, this was done only on February 28, 1973, although the government had approved these budgets on August 28, 1972, by order in council P.C. 1972/1865.
What is the situation with respect to the present bill? We have a period covering CNR and Air Canada financing from January 1, 1971, to June 30, 1974-three and a half years-with a six months' hiatus that extends from July 1, 1972, to December 31, 1972, that was covered in the previous bill. I am not saying that is included in this bill; I am saying that in that three and a half years period there is six months from January 1, 1971, to June 30, 1972, in which apparently nothing happened. It was included in the previous bill, but then there is another six-month period from July, 1972, to December, 1972, that does not appear anywhere. It was not in the old bill and it is not in this bill.
Where did the CN and Air Canada get their money during that six-month period? Personally, I am not going to heed the parliamentary secretary's appeal to rush this bill through the House, because I want answers to these questions. Again the House is asked to consider Bill C-164 with a gun held to its head by the government because approval of this bill is approval, in part, of capital and operating expenditures of public funds which have already been spent or committed without approval of parliament.
If it was not obvious before, it is now clear beyond doubt that the annual CNR financing bill is an exercise in

April 13, 1973
CNR and Air Canada
futility, a waste of time and an affront to the House. It is also obvious that the financial affairs of the CNR and Air Canada are controlled by the government, and by the government alone. The annual financing bill is simply a mockery to delude the public and its representatives in this House that they control the public's two greatest and most vital public utilities. Anybody who has sat on committees and spoken to officials of Air Canada and CNR has sensed the feeling of smug superiority and contempt that they hold for parliament because they know we have no power.
It does not matter how much we cry or beg, the decisions, legal or otherwise, are made by the government. This is what is taking place. Presumably the key to the government's financial control is contained in section 30 of the Canadian National Railways Act, chapter C-10 of the 1970 Revised Statutes, and the Air Canada Act, chapter A-ll of the 1970 Revised Statutes. Section 30 of the CNR act provides:
the National company may also borrow upon its notes or securities or the notes or securities of any such other company-
That is, any other company comprised in the CNR system.
-whether for its own benefit or for the benefit of such other company or otherwise.
In section 13(3) of the Air Canada Act there is provision that the CNR may lend money to Air Canada. There was something interesting about this that I suddenly discovered on reading the auditor's report to parliament for the year ended December 31, 1971. It was an item under the heading "Long-term Debt." On January 1, 1972, a $100 million debenture matured and a promissory note in the same amount was issued to the Minister of Finance to pay for it. When I read that I started to wonder what kind of financing was taking place. It seemed the CNR needed $100 million to retire these debentures held by the government so it said to the government, "We will give you a promissory note for $100 million." We have no way of knowing about this until we see the annual report and audited statements of the CNR.
In essence, the CNR has only to give the government a promissory note for whatever hundred of millions of dollars of taxpayers' money that it wants; and if Air Canada wants money also, it can include that sum in the amount on the face of the promissory note. The result is that the government gains control over the operations of CNR and Air Canada. The real board of directors of both corporations then becomes the cabinet. And, of course, that cabinet control is immeasurably strengthened when the president of the Canadian Transport Commission is invariably a former member of the government. It goes right down the line and you cannot get away from it. But what does the CNR act say about budgets? Section 37(1) reads as follows:
The annual budget of National Railways shall be under the control of the board of directors and shall be submitted by the board of directors to the Minister of Transport.
(2)	The Minister of Transport shall annually lay before parliament the budget of National Railways approved by the governor in council on the recommendation of the Minister of Transport and the Minister of Finance.
(3)	The annual budget of National Railways shall include estimates of the amounts required

(a)	for income deficits,
(b)	for capital expenditures,
(c)	for refunding or retirement of maturing securities, and
(d)	for additional working capital.
I suppose the government can say that it fulfilled this provision, that it laid the budget on the table of this House. But there it died. Parliament had nothing to do about either refusing or giving consent to these expenditures of moneys which amount to some $1 billion every year.
Considering these facts, one cannot help wondering at the realistic cynicism of the government in deliberately letting the CNR financing bill die on the order paper in the last parliament, in withholding the annual report while the second reading debate was going on in this House, in refusing to refer the reports of CNR and Air Canada to the appropriate committee of this House, and in perpetuating this empty farce of presenting a bill before the House for second reading while withholding from the House the 1972 annual report and audited statements of both corporations.
What does the Railway Act say about the annual report? Section 39(1) of the Railway Act provides:
The board of directors shall make a report annually to parliament setting forth the results of their operations-
And so on. It goes on to say what they shall do. They are to set forth-
-the results of their operations, the amounts expended on capital account in respect of National Railways and such other information as appears to them to be of public interest or necessary for the information of parliament with relation to any situation existing at the time of such report.
No matter how you read that section, there is a definite commitment on cabinet and on the board of directors of the company to submit these reports to parliament for approval. This the government has refused to do. That shows contempt for parliament and contempt for the people of Canada. The government has made only one mistake-perhaps I wrong the government; perhaps it is not a mistake-it has shown contempt for the laws of Canada as enacted by parliament. Section 38(1) of the act provides:
A continuous audit of the accounts of National Railways shall be made by independent auditors appointed annually by Parliament who shall annually report to parliament in respect of their audit.
The same provision is made in section 12 of the Air Canada Act with respect to Air Canada. It provides:
The accounts and financial transactions of the corporation shall be audited by the auditor appointed by parliament-
Then come these significant words:
-to audit the accounts of the Canadian National Railways.
The law. as written by parliament, stipulates that the CNR auditors and, necessarily, those of Air Canada must be appointed each year by parliament. Let us go back to clause 13.


Stanley Howard Knowles: Clause 14.
April 13, 1973


Charles Humbert Thomas: Clause 14; I am sorry. The number is immaterial; it is the government's actions that disturb us. In the financing bill of last year, a little clause was sneaked in which provided that the firm of Peat, Marwick, Mitchell & Co., of the city of Toronto, be appointed as independent auditors to make a continuous audit of the accounts for the year 1972. I ask, how was an audit carried out? Has an audit been carried out, and what happened?


An hon. Member:: Were the auditors paid?


Charles Humbert Thomas: I imagine they were paid.


An hon. Member:: How were they paid?


Charles Humbert Thomas: Well, perhaps these promissory notes mean something.


An hon. Member:: Should they be paid?


Charles Humbert Thomas: That may be more to the point. Should the government be allowed to get away with this skulduggery? The law, as written by parliament, spells out that a firm of auditors must be appointed each year by parliament. The government paid no heed to that; they did not lay the legislation before us in that regard. Their refusal so to do shows their arrogance, their contempt for this House and for the people of Canada. Further, they show contempt for the board of directors of Air Canada and the board of directors of Canadian National Railways. The government asks us to pass the bill before us as quickly as possible; I am beginning to understand why it wants it passed without discussion.
In clause 14(2) of the present bill we find this language:
For the purpose of carrying out the audit described in subsection (1), the following firms of chartered acccounts are appointed as independent auditors:
Get this, Mr. Speaker:
(a) for the year 1972, the firm of Peat, Marwick, Mitchell & Co., of the cities of Toronto and Montreal-
I ask, what kind of business practice do we see here, in which directors go to the shareholders and ask them to appoint auditors retroactively? What continuing records are to be used? Where are the auditors to start? Where are they to find the necessary records? As I say, how are they to make an audit? Is that why there is no CNR Annual report and no audited statement? That is what I have asked myself, and I have not found the answer. I hope answers will be forthcoming, for the government's sake. It compounds the confusion and the crime by saying, "Oh, but we have discovered an answer. We will tell parliament that the system of appointing the same auditors year after year is not a good one; we have to spread the business around a little." I am not implying why it would want to spread the business around; I do not know.


An hon. Member:: Perhaps Ben has something to do with it.


Charles Humbert Thomas: The government appointed one firm of auditors for last year, it has appointed two firms for this year, and another firm for 1974.
CNR and Air Canada


Stanley Howard Knowles: It appointed both firms for 1973, and one of them for 1974.


Charles Humbert Thomas: I see that the firm of Peat, Marwick, Mitchell & Co. is appointed for 1972 and also for
1973,	and in 1974 the firm of Cooper & Lybrand is appointed.


Stanley Howard Knowles: Mr. Speaker-


Mr. Speaker:: Is the hon. member for Winnipeg North Centre (Mr. Knowles) rising to declare his personal interest?


Stanley Howard Knowles: I have a personal interest in hearing the hon. member tell the House precisely what is in the clause to which he is referring. He will note that for 1973 two firms of auditors are named; there is one firm named for 1972, and one firm named for
1974.


Charles Humbert Thomas: I am sorry; I did not quite hear what the hon. member said. I will not embarrass the government any more. How far can you go in heaping ridicule on their heads? Here we have one firm appointed for 1972. That firm, with another firm, has been appointed for 1973. From the way this government has been extorting revenue from the taxpayer, I suppose it can afford to hire three or four firms, although I do not think that we as members of the House should authorize it.
I think I have made the point I have been trying to make. Normally, in debates such as this people talk about the debts of the CNR. It seems that the debts of Air Canada are almost in the same category as those of the CNR because many of the things you can say about the operation of the CNR can be applied to the operation of Air Canada. If I had time to make further remarks I would make it clear that I am not as critical of the CNR and Air Canada as I am of the government which refuses to enunciate and formulate a national transportation policy year after year. I raised this subject last year with the president of Air Canada and he complained bitterly that the Minister of Transport (Mr. Marchand) would not tell him on what basis the airline should be operated, whether in the public interest or for profit. I was interested to read a report in the Financial Post to the effect that Mr. Pratt, who I believe was chairman of the board, was waiting for the minister to take action, and now he is at the point of throwing up his hands and taking off for sunnier climes.
I have said some of the things I wanted to say. I know that my colleagues will not neglect the CNR in this debate; neither will they ignore Air Canada, the company which is rapidly taking over the position of CNR and which may be instrumental in getting CNR off the hook. Air Canada seems to be doing its best to downgrade service in the field of passenger accommodation, in service in the air and on the ground, and is reducing flights to the minimum permissible. It is doing its best to get the CNR off the hook. I believe that my colleagues and others who will follow me in the debate will express somewhat less than satisfaction with the operations of CN and Air Canada.


Stanley Howard Knowles: And the CPR.

April 13, 1973
CNR and Air Canada


Charles Humbert Thomas: My final remarks are these. Despite the government's urging us to pass this bill as quickly as possible, so that we will not find out what is in it, I say that so far as I am concerned I will be happy to consider the bill in committee where we can call witnesses and receive answers to our questions. Until we get those answers I will not be prepared to heed the urging of the parliamentary secretary to process this bill through the House as quickly as possible.


Mr. Bill Knight (Assiniboia):: Mr. Speaker, I participate in this debate because of the significance of this financing bill in terms of the operations of Canadian National Railways and Air Canada, the spending in terms of the overall effect of transportation in this country, how it affects many regions, particularly the west and the Maritimes and how important transportation is to the development of a strong Canadian nation.
The hon. member for Moncton (Mr. Thomas) raised a number of questions of great interest. They can be summed up by asking the parliamentary secretary, or possibly the Minister of Finance (Mr. Turner), one simple question: How did CNR and Air Canada do their financing in 1971 and 1972? That seems to sum up the remarks of the hon. member for Moncton which I believe to be appropriate.
When this bill comes before parliament it gives members an opportunity to review the question of transportation as it affects this country from one end to the other. I hope that members of the government will espouse and outline some aspects of the policy that is needed in the area of national transportation. Further to this, so many ministers of the Crown have their fingers in the pie of transportation that if we were to try to load them all on a streetcar, we would have to hire an additional one to carry them.
I hope the minister in charge of the Canadian Wheat Board will outline how the Canada Grains Council is operating and who is financing it. I hope the Minister of Transport (Mr. Marchand) will outline his area of jurisdiction and tell us what changes we can expect in the area of freight rates and in developing a co-ordinated transportation policy. Also, I hope he will outline the policy related to the development of harbours at the port of Churchill and other places.
The Minister of Finance, who moves this bill every year, ought to outline some of the changes in financing the CNR and Air Canada, and with regard to the CNR debt which occurred as a result of buying-out the Mackenzie and Mann railway, thus getting a private interest out of hock, in the early twenties. The Canadian people have been paying for it ever since.
I hope that within the confines of this debate the Minister of National Health and Welfare (Mr. Lalonde) will reflect upon the pension situation of retired railroaders and the question of collective agreements which date back to 1956. Perhaps he has an opinion on this matter and will use his good offices to try to bring about an improvement in the situation of retired railroad pensioners.
Debate on the financing of CNR and Air Canada is an annual event. During these debates there is considerable

objection raised to certain aspects of the national transportation policy or the fact that one does not seem to exist. The Minister of Transport was formerly in charge of the Department of Regional Economic Expansion. I am sure he is well aware of the problems of developing those regions in this country which are at an economic disadvantage in relation to the golden horseshoe of Ontario. As he was formerly in charge of DREE, he should be aware of the effect of freight rates in terms of the kind of growth that is needed in the west, in the Maritimes and in northern Ontario.
The Minister of Regional Economic Expansion (Mr. Jamieson) sat for several years as minister of transport. He ought to be aware of the effect of freight rates and transportation upon regional development. These two ministers should be able to co-ordinate a program to alleviate the difficulties in terms of developing a program to end regional disparity. With their vast experience, they should be able to come up with a policy that has some teeth in it to develop the various regions of this country on a basis equal to the golden horseshoe of Ontario.
I wish to deal with a number of points which are significant to this bill. As stated previously by my colleagues, the whole question of allocating certain moneys in relation to the CNR debt, which relates back to the time the Mackenzie and Mann railroad was purchased to get Liberal promoters and developers off the hook, needs revision. There was some change in the relationship of the debt several years ago. There is further need to take this debt off the back of Canadian National Railways. I hope the government will give consideration to this question within the realm of this bill.
Some things are very aggravating to those of us who come from western Canada, northern Ontario and the Maritimes. I refer to the national transportation policy and the disgusting inequity in the freight rates structure. There is no greater burden on western development than the freight rates structure which was initially set up to protect the developing manufacturing industries in southern Ontario. That freight rates structure has been with us ever since. We have lived with the burden of freight rates at the same time as we have lived with the burden of tariffs.
In the Speech from the Throne the government outlined its concern for meeting the discrimination against western Canada in the area of transportation. They have set up a western premiers' conference for July to deal with western economic problems. One fundamental question they must tackle is that of freight rates. I wish to quote some figures to indicate how freight rates affect western Canada. I first wish to deal with commodities purchased from the east. On goods shipped from Contrecoeur, Quebec, to Vancouver, the revenue for the railroads is $1.02 per ton-mile. If the same commodity is shipped to Regina, the revenue per ton-mile is $2.55. On goods shipped from Quebec to Saskatoon, the revenue per ton-mile is $2.59.
Looking at the other side, the rail revenue per ton-mile for eastern steel products terminating at Vancouver is $1.02. The rail revenue per ton-mile to Regina is $2.55. There is a 150 per cent increase in revenue for goods moving to Regina compared with those being moved to
April 13, 1973

Vancouver. In relation to Saskatoon, the increase amounts to 154 per cent. At this point I would refer to an editorial which appeared in the Globe and Mail of April 11 on the question of western freight rates. This is a further example of the discrimination we face. It reads:
Rapeseed, which is grown in Alberta, can be shipped raw from Lethbridge to Montreal for 81 cents per 100 lbs; but if it is processed into oil and meal it cost $1.22 per hundred pounds to ship the product to Montreal. Alberta would like to know if there is a cost relationship between the differing rates for the raw and processed product-which it suspects there isn't-or if the railways are setting industrial policy through their rates. The railways refuse to give any cost-relationship information. All this has so annoyed Alberta that it has produced its own transportation policy, covering air-international as well as domestic-highway and rail.
Similar moves have taken place in Saskatchewan and Manitoba. If we are really concerned about national unity, certain important elements in our economic make-up must be fundamentally changed. One of these is freight rates. In the constituency of Assiniboia, with which I am most familiar, we ship our basic commodity, wheat, by rail. Branch lines were built to provide this service. Out of all the rail lines in the constituency, 605 miles of track are scheduled for abandonment by the CN or by the CP. Situated along those lines is elevator capacity sufficient to hold 11.5 million bushels of grain. These elevators are to be closed down. In past years, an average of 22.5 million bushels of grain has been carried over those tracks. In future, this grain would have to be moved by truck. More than 5,100 producers in the constituency would be affected by the removal of these tracks. Every dirt road and municipal road would be affected. Tax losses to municipalities would amount to between 50 and 60 per cent of their total revenue.
The bill before us offers an opportunity to deal with the question of national transportation policy. If the government allows the wholesale abandonment of rail lines in western Canada, it will be carrying an enormous burden of responsibility. I draw attention to the fact that producers living near those lines have been offered no concrete alternative means of moving their grain. We are hopeful that in the course of this debate the minister will be able to give us an undertaking that the final decision to abandon these lines will be deferred beyond the 1975 date originally determined. Certainly, there is the odd branch line which may have to be shut down. I wish hon. members could see a map of my constituency. If these lines are shut down, there will be hardly any left; it will create a gap some 50 miles by 75 miles in extent in the middle of the riding. This is where the greatest burden will fall if services are discontinued in a wholesale manner.
I see I have only about one minute left, and there are a number of questions which I intend to address to the minister and which, I trust, will be answered. If I might be allowed to call it four o'clock, I shall continue next week.
Harbour Commissions Act BUSINESS OF THE HOUSE


John Angus MacLean: On a point of order, Mr. Speaker. I wonder whether there is a minister present who can confirm that we shall be continuing this debate on Monday and tell us what item is to follow.


Charles Mills (Bud) Drury: In the ordinary course of events we would be continuing this discussion, but whether we continue or not on Monday will depend to some extent on the probable length of the debate. Over the weekend we shall try to discover what the possibilities are.


The Acting Speaker (Mr. Boulanger):: Order. It being four o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper.


Mr. Reid:: Mr. Speaker, I believe that on April 10 there was agreement that the bill standing in the name of the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) would be brought forward today. We are prepared to debate that bill. It would require an order of the House to change the subject matter for the day from notices of motions to private members' public bills.


Stanley Howard Knowles: Agreed.


The Acting Speaker (Mr. Boulanger):: Is the House agreed?


Some hon. Members:: Agreed.



PRIVATE MEMBERS' PUBLIC BILLS


Thomas Clement (Tommy) Douglas: that Bill C-21, to amend the Harbour Commissions Act (Nanaimo Harbour Commission) be read the second time and referred to the Standing Committee on Transport and Communications.
He said: Mr. Speaker, in rising to move that Bill C-21 be given second reading and sent to the Standing Committee on Transport and Communications, I have two purposes in mind. The first is to provide for local representation on the Nanaimo Harbour Commission. Section 4(1) of the Harbour Commissions Act provides that a harbour commission shall consist of not less than three and not more than five members. Section 5(1) provides that there shall be one representative from the local municipality and, if there is more than one local municipality, that a second representative shall be on the commission.
In the case of the Nanaimo Harbour Commission there are only three commissioners, two appointed by the gover-

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Harbour Commissions Act
nor in council and one by the city of Nanaimo. The two representatives appointed by the governor in council are the chairman and a second member who is also the solicitor for the commission. But there is no representative from the adjoining municipalities, despite the fact that the act provides for this.
The provision of the bill which I am now asking the House to approve and to send to the Standing Committee on Transport and Communications asks that it be made mandatory to have five members on the Nanaimo Harbour Commission, three of whom would be appointed by the governor in council, one to be appointed by the city of Nanaimo and one by the regional district board.
Some hon. members may ask, why this insistence upon local representation on the harbour commission? I suggest that there can be no intelligent planning of harbour facilities unless the local authorities have an effective voice in determining the course to be followed, the location of streets and access roads, the effect upon the shoreline of any expansion of the harbour facilities, and in the matter of traffic control. All of these are of direct concern to the local authorities. Therefore, unless the harbour commission works in conjunction with the elected representatives of the local council, the result will be chaos.
There has been an example of this kind of lack of consultation and co-ordination in the Nanaimo harbour commission's operations recently. In March of last year the Nanaimo harbour commission made public a program costing some $10 million for a large extension of the harbour facilities. After this program had been announced, the city of Nanaimo's advisory planning commission looked into the matter and registered their objection to the location. The regional district board also looked into this matter and expressed their dissatisfaction with the location. Groups of interested citizens, for a variety of reasons, also expressed their opposition to the location that had been selected and some of the Indians of No. 1 Indian reserve were quite upset about the proposals.
In addition to that, the Department of the Environment expressed some concern. Some of the departmental officials stated in correspondence which I have that they had not been consulted. I have no way of knowing whether or not that is true, but the department and certain conservation groups were disturbed about the fact that the extension of the harbour facilities was going to block off part of the estuary of the Nanaimo River. The department was also concerned about dredging and backfilling and the effect this would have on marine and wildlife in the area.
The result was that .the Minister of the Environment (Mr. Davis) managed to get a stay of proceedings and appointed a task force to look into this matter. I am not familiar with the report of the task force, but I do know that as a result of its report the Minister of Transport (Mr. Marchand) referred the whole matter to the Canada Ports and Harbours Planning Committee. I commend the minister for agreeing to have this committee hold public hearings in the city of Nanaimo on January 25, at which time various groups expressed their opinions. I think it is safe to say, having looked over the briefs, that the majority of them thought this matter should be investigated further.
I have a press release dated April 10 in which the Minister of Transport said that as a result of the report of

the planning committee he has decided to accept their recommendation for an in-depth study of this harbour development. It is expected that this study, which will be conducted by specialists from the Department of Transport, the Department of the Environment, the Department of Urban Affairs and the Department of Public Works, will report before the end of this year.
I cite these facts, Mr. Speaker, in order to point out that lack of co-ordination and consultation prior to a project being launched can cause a great deal of difficulty in a community. It seems to me that there is need for making mandatory provision that there be adequate representation on the Nanaimo Harbour Commission-and I think this ought to apply to all commissions-from local governing bodies. This is why I have introduced Bill C-21.
My second reason for introducing this bill is that I hope the Standing Committee on Transport and Communications will give some thought to making recommendations to the Minister of Transport regarding a complete revision of the Harbour Commissions Act. In the years that I have been in this House, I have noted that members with ports in their constituencies have repeatedly expressed dissatisfaction with the Harbour Commissions Act as being archaic and undemocratic. Successive ministers of transport have said that new legislation was being considered, but so far nothing has been done to correct a situation that in my opinion is becoming intolerable.
I have a press release dated March 27, issued by the Minister of Transport, in which he says that the National Ports Council has been asked to make recommendations regarding a revision of the Harbour Commissions Act. That is perfectly proper. These men have the expertise to deal with the technical and engineering aspects of the ports. But engineering is only part of the problem; the people of the community and those planning the affairs of the community are equally important.
I hope the Standing Committee on Transport and Communications will take a look at the whole act to see whether or not there is provision in it for co-ordinated effort between the different departments of government, local authorities and harbour commissions.
I am not finding fault with any particular harbour commission or with any particular group of men. What I am saying is that there is a deficiency in the act itself in that there is failure to provide the machinery for adequate consultation and co-ordination.
The establishment of port authorities has grown up like Topsy-small bodies of men clothed with immense power and responsibility, controlled only by the Minister of Transport. These commissions have the power to buy, sell or lease property. They have power to expropriate land and borrow money, only subject to the approval of the Minister of Transport. Each harbour commission proceeds in its own way. Some do better than others, but they have autocratic powers which are at variance with the whole principle of participatory democracy.
The Harbour Commissions Act sets up little autocracies with wide powers subject only to the government granting them funds for capital expansion and guidelines set forth by the Minister of Transport through regulations. Other-
April 13, 1973

wise they can proceed to carry out developments which may be good or bad, which may coincide with local planning authorities or conflict with them. I submit that no other group has such sweeping powers.
There is no provision for co-ordination with other departments of government. The government has very wisely, but belatedly, set up the Canada Ports and Harbours Planning Committee, but this only provides for an input by federal departments and their agencies. It does nothing to ensure joint planning and consultation with local authorities.
I suggest that not only local authorities but local people have a right to be consulted if the harbour commission is proposing extensive projects which could have far reaching effects upon the community. The right to know and be heard is fundamental to democratic government. This act ought to provide for public hearings so that citizens' groups will be able to place their views before the harbour commission, not after the plans are completed and the project is begun but in the planning stage and before final decisions have been made.
At the present time the harbour commissions, provincial governments and local governing bodies are all making plans concerning the same people and the same areas; there is no provision in the legislation to provide joint planning and full consultation between the three levels of government. The Minister of Transport cannot be expected to supervise all these harbour commissions adequately. His department receives their applications for capital funds to extend harbour facilities, and if his officials are satisfied as to the need for expansion and the engineering feasibility of the project, it is approved-without any meaningful input by the people most vitally affected, namely, the people who live in the immediate vicinity of the port.
I submit, Sir, that the day is past when the public will stand for this kind of arbitrary administration of their affairs. From the government's own standpoint it should welcome the participation and co-operation of the local governing bodies and interested citizens' groups. By requiring full disclosure of information and by permitting an input from the people most concerned, the government will get better plans and more co-ordinated projects. At the same time, this will make for finer communities and more satisfied citizens.
Therefore, Mr. Speaker, I ask the House to pass this motion and give second reading to Bill C-21, in the hope that it will provide for local representation on the Nanaimo Harbour Commission. I would urge that as an ancillary benefit the committee give some thought to making recommendations to the minister for a general review of the Harbour Commissions Act so that the legislation will help to promote better co-ordination, better consultation and a more democratic way of carrying on the business of operating harbours in Canada.


Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I enter this debate rather belatedly, but I am delighted to support the proposals in this measure put forward by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), my neighbour to the north.
Harbour Commissions Act
In this day of growing government and government involvement more and more in the private affairs of people, it seems to me there is an increasing need to broaden representation on commissions such as the one at issue at the moment. The basis of the amendment proposed by the hon. member is to increase the number of commissioners from three to five. He has suggested a number of amendments to the act which I think are most appropriate.
There is no harbour commission within my constituency, but there is one in the neighbouring constituency to the south, the riding of Victoria. There is, of course, a harbour commission in that city with powers which extend to the inner harbour. I have had some experience with smaller harbours within my constituency and know something of the problems encountered by the municipality and people living in the area. First of all, and this happened only about a month ago, an attempt was made by the municipality in which the harbour, or bay, was located to conclude a lease over a wharf in the harbour to be used for multiple purposes. Basically, it is a federal wharf. This question involves the Government Harbours and Piers Act because these are related acts. This is a government wharf provided for the community. Many people living in the community of Sidney, at the north end of the Saanich peninsula, are fishermen; but in that area there is also a great tourist industry.
We receive many sports craft from Vancouver, from further up the inland passage and, of course, from our neighbour to the south, coming up through Puget Sound, the Strait of Georgia, Hecate Strait and beyond. Frequently they occupy wharf space in this area. The municipality was anxious to ensure that prime space at this wharf was accorded those who live in the community and for whom this facility had been provided.
The community ran up against a snag in concluding the lease, in not being sure that the wharf engineer, who is appointed by the Minister of Transport, had the power to conclude the lease or whether he just had the power to collect the parking fees, if you like, at the wharf. They wanted more than that; they wanted to apply more regulations than were actually applied and they wanted to be sure that the wharf engineer would have the power to apply them.
I believe it was a question of misunderstanding, which I was able to help clear up. Now I believe it will work satisfactorily. The fishermen who live in that area will have the pride of having representation on the board. The sportsmen in the area will be able to come to the wharf. They must pay their fees. I gather the fees previously had been collected rather indefinitely for a time. This emphasizes to everybody in that small inlet the need even for fishermen, perhaps, to be represented on commissions in the case of a fishermen's harbour.
The hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) mentioned environmentalists. It seems to me that the act he criticized, I suppose just through the passage of time, has failed to take into account some of the new interests and concerns of the Canadian people. When fishermen or sportsmen come alongside, there is a tenden-

April 13, 1973
Harbour Commissions Act
cy to pump out the bilges of their boats and to throw out their garbage. This should not occur. The commission should have the power to prevent it occurring.
It seems to me there is a real problem and there should be on the board the representative of an environmental interest, be it a local representative of the Department of the Environment or a local body concerned with the environment, to ensure that the law is properly observed and that the harbour is kept in proper order and clean for the public. Perhaps one of the members should be drawn from marina operators, sportsmen or harbour people, depending on the use to which the particular harbour, bay or wharf is devoted.
Sometimes representatives of tourism, if you like, representatives of fishermen and of environmental interests have their part to play in the commissions which are established. I note, for example, that the law as it now stands makes provision for the council to have a representative on the commission. I quite agree that the citizens of these communities ought to be represented. However, there is also the question of functional representation about which I have made a plea.
There is another example in an area which to some extent is a boundary link between my constituency and the constituency of Victoria. It is known in Victoria as "the gorge". It is a long, deep inlet of the sea. It is subject to the tides. It brings pollution from the sea into the narrows. There is a narrows through which one must travel; it is barely half the width of this room. There was a time when people could swim in the gorge. That time has now passed. I have asked people why it is that they no longer swim there. The obvious answer is, because of pollution from industries that have been established around the port of Victoria. This matter is being dealt with. The municipality and the harbour commission are working hand in hand, sometimes in the same direction and sometimes in conflict.
I agree that there should be greater provision in the act for regular consultation and also community consultation. The other matter in respect of the gorge is that some of the effluent is carried out to sea. The people who towed me through the gorge are a constituted group concerned with restoring the gorge to its earlier purity. People of this type would be happy to serve on the commission. They told me about the conflict in respect of jurisdiction between the province, the municipality and the federal authorities. How far up into the gorge does the federal authority extend? This has never been very clear. Should the day ever come when Esquimalt harbour could receive civil ships, it would deserve to come under a jurisdiction with
the broadest possible base of consultation. Today, however, it is under the jurisdiction of the Department of National Defence.
I am happy, Mr. Speaker, to support the purpose of the bill to increase the number of commissioners on the Nanaimo Harbour Commission, because it leads the way to further developments, to another study of the basic act so that it might be broadened to take into account the new interests, the new concerns and the new worries of our people.


Mr. Joseph-Philippe Guay (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, first I should like, through you, to say it is always a pleasure to listen to the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). I agree wholeheartedly with the comments he made pertaining to possible amendments to the Harbour Commissions Act. I believe this is a matter of concern not only to that area but other areas. If a change is to be made, and I hope it will, it should include all harbour commissions across our nation; it should embrace them all.
Several hon. members have indicated their interest in this particular field. I could possibly name several but I shall not do so. I am tempted to do so, however. Instead, I will say that the government has no objection to the hon. member's Bill C-21, which primarily is concerned with the administration of the Nanaimo Harbour Commission. We feel, however, that this bill should be recognized by the House as an interim measure. We feel it should be an interim measure because the National Ports Council, which includes representation from the harbour commissions, the National Harbours Board and all the provinces, is now reviewing the structure of all Canadian ports and harbours with a view to making recommendations on new, streamlined mechanisms for the administration of these facilities. We think it is vital to have an input from the provinces and these organizations, and because of this the House should recognize the necessity of this bill being only an interim measure.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Transport and Communications.
John Mercer Reid: Mr. Speaker, in recognition of the unusually productive day we have had, I think there might be consent to rise.


Mr. Bell:: This is agreeable to us.


The Acting Speaker (Mr. Boulanger):: Order. The hour for the consideration of private members' business has now expired.
At 4.30 p.m. the House adjourned, without question put, pursuant to Standing Order.

Monday, April 16, 1973