1974-03-14

ROUTINE PROCEEDINGS


Hon. Jack Davis (Minister of the Environment):: Mr. Speaker, beginning April 1, 1974, federal government projects will be screened to ensure that they do the least possible damage to our natural environment. Most of these projects will be cleared with little comment. Others, because of their likely effect on the quality of life in this country, must be examined very carefully indeed.
Federal departments, Crown agencies and private companies with government contracts, grants and loans will have to prepare environmental impact statements. These statements will be screened by a panel of experts in my department. Recommendations for action, that is, for approval, for modification or for denial, will be made to the Minister of the Environment. Final dispositions will, of course, have to be worked out in consultation with other ministers of the Crown.
Essentially, our new environmental assessment and review process is this. The initiator will be responsible for securing, at the earliest possible stage in the planning of a project or other environmentally significant activity, a forecast of likely environmental effects. This statement must use baseline data and procedural guidelines provided by Environment Canada.
If the initiating department, Crown agency or private firm has sufficient expertise it will prepare its own environmental impact study. If not, it will have to obtain this advice from outside sources at its own expense. When completed, the statement will be screened by a panel of experts in Environment Canada. Any element or aspect of the plan which the panel finds unacceptable must be noted and referred to the Minister of the Environment before the project proceeds.
Public disclosure is important. Written assessments made by the panel will, therefore, be published. Public participation is also vital. In cases of broad public interest, the Minister of the Environment, in consultation with the minister of the initiating department, may, therefore, appoint an environmental review board, the membership of which may be drawn from outside the Public Service. This review board will be able to hold public hearings and make recommendations which will be published.
More specifically, the initiator of a new project or activity with possible environmental consequences must:
1.	Take environmental considerations into account from the outset;
2.	Submit their project to a panel in Environment Canada or a public review board before financial or other commitments are made;
3.	Incorporate recommendations made during the course of our screening process into the design, construction and operation of the new project or activity; and
4.	Prepare to publish, or otherwise make public, their findings and plans in this regard.
In order to meet local needs, regional panels may also be necessary. They will be struck from time to time and in such places as the need for assessing and reviewing the environmental consequences of particular developments dictates.
This environmental assessment and review process will help to round out the resource management and environmental protection programs already under way in my department. It will be implemented in stages. It will also be put into effect in close consultation with the provinces and with industry.
I hope, in the process, that we can avoid the delays and other pitfalls which a strictly legalistic approach would cause in this country. Our approach, I believe, is the right approach. We will not hold up important developments which are clean from an environmental point of view and, in contrast to the situation which has developed in the United States, we will not bring the environmental assessment process into disrepute. We will not be charged with blocking everything. At the same time, we will make a great deal of information public. We will, I believe, deal effectively and efficiently with certain projects which are bound to be controversial because of their impact on our environment. In some instances, as we all know, these effects can be very serious indeed.


Mr. John A. Fraser (Vancouver South):: Mr. Speaker, the other day the minister, in answering questions put to him in the House by my colleague the hon. member for Portage (Mr. Masniuk), said he would be making a statement to clarify government policy on environmental impact today. With respect, Mr. Speaker, if this statement is supposed to be clarification it falls far short of what is needed in this country.
There was a great deal said in the minister's statement about making public the contents of environmental impact studies. But if one looks at the statement of the minister carefully he will find that this policy has been carefully geared to make sure that anything the government does not want the public to know will not be revealed. If you look at the procedure outlined by the minister today you will see it is quite clear that it is not until after a panel of experts of the minister's department have prepared a report based on their consideration of the environmental

March 14, 1974
Environmental Screening of Federal Projects
impact statement put forward by the proponent that anything will be made public. How are we to know whether the government, for its own purposes, will tell us everything that was in the initial statement? It is quite clear that if this is supposed to be an attempt to enlighten the public about considerations that have to go into the decision-making process before a major project with significant environmental impact is undertaken, it comes very close to being a fraud.
The minister is trying to give the impression that the public is going to be involved, but again it is only after an environmental review board is set up, which is permissive, not mandatory, that there may be public hearings. The fundamental difficulty in the policy the government is following is that it is still determined to pursue a process of secretiveness and of holding unto itself anything it does not want the public to find out about. This, of course, is based on the assumption that the government knows best. If the government knows best there is no need for environmental impact statements and there is no need to have public participation in the decision-making process.
Let me point out what the minister said in his statement. These words appear on page 4 of the statement the minister kindly gave me:
I hope, in the process, that we can avoid the delays and other pitfalls which a strictly legalistic approach would cause in this country. Our approach, I believe, is the right approach.
I should like to know what the minister means by "our approach". Does he mean the government's approach or does he mean the approach that was taken by the task force set up some time ago by this same minister to report to the government on the policy that ought to be followed with regard to environmental impact? The report of the task force is dated August 30, 1972, and the first policy position the report sets out is as follows:
The federal government shall offer leadership in the area of environmental impact assessment in respect of significant effects on the environment through the pronouncement and implementation of a policy and procedure to be based ultimately on legislation.
This is the exact thing the minister and the government have rejected. They do not want this to be mandatory; they do not want it set up in legislation. They want to have their own cosy little system of review, which means it does not matter how much in error they may be, or to what extent they are proceeding with something that is their political policy for the moment, the public is not going to get a look at it.
Recommendation no. 7 is as follows:
The policy shall provide for appropriate public information and participation in hearings and in reviews of statements.
How does this policy provide for that? I say again that I am quoting from the report of the task force set up by this minister, which was five months in the making and was highlighted by consultations with environmental experts of the United Kingdom, Holland, the United States, the other provinces of Canada and other federal departments.
I think I can sum up by quoting again from the front page of this report where it is stated:
The task force recognizes that there are alternatives to some proposals in this report.

We have had an alternative today. It goes on to state: However, consideration of these alternatives may best await the decision on just how strong a stand the federal government takes on environmental impact assessment.
The stand the government has taken on environmental impact assessment is not strong. It is not going to work, it is in defiance of its own report, and is a fraud.


Some hon. Members:: Hear, hear!


Mr. Randolph Harding (Kootenay West):: Mr. Speaker, I should first like to thank the minister for making a copy of his statement available to me before the opening of the House today. Our group welcomes this move by the minister to set up an environmental assessment review process as far as it goes. I agree with the last speaker that it certainly does not go far enough. But the mere fact that for the first time we are to have Crown agencies and federal departments go through the process of an environmental review is good. We have been advocating for years that where any project is carried out by the federal authorities, or by other agencies where there is partial federal authority, environmental impact studies should first be made and those studies should then be fully evaluated before any money is allocated for projects or a start made on projects.
An excellent example in this field is in the James Bay area. There have been several in British Columbia. The Columbia River was one and the Peace River Dam another. I could name a number of projects throughout Canada where environmental studies should have been made and evaluated before the project started. It is too late now. Immense damage has been done that can never be corrected regardless of what we do. Federal departments and Crown corporations will now be forced to make these studies. This is good.
But there are several weaknesses in the statement the minister made today. One is the fact that the Crown agency, or private firm given money to do a job for the government, will prepare its own environmental impact study. Whom is the minister trying to kid? All we need do is go into northern Canada where, under the Department of Indian Affairs and Northern Development we find that certain projects are under way, many of them being carried out by the minister's own department or let out by him to other groups, in respect of which we are not getting the protection in the northern part of Canada we should be getting.


Some hon. Members:: Hear, hear!


Randolph Harding: We have complained over the years about this kind of tactic and have urged that action be taken. I urge upon the minister that the very first department he tackle is the Department of Indian Affairs and Northern Development insofar as northern Canada is concerned.
For this reason that part of the statement which says that a private company or government department can carry out its own environmental impact study does not mean too much when one realizes that the minister's own department is the one which will assess the good or bad of the impact study. There is one bright spot. There could be some public input for the first time. The mere fact that
March 14, 1974

statements by the board will have to be made public and that in respect of some of the larger projects public hearings may be held is, I think, credit insofar as the minister is concerned on this point.
In closing I again want to point out that if the environmental impact studies are really to do the job which I think should be done we must get into the field where we can insist on these impact studies being made in those areas where we have only partial jurisdiction. One is in the field of the Navigable Waters Protection Act. Does this House know that a Crown corporation in the name of a province cannot be touched under that act? It can build any dam it wishes and does not have to come to the federal authorities for any license. It does not have to let the minister know what damage might be done behind the dam that is to be built.
I agree with the hon. member who has just spoken. We have to expand impact studies to cover the whole of Canada in order to really do a job for the people of Canada in the future.


Mr. Gilles Caouette (Charlevoix):: As usual, Mr. Speaker, this statement is a necessary one, but it comes belatedly, which has been the characteristic of the government administration for many years.
When all our rivers are polluted and when only perfunctory legislation has been created and nearly nothing is being done to rectify a persisting situation, the minister tells us that in the future all projects that may interfere with the environment must be approved by his department. The planning must incorporate any corrections or recommendations made by his department and, lastly, all the findings must be published.
In no way does the minister indicate what penalties will be imposed on those who do not obey these regulations and, even less, how they will be forced to do so. Money will once again be spent, not to rectify an existing situation but only to study and recommend a type of action which nearly never was applied in the past.
The House certainly recalls the nice briefs on pollution in the Great Lakes and in the rivers and water resources of Canada, but they are still polluted. Consider the Ottawa river, for instance, which is certainly not too far away from Parliament to go unnoticed. Pulpwood driving had been forbidden, but last summer tugboats still ran on the river with their shipments of wood. Nothing is being done. Then why make such a statement today when we are powerless to implement previous decisions?
Does the minister simply seek to toss good wishes in the air, or is he really prepared to get down seriously to the job of correcting present problems first?
This statement for the future is appreciated, but I have yet to be convinced of its effectiveness for, as I have said earlier, the minister puts nobody under the obligation of believing his statement, and moreover he sets no time limit for effective implementation.
I must therefore conclude that the minister simply perpetuate a deplorable situation and is absolutely not inter-
House of Commons Hockey
ested in correcting the problems we are now facing regarding the environment.


PUBLIC SERVICE
Hon. Allan J. MacEachen (President of the Privy Council):: Mr. Speaker, I should like to table Part I of the report on employer-employee relations in the Public Service of Canada prepared at the request of the government by Mr. Jacob Finkelman, chairman of the Public Service Staff Relations Board. Mr. Finkelman's terms of reference were outlined in the House of Commons on April 17, 1973.
The report is comprised of three parts. Part I of the report, which I am tabling today, is the substantive or main part of the report. Parts II and III will be tabled as soon as they are prepared in final form. Part II is to be a compilation of the recommendations that are set out in Part I and will be, in essence, what might be termed a ready reference document. Part III will be in the form of a draft bill which will simply embody in legislative language those recommendations contained in Part I that deal with the revision of the Public Service Staff Relations Act. The draft bill, of course, like the rest of the report, will be the work of Mr. Finkelman and it should not be regarded as being a government proposal or government bill.
As indicated earlier, it is the government's position that no major amendments will be made to the Public Service Staff Relations Act without a full opportunity being given to the employee representatives to express their views. The employee representatives, of course, will probably appear before the standing committee charged with the consideration of Mr. Finkelman's report. In addition, there shall be full consultation between the government and the employee representatives before the government brings forward any bill making major amendments to the act.
On behalf of the government, Mr. Speaker, and I am sure on behalf of members of the House, I should like to thank Mr. Finkelman for his thorough study of employer-employee relations in the Public Service of Canada. Mr. Finkelman's experience and reputation in this field are evident in the quality of the report he has prepared.


Some hon. Members:: Hear, hear!


HOCKEY GAME BETWEEN MEMBERS AND PRESS GALLERY-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Roch La Salle (Joliette):: Mr. Speaker, under Standing Order 43, I ask the unanimous consent of the House to introduce a motion.
Considering that it was vital for the honour of this House to avoid defeat in last night's hockey game between

March 14, 1974
Rail Transportation
hon. members and reporters, considering that the match was of prime importance within the minor hockey tournament organized by the Optimist Club in Hull and finally since the Press Gallery Club obtained an import from Air Canada named Howie Riopelle even under the watchful eye of the minister responsible for amateur sport in Canada, thus compelling hon. members to be satisfied with a tie game, I move, as captain, seconded by the hon. member for Mercier (Mr. Boulanger), coach:
That the minister responsible launch an inquiry into that disloyal tactic and demand a life suspension for coach Andre Bellemarre of the press team and the player involved.


TRANSPORT
Mr. Frank Howard (Skeena):: Mr. Speaker, I rise pursuant to the provisions of Standing Order 43 to seek consent of the House to move a motion in a case of urgent and pressing necessity resulting from the government's decision to assist Canadian National Railways and the Canadian Pacific Railway to repair some of their antiquated railway cars for the shipment of grain and the resulting refusal on the part of the government to afford similar generosity so far as lumber producing areas are concerned. I move, seconded by the hon. member for Comox-Alberni (Mr. Barnett):
That this House expresses its regret that the government has taken the course of denying lumber producing areas the same consideration that has been extended to grain producing areas in so far as it is assisting railway companies to renovate and repair boxcars.


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. The motion cannot be put.


SHORTAGE OF RAILWAY CARS TO MOVE PRODUCTS- REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Bill Knight (Assiniboia):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact the complete breakdown of rail transportation in Canada could cost western producers half a billion dollars in grain sales, and in view of the Minister of Transport's apparent rejection of the National Transportation Act, I move, seconded by the hon. member for Meadow Lake (Mr. Nesdoly):
That this House calls upon the government to place the CPR under immediate trusteeship and to appoint a boxcar allocator to begin placing boxcars in position to bring essential commodities to market.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


DRILLING OF OIL WELL IN BEAUFORT SEA-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Wally Firth (Northwest Territories):: Mr. Speaker, I rise under the provisions of Standing Order 43 to seek consent of the House to move a motion of urgent and pressing necessity. I move, seconded by the hon. member for Winnipeg North (Mr. Orlikow):
That the conflict between the statement made by the Minister of Indian Affairs and Northern Development on March 7, 1974, that offshore drilling in the Beaufort Sea would not be permitted until 1976, and the announcement today that Imperial Oil has drilled a well in the Beaufort Sea, be referred to the Standing Committee on Indian Affairs and Northern Development for study.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


CONSUMER AFFAIRS
Mr. Terry Grier (Toronto-Lakeshore):: Mr. Speaker, under the provisions of Standing Order 43 I ask consent of the House to move a motion which I hope will commend itself to the House. I move, seconded by the hon. member for Vancouver-Kingsway (Mrs. Maclnnis):
That this House instructs the Minister of Consumer and Corporate Affairs to appear at the March 20 meeting of the Food Prices Review Board dealing with bread prices increases to represent the interests of the Canadian consumer.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimity and the motion cannot be put.
March 14, 1974



ORAL QUESTION PERIOD


Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I should like to direct my question to the Minister of Transport. Having regard to the fact that prairie grain farmers have lost more than $300 million in wheat sales during the current crop year and that the Canadian Wheat Board has now fallen behind by 35 million bushels in committed sales for 1974 because the railways have failed to meet their transport commitment, and the fact that the government has obviously failed in its attempts to persuade the railways to face their obligations, may I ask the minister if the government is now considering action which would compel the railways to move western grain in sufficient quantities to meet export commitments?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, this is, of course, a subject which I discussed at length with the prairie ministers yesterday and the day before. As you know, we incited the railways to repair a certain number of cars but I do not think that is going to solve the problem. It is one solution, but I think we should have a more permanent one. I know there is another solution which is now before cabinet and I hope a decision will be taken very soon. I have a very close relationship with Canadian National Railways and I saw this morning that they have decided to build I do not know how many thousands new cars in order to discharge their responsibility. This does not mean that we are going to have the cars tomorrow. This is the problem.


An hon. Member:: No, it sure does not!


ALLEGED DELIBERATE SABOTAGING OF GRAIN MOVEMENT BY RAILWAYS TO FORCE CHANGE IN CROWSNEST FREIGHT RATES
Donald Frank Mazankowski: Mr. Speaker, I appreciate the fact that the minister agrees that his solution will not necessarily cure the problem.
May I ask the minister in charge of the Wheat Board whether, in light of the charge made by the President of the National Farmers' Union that the railway companies are deliberately sabotaging grain movement to force a change in the Crowsnest freight rates-I happen to agree the charge is true-he is consulting with his colleague, the Minister of Transport, in regard to this serious charge and are discussions taking place with a view to instituting an immediate inquiry into this very serious charge?


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, discussions are, of course, going on between myself and my colleague the Minister of Transport about this very important area. The charge is without any real foundation except in terms of the difficult performance over this past period and we are, of course, looking into that matter. The railways themselves set certain targets which they were unable to meet. The challenge to them now is the additional problem, for them to get back to their targets and to
Oral Questions
co-operate in additional steps to improve performance beyond the original targets in order to make up for the backlog. They know this is the challenge facing them. If they fall short in their efforts to bring about this result we certainly will be taking further steps.


POSSIBILITY OF USING TRUCKS TO MOVE GRAIN FROM INLAND TERMINALS TO PORTS
Donald Frank Mazankowski: Has the minister in charge of the Wheat Board considered the possibility of employing the trucking industry to move grain from inland terminal positions to the ports with a view to speeding up delivery, and is the government considering the possibility of payment of the charges in excess of the statutory freight rates?


Otto Emil Lang: Mr. Speaker, we have been looking at virtually every possibility. There are, in fact, a limited number of trucks available for the movement of grain in the large commercial quantities that would be required. A great number of these, almost to the fullest extent possible, are being employed in moving grain from country elevators to terminals so that it can be put into unit trains with quick turnaround. We are looking at other means including the possibility of encouraging farmers to haul grain longer distances in their own trucks and whether or not further compensation in that regard would encourage farmers to do so. The Wheat Board has been looking at that and is concerned that it does not have the power to do so or it might have done so already. We are looking at the question of whether we should step in.


EMBARGO AT PORT OF SAINT JOHN-ACTION TO ASSURE GRAIN MOVEMENT
Mr. Tom Bell (Saint John-Lancaster):: Mr. Speaker, I have a supplementary question for the Minister of Transport. In view of the very unusual embargo placed on the port of Saint John last night, would the minister check into the entire matter, particularly to see that grain continues to move, since the fire and the strike, the supposed reasons for the embargo, should not affect the movement of grain?


Jean Marchand: Mr. Speaker, this is something I am looking into. I have been looking at it this morning because the position in Saint John is a very serious one and I hope we are going to solve the problem very soon.


SUGGESTED REIMBURSEMENT OF WHEAT BOARD FOR DEMURRAGE CHARGES INCURRED BECAUSE OF SHIPS HAVING TO WAIT FOR GRAIN AT VANCOUVER
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, may I direct a question on the same subject to the minister in charge of the Wheat Board. In view of the shortage of grain in export positions which is causing a serious buildup of ships in Vancouver-22 are loading and waiting and 18 more will arrive in the next week or ten days-and in view of the fact that the delay of ocean vessels will result in demurrage charges being assessed, will the minister say

March 14, 1974
Oral Questions
whether the government is prepared to reimburse the Canadian Wheat Board for such demurrage charges incurred through no fault of the board or of the western grain producers?


Otto Emil Lang: Mr. Speaker, the question of when demurrage charges are payable depends on a number of circumstances. We do not ordinarily attempt to step in and offset a specific problem in this regard in this industry or any other, and it would be a serious question of principle for us to do so.


EMERGENCY ACTION BY RAILWAYS TO OVERCOME BACKLOG IN MOVEMENT OF GRAIN
Leslie Gordon Benjamin: Mr. Speaker, I have a supplementary question for the Minister of Transport further to that asked by the hon. member for Vegreville. In view of the fact that some $600 million in grain exports are in jeopardy and that the railways are 11,000 carloads behind at Vancouver and 7,000 behind at Thunder Bay, can the minister say whether the railways are now taking or have they informed him of any emergency priority action they will be taking in an effort to catch up on this backlog?


Jean Marchand: Mr. Speaker, a new idea proposed at the conference I attended yesterday was-it was suggested, I think, by the right hon. member for Prince Albert the other day-to have somebody who is going to supervise all this and see whether the best use is being made of the cars. I propose to suggest to cabinet that we implement as soon as possible some kind of monitoring system so that we are sure that all cars are used to the fullest extent at this moment.


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for Regina-Lake Centre for a further supplementary, after which the Chair will complete the first round of questioning by recognizing the hon. member for Champlain and then return for supplementaries to the right hon. member for Prince Albert and the hon. member for Assiniboia.


SHORTAGE OF BOXCARS TO MOVE GRAIN-SUGGESTED PLACING OF ENTIRE RAILWAY SYSTEM UNDER PUBLIC OWNERSHIP
Leslie Gordon Benjamin: Mr. Speaker, my question is for the Prime Minister. In view of the recurring situation in our transportation system, in view of the statement made by the Minister of Transport last Thursday in which he said that the principle of competition in the National Transportation Act is wrong in Canada and that the government does not have a real transportation policy, to use the minister's words, and in view of the present emergency situation, will the Prime Minister advise whether the government will now adopt and announce a policy of taking the entire national railway system in Canada under public ownership and control-


Some hon. Members:: Oh, oh!


Leslie Gordon Benjamin: -so that the principle of the provision of adequate railway services will be the first priority rather than competition and profit?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, this seems to be an interesting proposition. Perhaps the hon. member could give me details of his suggestion. Would it include, beyond the railways, the bus systems and other forms of local transportation or would it only apply to the railways? If the hon. member can work it out, perhaps he might want to write to me about it.


AGRICULTURE
Mr. Rene Matte (Champlain):: Mr. Speaker, I would like to put a question to the Minister of Agriculture.
Since Canadian breeders seem to reject a request by the federal government inviting them to increase their herds of cattle so as to prevent beef shortage and too high an increase in the price of this product, what other measure does the government intend to take to prevent such a ridiculous and stupid eventuality in a country like Canada which has such an enormous potential and cannot enable its citizens to get some good food at a reasonable cost?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, it is our intention to make sure that the people of Canada have food at reasonable prices and that producers get reasonable prices for their input. We are working on a program that I hope is long-term and also on one that will be short-term to make sure that these people do not have to sell their herds.


TRANSPORT
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, the Minister of Transport was kind enough a few moments ago to refer to a suggestion I had made. For several months I have endeavoured to get the government to bring in legislation to provide for a boxcar controller-I know the House would pass it very quickly-with power to direct the railway companies to make a proper allocation of cars not only for wheat but for all other commodities. Would the minister now do so? The situation is desperate on the prairies and all over the world we are losing contracts because of failure to live up to contractual agreements. I make this appeal to him because I know he wants to do something and he has the knowledge and the power to do it. Will he do it?
March 14, 1974


Jean Marchand: Mr. Speaker, I think I can say at this moment that I will discuss this very soon with my colleagues. I have just come back from the west and I think I can make a report next week. I should like to have the reaction of my colleagues to this concept, which I am inclined to support entirely.


SHORTAGE OF RAILWAY CARS TO MOVE GRAIN AND LUMBER-RETURN OF CANADIAN CARS FROM UNITED STATES-REPAIR OF ROLLING STOCK
William George Knight: Mr. Speaker, may I direct a supplementary question to the Minister of Transport. As there were some 15,500 Canadian railway boxcars on United States rail lines as of February 22 of this year and in view of the shortage of cars for the movement of grain and lumber, will the minister inform the House what action he has taken to get these boxcars back for the movement of Canadian products?


Jean Marchand: Mr. Speaker, I feel it is a little bit too simple to say that because there are a certain number of American boxcars in Canada.


An hon. Member:: How many?


Jean Marchand: I am not sure of the figures, and that is why I would be interested in having a monitoring system so that we can discuss not only suppositions but facts.


William George Knight: Mr. Speaker, I put it to the minister that there are half as many American cars in Canada as there are Canadian cars in the United States. As the government has put forward $3.43 million to repair some 2,400 boxcars and as on February 22 there were 7,400 box cars in need of further repair, will the minister inform us if the railways have taken on the obligation of repairing the other 5,000 cars?


Jean Marchand: Mr. Speaker, the problem is to know-and I am not in a position to say-if it is worth while repairing certain cars. I have heard that the CNR alone has just placed a $40 million order for cars and locomotives. Maybe it is preferable to buy brand new cars than to repair cars when it would be too expensive.


INQUIRY AS TO NEW NATIONAL POLICY-REFERENCE OF PROPOSALS TO COMMITTEE
Mr. Doug Neil (Moose Jaw):: Mr. Speaker, my question is for the Minister of Transport. The minister mentioned that he has just returned from the west where I understand he had meetings with the four western provinces regarding a transportation policy. May I ask the minister what the general mechanism of this new policy will be, and will these proposals be put forward as soon as possible and referred to the appropriate standing committee?


Jean Marchand: Mr. Speaker, I think I mentioned last week that, after a statement is made in the House, it would be only honest for my colleagues to produce a formal paper. Before going further
Oral Questions
I have to have the approval of cabinet, which I do not have at this time. I hope I will get it so that we may follow the procedure the hon. member has indicated.


SHORT-TERM ACTION TO ENSURE MOVEMENT OF GRAIN BY RAILWAYS
Mr. Jake Epp (Provencher):: Mr. Speaker, my question is for the Minister of Transport. As the minister in his statements today said that his proposals were long-term proposals, what short-term proposals is the minister able to put forward today in view of the fact that loaded grain cars are presently standing on sidings for as long as three weeks in the western prairies?


Jean Marchand: Mr. Speaker, I know this. I saw the brief prepared by Mr. Atkinson. I want to check into these alleged facts. I have some people working on this. Maybe they are correct and maybe they are not. Let us not jump to conclusions before the facts are properly in. We have all kinds of shortages with regard to cars in Canada. I met with the premier of British Columbia, Mr. Barrett, in order to solve the problem between the British Columbia Railway and Canadian National and I hope that today we will have the answer. I have no global answer for all these questions. However, I think we are going to solve the problem of rail cars in Canada very shortly.


Arthur Jacob (Jake) Epp: Mr. Speaker, I rise on a question of privilege. The minister questioned whether the statement I made was true. I should like to inform the minister that it is a fact that rail cars have been standing that long on sidings in western Canada.


Mr. Speaker:: Order, please. The hon. member for Egmont.


CONTINUITY OF CNR FERRY SERVICE TO PRINCE EDWARD ISLAND IN THE EVENT OF FUTURE LABOUR DISPUTES
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is for the Minister of Transport. I hope he will find it easy to answer because it is straightforward. It is with respect to the disruptive tie-up of the CNR ferry service to Prince Edward Island last summer during the rail strike. Can the minister report whether arrangements have now been completed with the government of Prince Edward Island guaranteeing continuity of ferry service by the CNR in light of the possibility of any future labour dispute?


Jean Marchand: Mr. Speaker, I took this matter up with the premier of Prince Edward Island. I also asked for the co-operation of the Minister of Labour because there is the problem, too, of the unions involved. They have acquired rights. We want to know, if we change the system, what is going to happen to these men and if they are ready to co-operate with us in order to be sure that there will be no stoppage in future. All this is in the process of being done. I do not think anybody in the House would like to see the government, or the House, take a decision before the workers are sure their rights will be protected.

March 14, 1974
Oral Questions


David Samuel Horne MacDonald: As it is now six or seven months since proposals were begun to be put together, can the minister indicate whether there are firm proposals before the union, Canadian National Railways and the two governments involved in order that there can be some effective resolution of this problem before we are faced with another disruptive strike?


Jean Marchand: Mr. Speaker, so far as the union is concerned, I asked my colleague, the Minister of Labour, to see if it is possible to meet with the union and at what level. He is working on this now. He may know the exact situation better than I do.


David Samuel Horne MacDonald: Mr. Speaker, I wonder whether the Minister of Labour is prepared to indicate if such meetings are in progress and whether there are firm proposals between the unions and other participants?


Hon. John C. Munro (Minister of Labour):: Yes, Mr. Speaker, officials of my department have been meeting with officials of the appropriate unions in an endeavour to work out some acceptable arrangement to make sure that there will not be a work stoppage in future. That is all I can say at the moment. I believe the talks are still going on.


REASON ADVANCED BY RAILWAYS IN SEEKING FINANCIAL ASSISTANCE TO REPAIR BOXCARS
Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, my question is for the Minister of Transport and is with respect to the boxcars for the repairing of which the government granted the railways some $3 million. Did the railways give as the reason for asking for that help that the cars were not worth repairing, or did they ask for a subsidy to the extent of over $3 million in connection with maintaining the service?


Jean Marchand: Mr. Speaker, I think I said in very plain words last week, rightly or wrongly, that there is no doubt that the railways are not interested in moving grain. They move grain because they are compelled by law to do so.


John George Diefenbaker: That's true.


Jean Marchand: So they do not make the effort they probably make in regard to other products where they make money. That is why we have to make this contribution. I think that is the truth.


REASON IMPERIAL OIL ALLOWED TO DRILL FOR OIL AND GAS IN BEAUFORT SEA BEFORE COMPLETION OF ENVIRONMENTAL STUDIES
Walter (Wally) Firth: Mr. Speaker, I have a question for the Minister of Indian Affairs and Northern Development related to the recent announcement that Imperial Oil has found oil and gas in the

Beaufort Sea. In view of the minister's oft-stated concern for the people of the north and desire to protect their environment, and in view of the cabinet's decision to allow drilling in the Beaufort Sea only after completion of the necessary environmental studies, will the minister explain why Imperial Oil was allowed to drill in the Beaufort Sea before the environmental studies had been completed?


Hon. Jean Chretien (Minister of Indian Affairs and Northern Development):: Mr. Speaker, my English may not be very good, but my statement the other day applied to drilling offshore. This last drilling was done from an island, so it is not offshore drilling.


Walter (Wally) Firth: An artificial island.


Joseph Jacques Jean Chrétien: It is not offshore, as far I know. It was an island. As to the second part of the question, before a permit was given to the company to drill at this site, there was consultation with the Eskimos of Tuktoyaktuk the hunters' association, and so on. They have approved the granting of the permit and I am sure the people of the north are very happy that once more we have been proven right and there are great resources in the north.


Some hon. Members:: Hear, hear!


Walter (Wally) Firth: Mr. Speaker, may I point out that it was a man-made island, an artificial island.


Joseph Jacques Jean Chrétien: It was an island.


Walter (Wally) Firth: Can the minister tell us whether the type of drilling being carried out on this man-made island has been approved by the Department of the Environment and by environmentalists like Dr. Pimlott?


Joseph Jacques Jean Chrétien: There was interdepartmental consultation among all the departments involved. Dr. Pimlott was not consulted because he is not working for the government-he is a self-appointed expert. As far as I am concerned we have the approval of the Department of the Environment, we have the approval of the territorial government, we have the approval of the people of Tuktoyaktuk, and I am sure the people of Canada are happy we are finding a lot of oil there.


Some hon. Members:: Hear, hear!


Mr. Erik Nielsen (Yukon):: I have a supplementary question intended to clarify government policy, whether or not it is in keeping with the minister's statement that he will not allow drilling until after a two-year study has been completed in offshore areas of the Beaufort Sea. Is it government policy to continue to permit the creation of artificial islands made by dumping gravel into the Beaufort sea for the purpose of drilling activities or will such activities as these cease, in order to permit the completion of the two-year study of which the minister has spoken?


Joseph Jacques Jean Chrétien: I make a distinction between offshore drilling from a platform or from a ship and drilling from man-made islands which are a very safe device approved by all the experts. If companies come forward with other plans which are as safe as this one, wherein we have been proven right-they have found oil and no disasters have
March 14, 1974

occurred-we will grant a permit as long as the plans are all right. But as far as drilling from ships or platforms is concerned we shall not grant any drilling permits before 1976.


Erik Nielsen: Thank you.


Miss Flora MacDonald (Kingston and the Islands):: Would the minister be willing to table the environmental studies which he says prove that these artificial islands are so safe?


Joseph Jacques Jean Chrétien: I will inquire whether there are specific documents on that aspect. I am saying there was interdepartmental consultation and that there was approval by everyone. I would rather have the confidence of the people of Tuktoyaktuk than of the hon. member for Kingston and the Islands.


TRANSPORT
Mr. Roland Godin (Portneuf):: Mr. Speaker, I should like to put a supplementary question to the Minister of Transport.
Since there is a shortage of cars and also locomotives apparently, could the minister say whether he considers using his influence with the Treasury Board so that an amount of money be lent to the CN at an interest rate not exceeding administrative costs in order that this company may take delivery of the order which had been destined to Cuba?


Mr. Speaker:: The hon. member might perhaps repeat his question. I have the feeling that the minister did not hear it.


Roland Godin: Mr. Speaker, 1 will repeat it word for word. Since there is a shortage of cars and also locomotives apparently, could the minister say whether he considers using his influence with the Treasury Board so that an amount of money be lent to the CN at an interest rate not exceeding administrative costs in order that this company may take delivery of the order which had been destined to Cuba?


Jean Marchand: Mr. Speaker, I referred a while ago to a CN ruling. In my opinion, the first responsibility regarding the construction of railway locomotives and cars falls on the railway companies, not on the government. Then I reported that the CN had decided to spend $42 million. We shall let them spend it and if afterwards there are other problems, we shall see.
Oral Questions


GOVERNMENT ADMINISTRATION
Mr. J. Robert Howie (York-Sunbury):: Mr. Speaker, my question is for the President of the Treasury Board. Will the President of the Treasury Board consider arranging for a royal commission of inquiry into the large and growing cost of government administration and the effect that such expenditures have in feeding inflation?


Hon. C. M. Drury (President of the Treasury Board):: think the House is well aware that some years ago there was an inquiry by a royal commission into government organization. I would be prepared to consider whether such an initiative should be repeated, either now or in the future.


PENITENTIARIES
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to address a question to the Solicitor General. I put a question to him last week in reference to a man by the name of Booth. My question today refers to a man by the name of Kully who was allowed out on temporary passes. During the period of his incarceration, having been convicted of raping and killing a five-year-old girl in 1966, he had received no psychiatric treatment. While he was out of the institution he committed a second murder for which a judge has now sentenced him to 20 years imprisonment, saying that no parole or temporary pass can be given. Can the Solicitor General tell us whether this policy is to be accepted by the government and by the Parole Board?


Hon. Warren Allmand (Solicitor General):: Last year, when Mr. Kully was away from the institution and committed the offence for which he has now been found guilty, he was not on unescorted temporary absence; he was with an escort.


Some hon. Members:: Oh, oh!


William Warren Allmand: He escaped from the escort. I might add that he has not been sentenced to 20 years. He has been given a life sentence but in accordance with the new law we passed in December the judge has stipulated he will not be eligible for parole for at least 20 years.


Eldon Mattison Woolliams: Thank you very much. I should like to put one more question. Since it is very difficult to obtain information about cases like this-there are several similar cases I could list though I will not take the time in which to do so this afternoon-will the minister tell us whether he now agrees with what the Prime Minister said last session and call for a judicial inquiry into the whole mess which has arisen in connection with these convicted

March 14, 1974
Oral Questions
people, particularly since there seem to be abuses which are destroying the parole system?


William Warren Allmand: Mr. Speaker, I do not think that is correct. I have always given full information on any case I was asked about, and I will be pleased to continue to give full information. Furthermore, the parole and temporary absence system is not a complete mess. There has been a very low rate of failures, approximately 2 per cent, and we are trying to improve that still further so there will be no failures, if that is at all possible.


Eldon Mattison Woolliams: A further supplementary question.


Mr. Speaker:: Order. May I seek the co-operation of hon. members at this point. I see at least 25 members seeking to ask questions or supplementaries and there are only eight or nine minutes left, so I hope there will be not too many supplementaries. When 25 to 30 members are rising with only eight minutes before the end of the question period, I am sure the House will realize that some will have to be left aside. The Chair will recognize the hon. member for Calgary North on a supplementary.


Eldon Mattison Woolliams: Mr. Speaker, I will make my supplementary brief. Will the minister tell the House and the country how many people who have been convicted of crime and murder are at the present time on temporary absence or out on parole and have not come back or have not been found by the RCMP? How many are there? Give us the information.


William Warren Allmand: Mr. Speaker, it is rather difficult to understand the hon. member's question. I do not know whether he is asking about murderers or about persons convicted of all offences. If he is asking about persons convicted of all offences and he wants to know how many have been let out on parole or on temporary absence and have not returned, then I will have to get the figures for him and am quite willing to do so.


COMBINES
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. In view of the fact that Canada Cement Lafarge has been involved now in three separate incidents and charges under the Combines Investigation Act arising in different periods of time, and in view of the fact the minister was asked in June, 1973, by the hon. member for Selkirk to inquire into the activities of three cement companies, Canada Cement Lafarge being one of them, in fixing prices at $28.72 per ton of cement, would the minister advise the House why no charges were laid in that particular case?


Hon. Herb Gray (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I am pleased that the hon. member

has confirmed that as a result of the work of the combines branch action has been taken in these areas. Under the act the director of the combines branch is obliged by law to undertake an inquiry whenever he has reason to believe that an offence may have been committed. He is aware of the situation and I am sure he is carrying out his responsibilities. But under the express provisions of the act it is impossible to comment on whether or not an inquiry is being carried on until the matter is completed either by a statement of the director or the taking of legal action.


Stuart Malcolm Leggatt: Mr. Speaker, I have a supplementary question for the minister. In view of the recent conviction in Vancouver of the seven major cement suppliers, Canada Cement Lafarge being one of them, and in view of the fact that those charges only cover a period to December 31, 1971, would the minister now advise the House whether an inquiry is in fact going on into that particular incident to determine whether the price of cement in the province of British Columbia is now being fixed, as it was prior to December, 1971?


Herbert Eser (Herb) Gray: Mr. Speaker, it is my understanding that the act itself creates a policy that is followed not only by myself but was followed by previous ministers in this portfolio, not to confirm or deny the existence of an inquiry until the matter has been determined by the statement of the director or by action in court. However, I would be happy to see what further information I can properly provide.


Mr. Speaker:: The Chair will recognize the hon. member for Burnaby-Richmond-Delta on a supplementary question and then the hon. member for Trinity.


Mr. John Reynolds (Burnaby-Richmond-Delta):: Mr. Speaker, my question is directed to the same minister. In view of the fact that Lafarge and Ocean Cement of British Columbia have made two price increases since January of this year, both of which were released on the same date and both of which were in the same amount, would the minister consider holding a public inquiry into the cement industry in British Columbia in view of the connection of former Liberals with one of the companies that is presently fixing prices?


Herbert Eser (Herb) Gray: Mr. Speaker, the provisions of the Combines Investigation Act are that any inquiry that is carried on must be on a confidential basis. I would be happy to consider this matter with my colleague the Minister of Justice.


BAUXITE-MEETING WITH PRIME MINISTER OF JAMAICA- EFFECT ON CANADA OF POSSIBLE PRICE INCREASE
Hon. Paul Hellyer (Trinity):: Mr. Speaker, my question is for the Prime Minister. Can the Prime Minister state in general terms the outcome of his meeting yesterday with Prime Minister Manley of Jamaica regarding increased prices of bauxite from that country?
March 14, 1974


Pierre Elliott Trudeau: Mr. Speaker, the meeting was the day before yesterday. I had an evening meeting with the Prime Minister and he explained to me that he was meeting later this week with the presidents of the various aluminum companies operating in Jamaica. He put to me various types of proposals which he would be putting to them. I would not want to betray his confidence, but I am sure they will become publicly known as soon as he puts them to the companies.


Paul Theodore Hellyer: Would the Prime Minister or perhaps the Minister of Consumer and Corporate Affairs say whether the government has undertaken any studies to determine the effect both on Canadian prices and on Canadian export markets of the various proposals being put forward by the Jamaican government?


Pierre Elliott Trudeau: Not to my knowledge, Mr. Speaker. The hon. member realizes that the developments are just a few days old. The meeting in Conakry was a few days ago. There was an earlier meeting when the bauxite producing countries got together, but they are still at the initial stages and I think it would be impossible to calculate the effects of what they are going to do until they say what they are going to do and agree among themselves.


THE CANADIAN ECONOMY
Mr. Ron Atkey (St. Paul's):: Mr. Speaker, my question is directed to the Prime Minister and relates to the response of the Prime Minister yesterday during the question period to an inquiry about legislation dealing with inflation. In view of his claim that the amendments to the Combines Investigation Act now before the House represent the initial thrust of the government's anti-inflation program announced in the throne speech, could the Prime Minister point out what sections of that bill have anything at all to do with the current cost of living increases facing Canadians?


Pierre Elliott Trudeau: Mr. Speaker, I did not, I believe, use the words "initial thrust". I said that this was part of the total thrust of the government. I would be very happy as the debate progresses to underline the parts of Hansard that the hon. member should read, and if he cannot understand them I will have someone explain them to him.


Mr. Speaker:: Order. The Chair will recognize the hon. member for a supplementary and then the hon. member for Annapolis Valley.


Ronald George Atkey: If the Prime Minister had remained in the House to listen to my speech yesterday instead of rushing out after the abysmal effort of his minister-


Mr. Speaker:: Order, please. May we have order, please. I hope we are not going to import into the question period the debate that is to take place later. It seems to me that
Oral Questions
would be quite out of order, but the hon. member may ask a supplementary.


Ronald George Atkey: May I simply ask, Mr. Speaker, what aspects of that bill are going to help keep down prices within the immediate future? I also wonder whether the Prime Minister is taking into account the rather large increases in public expenditure which will result when the bill sets up the new bureaucracy in the Restrictive Trade Practices Commission.


Mr. Speaker:: Order, please. The hon. member for Annapolis Valley.


Mr. Nowlan:: Mr. Speaker, I think the Prime Minister is rising to answer that very interesting question.


Mr. Speaker:: I indicated a moment ago that the question was not in order and that is why I will not allow the right hon. gentleman to reply to it. The hon. member for Annapolis Valley.


GOVERNMENT ADMINISTRATION
John Patrick (Pat) Nowlan: Mr. Speaker, I will put a question that is, I hope, in order to the Prime Minister in a spirit of conciliation. I wonder whether the Prime Minister would tell the House, in view of the conflict of interest guidelines that he tabled in the House some time ago, whether he can reconcile those guidelines with the employment of Intertask, which not only makes press arrangements for the government but one of the principal officers of the company reports on affairs of the government? Can the Prime Minister reconcile the tabling of the conflict of interest guidelines with employment by the government of Intertask?


Pierre Elliott Trudeau: Mr. Speaker, I see no conflict of interest between the government and the people in Intertask. If the hon. member would ask a supplementary perhaps by way of additional explanation, I will attempt to answer him.


John Patrick (Pat) Nowlan: Mr. Speaker, I have a short supplementary question which is not quite what the Prime Minister suggested. In view of the employment of Intertask at the federal-provincial conference last year, is Intertask going to be substituted for Information Canada or will Information Canada have any purpose left in the plans of the government?


Pierre Elliott Trudeau: Mr. Speaker, I do not think the functions are the same but, even if they were, I do not see the conflict of interest that seems to be on the hon. member's mind. Would he explain that?
510

March 14, 1974
Oral Questions TRANSPORT


REPORT ON PUBLIC TRANSPORTATION IN SOUTHWESTERN ONTARIO-AVAILABILITY FOR DISTRIBUTION TO MUNICIPALITIES
Mr. Perrin Beatty (Wellington-Grey-Dufferin-Water-loo):: Mr. Speaker, my question is for the Minister of Transport, and I apologize to him if it was asked in my absence. In light of the minister's commitment that the CTC report on public transportation in southwestern Ontario will be discussed at the next Ontario tri-level conference, has the minister seen fit to make copies of the report available to the municipal councils of the area and provincial members of the legislature so that they will be in a position to make a coherent response to that report?


Jean Marchand: Mr. Speaker, as the hon. gentleman knows, the first two volumes of that report were tabled in the House last week, so it is available. The third volume has not yet been tabled becaused I asked the CTC to do some more work on it. I expect this third volume shortly, perhaps in a couple of weeks.


Henry Perrin Beatty: Mr. Speaker, perhaps the minister did not hear my question properly. My question was whether or not the minister had made the report available to municipal councils involved. In light of the fact that his office has refused to allow it to be distributed, or to supply sufficient copies for distribution to municipal councils in my area, is the minister willing to see that the supply is sufficient so that officials interested can get copies or that copies can be supplied to them?


Jean Marchand: Mr. Speaker, maybe I am wrong and I will have to check that, but I understood that once it is tabled in the House it becomes a public document and it would be normal to send the document-


An hon. Member:: That hasn't been done.


Jean Marchand: If it has not been done it is going to be done immediately.


GOVERNMENT ADMINISTRATION
Erik Nielsen: Mr. Speaker, my question is supplementary to the question of the hon. member for Annapolis Valley, and I direct it to the Minister of Indian Affairs and Northern Development. It has to do with the guidelines in respect of conflict of interest tabled by the Prime Minister. Since his newly appointed special assistant, Mr. Paul White, was elected to and accepted a directorship in the Yukon Liberal Association last month, is it to be the policy of the government to permit executive and staff assistants to accept active participation at the official

level in the office structure of the Liberal party across the country?


Joseph Jacques Jean Chrétien: Mr. Speaker, I do not know if there is a conflict of interest but I will check.


An hon. Member:: You wouldn't know.


Joseph Jacques Jean Chrétien: He is a well-known Liberal and he is proud of it, just like I am.


Some hon. Members:: Hear, hear!


An hon. Member:: Explain.


Joseph Jacques Jean Chrétien: If you are bothered about it I will ask him to resign as a director of the Liberal Association, but I will keep him on my staff because he is a good person from the Yukon and he is doing a damn good job.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for Yukon on a supplementary question and then the hon. member for Winnipeg North Centre and the Lender of the Opposition, after which I will call orders of the day.


Erik Nielsen: Mr. Speaker, I certainly do not quarrel with the appointment. That is the last thing I would want to do, and the minister knows that. What I am trying to do is establish government policy. If it is going to be government policy to permit executive and staff assistants to hold such official positions within the Liberal organization, will the government be extending that policy to include other civil servants or quasi civil servants?


Joseph Jacques Jean Chrétien: Mr. Speaker, I have not discussed that with Mr. Paul White, but I will do so. He was a director of the Liberal Association before we appointed him and he was re-elected. He is a well-known respected citizen of the Yukon. Anyway, he would be very willing to withdraw from the Liberal Association if necessary-


An hon. Member:: I don't blame him.


Some hon. Members:: Hear, hear!


An hon. Member:: You can't blame him for that; more power to him.


PUBLIC BUILDINGS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, my question is directed to the Minister of Public Works. In view of the fact that about ten o'clock last night a section of the Winnipeg general post office, a concrete portion measuring about 30 feet by 60 feet, fell to the street-


An hon. Member:: Was it the coat of arms?
March 14, 1974


Stanley Howard Knowles: -will the minister arrange for an immediate investigation into this accident and take steps that will assure the people of Winnipeg that there will not be a repetition?


Hon. Jean-Eudes Dube (Minister of Public Works):: Mr. Speaker, my information is that a portion of the overhanging roof above the public entrance to the post office in Winnipeg fell during the night. Fortunately, no one was injured. Our consultants are at the present time searching for the cause of the accident, and hopefully will find a solution.


FINANCE
Robert Lorne Stanfield: Mr. Speaker, I should like to direct a question to the Minister of Finance in respect of policy regarding the Canadian dollar, particularly in respect of the clean float policy of the government in the past. I should like to ask whether this float is still what you might say cleaner than clean, or does the expenditure of some $300 million odd in recent months in respect of foreign exchange operations indicate that there has been some change in policy and that the float has become a little dirty?


Hon. John N. Turner (Minister of Finance):: No, Mr. Speaker, there has been no change in policy. The Bank of Canada intervenes on behalf of the exchange fund only to maintain an orderly market. Sometimes that involves purchase and sometimes sale. If the hon. gentleman will look to the year 1973 he will see that the bank intervened on the other side.


Mr. Speaker:: Order, please. I note that several hon. members are seeking to ask either supplementary questions on this subject or additional questions. We have already gone five minutes beyond the question period. I will try to give priority tomorrow to those who have tried to ask questions today, including the hon. member for Hamilton Mountain, the hon. member for Gaspe and others.


PARLIAMENT HILL
Mr. Duncan M. Beattie (Hamilton Mountain):: Mr. Speaker, I hesitate to rise on a question of privilege, but I wonder whether you would allow me to ask my question as it is of some importance and relates to an event that is to take place on Parliament Hill tomorrow. Apparently a wedding is scheduled to take place at 2.30 on Friday in front of the centennial flame on Parliament Hill to draw attention to religious discrimination in Canada. The marriage will be performed by a minister of the Church of Scientology. My question is directed to the Minister of
Oral Questions
Public Works. Will he inform the House whether permission was granted to allow this mock wedding in violation of our marriage laws which require that only licenced clergy or officials should perform such a ceremony?


Jean-Eudes Dubé: Mr. Speaker, I was not invited to the wedding, but I will inquire.


Some hon. Members:: Oh, oh!


BUSINESS OF THE HOUSE
Thomas Miller Bell: Mr. Speaker, my question has a marriage connection. How are the two co-house leaders of the House coming along with plans for business for the next few days?


Allan Joseph MacEachen: Mr. Speaker, today we will continue-


Mr. Wagner:: "We"!


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: We will continue with the competition bill, and tomorrow, as my hon. friend knows, is an opposition day. Monday I hope to deal with the bill in the name of the Minister of Indian Affairs and Northern Development (Mr. Chretien), Bill C-9. On Tuesday, Thursday and Friday of next week we will call opposition days, as well as on Monday and Tuesday of the following week. In order to satisfy the requirement under the rules we must call those opposition days. If my hon. friend will tell us the business he wants to call on those five days we would be grateful for his co-operation.


Erik Nielsen: Mr. Speaker, I, too, have a question in respect of the business of the House. I did not hear the President of the Privy Council (Mr. MacEachen) say that Bill C-12 would be called on Monday along with the bill in the name of the Minister of Indian Affairs and Northern Development (Mr. Chretien). Is that not the case, to have the two bills on the one day?


Allan Joseph MacEachen: Mr. Speaker, I would be happy to add that. That is the amendment to the British North America Act.


Erik Nielsen: Yes.


Eugene Whelan: I rise on a point of privilege, Mr. Speaker. It has just been brought to my attention that it is reported in the Ottawa Citizen that I said we need a 40 cents per pound increase in the price of beef. I said no such thing. We do not need this kind of increase in beef prices to make the industry a healthy one.
27398-33i

March 14, 1974
Competition Bill



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, March 13, consideration of the motion of Mr. Gray that Bill C-7, to amend the Combines Investigation Act and the Bank Act and to repeal an act to amend an act to amend the Combines Investigation Act and the Criminal Code, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Paul Theodore Hellyer: Mr. Speaker, if this bill had been introduced 30 or 40 years ago it would have been considered quite radical. Today, as a reminder of just how far out of date in its thinking the government actually is, it represents, in so far as it is intended to be economic reform, a myopic and dated approach. As the hon. member for St. Paul's (Mr. Atkey) indicated, we approach it with mixed feelings. Of course, there are some provisions that are welcome. Some of the provisions to strengthen consumer protection and to prohibit bait, switch and pyramid selling are steps in the right direction.
The small businessmen of Canada are delighted to see the wings of their giant suppliers gently clipped. Heaven knows the small businessmen have suffered much, both in the hands of the government and the giant enterprises. Any relief for them can be greeted with enthusiasm and appreciation. We also applaud the move to require, by law firms operating in Canada to operate in the interests of this country and not under the yoke of extra-territorial restraint. But, and this is the nub of the argument, the suggestion that this bill will guarantee for Canadian consumers the benefits of genuine price, quality and service competition is a cruel hoax. It is misleading in the most blatant sense, and if uttered in the private sector after passage of this bill would be an indictable offence.
This is exactly what the Minister of Consumer and Corporate Affairs (Mr. Gray) suggests. Yesterday in his opening remarks at page 480 of Hansard he said:
This bill reflects the view that all Canadians can benefit from having a marketplace subject to the stimulus and the pressures of the forces of competition.
Well, the minister will be lucky if he does not wind up in jail for making a suggestion like that. The government's position is based on the view of many orthodox economists that a more aggressive competition policy, coupled with a responsible combination of monetary and fiscal policies-a restraint, incidentally which the government has rejected in its unrestrained expenditures-will, in itself, be the best solution to the double disaster of high unemployment and high inflation. This approach, in my opinion, is very naive and neglects to take into account the structural changes in the real world of economics. The theory of genuine competition in the marketplace is well known, but is it feasible? It implies the dismantling of some of the greatest trade unions that have developed in the history of the world. It implies a rejection of the whole theory basically of trade unionism. It implies that there is genuine price competition in big industry and that somehow

the great monopolies and oligopolies of our economic system can be broken up in such a fashion that genuine market competition in so far as price, service and quality is concerned would take place.
Is the prospect of either one or both of these developments realistic in the present context? I do not think so. I do not even think, under the circumstances and taking into account the real benefits available for the Canadian people, that either would be desirable. Could Canada support enough steel companies, for example, to have real, basic cut-throat price competition? How many would be required-10 or 15? Could Canada support 10 or 15 steel companies or is something in the order 3, 4 or 5 the limit of an economy our size. Could we support unrestrained competition among air carriers? Would we really want to? Would we want to subject them to the kind of cut-throat competition which might under some circumstances cause them to perhaps not maintain the standards of service and safety the Canadian people would expect of air carriers? Could Ottawa support sufficient numbers of ready-mix concrete suppliers, for example, to ensure genuine price competition. There is inevitably a trade-off between competition and the economies of scale.
With some notable exceptions, such as hockey, the Canadian economy has been moving in the direction of smaller numbers of larger units. The question is, does this bill do anything to change the situation in a fundamental way? The answer I think is an unequivocal no. Except for the employment of some additional dozens or hundreds of bureaucrats, and the additional work they will generate for the legal and accounting professions in the private sector, the effect on unemployment and inflation will be negligible.
First of all, and probably most significant in economic terms, labour is not included. In fact it is specifically exempted. This thinking goes back to the days of Mackenzie King when he was Minister of Labour. In those days, as hon. gentlemen know and recall, the situation was different. At that time the economy was operated in such a way that from time to time there was a surplus of labour and there was not an opportunity for meaningful work for people who wanted to be members of the working force. The working man was downtrodden relative to the rest of society. He was opposed by the establishment, the judges and the politicians. Basically everyone was against him. So, under the circumstances at that time it was logical-as a matter of fact in my opinion it was just and inevitable- that trade unions would be exempt from the provisions of the laws in so far as they relate to combines and restrictive practices.
But, that was decades ago. The situation has changed enormously since that time. The world in which we live is not the same world as that of the late Right Hon. Mackenzie King. It is not the same world as the world of the early 1900's, the depression days, and the early post-war days. The situation has changed dramatically, in many respects for the better. Today our mastery of demand management and employment techniques has made it possible for us almost-I underline the word "almost"-to provide meaningful employment for those who want to work at any one time.
March 14, 1974

Today more than half Canada's gross national product is taken up in wages and salaries. It is true that not all labour is unionized, but we have developed big, powerful unions in the course of the last few decades. This was a natural evolution from the conditions in which we found ourselves in the 1920's and the 1930's. Nothing else could have happened based on that historical set of circumstances. So today you have giants of the labour field as well as giants on the industrial side. The big unions have the power to achieve in the marketplace industrial settlements, often based on the productivity of their particular union, and these set the base, these provide what is now known as wage leadership. The most powerful unions, operating usually with the most powerful companies, can and do effect settlements which are two or three times the average increase in productivity per person.
Now I am speaking of what is happening at the moment. These settlements set the pace for the rest of our economy. Everyone wants to keep up, everyone tries to keep up, everyone thinks they are entitled to a similar share when wage negotiations take place. Not only do all members of the labour force, including those who are non unionized, want the same kind of wage increases but in fact in order to maintain their comparable position they must obtain them. If they do not obtain comparable wage increases, then their relative position will deteriorate proportionately. The impact on prices is enormous. It is axiomatic that wages rising two or three times faster than productivity must be reflected in prices. Although it is futile to get into the argument as to whether rising wages cause rising prices or rising prices cause rising wages, it really does not matter. It is a chicken and egg proposition and you can argue about which comes first for decades. The important point to remember is that the two must be taken in context, that they are related, that you have to cope with both at the same time rather than trying to ascribe responsibility or blame to one or the other. The relationship between wages and prices cannot be ignored.
I should like to cite very briefly something of the British experience. In an excellent book, that I recommend to any hon. member who is interested in the subject of inflation and possible methods of bringing it under control, called "The New Inflation" by the Right Hon. Aubrey Jones, a book well worth reading, Mr. Jones has some very interesting statistical information which is worth looking at. First of all, he shows what has happened in so far as labour's share of the national income is concerned and he shows that, going back as far as 1855, for example, labour's share was about 53 per cent of the national income in Great Britain. This fell in 1870 to about 45 per cent. But in the succeeding years it has increased until it is now more than 70 per cent of the total. Labour's share of the national income has been rising. At the same time, labour unit costs have been rising, and this inevitably has played an important part in the establishment of prices. There is an index in the book which I cannot find at the moment. Perhaps my colleague could look it up and I will return to it.
The important part of the graph is that, first of all, the unit cost of labour has increased dramatically over an extended period. But from our standpoint perhaps the lesson to be drawn is that the two graphs of labour unit
Competition Bill
costs and the consumer price index virtually parallel each other throughout the entire period. They are almost identical. One lies almost on the other. I tried to find comparable figures for Canada but was unable to lay my hands on them this morning. However, it is interesting to note the relationship between wages and prices in this country. In my book, "Agenda", I propose a formula. All other things being equal, which of course they never are exactly, I suggest that P equals W minus Q. This means that the rate of change in our consumer price index is equal to the rate of change in wages in money terms, minus the rate of change in productivity in real terms.
It might interest you to know that in the ten year period from 1963 to 1972 the average annual percentage increase in wages and earnings in Canada was 6.5 per cent, the average annual percentage increase in productivity was 3 per cent, the average annual increase in consumer prices for the ten year period was 3.5 per cent. The increase in consumer prices was exactly the difference between the wage increases in dollar terms and real productivity throughout on an average throughout the ten year period.
My colleague the Conservative House leader has now found the chart to which I referred earlier, Mr. Speaker. It is an index beginning at 100 in 1948 to 1970. It has gone from 100 to about 270 in so far as labour unit costs are concerned. In the same period of time, the price index has gone from 100 to about 250, almost parallel to the increase in unit costs.
The Prime Minister (Mr. Trudeau) told the House of Commons the other day, as recorded at page 33 of Hansard, the following:
I find it appropriate at this time to destroy the myth that the cost of labour has been a dominant factor in contributing to the present inflationary round in Canada. That is not true.
To put it bluntly, the Prime Minister in this case is full of hops. To make that kind of statement in spite of the professional expertise available to him is outrageous. If he is not careful, he will wind up in jail with the Minister of Consumer and Corporate Affairs (Mr. Gray).
I do not want to give the impression that labour is primarily responsible for inflation. I think that government expenditures and high taxes have put a tremendous pressure on the working man. But there is a relationship, mathematically, between wages and prices, and this must be taken into account in any discussion of inflation, along with taxes and profits.
If the bill does nothing to control the influence of big monopolistic labour, the question arises as to whether or not it will be more effective in controlling industry. Certainly, on the basis of past experience there is little hope. I should like to quote, if I may, two paragraphs, again from my book, as follows:
The Canadian approach to these questions was suggested by Mr. King in presenting the bill. Like his colleague to the south, Mr. Roosevelt, he indulged in no sweeping condemnation of trusts but differentiated between the good ones and the bad ones. And the formula for enforcement was publicity and conciliation resting on the conviction that "light is the sovereign antiseptic and the best of all policemen".
Does that not sound strangely reminiscent of the present Minister of Consumer and Corporate Affairs and

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Competition Bill
his hopes for Mrs. Plumptre and her rather ineffectual enforcement group?
Notwithstanding this faith in light, subsequent legislation has opted for a bit more flesh, though only a bit more. In addition to attempting clarification of what a combine was, the revised Combines Investigation Act of 1923, which is the basis of present law, provided for permanent officers and staff and gave independent powers of initiative to that staff. Despite these powers, from 1923 to 1959 there were only sixty-five reports issued and twenty-three convictions. One non-admirer of the law has observed with perhaps more than a trace of bias:
"Either Canadian business has been very good or our administration
has been very loose. In either case, business seems to have little to
worry about whether or not the law be strictly construed."
This new law provides little substantive change. Oligopolies don't need to have agreements in restraint of trade. They don't need to engage in identical bidding. All they have to do is follow the well established practice of price leadership.
For the benefit of those who may not understand from personal experience how oligopolies work let me give two examples. One I often cite is of, say, five companies in the city of Toronto. Their representatives get together for lunch. The representative of the largest manufacturer will say, "The cost of transportation has gone up; the cost of labour has gone up; the cost of energy has gone up, and on April 1 I am going to put up the price of bricks $5 a thousand." Then, perhaps they talk about how last week's warm spell has affected the buds on the fruit trees in the Niagara peninsula, and about whether or not John Bassett has met his match in the Minister of National Health and Welfare (Mr. Lalonde). They then go home, Mr. Speaker, and there is no contract, no agreement-not even a handshake. This is the way oligopolies operate, for the most part through understanding.
When I visited Australia a couple of years ago I was entertained to lunch by our trade commissioner there. He took me to a very interesting club known as the Bamblers' Club. He said, "Do you see the table on my right? The 14 people there are the Viniers of Australia. By the time they finish lunch they will have divided up both the domestic and foreign markets for the next quarter." Nobody was taking notes, Mr. Speaker. Nothing was obvious whatsoever. There was just that kind of mystique, that almost mysterious understanding that people who operate in an oligopolistic situation have with each other.
Not long ago when an increase in the price of gasoline was proposed in the city of Toronto a spokesman for one of the companies said, "We will have to wait until we see what Imperial Oil does." The proposition was that Imperial Oil was the leader. It was the biggest and most powerful company. Consequently if it figured its cost situation demanded a certain increase in prices then the others would more or less automatically follow along, without any agreement, without any understanding, without any contract, and without sanctions, having in mind the way oligopolistic industry has developed not only in our country but in other countries as well. Inevitably when a small number of companies occupy a major share of the market, imperfect price competition will prevail.
Added to the fact that this bill excludes labour, and will be largely ineffective for business, is the list of additional

specific exemptions. The doctors won't be included if they are subject to provincial law. The dentists won't be included if they are subject to provincial law. The lawyers won't be included if they are subject to provincial law. The real estate brokers won't be included if they are subject to provincial law. The banks can be excluded on authorization of the Minister of Finance (Mr. Turner). Hydro power won't be included if it is subject to provincial regulations. Air fares won't be included if they are subject to federal regulations. Telephone charges won't be included because they are subject to federal laws. Postage stamps won't be included because they are subject to federal regulations.
If the bill will be largely ineffective for big business, and if labour, the professions, energy and transportation, among other things, can under normal circumstances be excluded, then what is left? The answer is very little-not much indeed! The great majority of the Canadian economy is not included. It is exempt, or it is insignificantly affected except for additional red tape and the consequent higher costs that it will entail.
As the hon. member for St. Paul's indicated, Mr. Speaker, we will support the bill, subject to some reservations and amendments, in the hope that some of its provisions will be beneficial to small business, and that others will provide some additional consumer protection.
As some of its provisions are far-reaching in so far as they may interfere with existing distribution techniques we feel they deserve serious study, and that all interested parties should be given ample opportunity to present their views. Consequently, the government may wish to give consideration to the possibility of splitting the bill, which would allow speedy passage of the more urgent sections while allowing more extensive discussion of the other far more reaching sections. On the broader front, as a contribution to price stability one can only conclude that the approach is totally inadequate. It is outdated. It is, in fact, archaic.
We must admit that we have a split economy. It is not a homogeneous economy. It is an economy where some prices obey the law of supply and demand, where some wages are negotiated between small operators and their employees directly; and where, on the other hand, some prices are set by market power, by the big oligopolies, and where some wages are negotiated by unions which have sufficient power that they can in fact exercise a monopoly with respect to the supply of labour, and where a settlement is reached between a company and a union, perhaps not on the basis of the public interest but on the basis of the interests of the two participating parties at the negotiating table.
So, Mr. Speaker, the first thing we have to do in order to come to grips with the over-all approach is to admit, once and for all, that our economy is split; that it consists of two parts, and that probably of the two parts the rigid, oligopolistic and monopolistic part has more power and more influence on what happens in the economy than the remaining market sector which is in fact very much influenced by the more rigid sector. We must abandon the approach of the last century which held that we have a genuine market economy. In fact, we do not. We must introduce a new concept of reconciliation. The real economy must be reconciled with the public interest.
March 14, 1974

We regulate transportation costs in the public interest. We do not always do it well, as is evidenced by the transportation mess that we have in the country at the present time, but the principle of reconciliation is accepted. We permit the Minister of Finance to authorize banks to set uniform interest rates on deposits, as indeed well we might. Certainly, if we start moving into a situation where we want to get inflation under control and where it is public policy to reduce interest rates, this is a power that must reside in the Minister of Finance because it is one of the most important aspects affecting the over-all interest rates situation in this country. Those of us who believe that something must be done would not want to see the Minister of Finance without this power of regulation. Yet we realize it is inconsistent with the old, out worn concept of genuine competition at all levels.
Why cannot we recognize both the right and the necessity of establishing guidelines under which union power and market power could operate in the public interest? People are getting sick of strikes. People are getting sick of slowdowns and of working to rule. People are getting sick of students who are not being taught. People are getting sick of having their travel arrangements disrupted by strikes or any other device. No one wins; everyone loses. It is almost as if we were considering the human body, Mr. Speaker. How could we say to any one of the systems in the human body, "We can do without you for some period of time"? We cannot say to the heart, "You do not need to work"; nor to the respiratory system, "You can have the weekend off". It is impossible to operate any interdependent complex system in this way and similarly it is impossible to operate a complex interrelated system like our modern economy in this way.
People are getting sick of rising prices. They are getting sick of dramatically increased profits with their inflationary increments. People are getting sick of the status quo. People are sick of the confrontation between business, labour and government and it is obvious that something new must be tried. A policy of reconciliation must be tried and given a chance.
The Prime Minister has chided my leader for suggesting a new approach. Surely, anyone as wedded to policies which have been proven as disastrous as present policy, should not pour scorn or ridicule on new approaches.


Some hon. Members:: Hear, hear!


Paul Theodore Hellyer: The government's policy is set in the concrete of the 1930's and the 1940's.


Thomas Miller Bell: With the NDP.


Paul Theodore Hellyer: They are all part of the same bunch. Neither has had a new idea since 1935. The Leader of the Official Opposition (Mr. Stanfield) on the other hand, welcomes new ideas. He is willing to innovate; he is willing to accept the risk involved in blazing a new trail. He is willing to set Canada on a new course of conciliation under which all Canadians can work together but work as partners to build a new Canada.
Competition Bill


Mr. Jim Fleming (York West):: Mr. Speaker, despite the closing comments of the hon. member for Trinity (Mr. Hellyer), rather than launch into a tirade in response to the very superficial and traditional remarks at the conclusion of each address by hon. members opposite, anxious and lusting for power but a long distance from it, I should like to begin by saying simply that this bill before the House today is a plateful of nutritious justice for Canadian consumers. It has been a long time in the kitchen. It is action to achieve a major cleanup of the marketplace, and it is of great significance to all consumers, urban and rural alike. The various measures in this one bill are enough to make any parliament proud of it as the work of an entire session, were that all that was accomplished. It is a most significant choice as the first piece of legislation to be debated in this second session of parliament following the throne speech debate. I hope the bills that follow from this government will each be half as significant, in protecting and assisting Canadians, as this bill is to Canadian consumers.
During the leadoff address by the minister yesterday, when he urged quick, thoughtful, but prompt judgment of this legislation so that it could pass into law and at last correct these injustices in our system, some members opposite heckled "If that is the case, why did you not do something last December? Why did you bring it in last November? Why have you not done anything about it until now?" Of course, a few minutes later when the minister had finished, the first spokesman for the official opposition rose and said, "One of the things that is really bad about this is that you gave it to us on Monday and you spring debate on us two days later." That is the kind of hypocrisy that the official opposition suggests is honest debate and criticism of the actions of government. I really doubt very much whether they are carrying out their full responsibility. I always thought that progressive conservatism meant that there was at least some progress within conservatism. I am beginning to think that it means becoming progressively more conservative.


Mr. Baker:: Tell us about the glories of the new world.


James Sydney Clark Fleming: Mr. Speaker, I am always pleased to have the attention of hon. members opposite. That is a rare compliment, when they listen and consider someone else's view.
If I may continue, Mr. Speaker, back in 1966 the Economic Council of Canada was called on by government to study this situation. The first competition bill was brought down in June of 1971, and we are all familiar with the strong reaction to it. It has been eight years in total since work was begun on a study of this matter. As I said a few moments ago, this bill was first presented late last year; now we have it, and now it is time to act. I hope that members on both sides of this House who are concerned about consumers and their protection will responsibly act together to take action, make amendments where necessary in committee, and bring forward the bill to have it passed into law as soon as possible.
I want to put into the record, if I may, Mr. Speaker, the reaction of some small business leaders and some of our media people in Canada who are often critical of the government. There is for instance the statement given at

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six o'clock on November 5 of last year on CBC radio by Ruben Bromstein of the Canadian Federation of Independent Business, which has some 9,000 members across Canada. Mr. Bromstein said, of this legislation:
Clearly, we are most pleased that the bill has been introduced ... basically it is giving small business an opportunity to be protected by the law. And even after a decision has been made that somebody is violating the law, a small businessman will have the opportunity to sue in court to collect damages that have occurred because he has been hit by the people who are trying to drive him out of business, or are in some way affecting his business unfairly.
What we are concerned with here is that the government seems to have made a genuine attempt to catch the errors (at least that's the impression I'm getting from reading these provisions) and to try and, in a staging process, get at the problems that affect him.
That is a small business leader of probably the largest association of businessmen in Canada. I have another quote here from Gail Scott of CTV News on November 5, 1973 when the bill was first brought in during the last session. She said:
... the new act does go a long way to regulate continual consumer problems and if implemented, will bring with it many of the changes that consumers have been asking for.
Biographer and columnist Geoff Stevens of the Globe and Mail said:
Many of the bill's provisions make simple good sense.
Two encouraging aspects of the new bill are that it would bring a broad range of services (as well as goods and products) under regulation and it would give the Restrictive Trade Practices Commission the power to order a halt to illegal business practices.
And finally, one of Canada's leading experts in competition and consumer law, as quoted in the Globe and Mail for November 17, 1973, Professor Donald N. Thompson, Professor of Administrative Studies at York University, said:
One of the rare abilities in this world is that of taking a good but controversial idea a lot of people find objectionable, and revising, rewording and re-introducing it so that it says exactly what it said before but is now embraced as being both desirable and different from what it was.
This is precisely what has happened with the new competition bill, introduced by Herb Gray, Minister of Consumer and Corporate Affairs, as an amendment to the Combines Investigation Act.
So, from a broad section of the media, from business leaders, from experts in our universities, comes acclaim for this bill. Mr. Speaker, if I were still in the news business, as once I was, and I were faced with deciding how I could handle this bill, I think my first reaction would be, "If only you could bring in something like this piece by piece over a number of days". Each of the many actions within it is major front page news of very real significance.
I should like now to talk about some of the particular aspects that relate directly to consumers, some of the principles involved in this bill. In the area of misleading advertising, particularly significant is the proposed new clause that would apply to prices shown on the article itself or, as set out in clause 36(2) (b):
-expressed on anything attached to, inserted in or accompanying an article offered ... for sale,-
-on point of purchase displays or in any advertisement. In fact, statements made by salesmen in the store, by telephone or in door to door selling-any presentation, can be judged. If it is not correct, then under the new provision the general impression created by representation, as

well as the literal meaning, would have to be taken into account by a court in determining whether or not that advertising was misleading. There is real discipline provided by this measure and Canadian consumers can expect to get the straight and honest facts when they are considering a piece of material, goods, or now, services.
As well, it often happens that people are worried about the merchandise they are about to purchase; that it will not stand up or there is something about it that makes them uncertain. The assurance given by the salesman is that there is a guarantee or warranty. It is a very official, ceremonial looking piece of paper with a lot of small print that they do not understand. That is their reassurance and, even though there is something about the object they are about to buy that they are not sure about, they go away and find out later that the piece of paper means nothing. However, it helped the salesman get rid of the object. The buyer is stuck and must take the loss. I think the principle underlying this legislation is tremendously important. I am referring to that part of the bill which says that warranties, guarantees or promises to replace or repair an article offered for sale are misrepresentations contrary to the act if there is no reasonable prospect that they will be carried out.
May I continue talking about the misleading advertising section of the act. Clause 36(1) contains a principle of great importance. We all know the tremendous impact of the advertising on television which shows the lovely lady next door, so to speak, with two kids; she is a model housewife-and says something like this. "I know that you just came across me, Mr. Announcer, but the wonderful, glorious truth is that I love this product. I use it all the time and what I have just said is completely spontaneous." That kind of nonsense will not wash anymore. If there is to be such advertising, the statements must be made by somebody who makes them honestly. There must be proof of this. This kind of testimonial cannot be used without the permission of that person.
I also hope there will be discipline, so that if somebody wants to put an appropriate plug on the air he will not be able to go out and conduct 500 interviews, then use the one interview that is suitable. I am not sure whether the bill, in its present form, will clamp down on such abuse. I hope the restrictions will be in the law, so that we may rely on the truth of what is said in this way by an alleged consumer who may advertise on the media.
Double tagging comes within the purview of the act. This crops up quite often and is of major significance. I believe last fall, as a result of investigations carried out under the direction of the Prices Review Board, we discovered that many stores, because people had been talking of inflation and so fanned the fires of inflation, had put on more than one tag. Retailers had put new prices over the old ones, and the new prices were charged even though the commodities had been on hand when the old price had been charged. These commodities had not been bought at increased prices. The sale must be at the lowest price of any tag put on the article. I would be pleased if we could even go further and say that the commodity in stock must be sold at the going price, and that its price cannot be jacked up when more expensive stock arrives later.
March 14, 1974

Bait and switch is an old trick which people without a good product to sell or people trying to lure customers into the store frequently use. It is used on the unaware consumer and has brought great profits to certain people who have no conscience about using the technique. It has brought great hardship and unhappiness to the consumer. Bait and switch is a technique which takes advantage of less consumer educated people. Often they are lower income Canadians, and I am pleased to see that this bill deals with this situation. The old practice of saying, "We are going to have television sets at $89 each; you must come and get these beautiful 27 inch television sets," and then, after 500 people have rushed in, saying, "We are sorry but we only had three sets at that price; now that you are here, come and buy this 21 inch set for $500," is to be forbidden. This practise will not be tolerated. You must have an adequate supply of whatever you are advertising in stock. You must prove that you really mean to do what your advertising says, and that you are not just luring in people who hope to buy something at bargain rates, when the truth is that there are no bargains. In fact, the advertiser knows darn well he can't afford to give such bargains.
Clause 37(1) of the bill, Mr. Speaker, carries the merchant's responsibility a step further. It would be an offence for anyone who advertises a product for sale at a specified price to sell that product at a higher price during the period and in the market to which the advertisement related. Again that is a significant move. You cannot put an advertisement in the paper on Monday, an then when people go shopping on Thursday, having read your advertisement, say to them that that price was only good for Monday and Tuesday. You will not be able to do that; you will not be able to highjack people in that sense anymore.
The other part of clause 37 is intended to provide new ground rules governing the practice of employing lotteries or other types of contest to promote sales of products. This is something that is all too often used on the consumer. The advertisement will say, "Win a bicycle for your child," or "Win a trip to Nassau," or something like that. All you have to do is fill in the form, read the ground rules and answer that easy test question at the end, then you will win. Often even more glorious prizes are offered. The advertisement will say that you can win $100,000, that there are many prizes. Under this legislation you will have to show what the odds are. No longer can everybody be given this false hope and so be induced to buy a product which they may not want or cannot afford. No longer will they buy a product that is more expensive than it ought to be because by buying it they can indulge in a dream which will never come true. After many disappointments, consumers become very disillusioned. They have wasted their money and they become bitter about the product involved.
If I may now leave the misleading advertising part of the bill which deals with the direct approach to the public, I should like to deal with two other areas of great importance in this bill, namely action to control referral selling and pyramid selling. Pyramid selling, as you know, operates much as a chain letter operates. The people at the beginning make tremendous gains, if it works. The idea is that you must keep on "suckering" more and more people into the scheme and broadening the base. The regular Joe who has been sucked into the scheme loses his money, has
Competition Bill
nothing to gain, and the people at the top walk away with the windfall gains. These schemes will be closely restricted under this act.
The second area is that of referral selling. I am talking about the sort of situation in which the vacuum cleaner salesman comes to the door and says, "I have a vacuum cleaner for you; it is only $800." The housewife gasps, says it is a beautiful vacuum cleaner, but how can I possibly afford $800? Within one hour and a half that salesman may have that woman selling 80 vacuum cleaners to her friends, neighbours and relatives so she can afford to buy the $800 one. That type of selling will end. That is one of the most significant parts of this bill.
I am pleased also to see that this bill, when passed, will give the restrictive Trade Practices Commission power to act against abusive practices such as refusal to deal, consignment selling, exclusive dealing, tide sales and market restrictions. These may be terms unfamiliar to many Canadian consumers. So, if I may, I will touch on them briefly.
Let me talk about refusal to deal. The supplier of a commodity may be angry with a retailer because the retailer has not been maintaining the price, or there may be some other reason for his anger. The supplier may, therefore, refuse to supply that retailer and thus affects his position unfairly. That will not be allowed to happen. The Restrictive Trade Practices Commission can investigate practices like that and, if needed, action will be taken. The people responsible for the abuse will be punished.
Consignment selling has sometimes been used to get around the prohibitions of resale price maintenance and price discrimination among a seller's customers. If appropriate the commission may order, in any given situation, that the practice be stopped or modified. Let me interpret that. For instance, if you are a large supplier you can go to a number of the major chains and say, "We will give you a price advantage because you are dealing in large volume." If you are selling 80 per cent of your volume to large retailers and selling only 20 per cent to smaller retailers I do not understand how you can sell 80 per cent at a low price and leave 20 per cent of your market at a price disadvantage because the small retailers handling the 20 per cent are not selling as much as the large chains which sell 80 per cent. I hope that this bill will be effective in stopping that kind of price discrimination.
I very much support the principle used by the bill for dealing with exclusive selling. It will prevent the supplier from making exclusive contracts with retailers in which there will be certain boundaries within which that product will be sold exclusively by one retailer. Under that practice there are no overlapping boundaries and there is no competition between retailers with regard to that product. This situation is prevalent in the automotive field. It is not fair and must be stopped, especially as large scale advertising creates a special demand for the product in the minds of the public. Therefore, I think what the bill does in this regard is very important.
I should like to see amendments dealing with certain abuses to which I shall refer. Perhaps this could be done in committee. I am talking of a practice that is very similar to exclusive dealing. For instance, in Ontario you might be
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Competition Bill
selling cocktail mixes. The large food chains might say to you, "We will only handle one brand; if you want us to handle your brand you must pay us $12,000 for a one-year contract, and we will handle it exclusively. You will also need to take advantage of our advertising deals, and so on." That is how they treat suppliers. It means that the consumer has no choice in product. Meanwhile, the price of that product must surely be affected because of the front end cash payment for one chain to handle it exclusively. I hope this practise will be considered later in committee.
Let me refer to something which is foremost in people's minds, especially in view of the difficulties we have been witnessing in connection with the sale of locomotives to Cuba by Montreal Locomotives Worthington. There have been difficulties with United States laws. I think it is excellent that the bill provides that where, foreign judgments, laws or directives are found to be contrary to the Canadian public interest, the commission may make orders that forbid their implementation in Canada. At last, we will clear up that inequity.
One of the major principles of this bill, one which, as I understand it, will not come into effect at the same time as the other measures, has to do with the whole area of competition and consumer protection in relation to services. The inclusion of services in the bill reflects the growing importance of this sector of the Canadian economy. Formerly, though some services related to goods were included, services of any description are now covered. The minister has explained that the proclamation of the law, to the extent that it relates to agreement in restraint of trade in tha'service sector, may be brought into force at a later date in order to afford an opportunity to discuss any problems which might arise and find an equitable way of setting out the regulations. Even so this vast area will at last be included in competition and consumer legislation.
I turn, now, to the section which says that in the field of professional and amateur sports it shall be an offence to combine or arrange with another person to limit reasonable opportunities for a person to participate in a sport or to negotiate with a team of his choice. This will not mean there will be no contractual rights. It will not mean that the richest franchise in a particular sport can buy out all the best players in other teams. But there is some muscle here to be sure there is not the kind of human horse-trading which often takes place in our sport today, particularly in junior or amateur sports where young people are involved. For the first time, provision is made within this bill for civil action to be taken in the courts by anyone adversely affected by violations of this legislation. At last the consumer will have the right to fight for the return of his money and for justice to be done. It is a significant addition to the bill, and, I think, a rounding out of the measures taken to ensure fairness to consumers.
Another new provision would allow the director of investigation and research to make representations and call evidence before any federal board or commission with respect to the maintenance of competition whenever it would be relative to the matter being considered by the board. I believe this to be of particular significance. I see no reason why this provision would not apply to the work

of the Food Prices Review Board. In cases where the board wishes to conduct its investigations, it will now be empowered to work directly with the investigations branch. I hope this provision will be of major assistance in making the work of the Food Prices Review Board even more effective.
As I said when I began, Mr. Speaker, this is a list of important measures to put the Canadian market place into much better order. It means an end to the hustlers and the hucksters. There will always be some, of course, who will try to find a new way of deceiving the public but we are closing many of the doors which have been left open, and which have allowed their imaginative minds to devise various ways of duping consumers and avoiding existing laws. The bill has been the subject of lengthy discussion over a number of years, beginning back in 1966. It was before the last parliament, where it was considered at length. All groups affected were given the opportunity to consider the extent of its impact, and I believe the time has now come to act. I have spent almost half an hour describing the specific principles which will deal directly with the action of those who would take advantage of consumers in Canada. The passage of this bill will stop this exploitation. It has gone on for years. Schemes such as bait and switch, pyramid selling and referral selling have taken advantage of consumers for years. Surely, this is the point at which we should all co-operate in seeing that the bill is considered quickly and passed into law. All of us think of elections from time to time. After this measure is passed, members from any party represented here can stand on the hustings and say: I, as one member of parliament, have done this for you, the Canadian consumer.


Mr. Don Blankarn (Mississauga):: Mr. Speaker, the philosophy of this bill demonstrates the radically different approach to prices, and the problem of consumers, between our party and the government. The government and its allies to my left look at the economy of Canada in the light of a past century. This is the light of the 19th century, when there was a free economy, when there were innumerable buyers and innumerable sellers, when there was genuine competition between many manufacturers and many distributors of goods. They say that this bill, and the tinkering it provides, will make sure that there will be real competition and that competition in itself will make prices fall, will provide the justice that consumers demand.
The reality of the 1970's is that we are in an age of oligarchy, big corporations, big business, big labour, where there is really no competition, an age in which, as the hon. member for Trinity (Mr. Hellyer) said, prices are determined by price leadership, by administrative policy, by administered terms of competition. We do not live in an open barter economy any longer. We do not live in an era where there are many steel companies, where there are many cement companies, where there are many automobile manufacturers and where these companies compete with one another individually in every sense.
We only have to consider the automobile industry to realize the misunderstanding of the nature of our society that this government and its allies in the New Democratic Party have. The automobile industry, for example, amounts to one company which basically controls the
March 14, 1974

whole industry. I refer, of course, to General Motors. Let's not kid the troops; there is no competition in terms of price. It is a question of price leadership. The only competition, and it is certainly minor competition, exists in the registered outlets of each of the large manufacturing corporations. When you say you will lower tariffs and allow in foreign goods to increase competition you are talking balderdash and nonsense. We cannot dismantle our industrial enterprises just because the prices don't fall low enough. We must make sure that our large manufacturers are protected in a sense. So, prices will never be lowered by reduction in tariffs or removal of customs barriers. It is nonsense to suggest that they will. These large organizations set prices and set the terms, and they are never really prosecuted because they combine. If they are threatened they find a way out. They have always avoided prosecution in the past and they will in the future. The bill before us does not solve anything with respect to prices.
The measure before us deals with the banking industry. What an industry! Does anybody honestly suggest that there is real competition in the banking industry, other, perhaps, than in the advertizing campaigns they run on television, or over the radio or, perhaps, in terms of their fancy buildings, claiming that one tower is a little higher than another, or in terms of the personality of one manager as compared with the personality of another? Is there any competition in the interest rates charged by banks? We all know that the prime rate of interest is 9 VS per cent and we know that credit risks are adjudged by all bankers in basically the same fashion.
Every small businessman knows that when he goes to one bank and is refused he will probably be refused at another bank. This bill does not get at this situation at all. So far as the banks are concerned, all the bill does is to levy a fine of $10,000 as an alternative to the possibility of two years in jail, and whoever heard of a banker going to jail under the last act? Is a banker going to jail or is he going to pay a fine under this act? So, let us not kid ourselves: the provisions of this bill with respect to banks are meaningless in terms of competition, and why they are in the bill I do not know. This bill is not a bill that is going to improve competition in banking in any way.
So far as the oil industry is concerned, just last fall we had what was supposed to be an oil crisis. The price of gasoline increased by an almost identical amount at the same time at the pump of every oil company. There is no question of combine here; it is a question of an oligarchy when that type of activity occurs. The approach of the government is the wrong approach. The government is not doing anything about increased prices or about these oligarchies.
What we really need is an incomes and prices review board. What we really need is an incomes policy based on the long term that will put public input into our price and wage structure. In a country like Canada, with 22 million people, we must maintain the economy of scale that the large corporations provide. But recognizing that, we must also recognize that competition is not going to control prices, that public input must be made.
Competition Bill
For a long time we have recognized that to control telephone rates and transportation rates, the rate that is charged must be reviewed by a public board or commission. This is what this party has been saying all along in regard to inflation and price control. Essentially, we have been saying that what we need is an incomes policy that is absolute. We need to attack inflation in a different fashion. Simply tinkering around with provisions dealing with refusal to sell and other little things in this bill will not do very much to benefit the consumer. The hon. member for St. Paul's (Mr. Atkey) was right when he asked the Prime Minister (Mr. Trudeau) today: Where in this bill is there anything to reduce prices? This is the issue today, yet there is nothing in the bill whatsoever to reduce prices. The bill may have some good points, but really it is a bankrupt bill.
As I say, there are some good things in the bill which we would be most pleased to support and are very happy about, but with regard to the over-all concept of reducing prices and controlling the economy so that the big and powerful do not, to use the words of the hon. member for York South (Mr. Lewis), rip-off the people of Canada, we must have an incomes policy that will control prices and wages in the public interest. Then the large fixers of society will not be able each and every year to take a larger and larger share of the total pot. This is what has been happening in the 1970's, and it will continue to happen since this bill is not going to do anything to stop it. It might do something to control arrangements made between two automobile dealers, but it really is not going to do anything to control the fixes in society. It is about time the government and their allies started to realize that this is the 1970's, the last half of the 20th century. The economic philosophy of the 18th or 19th century does not apply today. This is not 1930.
I should like to say a few things about what the bill does. It has some accomplishments that are valid and for which we have been calling from time to time. The bill creates offences for certain shady business practices, and certainly these shady business practices must be controlled. The bill restricts bid rigging, where one contractor combines with another contractor to put in a fixed, high priced bid. It controls that sort of thing, and that is important.
The bill controls misleading advertising. It controls phony warranties, and I think we are all in favour of that. It controls some aspects of double ticketing. It has provisions in regard to advertising and in regard to some of this alleged bargain advertising. This is the situation where someone advertises what is said to be a bargain, but unfortunately he does not have enough goods in stock to meet his anticipated orders and he is really using his advertisement of a bargain as a method of switch selling. The bill does control this type of activity. The bill controls pyramid selling. It controls some of the phony contests that are carried out by some firms through advertising of merchandise.
All of these are items of consumer protection, and if they were included together within one bill and put before the House as one proposition, then we would have a worth-while piece of legislation, a piece of legislation that members on this side would, I am sure, accept almost
520

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Competition Bill
immediately. The bill would go to committee for some touching up of the drafting, and it would be through the House and passed into law in no time at all. However, this bill is an omnibus bill. This government is used to omnibus bills. It is a government that always wants to put a whole lot of things under one umbrella.
I should like to say a few words about some of the provisions that I am not sure have any validity, matters that will probably not help business conditions or encourage more competition. I suspect they will only add to the costs that are inherent in our economy and they will certainly increase bureaucracy in our economic and business system. The government continually receives complaints from citizens about certain problems. One of the concerns that I have, and which I know other hon. members have, is that all of a sudden, having received a complaint, the government does something about it but often uses a cannon to shoot a mouse. It passes a law or sets up a board or commission with far greater powers than required to deal with the situation.
That, to a large extent, is the case with this bill. For example, let me address myself to competition in sport. Some serious complaints have been made about young athletes being enslaved-I suppose enslaved is not too strong a word for it-by contracts that were made on their behalf by their parents when the athletes were young and which, in effect, prevent them as they move forward from going from one league to another league as they wish. In other words, their employment is restricted and their freedom destroyed. However, these contracts may have offered some advantages. They have perhaps enabled leagues to develop. It may be that those contracts have enabled junior players to be brought along. When we get worked up about these contracts we ought to remember that they were voluntarily signed by people who knew other people who had signed such contracts. Often those contracts were signed when a person did not realize his income potential. Then, suddenly, he does realize it and he begins to scream because he made a bad deal. The whole question of sports contracts should be a matter for a separate bill and a separate review by a committee of this House which could look into the contracts and the terms of the league organization.
This government has really done nothing about sports until now, other than I suppose put the NFL on CBC television and decide that it is going to ban the WFL from coming to Toronto. Really it has done very little in respect of professional sport, but all of a sudden it comes into the picture with a bill amending the Combines Investigation Act, the Bank Act and the Criminal Code, and decides to make provisions in respect of sports contracts and the direction of sports. Really this is a different issue from the price of goods or selling something in a store. This is a different issue from distributing goods among franchise holders in a commercial business sense. The particular provisions of this bill which relate to sports should be set aside and referred to a special committee. One of the problems with an omnibus bill, is that when you put a lot of things under one cover, you find many things you are happy with but a number of other things that cause you concern. I have some concern about the sports provisions

in this bill. These provisions are not the essence of the bill at ail but the essence of a new approach to organized sports, and they should be in a different bill.
The next thing I want to talk about is this refusal to sell problem. There have been a number of outlets which have become worked up about the fact that they would like to buy certain manufactured goods for resale but, generally speaking, in the distribution of manufactured goods across Canada the manufacturers have set out exclusive territories or have exclusive arrangements with certain distributors. In a country as diverse as Canada this business of exclusive territories or areas of distribution has proved to be quite valuable. Indeed, I suggest that in many ways the distribution of many goods could not be effected without some exclusive territorial or distributor franchise system. It is only with a franchise system that goods can in fact be distributed.
The difficulty with this bill is that it may or may not be proper to interfere with such arrangements. Anyone can complain. Then, the commission will investigate and may declare an arrangement to be improper. If that declaration is made the person involved in setting up a distributorship or a franchise arrangement is forced to justify his marketing techniques. It seems to me there is no reason for this kind of provision in the bill. Is it really necessary at this point? I suggest it requires a lot more examination. I have grave doubts as to whether a person should not be entitled to refuse to sell to someone unless he agrees to buy the entire line, or to stock all the parts and the ancillary things required. The manufacturer of the goods has a pretty good idea of his potential market, and he knows how best to distribute those goods. Is it really essential that a bureaucratic arrangement be made empowering a commission to interfere with the details of such a business, just for the sake of suggesting it will increase competition? Indeed, it may have exactly the reverse effect. The increased competition may destroy the business or the possibility of marketing the goods at a low price. These provisions in respect of refusal to sell or tied lines, and this interference in a legitimate business organization or a company's dealings across Canada, will have to be examined in great detail, and a great deal of evidence will have to be placed before a committee.
The hon. member for York West (Mr. Fleming) is perhaps right in suggesting that the part of the bill which really affects the consumer could be passed right away, but when we come to this complex question of franchise arrangements, exclusive territories and the demand that one person be entitled to buy goods directly from a source, then we have problems which will take some time to solve it. We must be sure we are not creating a law that is going to do more harm than good in Canada. Unfortunately, the minister has used this grab-bag approach again by putting provisions in the same bill in relation to business, sports, banks and the legitimate concerns of which I spoke earlier.
One thing that has bothered many of us is the way the Restrictive Trade Practices Commission is to operate. It appears that the commission will have three real functions; one is administrative, one will be irvestigative and one will be judicial. The problem is that there is no separation of these functions, so the commission is the
March 14, 1974

judge and the jury, as well as the policeman. We have a situation in which the commission will investigate and then charge a businessman or some concern with an offence. That man or concern will come before the very people who did the investigation and laid the charge. There is no provision in the bill for a fair hearing or trial of the issue, no provision for the calling of evidence, for cross-examination of witnesses by counsel, and no provision that the commission, when adjudicating on a matter, must give written reasons for its decision.
That would not be so bad, I suppose, if all the commission could do was levy a fine, or make an order, but the difficulty arises in respect of a civil suit which can be brought as a result of the order of the commission. All the person complaining must do is prove that the commission made an order. Then, if he can show any loss at all he gets back not only that loss but also any costs he may have incurred in investigating the matter. We do not have any provision for written reasons, yet an order of the commission is all that is necessary to collect civil damages. This is an amazing change in the concept of law.
Let me go into the matter of criminal law, or highway traffic law, if you like, which applies to the offence of careless driving. Let us take the case of a person who is charged by a policeman with careless driving. He attends court and may plead guilty. He may feel that really he is not guilty because the person with whom he had the accident was also careless. In many cases both parties have been charged with careless driving and, because of the cost involved in defending the charge, plead guilty and pay the fine. If a lawsuit should result, then the whole issue is tried all over again and evidence produced. When a person pleads guilty he may not know what damages are involved.
If a person is charged under this particular provision of the bill, he would not dare plead guilty. He had better fight it right down to the wire because he does not know when he may be sued for damages and the order made by the commission is sufficient to nail him for damages. Such people must defend an action brought by the commission to the very utmost. Ordinarily when a person is involved in a civil lawsuit arising from a criminal charge, a new trial is held and the plea to the criminal charge is not taken into account. This is not the case in this situation, so what we have here is a step away from the normal jurisprudence of this country.
Should this bill pass second reading, I feel the committee must carefully examine this provision because it is a new step. It is a totally new proceeding, a new way of handling the question of civil responsibility for actions that are now declared to be of a criminal nature. Nowhere else in law does this situation exist. One may commit rape and be placed in jail. However, one also can be sued civilly for that offence and may have to pay damages. But in such a case there are two separate trials of the whole issue. Under the provisions of this bill there are not two separate trials. There is one trial by the commission. This is a kangaroo court conviction. The person concerned is stuck for civil damages. Any damages that are proved he must pay. This situation must be looked at in every detail.
Competition Bill
One concern that has been expressed by the hon. member for Trinity (Mr. Hellyer) and others is that the bill exempts the labour organizations from being subject to the restraint of competition or combines legislation. Certainly, over the history of the 19th century, and the first part of this century, the labour unions, with the development of collective bargaining, have managed to obtain for the men a fair recognition of their labour in the development of the country.
Unfortunately, however, there have developed on the labour scene conditions that are far from marketplace conditions and which go a long way beyond what is normally the proper sphere of collective bargaining. For example, the collective agreement of the electrician's union in Toronto contains a provision which places a serious limit on the number of persons who can become apprentices. If I or my son wished to become apprenticed as electricians we could not do so. The number of apprentices is limited and the number of people allowed in the trade is limited. That is a combine every bit as much as any other combine.


An hon. Member:: What about law?


Donald Alex Blenkarn: Yes, the legal profession, the engineering profession and these other professions should be included because they are combines in restraint of trade. The same situation applies in respect of the construction industry. I will tell you a story, Mr. Speaker. I was acting for a construction company which wished to bid on some work. That company was told it could not bid on the work unless it was unionized. So, a patsy agreement was made with the union. The employees did not have anything to do with it. The company paid the dues and the company obtained the contract because it was a union company. The men were not organized. The contract price was increased by the amount of the union dues paid. If this is an example of collective bargaining, then I am pretty shocked.
This is the type of thing the minister should direct himself to as well. There is no reason this bill should exclude from the provisions of restraint of trade legislation labour unions which operate in that fashion. If there is a monopoly in respect of the people entitled to be plumbers in a city, is that not an example of restraint of trade just as it would be in the case of real estate brokers or doctors. While these people may be excluded from this legislation because of provincial legislation, I suggest the labour unions should be placed in the same position as professionals. I am a member of a classy labour union, the Law Society of Upper Canada. I am a member of the society and I cannot practice law without such membership. I am at least subject to provincial jurisdiction and I am subject to this legislation where it is not in conflict with provincial legislation.
Surely, this bill should include all forms of people involved in professions. If you drive a truck or locomotive you are a professional. There is no reason that type of activity should not be treated as professional. Because these people are professionals they should come under the provisions of this act and should be subject to the same disciplines as any other professional. The reason they are exempt from these provisions is pretty evident in this parliament. It is because the government relies on the New

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Competition Bill
Democratic Party in order to stay in office. It is not a question of principle. It is the only thing the government can do. It must keep the NDP happy.
The major complaint I have is that this bill takes the wrong view in respect of the kind of economy we have in the 1970's. The bill contains some provisions that will help in the trade of goods. It does ban certain obnoxious retail practices. However, it is not a bill that would do anything to reduce prices in Canada. It takes a totally wrong approach. The approach taken in this bill will not reduce prices in Canada. We live in an economy where the major price structure is controlled by large corporations and large unions. These corporations set prices on an administrative basis, on what they think they can get for their product. If they decide they want to pay more for labour or for management's salaries, they pass that on. They could continue to do that. There is nothing to prevent them from doing so in this bill. They can stay well within the framework of the bill, and there will be no improvement in the price structure or in the competition among them.
What we need is a new approach, a new industrial and commercial policy for Canada in terms of the pricing of goods, the pricing of labour, and the pricing of incomes in the public interest. That can only be done with a rounded incomes policy, and that is not being done in this bill. This bill sets up more bureaucracy and more rules for people to watch out for but it does not get at the real issue of 1974, and that is inflation which is as high as we have ever had it and going higher. When the cost of everything we buy goes up by at least one per cent a month, when people are buying and buying because they have no faith in paper money, that is inflation.
We have a government which introduces some fiddly bureaucratic rules and controls. It hopes to accomplish something with those rules, but it really accomplishes nothing. Other than the provisions in this bill that clean up some dishonest business practices which I have mentioned earlier, this bill will need a great deal of review and reconsideration. The government should withdraw the bill immediately as it is now presented and produce a new bill covering those parts of competition that eliminate the bad practices of some businesses. It should present such a bill to the House, which would then be passed. The government should then, if it wants to go further, bring to the House committee a separate bill dealing with refusal to sell, franchise agreements, territorial agreements and that type of thing which seems to concern them so that the House committee could have the time to hear witnesses, to understand these, problems and to determine whether or not they are worth solving.
The same applies to the field of sports. If the government approached this bill with the real intention of doing something for Canadians; those parts of the bill that are valid would be passed very quickly. But the government does not do that. It put all these matters under one roof and said: "Aren't we wonderful". If they understood the economics of this nation and the problems of the 1970's they would not have presented the bill the way it is and they would have banned some of the distasteful practices.

Before concluding I want to mention one other matter that has concerned a number of us, that is the provisions in the bill that allegedly look after a situation in which the rules of a foreign government affect the trade practices of Canadians. Under the provisions of this bill, the Restrictive Trade Practices Commission is supposed to review that type of contract. These provisions in the bill are a complete abandonment of this government's responsibility to ensure that foreign laws do not control the business ethics and attitudes of Canadian businessmen. It is the government's obligation to act as they should have acted long ago in this matter before it was taken up by the public press. It should have stepped in and said: "This is Canada and if you are going to do business in Canada then you should follow Canadian rules and laws".


Mr. Deputy Speaker:: I hesitate to interrupt the hon. member, but the time allotted to him has expired. He can conclude his speech if there is unanimity. Is it agreed?


Some hon. Members:: Agreed.


Donald Alex Blenkarn: I was just about to finish in any event, Mr. Speaker. I say that the provisions in connection with the control of foreigners doing business in Canada are not satisfactory and do not come to grips with the problem. This matter should be dealt with in another two section bill which should provide, as the hon. member for St. Paul's indicated, that foreigners or foreign controlled corporations doing business in Canada should obey the rules of trade in Canada and not be subject to the rules of trade that may emanate from their home country which may make their activity in this country illegal. That is an easy matter. It could be introduced by this government and would, I am sure, be passed by the House without even having to go to committee.
This omnibus bill leaves a great deal to be desired because of the way it is put together and because of the nature of the bill. I say to the minister-and I wish he were here-that if he wants this bill passed he should break it up into two parts. Some parts would be put through instantly and others would have to be closely examined. A great number of witnesses must be heard and it may take a long time before this bill returns to the House for third reading.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Grenville-Carleton (Mr. Baker) - Energy-Price of Home Heating Oil in Ottawa Area; the hon. member for Sault Ste. Marie (Mr. Symes)-Manpower-Opportunities for Youth Program-Level of budget in Sudbury area; the hon. member for Winnipeg South
March 14, 1974

Centre (Mr. McKenzie)-External Affairs-Garrison water diversion project-Federal representation at meeting between North Dakota and Manitoba governments- Government position.
It being five o'clock, the House will now proceed to the consideration of private members business, as listed on today's order paper, namely, notices of motions (papers), private bills and public bills.


PRIVATE BILLS
Mr. S. Victor Railton (Welland) moved: that Bill C-264, respecting the Eastern Canada Synod of the Lutheran Church of America, be read the second time and referred to the Standing Committee on Miscellaneous Private Bills.
He said: Mr. Speaker, this will not take long, I am sure. It is a request to bring Bill C-264 before the House and obtain consent for this bill to be sent to committee. The request is made by the Eastern Synod of the Lutheran Church of Canada. The statute of 1885 which incorporated the synod restricted their investments. Recently, a large sum of money was given them which they think would be used better if they obtained a little more interest. In this way they could do more work for the church and for their foreign missions. I believe this is so, and I think that the investment should be carried out in the same manner as investments made by any institution such as, for example, an insurance company. However, this can all be discussed in committee, and I would simply ask the House to give the bill second reading so that it may proceed in the usual way.


Mr. Deputy Speaker:: If there are no further statements, I will put the motion.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Miscellaneous Private Bills and Standing Orders.
Mr. Deputy Speaker:: We will now proceed to public bills.


Mr. Foster:: On a point of order, Mr. Speaker, I believe there is general agreement to proceed with Bill C-104 standing in the name of the hon. member for Prince George-Peace River (Mr. Oberle).


Mr. Deputy Speaker:: Is this agreed?


Some hon. Members:: Agreed.
Canada Labour Code Amendment



PRIVATE MEMBERS PUBLIC BILLS


Mr. F. Oberle (Prince George-Peace River) moved: that Bill C-104, to amend the Canada Labour Code, be read the second time and referred to the Standing Committee on Labour, Manpower and Immigration.
He said: Mr. Speaker, I wish to speak on the subject of Bill C-104, an act to amend the Canada Labour Code. May I say that I do so against the advice of my friends and supporters, against the advice of my business colleagues, against the advice of my solicitor, and I have not even checked it out with my colleagues in the House of Commons. However, Mr. Speaker, I will put those who are timid and afraid at ease at once by saying my comments are not directed against labour unions in Canada. They are directed against businessmen and politicians who, in the interests of political expediency, in the interests of profits, have sold our Canadian labour force down the drain. They have done so, first of all, by allowing giant unions from outside our country to gain a stranglehold on our Canadian work force, but only in the most lucrative sectors of employment and only in the industries that can support the demands made by these giant international unions.
I would like to state that my argument is not based on one-sided experience. I have been a member of the International Woodworkers of America, and for a great number of years I have been a member of that other great union, the Mine, Mill and Smelter Workers. Of late, however, I have gathered experience on the other side of the fence, and it is about this fence that I wish to talk.
It is this fence which keeps people of good will, of common goals and common interests, divided here in Canada. It is this artificial barrier that makes people on both sides set off on a course of confrontation and open warfare. It is this fence that prevents us from sitting together as intelligent people in an attempt to solve some of the great problems facing our nation, problems not at all related to everyday business-labour relations, but problems directly resulting from this warfare and confrontation raging within our country. I blame these barricades directly for part of the inflation which has become a serious threat to the survival of our monetary system, and for their effect on our cost of living which has such devastating effects on Canadians who do not have access to membership in a union or business and, as a result, cannot use the tool of lobbying or political pressure to further their aims.
The lack of a national identity is a direct result of this barrier, because we have nothing to offer our society to identify with as long as the smartest people in our land live on two sides of a fence, in open conflict with each other, and using every means at their disposal, but most of all politics. Political philosophies have become distorted by this confrontation, as we have resorted to identifying one side or the other with capitalism or communism.
We are confronted with strikes and picket lines because, as a government, we have not insisted on effective tools to

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Canada Labour Code Amendment
settle disputes. We allow the tolerance of both sides to be tested to the breaking point. As a government, we are in a hopeless position because 55 per cent of the country's labour force works for the government in one way or another. We are the worst offenders because of the unfair and discriminatory practices we apply in dealing with the thousands upon thousands of Canadians who work for us in the civil service or in our Crown corporations. Surely, it should be our first responsibility to set an example by which modern labour legislation could be worked out.
Surely, there must be ways by which the government could earn the respect of its employees, so that the threat of strikes and open war is eliminated, at least in essential public services. And it should not be too difficult for us to identify essential public services. Simply, they are the services which the people of Canada have requested their government to operate, because they could not trust private enterprises to supply these services without interruption. We have stepped in and, in some cases, confiscated private business ventures because it was in the interests of our country to ensure control. But then, Mr. Speaker, we have turned control over to someone else, someone who, over the years, has equipped himself with more power to manipulate the welfare of our nation than the private businessman ever dreamed of possessing or ever wanted to possess.
May I use the rail strike of last year as an example. I was one of those members of parliament who were honest with their constituents. I said openly that, in my opinion, strikes in essential public services should be illegal. I said that we could not afford to put in jeopardy the safety, health and comfort of our people, and the very survival of our nation, by indulging in conflicts which are costly not only to government and to unions but also to wives and children, to the sick, the poor and the old-in other words, to all those who are in the least involved.
One of those wives wrote to me recently, and I quote from her letter-incidentally she is from British Columbia, from which I also hail:
How many roles are being reversed in this, our glorious B.C., when the wives and mothers are forced, by the atrocious situations in their husbands' union, to go out to work and bring home the bacon, while husbands babysit and roam the streets? I believe in the right for women to work, if they want to, and when their families are grown. But, when I see strong, healthy men doing nothing to fight for their place in society and letting their union executives rule their lives like kings and the members just following along like little lambs, never complaining, just wondering why they are more and more out of work, it makes me boil.
And, Mr. Speaker, it makes me boil too, but I did not have to be afraid to state my views to my constituents who were on strike against the CNR, because I explained to them how I would protect them from having to take a seat on this vicious merry-go-round and from that competition through which everyone loses. I told them that employment conditions in essential public services, at the beginning, should be tied to factors established by private industries and their unions, but that eventually and more ideally the public service, through meaningful, consultative negotiation with the government, should be setting the standard by which those in the private sector would settle their differences.

But really we have gone too far for all that, Mr. Speaker. The same woman to whom I referred previously also wrote:
Some unions and their executives have eaten away at the very souls of our men and husbands. They have taken away their self-respect and have corrupted them by encouraging situations where men must lie, cheat, or pay to get jobs to feed their families.
By allowing this to continue what kind of example are we showing our young men who are ready to go out into the labour force without skills and ambition and the pride necessary to do an honest day's work?
As a wife of a construction worker for six years now, I have watched the power a man's union has over him. It can be for good or for evil. But in our case it is the latter. The only good that has come out of it, is that it has opened my eyes to the real problem in our society. A society is only as good as the people who make the politicians make it. And a union is only as good as the members who make the labour leaders make it.
We have spent a hundred years correcting the sins of unscrupulous and irresponsible business tycoons who certainly were responsible for acts of slavery and worse. But, we have been so preoccupied doing that, that we have overlooked the power the unions and their leaders have accumulated in the process. Human nature, Mr. Speaker, not only applies to business people, it is something which is applicable to others with too much power as well. Unions are still a very vital part of the business of labour relations but, not in the role they have assumed today. They are controlling the only resource a nation has, its responsibility to its labour force and the productivity of that labour force.
Unions are not weak and helpless any more. They not only have developed political muscle unmatched by any other sector of our society, but they also have accumulated almost unlimited financial wealth through pension funds dues and payoffs. But that is not even the real problem, Mr. Speaker. The most frightening aspect of all is that this wealth and power is, to a great extent, controlled from a foreign land. I am quoting from a Canadian press story, making reference to the annual report of the Corporations and Labour Unions Returns Act. The article which appeared in the Albertan of November 5, 1973, reads:
United States-centred unions in Canada collected nearly twice as much money in 1971 as they spent in this country in certain key financial categories, the latest issue of a controversial annual government report says.
The Corporations and Labour Unions Returns Act (CALURA) report for 1971, released Friday, shows that international unions paid out $25.6 million in salaries, strike, pension and welfare benefits to Canadian residents while collecting $50.6 million in dues and assessments.
Why, Mr. Speaker, do we not have the guts to speak out and issue warnings to our citizens about that? We have no hesitation about condemning and confiscating business controlled by foreigners in order to protect our sovereignty. Just how much more of a threat to our sovereignty today, Mr. Speaker, is foreign control of our labour force? We have had practical demonstrations of what happens to a country, or I should say our country. When the picket signs go up, there is no mercy. The survival of the business is not debated any more. But remember, Mr. Speaker, my conflict is not with the union, my conflict is with government and business. It is business and government that have established the climate in Canada which allowed
March 14, 1974

unions to assume such powers and abuse them, because, remember, Mr. Speaker, that is only human nature and human nature makes people do those things.
Let me give you some examples of what my bill is supposed to eliminate. As you know, Mr. Speaker, several of the major unions in Canada, and mostly the ones controlling the construction industry, operate with complete control. That means they hire and fire and set their own remuneration for the service. If you do not belong to the union you do not get hired, no matter how hard you have looked for a job, how competent you are or how much you need a job. If you fall out with one of the union leaders, you not only get fired but you also get blacklisted and you will have to change your vocation if you ever want to work again in this country. Is there a tribunal, a hearing, a court action, a right to appeal-why, of course not. Is there any protection under such a thing as a Canadian Bill of Rights or a minister of labour-well, of course not.
One such unfortunate fellow writes to me saying:
Mr. Oberle, I will never be able to work in my trade again. My wife and kids will be starving before I get another job. I have written to the minister of labour in Victoria and Ottawa (letters enclosed). They have turned me down. For God's sake, do something.
Well, Mr. Speaker, I also have the letters the ministers wrote and I will indulge by submitting them to the record as well. On November 14, 1972, the British Columbia minister of labour replied:
Thank you for your letter of November 1 having reference to problems you have encountered with the Tunnel and Rock Workers' Union, Local 168.
It would appear that the problems which you outline are essentially internal union ones, and not a matter for involvement of the Department of Labour.
I am, however, taking the liberty of referring your letter and attachment to the appropriate officer of the department, for study. If there proves to be a basis for any further action, I shall contact you accordingly.
Thanking you again for taking the time to write to me in this regard, I am,
Obviously, there was no basis for any further action because this letter was written in 1972 and there has been no correspondence since.
The other letter is from the Canada Department of Labour under the minister's signature and reads:
This is further to my letter of April 24 concerning the complaints of Messrs. Nescar and Gervais.
I have had a report from my Vancouver officers and I am told that the complaints have been previously taken up with the provinical authorities and that as recently as February 19, the Honourable W. S. King, provincial minister of labour, has taken the position that these matters fall within the internal administration of the union and that his department has no basis for intervention.
In the circumstances, you will appreciate that there is nothing that I can do as federal Minister of Labour, to assist the complainants.
Well, Mr. Speaker, would you have expected a different answer from the two labour ministers-of course not. Under what law would they act, unfair labour practices? That only applies to unscrupulous businessmen.
Let me relate to you a personal experience which involved a government appointed mediator appointed to settle a dispute not between my company and the union, but the work force of my company and the union. The
Canada Labour Code Amendment dispute, Mr. Speaker, resulted over the fact that not a single employee in our plant had the privilege of being asked whether or not he wanted to join the union. That was settled between the B.C. government-and may I say that it was the former B.C. government that made the settlement- and a union, not after the plant was built and in operation but before it was built and in operation. The decision was made to sign a union agreement with people who were not part of the labour force of my company. My colleagues, my lawyer and myself were meeting with this person who posed the questions to us about whether our intention was merely to build up the business to sell or whether we intended to make a career of it. His advice was that if the former was the case, we could become quite the heroes if we held out, but if it was the latter we should sign up because if we did not the union would break us.
Well, Mr. Speaker, I had more faith in the integrity of that union than the British Columbia government had at that time. I had to have because my neck was stretched into the front door of the bank 36 inches. The manager's office was right beside the door and I could visualize a big long knife under his desk. I have little to offer to that industry but some principles and I intend to stick with them. We have still not been able to sign an agreement with the union and our men are denied the benefits of union affiliation. The only thing the certified union ever did for them was to hold repeated strike votes which the work force always turned down because they simply did not have a choice whether to sign or not.
Meanwhile, the union keeps negotiating and the only contract it will sign has a union, not a man or business security clause, which prescribes that we may do the hiring all right but that, if the man has not joined the union after 30 days of his employment with us, we must fire him. Now, Mr. Speaker, how do you fit that into the Canadian Bill of Rights? I am compelled, as a businessman, to make it a condition of employment, at a time when six per cent of our labour force is looking for work, that a man must become a member of an organization which is controlled from the United States.
You know, Mr. Speaker, interestingly enough, I have argued the justification of such a clause with some of the union bosses. I even remember arguing on the other side when I was a member of a bargaining committee with the mine, mill and smelter workers. One fellow told me the other day that if only a portion of the men would sign up and pay, the others would get a free ride and all the benefits of the bargaining process. He compared his union with the institution in which I am now speaking, Mr. Speaker. He said-and it almost made sense, because it would be fair to say that the unions are second in this country, in power and control, only to this place-"If I voted NDP and the Liberals got into power, I should not have to pay taxes." I am just about prepared to go along with him on that, if what he said would hold true for the Conservatives as well. Yes, Mr. Speaker, this is how far it has gone. So powerful are some of these unions today that they confuse themselves with a democratic institution.
How did they obtain this power? Well, let us look at the pension plan. I am, as an employer, compelled to deduct-

March 14, 1974
Canada Labour Code Amendment


Mr. Speaker:: Order, please. I interrupt the hon. member, to tell him that his time has expired. He may continue if he has the consent of the House.


Some hon. Members:: Agreed.


Mr. Speaker:: Is it agreed that he continue?


Some hon. Members:: Agreed.


Frank Oberle: Thank you, Mr. Speaker, and I thank my colleagues. As I was saying I am, as an employer, compelled to make deductions for the union in connection with the pension plan, even though less than 30 per cent of the membership will ever benefit. Why? Because you must be in the industry for at least eight years. In most northern areas of Canada people only work in the construction or wood industries for a certain period of the year to supplement a farming venture or some other small business. So, such people are making a donation to a nice, neat, powerful block of wealth. They know little about the administration as, in many cases, it is carried out in the United States.
Well, Mr. Speaker, the government of the day demands speedy passage of a foreign investment bill which would stop foreign interference in the sale of eight locomotives to Cuba-imagine the Cubans wanting to play railroad! However, no one ever dares to look at the books of some of the great unions, to find out in what way the Canadian people are forced to spend their money. I wonder what happened to the $50 million which in 1971 went to the United States.
If this institution, Mr. Speaker, has been given any mandate by the Canadian people, it is a mandate to make sure that no one single person or group obtains too much power, be they business, church or, oh yes, union. It is then up to the people of Canada to keep us honest, so that human nature does not influence our deliberations, as might happen if we are allowed to become too powerful.
You see, Mr. Speaker, I grew up in a country where fat and lazy politicians and a greedy, arrogant business world allowed a third group to assume too much power. We all know that this world will never quite recover from the ensuing results. My father was a workman who protested against his union leaders. I will always hear the sobs of anguish, pain and despair which my mother tried to hide from us kids when we had to leave our home and move to another country. But I can also speak of the pride we feel for having questioned the system.
Well, Mr. Speaker, I wonder if it is not time to question the validity of some union agreements in Canada today. Since I have spoken out I have received literally hundreds of letters from various places, all lending support to my argument. The press is responding. It is not uncommon to see reports such as I have in front of me. One headline reads, "Tunnel, rock union picketed by workers". Another reads, "Union bitterness still not finished". Still another says, "Workers picket their own union". I will not read the articles. Oh, how I should like to provide some of these people with the opportunity of presenting their case before a standing committee of the House of Commons; for they, too, have a right to protection under the law. Of course, my colleagues will very likely assure themselves

that this will not happen, that we are no different from the ordinary politician, so why rock the boat?
The irony is that it is only human nature-I say this because of the union security clause, the blank cheque and government protection-which affects seriously the service one would expect unions to provide to their membership. The only real services the unions offer today involve services established by the government, services like those provided by Manpower, on the job training and other similar services.
Let us consider the pension plan for a moment and talk about the 30 per cent who qualify. When that faithful member who is in that bracket retires, he might well end up with a pension of $65 per month. My hon. colleagues know, of course, what happens to that $65. Our friend will get his basic old age pension of $107 per month. In addition, he will qualify for an income supplement of $77 per month which shrinks, however, by $65. All he will have left is $12. So, he will get no more and no less than anybody who has never contributed to such a plan.
However, it gets worse. If we suppose that the pension exceeds the $77 and our friend is married, the government will combine the income of the married partners and take the rest off his wife. How many of my colleagues ever had a representation from any union protesting that kind of confiscation? Why should they have paid? The union had the benefit of the members' savings and will continue to get it. The same holds true, of course, for the guaranteed dues. Why should one fall over himself in the service of his fellow man if the cheque is guaranteed in any case?
My fight on behalf of the workman in our plant, Mr. Speaker, has earned me an action in the Supreme Court of British Columbia. I am, for this reason, reluctant to relate my own experience. All the same, I hope and pray that my tenure of office in the House of Commons will give me the opportunity, even if not today and even if my bill does not reach committee, to bring the case of thousands of unfortunate Canadians to the attention of the public, even though the government in the interest of expendiency will ignore their plight.
It is wrong, as a condition of earning a livelihood in this country, to force a person to join a union, church or other fraternity, and then to force that person to have a portion of his earnings deducted from his pay. We can only make the union movement in Canada effective if we remove this type of discrimination. My bill provides for that. It would take the first and most important step in tearing down the barriers to which I referred earlier. If passed, it would give the manager the opportunity to visit the lunch room and discuss his business with people who know much more about their jobs than he does. Conversely, the employee will have the means to communicate directly with management if he is not in his union's confidence.
I hope that my colleagues will have the intestinal fortitude to act before it is too late.


Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, the hon. member for Prince George-Peace River (Mr. Oberle) followed a long road this afternoon before coming to the point with which his bill deals. He seems to be disturbed by something that took place in British Columbia. The example he referred to comes under provincial jurisdic-
March 14, 1974

tion, I think, not under federal jurisdiction, and that condition would not be corrected by the bill he is proposing for consideration this afternoon. He seems to be most disturbed by the power of unions and seems to think that his bill somehow will enable us to consider the question of Canadian unionism as against international unionism.
The hon. member is asking for model legislation. He feels we have not yet found an effective tool for settling disputes. He is against business tycoons and foreign control of our labour force. On the other hand, we find that at the centre of the hon. member's bill is an extremely interesting concept, one which can be debated without raising all the other elements I have mentioned. It concerns the responsibility of an individual who chooses not to join an organization which benefits him. The hon. member apparently believes that an individual who, in his work, enjoys the advantages of wages and fringe benefits which are the result of a lengthy and elaborate process should not be obliged to contribute financially to the support of the union which represents the collectivity of employees.
This is a view which is shared by others. We have heard it put forward by organizations which base their representations on religious grounds. They argue that certain religious convictions, if sufficiently strong, should excuse an individual from the obligation to join. It so happens, however, that economic conditions have improved and that society has done very well as a result of the ability of employees to organize themselves. Unionism is not a phenomenon limited to non-professional workers. There are many well-established unions among professional people such as doctors and lawyers who have found it desirable, though in a different manner and using different techniques, to group themselves in a way which permits them to defend their interests and also to provide, I suppose, for certain standards of performance in the interests of their own reputation and, supposedly, of the public at large.
If we were to accept the proposal put forward by the hon. member for Prince George-Peace River, it would mean that certain individuals would not be obliged to contribute to the bargaining units to which they belong, and their employers would not be under an obligation to make the relevant deductions from their pay. It seems to me that if we weigh the pros and cons of this issue it will be seen there are great weaknesses arising from any decision which would permit this to take place. The union or bargaining unit representing the workers would no longer be able to come to the full support of those represented by it. Moreover, it would be reasonable to ask why a man or a woman who is deriving a benefit of some kind from the work of a union should be excused from the reasonable burden of contributing in the form of dues and fees to the maintenance of the bargaining unit which is working in the interest of the group, including the individual concerned.


Some hon. Members:: Hear, hear!


Mr. Caccia:: It does not take a genius to see this side of the question. I was somewhat disturbed to hear the hon. member describe unions as though they were monsters, as though they were entities beyond control, as though they
Canada Labour Code Amendment were not, in reality, the sum total of the individuals who were trying to form and run a reasonably democratic institution. In the end, a union is simply an organization of human beings; it will be as good or as bad as the people who form it.
When the behaviour of a union leaves something to be desired, it is usually because its members have failed to take an active interest in its operations, failed to attend the regular meetings of their local or to take an active part in the organization. Of course, this applies not only to unions but to all organizations of human beings. To conclude that unions are negative entities, or something to be afraid of, is to display a lack of understanding of what the union movement is all about.
As I say, the hon. member has raised an interesting point for debate. I imagine it was discussed 100 years ago and I would not be surprised if it were discussed for years and years in the future. It really comes down to the rights which an individual should enjoy in society. In my opinion, the amendment which the hon. member proposes is not acceptable.


Mr. Paddy Neale (Vancouver East):: Mr. Speaker, I rise to oppose Bill C-104, and I do not think that catches the House by surprise. Frankly, it is beyond my comprehension why the hon. member for Prince George-Peace River (Mr. Oberle) would even attempt to introduce this regressive amendment to the Canada Labour Code, except that I notice that in the Parliamentary Guide he is listed as a businessman in the town of Chetwynd, B.C. I can only assume that he is engaged in monkey business in Chetwynd, because that is what his bill smacks of to me. Frankly, it will not help one bit his petty little beef with the union in his industry.
As the previous speaker said, this amendment would only cover workers under federal jurisdiction. All the outpourings of grief on the part of the hon. member dealt with unions certified under the labour legislation in the province of British Columbia. It seems to me that what the hon. member is really after is to make an obvious and blatant attempt to weaken and destroy all trade unions falling under the jurisdiction of the Canada Labour Code, which proves to me that the hon. member is tremendously anti-labour, and consequently anti-worker, in spite of his protestations that he was not rising to make an attack on trade unions, the workers, but was going after employers and others. I did not hear any comments in his speech that were not directed against trade unions and against the workers. For the whole of his 20 minutes, that was the diatribe I listened to. This really should not surprise me because I have ascertained since coming to this House that the great majority of the members of the Tory party fall into exactly the same category-anti-worker and anti-labour.
I was active in the labour movement in the hon. member's province, namely, British Columbia, for over 30 years before being elected to this House and I feel I am more than qualified to speak on this subject. The hon. member stated that he had been a member of the IWA. I joined the IWA in British Columbia in 1939, and I am still paying my $8 a month dues into that organization, even though I

March 14, 1974
Canada Labour Code Amendment could take a withdrawal, because I want to participate as much as I possibly can in one of the most democratic organizations anywhere in the world.
When the hon. member speaks of lack of democracy and shows contempt for anyone who suggests comparing the trade union movement with this House, it becomes obvious that he has never participated in the affairs of any union, or he could not possibly have made those statements. My union, the International Woodworkers of America, is an international union. He decried the fact that we had international unions, but I did not hear him mention once that the parent body of just about every employer with which the international union deals in British Columbia is located in the United States. They are all U.S. companies, and if anyone suggests to me that we should not be working together, on both sides of the border, against these monstrous employers, then I say he does not know what he is talking about.
Let me tell the hon. member, since he wants to talk about democracy, that in the IWA, as in nearly every union, officers are elected by secret referendum ballot, from the international president down to the local officers, the regional officers, the business agents, the shop stewards on the job, the committee members and safety committee members, as well as any other position in the union that you can name. They have campaigns that members in this House just could not believe as to politics, campaigns that are much more bitter at times than any federal, provincial or municipal election campaign, but nevertheless in the main they are good, honest, democratic election campaigns.
When I started work in the province of British Columbia in 1939, I went to work for the largest company in the province and one of the largest in the world. At that time there was no union, and it did not take me long to find that I was subject, as were all the other workers, to the whim not only of my foreman but my superintendent, the manager, the general manager and anybody else who took a dislike to me. There were times when I had to pay the foreman on payday either $5 or give him a bottle of whisky to keep my job in the industry. In 1939 jobs were hard to come by, so you did what you had to do. Conditions were absolutely atrocious. Wages were bad and so were living conditions. The only thing that was good in the logging camps in those days was the food, and I will say we had the best food. But as for the rest of it, it was absolutely atrocious.
The first union organizer showed up in the logging camp that I was working in and I took union cards from him and went round to sign up workers I was engaged with. I was fired four days later for union activity. This is the situation the hon. member is trying to bring back. Frankly, if he has his way with this kind of amendment, then all an employer has to do is to make darned sure that every new employee that he hires is anti-union, and under the existing legislation it would not take very long for that union to be decertified. Then we would be right back to where we were. Frankly, Mr. Speaker, this is eighteenth century legislation that the hon. member is proposing. It is not even nineteenth century legislation, leave alone twentieth century.

People are still telling me what the hon. member said, that maybe unions are not as necessary as they used to be, since employers are now enlightened and would not dare treat their workers as they used to treat them before the advent of the labour movement. I have had practical experience of these enlightened employers, Mr. Speaker, and I should like to cite to hon. members just one example.
There is a large forest products company in British Columbia called Canadian Forest Products. It is the only B.C.-owned company in the province, except for some small ones. We organized that company after a very difficult struggle and I assisted in that organization. Finally we got a contract. We have had some difficulties with the owners of the company over the years, but in the main they have adhered to the finest contract in the woodworking industry to be found anywhere in the world. The workers are the highest paid, the best working conditions, the best fringe benefits of any workers anywhere in the world, and these benefits were negotiated by the workers through their elected officials representing them at the bargaining table.
This company bought a sawmill that was in existence in the province of Alberta, and the IWA once again went into that province and organized the company. The same employer, who was then paying the minimum wage in the province of British Columbia, $3.25 an hour-this was some years ago-was paying $1.35 an hour base rate in the province of Alberta. The International Woodworkers contract only called for $1.85 base rate in Alberta, and this company refused to pay it. The union was forced to strike the company. The strike lasted one year and then it was broken. The same employer that we had in the province of British Columbia-this enlightened employer-destroyed the union there, and only just recently, after some four years, the union went back in there with certification and is trying to get a contract. So no one need tell me that employers have changed in any way.
What most people do not understand, Mr. Speaker, is that we live in what is called a free enterprise society. In my opinion, it is neither free nor enterprising when you consider the combines investigations and fines paid by monopolies, cartels and multinational corporations. But despite this it is called a free enterprise system. The labour movement-I have been criticized for saying this- is a necessary evil in the free enterprise system. The late President Roosevelt said that if he were a worker, the first thing he would do would be to join a union, because under the system that was absolutely necessary. John Paul Getty has said many times that he would rather deal with organized workers in a union than try to deal with them individually.
We have an adversary system. The employers, the owners of industry, invest their money for only one purpose; that is, to use our natural resources and our labour and make a profit through the production of a product at the cheapest possible rate for resale at the highest possible price. Conversely, Mr. Speaker, the labour movement's role is to get the highest wages possible for the people they were elected to represent and negotiate for, and to obtain the product at the cheapest possible price. So there will always be a conflict. If the hon. member for Prince George-Peace River thinks that conflict will disappear,
March 14, 1974

without the trade union movement being totally destroyed or forced into compulsory arbitration, he does not know what he is talking about.
The trade union movement has been condemned for many years by the news media, by every chamber of commerce and by every anti-labour person in this country. We admit that in the labour movement we do not have a very good public image, and that is to be expected. The news media itself must negotiate with unions. They do not like unions and they do their damndest to paint as black a picture of us as they possibly can. The only way trade union leaders could become nice people in this country would be if they abdicated their responsibility and sat down quietly with employers and accepted anything they offered. You must bear in mind that if they did that, they might get nice press coverage but at the next election of the local, the region or the international they would be put out of office and out of a job because the workers would not stand for that kind of trade union leadership. I would not blame them and would suggest that the leaders be removed.
Let me touch upon a couple of things the hon. member for Prince George-Peace River said about unions. He said that unions were foreign-controlled. There are many unions in this country that are Canadian, and there are some in respect of which the members opted to affiliate with international unions. Had it not been for the international unions coming into this country many years ago to help organize by providing experienced organizers and by putting up the money to fight these monstrous employers, with all the money and brains they had at their disposal, we would not have in Canada the trade union movement we have today.
The hon. member said that only the wealthy industries were unionized. I suggest that he go to Winnipeg and Montreal and look at the clothing industry, where employees are organized and are paying dues to a union. They are among the most poorly paid employees in the country. He should also study the canning industry in the province of British Columbia, another of the poorer paying industries, where the Union of Fishermen and Allied Workers has worked for many years to organize and improve the lot of the workers.
The hon. member also spoke about inflation. It took us years to convince members on the other side of this House that wages were not responsible for the inflationary spiral, and the Prime Minister (Mr. Trudeau) admitted that the other day. We are still dragging behind, with the Tory party using the same stupid arguments that we have heard for years. The Economic Council of Canada shot that argument down in flames. Even the public relations man from the University of British Columbia hired by a previous government to try to convince the people of Canada that wages were responsible for inflation refuted that suggestion. He admitted that wages are not the cause of inflation in Canada.
The hon. member spoke about the power of the unions. I suppose he does not know that less than one-third of the workers in Canada belong to a union; that two-thirds are still at the mercy of the beneficent employers he was
Canada Labour Code Amendment talking about, and have no protection. The only way they receive any assistance in the way of wage increases is after a legitimate union has negotiated, and sometimes has gone out on strike, with the workers suffering before getting an increase. Then the employers of non-organized employees grant a relative wage increase.
The hon. member also spoke about union executives running the lives of their members. Let me tell him, through you, Mr. Speaker, that every time there is a strike in Canada there is a secret ballot conducted and every member of the union votes whether he wants to go on strike or not. I am sure they must have been anti-union employees the hon. member spoke about when he referred to those who have constantly voted against strike action in order to leave the union in a precarious position. By law in this country, every time there is a strike there must be a secret ballot and the rank and file members of the union decide whether to go on strike. The leaders cannot pull them out on strike, as was suggested by the hon. member.
I have spoken about democracy because the hon. member referred to it. Let me say that in my honest opinion the most democratic organization I have ever belonged to is the trade union movement. This bill is only an attempt to drive us back to the eighteenth century. The hon. member also referred to union shops, closed shops and the Rand formula. These conditions took a long time to come into being in this country. They were developed step by step with, first, the open shop, then the Rand formula and then the union shop, in some instances a closed shop. These conditions are absolutely necessary in this country because of the situation we face respecting employers in North America as opposed to those in European countries. Employers in Canada and the United States still feel that the trade union movement is like a plague of locusts, and if they keep on fighting them they eventually might go away. They continually try to weaken the unions, and with the assistance of people like the hon. member for Prince George-Peace River they just might be able to do that, particularly if this kind of legislation is ever allowed to pass.
Mr. Speaker, I see that my time is just about up. I would urge reasonable and sensible men in a free, democratic country to allow free, democratic workers to make their own decisions. I thought the hon. member was quoting me when he spoke about paying taxes, because I have used that argument many times. If 90 per cent of the workers in a plant want to join a union, why should the other 10 per cent sit on their butts and inherit all the benefits negotiated by the representatives elected by 90 per cent of their members? No one in his right mind, as far as I am concerned, can argue against the union shop or the Rand formula.
We have a strike on right now because a U.S. company threatens to close its doors and move its operation back to the United States because in the United States the employees have no union security. The company is hoping to smash the union. This should never be allowed to happen in Canada.
I see that you are about to rise, Mr. Speaker, so I will conclude my remarks immediately. Let me just say, in closing, that I have been a member of the trade union movement for 30 years and a trade union leader for 25 of

March 14, 1974
Competition Bill
those years. I am proud to say to anyone in Canada that I have been a trade union leader, not just because trade unions have given our people many benefits and more money but because they have given them dignity, which is something we never had before the advent of the trade union movement.


Mr. Speaker:: Order, please. The time allotted for the consideration of private members' business having expired, I do now leave the chair.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Gray that Bill C-7, to amend the Combines Investigation Act and the Bank Act and to repeal an act to amend an act to amend the Combines Investigation Act and the Criminal Code, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, I would first like to congratulate the hon. member for Trinity (Mr. Hellyer) for his excellent speech this afternoon; I thought it was an extremely thoughtful contribution. I would also like to congratulate him for having changed the Conservative Party's position on combines. It is a very convenient approach to have the hon. member for St. Paul's (Mr. Atkey) lead off with sort of faint praise and indicate his support, and then have the hon. member for Trinity, with the rest of them following through, condemning the whole combines legislation approach which I think a Conservative government was very instrumental in enlarging.
I agree generally with the analysis of the hon. member for Trinity, although there are some exceptions to my agreement. One of those exceptions is the attitude he took toward condemning big unions as contributors to inflation. When you talk about big unions, you talk about auto workers, steel workers, packing house workers and oil and chemical workers. If he would look at the record, he would find that in those industries price increases have been among the lowest in this country, mainly because their productivity has been rising substantially. To say that those unions have contributed to inflation is contrary to the facts.
[Mr. Neale (Vancouver East).J
There are some difficulties, and I am surprised the hon. member did not point them out and how they arise in creating an inflationary atmosphere. The real problem is not in industries where the big unions exist; it is that other sectors of our economy cannot match the productivity increase in steel, automobiles and chemicals, and therefore as they seek to obtain commensurate benefits the pressure in the service industries contributes substantially to inflation.
In looking at the combines legislation, it seems that the members who have come to the defence of the bill are using the argument of all kinds of small benefits to support the legislation. The small benefits that they trot out, no matter how you total them, are still small benefits. A whole bunch of zeros multiplied by zero still comes out as zero. Frankly, I found it very difficult to understand either the ferocious opposition to the legislation by the business community or the kind of support for the legislation by some academics who have been to my office urging me to support the bill.
So far as business is concerned, it seems to me that if this legislation does anything, it protects business because it really obscures the problems created by business in our society. If anything, it simply puts a price on their misbehaviour. It does not make it impossible for them to misbehave, nor does it allow their misbehaviour; it simply says: If you do this, we will impose a penalty on you and you will pay a price for so doing. That is not a bad deal for business and I find it very difficult to know what they became so excited about.
The one area given to business as a concession, and which I presume reduced their opposition, was the section that now says directors of a corporation will not be held liable for the actions of the corporation. This is ironical in a way, because for years the same people have been arguing that trade union leaders should be held personally liable for the actions of trade unionists. Then at the first opportunity they get, instead of really continuing the argument about holding people responsible and liable, they simply say: We want to be exempted as well. So another of their favourite arguments has gone down the drain.
I do not see how consumers will benefit in any substantial way. Many of the things the bill sets out to correct, such as bait, switch and pyramid selling, do not involve many consumers. How many consumers are really involved in pyramid selling? You must have an enormous streak of stupidity in you to go for one of these pyramid sales clubs. The only people I know who were trapped were people who were persuaded that they would make a lot of money without having to make much effort. Perhaps we should have laws protecting people from their own cupidity. It is probably just as well to have something like that, because occasionally somebody relatively innocent may be trapped in that kind of swindle. This is the kind of swindle that an ordinary person sees through very easily. Most of the people who get caught in it are looking for a fast buck themselves and I sometimes wonder how much sympathy should be extended to them.
The academics, of course, will have another field day. Some of the academics in Canada have made their living from describing the combines legislation, enlarging upon
March 14, 1974

it and calling for tighter controls. Usually they argue: We need more teeth in the legislation. It is a sort of cops and robbers approach. They say: We must make it tough; we must strengthen the combines legislation. Some of them, I suspect, wrote their first essay in politics or in economics on combines legislation, then developed it into an MA thesis and then into a PhD thesis, and they have lived off it ever since.
However, this is not really important legislation and it is hard to vote against the bill because it does provide a few minor benefits, just as it is hard to vote against anything of a motherhood nature-and this is obviously a bill of that type. I listened to the defence and found that it was of a minor kind. Government speakers who told us how valuable the bill is were really making an effort to put together a valid argument in support of the present combines legislation.
I have reservations about this bill. If it were just a minor bill with minor benefits in it, there would be no great cause for complaint. We see quite a few of these bills in the House, and one might argue that any improvement is worth supporting. On that basis the bill is probably worth supporting because it provides some minor corrections in our society. But it seems to me that a very serious problem is involved in the entire concept of the combines legislation as we now know it, and just trying to correct it in a minor way does not take care of the problem. The combines legislation, in my view, stands in the way of our society facing up to the need to find serious answers to serious economic problems. It merely obscures those problems, rather than casting light on solutions to them. In that sense I agree with the hon. member for Trinity who said much the same thing.
The combines legislation has never worked. There is no evidence that it has ever been effective. Those who have been caught and prosecuted under the combines legislation, or by the restrictive trade practices group, should have been prosecuted not because they contravened the legislation, but for idiocy-because you have to be an idiot to be caught and prosecuted under the legislation in the way it is drafted. If you look at how these prosecutions arose, you will find that in some cases contractors held a meeting, and because they did not trust each other they kept minutes of the meeting or called accountants to clarify the meaning of the agreement they had reached. On one occasion when the bids were opened a record of the meeting, with the prices upon which they had agreed, fluttered out with one of the bids. With evidence like that, this group was prosecuted. There are many examples of that type. We have had prosecutions in the glass industry and the paper industry; but look at those industries today. Prices are identical right across the board. There is not one paper company, one glass company, underselling another. What has been really accomplished by the prosecutions which have taken place in the past?
We live in a society where oligopoly is the rule, rather than competition. That may be one of the reasons I reacted so favourably to the description given by the hon. member for Trinity of how oligopolies work and how business agreements are made. He was in business, Mr. Speaker, and I was in business. Both of us know that this is done
Competition Bill
without sitting down and holding formal meetings in order to get agreement. I am sure neither he nor I participated in that kind of endeavour, but we have seen it take place often enough either over lunch or on the golf course. Somebody in the group says, "We cannot go on like this; we will have to raise prices." There is always a leader who raises the price and the others follow suit.
This advantage always belongs to an oligopoly. Under those circumstances, you cannot get a conviction. In circumstances of that kind, in an area where there are relatively few sellers seeking to protect their positions, it poses a worse situation for society to deal with than a monopolistic situation. Consider what happens when an industry is a monopoly. Take the examples of the Bell telephone company and the gas transmission companies. Obviously they are in a monopoly position, and obviously the government has to step in and do some regulating.
Of course, if there were a number of telephone companies I am sure we would not have any regulation of telephone rates. I am convinced that rates in Canada would be infinitely higher and that telephone service would be infinitely poorer. In a way, this is a kind of heretical thinking, but if you ponder the century we are in, the kind of technology that exists and the size that companies have to be in order to take advantage of that technology, it is clear that we must indulge in thinking which is different from that of the past when dealing with these matters.
Sometimes people talk about competition between banks, but the minute one bank announces it is going to raise interest rates by half a percentage point, all the other banks follow suit. Then when you get representatives of the banks before a committee of this House and you say, "Here is clear evidence of collusion because you all raised your interest rates; the day bank A's rate went up in the morning, it was followed by bank B in the afternoon and then there was a long drag, maybe for one day, before the others followed suit," the response of the banks is, "That is really an example of perfect competition." What they are saying is that if competition is perfect, everybody will be charging the same rates because they are all responding to the same market forces and, as a result, must charge the same rates.
Would we not be further ahead if, instead of pretending to ourselves that it is possible to have competition in the banking industry, we legislated the spread between what banks can pay and what they can charge for money? It is pretty hard to legislate what banks will pay for funds, because that tends to respond to international economic situations. But we can legislate the spread and say they are entitled only to a certain difference between what they pay their depositors and what they charge those who borrow from them. However, we are not willing to do that. We go on pretending that in some strange way we can make the banks compete with each other.
Other examples come to mind. Just a few years ago General Motors came out with a price increase. They were followed within a day or so by the other automobile manufacturers who increased their prices by the same percentage. But for some reason or another General Motors decided that their price increase was a mistake and they reduced the amount they were going to charge for

March 14, 1974
Competition Bill
their cars. Again, everybody else in the industry followed suit. I am sure General Motors would argue, as the banks did, that that showed we have a competitive society in which everybody responds to the market forces. That is one interpretation. I think a more realistic interpretation is that in every industry, particularly industries characterized by large firms, there is a price leader, and it is not market forces which firms are responding to but the price leadership of the largest, strongest firm. Whichever way that firm goes is a signal for all the rest of them to go in the same direction. Anything else is suicidal. Who wants to pick a fight with General Motors? I do not think there is any firm in the automobile industry prepared to do that. The others don't mind nibbling around the edges to get an advantage here or there, but they know that when a firm reaches the size of General Motors, you don't fight it any more; you co-operate with it.
Sometimes it seems as though General Motors have a policy of keeping their competitors alive. I often wonder why, with their strength, they do not drive every other manufacturer out of the field. They have such a large share of the market that they could drive every other manufacturer out of the field. But if they did that they would then become a monopoly, and being the only one remaining in the field they would be subject to government regulation. It is much better for them to allow a few competitors to exist with lower profit margins, in order to enable them to take higher profits that they would not get if they were regulated by government.
I can recall one instance before the 1966 joint parliamentary committee on consumer prices when we had a clear example of companies behaving in this way in order to keep a competitor alive. As I recall the case, it had to do with a leading manufacturer of baby foods in Canada. It was a branch of a multinational corporation with its parent organization in the United States. It had 80 per cent of the market, and its only competitor was in danger of going broke. The competitor had been losing its share of the market year by year and finally was looking at a loss situation. Then came the introduction of glass jars to take the place of cans. Up to that point baby food in Canada had been marketed in cans, but when glass jars arrived consumers showed an obvious preference for them. The weak competitor went into glass jars, but it took it three years to reach the break-even point when using them. During that time its larger competitor would not touch glass jars.
We asked the larger competitor, "Didn't you know that the public was in favour of glass jars? Didn't your parent company in the United States, which has been in glass jars for year, tell you this was the direction the industry was going?" The answer was, "We really did not know. The American company did not tell us anything about its operations, about which way it was going and what was its experience." We can believe that if we wish, Mr. Speaker, but what is more believable is that this company deliberately kept its competitor alive rather than run the risk of arriving at a monopoly situation and coming under government scrutiny.
As I say, very often an oligopoly situation is desired by large corporations because the public thinks it is protected when there is a smaller competitor visible. But in truth

there is no competition and the larger companies are free to raise their prices in a market largely of their own making. In the particular case I cited, the competitor did not have any market in the maritime provinces or British Columbia.
Do hon. members think that the person with 20 per cent of the market, who can hardly stay alive, is going to enter into a price war with a giant who has 80 per cent of the market, who is making tremendous profits and can hold out indefinitely? I do not think so. This is why it seems to me that a bill calling for the market to behave in a way that the market has no intention of behaving, and when you have no way of even demonstrating that there has been any collusion or conspiracy, is doomed to fail. That, I think, is a general defect of combines legislation. It takes us off guard; it pretends we are getting some protection, when in fact we are leaving the market wide open to the rapacious and the powerful to do as they please.
When we talk about competition I think we must realize that in many areas of our society competition is no longer practiced. In some cases it may no longer be possible to practice competition, and in some cases it may not even be desirable. I should explain what I mean by that. When we talk about foreign ownership, we generally take the position that the problem with foreign ownership arises from the fact that American capitalists are running a company, rather than Canadian capitalists. On very few occasions do we ever examine the real problem. We know that sometimes the problem is a question of extraterritoriality, that American directors are subject to American law. But usually the problem is that when American corporations set up branch plants in Canada, they virtually destroy our ability to be productive and competitive and enable the manufacturing industry in Canada to exist only because of tariff protection or because lower wages are paid.
The chief problem with foreign ownership is that it has virtually wrecked our manufacturing industry sector of the economy. That is not true of raw materials because these have to be sold on the world market and have to be competitive. But the domestic market is protected by tariffs. Analysis of the manufacturing industry in Canada shows that we employ 30 per cent more capital per worker and end up with 30 per cent less production because of the Dinky toy structure we inherited from the Americans. An example is the refrigerator industry. A country the size of Canada could probably tolerate two refrigerator companies, but we had 14 at one time, the same number as the United States. We had a situation, Mr. Speaker, where Americans in Canada imposed a pattern of production on this country identical to that of the United States. It might have made sense with a market 11 times the size of ours, but it made no sense in the Canadian economy. If you want to find efficient industries in Canada, sometimes you have to look at those industries which remain under Canadian ownership, like steel and cement, because they were able to adapt to our market rather than having imposed upon them an American pattern.
This is a clear example of where competition has worked to the tremendous detriment of our society and has contributed to a lower standard of living than we might have had. You may say it has given us more product variety-

but how much product variety do we need? How much difference is there between one refrigerator and another, one stove and another? The hinges are different or the door may be an inch shorter or longer, but there is a limit to the kind of variety you want in a society. Beyond a certain point it becomes a useless extravagance that most people neither need nor desire. It exists only because it happens to suit the particular competitive pattern of the industry.
That is one area in which I think competition has done us a terrible disservice. One of the reasons Canada has one of the most efficient steel industries in the world is that there is a level of competition, or production, that is appropriate to that industry, that is appropriate to the available technology and to the needs of Canadian society. One of the reasons we do not have that in the rubber industry, for example, is that you have every rubber company in the United States with a branch plant in Canada making the same range of products, but on a Dinky toy, miniscule scale compared to the United States.
Of course, the Canadian government compounds the situation by inviting an additional competitor into a market that is already overserved. What is the justification for the new competition? I am talking about Michelin. In fact, there is an additional justification for Michelin that has nothing to do with competition. There is a good argument for having a tire industry in the maritime provinces because this is where the industries should be directed. The question then arises, why do we not restructure industry from central Canada into the maritimes, rather than encouraging another one into Canada with the consequences it has on the entire industrial structure of the rubber industry?
Despite the mounting evidence of these changes in our society regarding the competitive position of various companies, despite the fact that so many firms, in order to even survive, require to be almost in a monopolistic position, we still go back to Adam Smith; the government still hangs its hat on the Adam Smith model of an economy. I do not know whether they believe it or not, whether they are bringing in this legislation because they have been urged by the so-called intellectuals in the business community, or whether they are doing what they have always done, that is, imitating the United States: because the United States has competition, combines legislation, then we must have it as well.
The only two countries in the world with these antiquated, outmoded ideas are Canada and the United States. In the rest of the world every country is moving in the opposite direction. They know that competition is no longer an internal matter but is another international matter. Instead of encouraging companies within a country to compete with each other, they are asking their companies to go out and compete with others all over the world. Instead of having combines legislation, they have rationalization boards which encourage the merger or the coming together of companies of suitable performance. It is that which makes the combines legislation in Canada so harmful. I must admit that the government senses some of this, and in clause 2 of the bill they are apparently going to deal with this particular problem-hesitantly, but apparently they are going to deal with it.
Competition Bill
What does it mean? Does it mean that we scrap the combines legislation and turn our whole society over to our competitors without any protection at all? No, Mr. Speaker, this is not what I am suggesting. What I am suggesting is that the competitors have to be held in check, that we have to do something about those who would take advantage of the weak in society. The way to do it is not through a combines policy which can be so easily evaded, or through an approach such as outlawing pyramid selling. I wonder how many weeks it will be before they come up with a new tactic that is not called pyramid selling?
It is a losing game, but there are things we can and should do. However, we will not be doing them as long as the government pretends the problem has been looked after because they have introduced combines legislation, new amendments to it and talk grandly about what a marvellous job they have done. What are the things we need to do? We need effective legislation. We have great problems with Bell telephone, arguing whether their legislation is as good as it should be. You can say one thing about the Bell company: it does not make a move in this country which is not scrutinized. It must justify its actions before the transport board. Often parliament is not satisfied with the decision of the transport board and Bell is forced to roll back its rates. The company must justify everything it does.
We should treat other industries in the same way, including banks. Banks should come under the jurisdiction of the parliament of Canada in the same way as the telephone company comes under its jurisdiction. Parliament removed the 6 per cent ceiling on the bank rate because the banks declared that the rate was unworkable. They made a good case for removing the 6 per cent ceiling, and parliament agreed but failed to introduce safeguards which would make sure the banks would not take advantage of the situation then existing, in which money was in great demand, thus putting them in a position to reap tremendous profits. There was no attempt to regulate the spread between what the banks paid for money and what they lent it for. That is the kind of thing I am talking about.
We ought to bring in selective price controls. We could still bring them in to affect particularly, the resource industry. The hon. member for Trinity and some of his colleagues talk about the terrible trade unions, how they are raising prices and the extent to which they are contributing to inflation. How does the hon. member equate his remarks with what is going on in the mining industry? Contracts were signed a few years ago, but there is no relationship between wages and the price being charged for zinc, nickel or iron ore. Why? Because it is demand, and not the cost of production, which determines the price on the world market. There is no attempt to control industry in that way. We made an attempt to control the oil and gas industry, which is fortunate. We should be introducing export taxes for all the natural resources we export. If windfall profits are to be made, they should accrue to the people of Canada, the owners of the resources and should be treated as a sort of depletion allowance. The people

March 14, 1974
Competition Bill
should get them instead of the companies which temporarily are working these resources.
We should move in the direction of greater public ownership, as it is almost impossible to know whether these companies are acting in the best interests of Canada. This has been done in the case of electric power. If a company abuses its privileges, then instead of imposing a fine which it may laugh at and pass on in the form of higher prices, we should expropriate it. Once we have expropriated, not many companies will feel like doing the same type of thing. We should let it be known that defrauding the Canadian public is a serious business, that taking advantage of a situation to the detriment of the Canadian public may lead, in certain circumstances, to expropriation, to a jail sentence and not to a gentle fine which the company can laugh at and shrug off.
We should consider taking away the tariff protection of companies which run afoul of the law. One of the key recommendations of the Macquarrie commission report on the combines legislation of 20 or 30 years ago was that companies guilty of collusion should have their tariff protection removed. That recommendation was never acted upon. It was recommended that this course be followed with a certain glass company and a certain paper company. When you ask why this was not done, you are told that we must save tariffs as bargaining counters in multilateral trade negotiations, that it would be wrong to take away tariff protection now because we could not bargain with another country when we want it to remove its tariff protection.
One of the most effective instruments for preventing collusion among companies has never been used. In some cases the tariff protection is justified. But those companies must live up to their responsibilities and must remember that the Canadian people are willing to pay higher prices in order to protect them. There is no justification for continuing tariff protection for a company that abuses its privileges by increasing prices unjustifiably.
The government could become a competitor with industry. Lately there has been much talk of the national petroleum corporation. Such an instrument can be used to compete with oil companies. Sweden has done this sort of thing effectively with its co-op movement. You need not take a large share of the market in order to be effective. If your share is 5 or 6 per cent and you work aggressively, you can force prices down. In theory, Crown corporations in Canada are supposed to compete with industry. Yet too often the people who work for Crown corporations play golf with the guys they are supposed to be competing against. They soon develop an understanding, instead of pursuing the path of defender of the public interest.
We should break up vertically integrated companies. To my knowledge, nothing like this has been done. What justification is there for oil companies to control the finding, refining and selling of gasoline? That is the sort of problem we face. If an independent organization appears on the scene, the big companies try to force it out of business. Once it has gone, they go back to their cozy arrangement involving vertical integration under which the only service stations serving you are the ones tied in with the big oil companies. There is little competition in that situation. Various commissions have made recom-

mendations regarding the oil industry. They have said that service stations should be separated from the big oil companies. Instead of action to carry out such recommendations, we have been presented with combines legislation.
Brand names should be looked into. Often brand names are abused and it is claimed that the product sold under a brand name possesses a quality which it does not really have. Also, we should if necessary remove patent protection. I see that those who drafted this legislation are concerned about misleading advertising. This, I think, is little but puffery. I agree that much advertising is idiotic. Nothing is more idiotic than pretending that men and women go about looking through closets, with their arms up in the air, revealing their underarms and spraying some substance on themselves. If you watch television you will be given the impression that that is how people behave. I think advertisers very much underrate the intelligence and sophistication of our public. I do not think we need to protect viewers against this kind of lunacy, because sooner or later the product itself suffers.
What is required, in my view, is a different treatment of advertising expenses. Our advertising system is designed to encourage this kind of idiocy. An advertising expense is deductible from income for income tax purposes. This means that every dollar a company spends on this kind of lunacy is deductible. It can deduct at least 50 per cent if it is in the 50 per cent tax bracket. It should be remembered that it is not only the consumer who pays for the advertising expense incurred by the company: every taxpayer in Canada pays. If somebody wants to push something that is of psychic benefit, is perfumed or is an underarm deodorant, that is one thing. On the other hand, I should not be required to pay extra taxes to bring some psychic benefit to somebody else. We need changes in this area.
In dealing with advertising, I am not dealing with it from the standpoint of whether advertising for underarm deodorants, is intelligent or not intelligent; I am dealing with it from the standpoint of the tax system.


The Acting Speaker (Mr. Laniel):: Order, please. I regret to interrupt the hon. member, but I must remind him that his allotted time has expired. He may carry on if he has unanimous consent.


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Laniel):: Do hon. members agree to allow the hon. member to complete his remarks?


Some hon. Members:: Agreed.


Max Saltsman: Thank you, Mr. Speaker, and I thank hon. members. I shall be brief. What I am really saying is that this combines legislation obscures the issue. It takes things which are really not problems and says they are terrible problems we have to deal with. The things which are problems and really do have to be dealt with are set aside and are not even looked at. The danger is that the public will think that something is being done, when in fact little is being done.
March 14, 1974

If we talk about standards, about making sure there is no shoddy workmanship, then certainly we can set standards. We do this in connection with weights and measures. There is very little of the type of heavy thumb on the butcher's scale activity left in this country. We can force standards to be adopted. We have done so in the electrical industry. Standards should be enforced. We should have a better Canada Corporations Act. Now the government gives us this piece de resistance to really show this is a wonderful piece of legislation, right up to the minute, and shows how this piece of extraterritoriality came in with the Worthington company. They say, "We are going to put that into the combines legislation package to show you what a well-rounded, beautifully developed thing it is." Except for one thing-it doesn't belong here: it belongs in the Canada Corporations Act, where you can clearly say that no director of a Canadian company shall act against the laws of Canada. And, if he does, he cannot be a director of a company. Why fool around with this matter in the combines legislation?
Also, we should go further with the corporations act. Those of my party who have had a chance to look at the corporations act have argued time and time again not only for this kind of a measure but for full disclosure. How are you going to know anything if you do not in fact have full disclosure? It is true we are getting more disclosure in oui society, but we are not getting as much as is required in order for us to make decisions. Rather than give us a good corporations act, something which would really protect the public, we get a little bit of it thrown into the combines legislation and the corporations act goes on in its unrepentant way.
To conclude, Mr. Speaker, if the government wants to say to this House that this is all they can do at this time, make a few minor changes and adjustments, as long as they are sufficiently humble about it and bring the legislation before the House in an attitude of humility and admit it is an insignificant measure which makes a couple of minor corrections, I will go along with it. I will respond to the bill in kindness and say to the minister that he has not come up with much, but that it is something. But I hope the government has no illusions that by bringing in this piece of legislation it has accomplished anything worth while for the Canadian people or has made any significant correction in what is essentially a bad market situation.


Mr. Jack Cullen (Sarnia-Lambton):: Mr. Speaker, I had not intended speaking on this bill, primarily because I think the minister did justice to the bill in his speech, as did his parliamentary secretary. The measure was introduced in the last parliament and is being repeated at this time. I think the Canadian public, and certainly small businessmen and the press, have had an opportunity to digest what is covered in the measure before us.
We just heard from the hon. member for Waterloo-Cam-bridge (Mr. Saltsman). He uses about eight different approaches when making speeches, and I think the one we heard tonight was what he calls his "pooh-pooh" speech. When he finds a bill as good as this one which is difficult to attack, one which has won wide acceptance in Canada in all segments of the business community and from consumers, it ill behooves him to attack the bill and cut it to pieces, so what we have is the hon. member delivering to
Competition Bill
us his "pooh-pooh" speech. His approach is: It is not a bad bill. It does a few good things, but it is really not all that significant.
Mr. Speaker, I did not hear or see the Minister of Consumer and Corporate Affairs (Mr. Gray) jump up and down, or pound his desk and scream that this was the greatest piece of legislation the government had ever introduced. I think it speaks well for the bill when it indicates this and nothing more. It is not a new bill; it is an amendment to a piece of legislation, and the amendments it contains bring important benefits to consumers, to small businessmen and to Canadians in general. The government had earlier announced its intention to bring in a new competition policy, to bring it forward in stages, and this bill represents the first of these stages.
The principal features of the bill before us include additional measures to deal with undesirable trade and advertising practices, the creation of a new, civil function for the Restrictive Trade Practices Commission which will enable it to issue orders to modify or prohibit trade practices brought before it, and provisions which will bring services in general under the legislation. That is what the bill attempts to do. To hear some members opposite comment on the bill, particularly hon. gentlemen in the far left comer of the House, one would get the impression that illegalities are rampant across the country, that Canadian businessmen are engaging in the kind of practices this bill is introduced to prevent.
Only a very small segment of Canadian businessmen and markets would be affected by this legislation in any event, because its provisions will apply only to very few of them. I took issue the other day with some hon. members who have a tendency to give Canadian business a black eye. I think the marketplace in Canada is probably as honest as any in the world. Mr. Speaker, you cannot legislate honesty, but I think you have an obligation, when someone does something which is contrary to what is fair in the marketplace, to bring in legislation to catch that particular irregularity.
Opposition members would be jumping to their feet, no matter what provisions the bill contained, if no machinery was provided to restrict unfair practices in the marketplace. They would be criticizing the government for failing to bring in measures to control pyramid selling, and so on. When corporations engage in illegalities, means should be provided for dealing with them; and in cases where the consumer is hurt, some redress should be forthcoming, as is provided in this bill.
As one who practised law for a few years, I remember dealing on all too many occasions with people who had signed promissory notes at the end of long contracts. They found the note had been assigned, usually to a finance company. The finance company sued for payment. The answer was, for example, that the cutlery had not been delivered, or it was not aluminum, it was tin, or whatever it was. There was no particular defence. No legislation existed to cover such a situation. There was no protection for the consumer. It is the obligation of provincial legislatures to afford protection in instances of this kind.
This party, this government, brought forward legislation to protect those who were on the short end of a bill of exchange where they really had no defence. We have an

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Competition Bill
obligation to keep businessmen on their toes and to let them know there is some law that will prohibit illegal activity. But for the most part, as I said earlier, most businessmen are honest. Any of them who get together to act in a dishonest fashion are probably a minority. Considering the billions of business transactions that take place in Canada annually, very few of our businessmen break the law.
The next aspect that I like about this legislation is its approach. The minister has followed an approach that I think is consistent with what the Special Committee on Trends in Food Prices said in our first report. I quote from that report:
Certain provisions of the proposed competition act dealing with consumer protection (e.g. misleading advertising, bait and switch selling) be split off into a separate bill and enacted immediately, and not be tied in with the provisions relating to monopolies, mergers, etc., requiring reconciliation with broader policy directions relating to industrial strategy and foreign investment.


Mr. McGrath:: That is not what this bill does.


Ronald George Atkey: Why did not the minister follow that recommendation?


James Aloysius McGrath: Yes, you are chairman of the committee. Why not?


Jack Sydney George (Bud) Cullen: As a result of that intervention, we know that the hon. member for St. John's East (Mr. McGrath) is here this evening. I hope he will have something constructive to say, instead of destructive. It certainly would be revolutionary to hear him speak in a positive way for a change. I see the hon. member for St. Paul's (Mr. Atkey) smiling. I know he likes this bill, and a little later I am going to quote a statement made by the hon. member for St. John's East, something he said about this bill last November. Hon. members opposite have now had a caucus and probably think they cannot praise the Liberals too much since we have done a great job in the first year. If they had to be careful about praising us in November, 1973, today they might have to be even more careful.


James Aloysius McGrath: What about the other recommendations?


Jack Sydney George (Bud) Cullen: Mr. Speaker, I have only 40 minutes so I cannot deal with all these interjections. I agree with the approach adopted by the minister. I feel that the Progressive Conservative Party would adopt a carte blanche approach if, heaven forbid, they were in power. These provisions would be cut to pieces by those who want to break the legislation. We need a careful approach that aims at particular targets. Where illegalities creep into the marketplace, we must deal with them we as we should.
One of the criticisms that is levelled at this bill is that it has taken a long time to bring it in, I believe something like three years from its inception. The regulations themselves will not have to be fully implemented until approximately two years after the bill becomes law. I agree with this particular procedure in this instance, and for this reason. Most of the people affected, in fact the very large

majority of the people affected, by this legislation are honest businessmen. As honest businessmen, they should be given the opportunity of meeting the requirements of the bill and not have to gear up and overnight make significant changes which might be to the detriment of their particular business. They have done nothing wrong and they are quite prepared to comply with the regulations; all they are asking for is a little time.
I heard the criticism earlier today that two years was not long enough. I would say to the honest businessman of this country that if he needs a little longer period in order to implement these regulations, I think he will find a sympathetic ear with this government. Some would rush with haste into these things, such as hon. members opposite. I would be a little wary if they were in power because then we would have something to worry about. We are not trying to do anything that is going to be to the detriment of the small businessman. If he does need a little time to implement the provisions of this act, then my view is that the government is right in giving them that time.
What does the small businessman think of this legislation? I should like to quote some of our critics in the press. It is of interest to note that we have received commendations from almost all sources in the press. I note, going outside the press, that Mr. Ruben Bromstein, who at the time was president of the Canadian Federation of Independent Businessmen, a body with some 9,000 members had this to say on November 5, 1973, speaking on CBC radio:
Clearly we are most pleased that the bill has been introduced . .. basically it is giving small business an opportunity to be protected by the law. And even after a decision has been made that somebody is violating the law, a small businessman will have the opportunity to sue in court to collect damages that have occurred because he has been hit by the people who are trying to drive him out of business, or are in some way affecting his business unfairly.
What we are concerned with here is that the government seems to have made a genuine attempt to catch the errors (at least that's the impression I'm getting from reading these provisions) and to try and, in a staging process, get at the problems that affect him.
Gail Scott, a CTV news correspondent, had this to say:
-the new act does go a long way to regulate continual consumer problems and, if implemented, will bring with it many of the changes that consumers have been asking for.
Mr. Bill Wilson, a columnist for the Montreal Star, writing in Ottawa on November 5 last had this to say:
There is some consensus in Canada that the consumer deserves decent protection from unfair practices and this is the biggest field where Mr. Gray has moved.
The Montreal Gazette for November 6, 1973, carried this headline:
Gray bill arms shopper against unfair pricing ads. Bill allows action by consumers. Athletes may get a break on binding contract terms.
Then I was interested to note that Mr. Geoff Stevens, writing in the Globe and Mail on November 6, 1973, said this:
Many of the bill's provisions make simple good sense.
Two encouraging aspects of the new bill are that it would bring a broad range of services (as well as goods and products) under regulation and it would give the Restrictive Trade Practices Commission the power to order a halt to illegal business practices.
March 14, 1974

We always save the dessert till the last, Mr. Speaker. Mr. Henry Ileald, writing in the Ottawa Journal on November 6, had this to say:
Both Grace Maclnnis (NDP Vancouver Kingsway) and James McGrath (PC St. John's East)-


James Aloysius McGrath: Order.


Jack Sydney George (Bud) Cullen: I continue:
-said the bill proposed worth while measures in the field of consumer protection.


Some hon. Members:: Hear, hear!


Jack Sydney George (Bud) Cullen: Mr. Speaker, if I may turn away from this Ottawa Journal column for a moment, the hon. member for Sarnia has a great deal to say about this, but it is very seldom that a Liberal is quoted favourably in the Ottawa Journal. At least, that has been my experience. If I may continue with Mr. Heald's comment, the article goes on to say:
Mr. McGrath said: "The bill offered a lot more than I expected". He called it: "an important piece of legislation ..."


Some hon. Members:: Hear, hear!


Jack Sydney George (Bud) Cullen: Mr. Speaker, I do not think we have a more severe critic, and when we get praise from such a source I am almost tempted to sit down and rest my case. However, since this is such an excellent bill I do have a few more comments to make. As I have indicated, this bill is not the greatest bill that has ever come down the pipe, nor are we suggesting that it is. It is an amendment to a particular piece of legislation that is presently on the books. But it does make provision for Canadian corporations and for subsidiaries of United States corporations, or for that matter any foreign corporation, to act in Canada as good Canadian citizens.
The hon. member for Waterloo-Cambridge has indicated one approach that he would like to see adopted. We have adopted the approach of making these amendments to the combines act. I am not concerned so much with the means as I am with the result, and the result is that subsidiaries operating in Canada have got to be told plainly that they have an opportunity to do business anywhere in the world and that they are going to conduct their business pursuant to Canadian foreign policy, not United States, British, French or the foreign policy of any other country. That is why these provisions are contained in this piece of legislation. If we dolled it up a little by putting it in another piece of legislation, then that would not bother me at all. I am not interested in the form; I am interested in the result.
Mr. Speaker, I know there are many others who want to speak in praise of this bill.


James Aloysius McGrath: Would the hon. member permit a question?


The Acting Speaker (Mr. Boulanger):: Does the hon. member agree?


Jack Sydney George (Bud) Cullen: Any time.


James Aloysius McGrath: Mr. Speaker, so far we have heard the hon. member tell us what other people have said about the
Competition Bill
bill so far as the business community is concerned. As the learned and distinguished former chairman of the Special Committee on Trends in Food Prices, I should like to hear him say what this bill means to consumers. He has not yet enlightened us on that score.


Jack Sydney George (Bud) Cullen: Mr. Speaker, now I know the hon. member has not read the bill.


Some hon. Members:: Hear, hear!


Jack Sydney George (Bud) Cullen: I hope he does read it before he gets up to read his speech, as there are others more knowledgeable than me who will follow him and point out the error of his ways, particularly if he thinks the bill does nothing for the consumers.


An hon. Member:: Let's hear what it does.


Jack Sydney George (Bud) Cullen: Mr. Speaker, when you have a court case you do not belabour the obvious. There are certain circumstances and situations in respect of which we say the judge can take judicial notice. It is not necessary to comment on or put something in evidence in court when it is self-evident. I do not intend to stand here and read the bill when I know the hon. member can read it for himself. The bill speaks for itself, but apparently not loud enough for the two consumer critics of the opposition.


Walter David Baker: Tell us about double-ticketing and how you are going to enforce that provision.


An hon. Member:: What are you going to do about the price of meat?


The Acting Speaker (Mr. Boulanger):: Order, please. I am not sure whether the hon. member has answered the question, if he has decided to make another speech or to continue with this speech. However, I understand that the hon. member for St. John's East (Mr. McGrath) wishes to ask another question. Whatever the situation, the hon. member has lots of time left.


James Aloysius McGrath: I should like to ask the hon. member, who has had a wealth of experience as chairman of the Special Committee on Trends in Food Prices, another question. I suggest that all the recommendations of that committee have been ignored. I should like to hear the hon. member address himself to the provisions of the bill dealing with double-ticketing and explain how the government intends to enforce that provision. Perhaps he would also direct himself to the misleading advertising part of the bill about which the committee had so much to say.
The Acting Speedier (Mr. Boulanger): Order, please. Perhaps the matter was not put in the form of a question, but it was explicit enough that the hon. member might answer.


Jack Sydney George (Bud) Cullen: Mr. Speaker, after listening to that rather wide ranging discourse, let me say that one of the difficulties in respect of the double-ticketing system, which the hon. member may be as well aware of as I am-

Competition Bill


Walter David Baker: Let's have no double-talk on double-ticketing.


Jack Sydney George (Bud) Cullen: I am trying to give a straight answer, which it seems to me might be difficult as the questions are so crooked I have to go around corners to get at them. Prohibition of double-ticketing might be extremely difficult to enforce.


An hon. Member:: Well, isn't that great.


Jack Sydney George (Bud) Cullen: You had better let me finish before you fall into another trap. The hon. member has probably read as many, if not more, newspapers as I have. After all, members in the opposition have more time to read than we do, because we are busy working. In any event, I read the newspaper article which pointed out one of the difficulties of the double-ticketing system. When a price is put on an item it is extremely easy to get a dark red, black or blue ink pen, strike out that price and put on another one. There will be some difficulty in enforcing that particular provision, but I think businessmen in the marketplace across Canada are on their guard and know that we will be looking at this matter.
I might point out that there are scientific ways of determining whether one, two or three prices have been put on a particular item. I am not suggesting it is not going to be difficult to enforce, just as many provisions of the Criminal Code are difficult to enforce, or even to lay a charge under, to say nothing of proving it. No one is suggesting that this bill is a panacea, and I hope there will be some amendments forthcoming. The hon. member, who is well respected-we are complimenting each other tonight-contributed a great deal to the deliberations of the committee, but sometimes when he gets before the cameras he has a tendency to suggest that the government has not followed all the committee's recommendations. I suggest he is confusing the issue by doing that. The government may not have followed all the recommendations of the Conservative Party, but it certainly followed the recommendations of the committee.
The committee recommended the establishment of a Food Prices Review Board. Such a board has been established and significant action has been taken. Only this afternoon we heard about some of the splendid actions taken by this board. The committee also recommended that money be made available to consumer associations so they could go into various areas they could not go into before and conduct more efficient examinations. I understand the minister is increasing that amount this year by something like $100,000.
I should point out that all the recommendations of the committee were not directed to the federal government. Some of its recommendations were directed to the media, and I think the media have fulfilled what we asked them to do. For instance, we now have the program The Market Place in prime time and we have a tremendous amount of newspaper advertising. Everyone has the responsibility to follow these recommendations. We have heard the Minister of National Health and Welfare (Mr. Lalonde) indicate that if any province wants to embark on a private program in this respect, funds from the Canada Assistance Plan will be made available. Initiatives have to be taken at

every level of government. Carte blanche, sweeping criticism does not really tell the whole story.
In any event, I do not like to labour the obvious by referring to a bill that really speaks for itself. I suggest that a careful reading of it will indicate exactly what it does to protect the small businessman and the consumer.


James Aloysius McGrath: Would the hon. member permit another question?


The Acting Speaker (Mr. Boulanger):: Is the hon. member agreeable to accepting another question?


Jack Sydney George (Bud) Cullen: Yes.


James Aloysius McGrath: Since the hon. member did not use up all his time, I should like to ask him what happened to the amendments to the Weights and Measures Act passed by this House almost three years ago. Where is the consumer protection, based on that bill? Why did it take over three years to implement the packaging and labelling legislation, which I suggest will not become law in most cases for two years?


Jack Sydney George (Bud) Cullen: When I am called upon to justify the weights and measures legislation, I will be only too happy to do so. It has been my experience around here that when something takes a little longer than the layman might think it should take, it is because of careful examination and discussion between industry, the department and the minister. An investigation would soon reveal that there are very good reasons for taking time in most cases. The government does not want to hurt the businessman who is to be affected by the legislation. Businessmen have done nothing wrong and want to comply with the law. I think the Canadian businessman should be given sufficient time to effect a change in practice in order to live up to the new legislation. We should try to avoid anything that would cause hardship to a particular businessman. Usually changes involve some expenditure on the part of businesses because they must replace their present packaging systems with another. These people should be allowed to continue their normal business unless they are violating the provisions of an act or its regulations.


Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, I listened with interest, as I always do, to the hon. member for Sarnia-Lambton (Mr. Cullen) who caused me some consternation when he said the legislation had been widely welcomed by various hon. members and communities. I wondered for a moment whether I was listening to the right debate. However, when he said that when the minister introduced the bill he did not exactly jump up and down with enthusiasm, I knew I was in the right place at the right time. He indicated, as well, a slow, careful and cautious approach. I did not understand whether he meant to the legislation or in the legislation. If he meant a slow, careful, cautious approach to the legislation, I welcome his words and hasten to agree with him.
I had intended during this debate to deal with only one small aspect of the bill which is of considerable concern to me and others, but I am forced by the words of the minister who urged speedy passage of the bill to answer to some degree. Speaking personally, I would be quite con-
March 14, 1974

tent to expedite passage of this bill if I could find some justification for the rush. For that reason I searched today for justification. One might like to justify urgency on the ground that this government understands or sympathizes with the consumer or the small businessman, but I can find no justification in that regard.
This government, in my opinion, has not only had a history of but a propensity for callous disregard for the consumer. On the one hand it crawls and cowers under the protection of the Food Prices Review Board; on the other it struts and prances like a proud capon when discussing its attempts to put ceilings on the price of such things as milk and bread at the consumer level, while conveniently and simultaneously ignoring the input costs and transportation problems of the farmer-producer of these items.
With regard to small business, I suggest that the record of the government is dismal. It consists mainly of pious utterances in a succession of throne speeches, followed by a remarkable lack of activity between the speeches. The government has increased remarkably the problems of the small businessman. The small businessman in my riding, and in every riding in this country, deals with more and more government inspectors, he has more and more government forms to fill out, more and more government statistics to compute, and more and more reports to complete.
This government, in summary, has said to small business-I think this is the crux of it all-"If you want to expand, borrow money at prohibitive rates of interest." The government's action and concern for the consumer and small businessman gives me no justification for this rush on the part of the minister. I looked at the record of the minister and that of his predecessors in respect of competition legislation. Of course, I had to look for further back than 1971 and the competition act, the infamous Bill C-256 which was conceived in ignorance, drafted without understanding and which could have been implemented in chaos.
Fortunately for both consumer and businessman alike, it died the death it so richly deserved. Therefore, the government's track record in this field of legislation provides remarkable lack of justification for proceeding so hastily. Then I looked at the minister's speech-I believe it is at page 482 of Hansard-where he refers to the problems of foreign judgments, laws and directives and says:
I think that recent events have demonstrated the importance of this proposal and have provided a strong argument for the House to make a favourable decision on this bill at the earliest possible date.
No doubt the minister was referring to the MLW-Worth-ington Limited case. Then at page 483 the minister says:
At the same time, by asking the House to deal now with Bill C-7 I am taking action on behalf of the government to enable parliament to take decisions earlier than would otherwise be the case in some important areas particularly relevant to present public concerns linked with current inflationary pressures.
Speaking for myself, I recognize these two problems as being extremely urgent. I sympathize with the problems, of the minister, and indeed with the government. However, I am more in sympathy with the problems of the consumer and the businessman. With respect, I submit the
Competition Bill
minister knows very well there are other more efficient and expeditious means of dealing with these problems. I am sure the minister has been well aware of them for some time.
I am sure these matters will be discussed in this debate. Indeed, this question was mentioned by the hon. member for Sarnia-Lambton earlier today and by the hon. member for Trinity (Mr. Hellyer). Yesterday, my colleague the hon. member for St. Paul's (Mr. Atkey) suggested a minimum of four to six weeks before commencement of the committee hearings. I hasten to say that I agree completely with that request. In doing so, may I make an attempt to justify our position. I and every member of this House received an information kit from the minister and the department. It contained Bill C-227, the press release and a number of papers called background documents. I contacted the minister's office and he was good enough to send me 50 more of these kits which I distributed to 50 businessmen in my riding.
I do not pretend to be a spokesman for big business, because in my riding we do not have big business. I suppose the biggest business in my riding would employ about 250 people: the average would be between 100 and 125 people. These businesses are at all levels, retail, wholesale, manufacturing and service. I submitted this material along with what I call the blue book, entitled "Proposals for a new competition policy for Canada, 1973". Again I thank the minister for providing me with sufficient copies.
I sent these out for the purpose of obtaining a reaction, and solicited inquiries.
I did not receive any wild-eyed, outraged condemnation. I did receive, in profusion, questions such as, "What does this mean? Does this mean strict liability? What are the procedural rules of the commission?" And so on. In summary, I received answers indicating a good deal of confusion in respect of the bill. Although some of the provisions are short, they involve extremely complex matters. Now that some 3 Vi or four months have passed since I distributed the material -as I am sure many other members have-the tremendous business and economic complexities of the bill at this point have been only partially digested.
These representatives of the small business community want to play their part, the part they deserve to play, in informing us of their opinion regarding this legislation. I am sure various consumer groups are adopting the same position. Again, they have an obligation, as have their business counterparts, to advise us and give us their opinion. I, for one-and I do not believe I am alone-want the best possible input when this matter is discussed in committee. My friends to the left, the NDP, will probably disagree. The hon. member for Toronto-Lakeshore (Mr. Grier) yesterday, as recorded at page 488 of the official record, said:
From my point of view, this legislation has appeared none too soon. I hope the bill will proceed to committee without lengthy debate and, in view of the fact that much discussion has already taken place on the general principles and philosophy of competition policy, that we can avoid the bill's being bogged down in committee as it is lobbied by one group or another over a lengthy period of time.
I say to my hon. friend, the hon. member for Toronto-Lakeshore, that there is a lot more to this bill than what he calls general principle and philosophy of competition

March 14, 1974
Competition Bill
policy. He is naive indeed if he does not think, for example, that the entire distribution system of goods in this country is at stake here. He went on to say:
Of course, this is not to deny the right of interested parties to appear before the committee. But I am not anxious to be party to a procedure which sees the effective implementation of this bill delayed for a long period of time while many of those groups which have already had a substantial say in the formulation of the government's basic, philosophic approach come back to have another crack at it.
The hon. member says that many of these groups have already had a substantial say in the formulation of the government's approach. I have no doubt that members of the NDP are much closer to the government than I am or my colleagues. He may have been privy to all this input; others of us have not had this advantage. He may have been talking about the 1971 competition bill. I hope he does not rely solely on the evidence presented at that time to justify rushing this bill in and out of the committee. He and the minister and their respective colleagues may ignore some of the warning lights in the bill. I think of federal-provincial jurisdiction. I think also of the possibility of strict liability. I think of a commission that may be judge, jury and prosecutor rolled into one. I give just these few examples of the dangers one might find in this legislation. The minister said yesterday, as reported at page 480 of Hansard:
m (2130)
-I look forward to the committee study of the bill where there would be an even greater opportunity for me to deal with hon. members questions, ideas and suggestions and to discuss these with them, as well as the various proposals of the bill, in full detail.
I assure the minister that I, too, look forward to the committee study, but I say most frankly that there are others in whom I have more confidence than the minister whom I wish to hear questioned-persons and associations representing business and consumer interests and I hope, also, provincial governments will be given a chance to express their opinions. I think this claim of necessity for haste is partially, if not totally, answered by an editorial in the Financial Times of November 12, 1973, headed, "No Paper Tiger". This editorial, which is short, reads as follows:
Anyone who has been misled into regarding the new amendments to the combines act as a paper tiger should take a second look. The detailed report on the following two pages shows that the new minister and new staff of the Department of Consumer Affairs have learnt a lot from the demolition of Ron Basford's doctrinaire 1971 bill. But they have still adopted considerable chunks of it, and their bill demands equally searching examination.
Mr. Basford's 1971 competition act was the supreme example of the academic and theoretical approach to government which was the hallmark of Mr. Trudeau's first ministry. Herb Gray's more modest bill is just as typical of the strictly political approach Mr. Trudeau has adopted in the last year.
The amendments to the combines act are presented, blatantly and officially, as a response to the wave of consumer complaints about inflation. They are designed to ease Beryl Plumptre's lonely position as the government's lightning-rod-or, if you will pardon the expression, whipping-boy. At the same time, an attempt is made to placate business by withdrawing Mr. Basford's outrageous plan for a tribunal with authoritarian power over business dealings.
But Mr. Gray's bill would also give a resurrected Restrictive Trade Practices Commission the power to make orders enforceable in the courts, over r.n important range of established business practices. Oil companies ai. d service stations are only one of the most obvious cases

in which the prohibition of tied sales and exclusive dealing might compel new arrangements to be made.
The new rules on price maintenance and price discrimination are, mercifully, an immense improvement on Mr. Basford's bill. But they are not soft. Nor, let it be noted, has Mr. Gray given up the wider aims of the Basford bureaucrats. He has merely postponed them to a future "Stage Two" of uncertain date.
His policy proposals anticipate an eventual need for "a more flexible, quicker and thoroughly expert investigation and enforcement machinery;" reform of the Restrictive Trade Practices Commission to make it "more efficient" and development of an "efficiency test" for business agreements and acquisitions.
It would be wise to look behind the arras before starting to pet the tiger.
I urge the minister to agree that a four to six weeks period before the committee study is not only reasonable but advisable. The one area of the bill with which I wish to deal tonight is the refusal to deal, refusal to supply or refusal to sell, whichever we want to call it. This part of the bill is dealt with in what I call the blue book, "Proposals for a new competition policy for Canada", at page 44, the first paragraph of which reads as follows:
Businessmen who have been unable to get supplies needed for their operations on ordinary trade terms have submitted many complaints to the director in recent years. In some cases, these are comparatively new entrants to a market and in others they are established firms whose supply lines have been disrupted after developing the market for the product involved.
In the majority of cases the firms adversely affected are relatively small although their credit may be good and they are willing to take delivery in acceptable quantity ... Alternatively, the refusal to supply may reflect the supplier's decision to undertake or increase its own distribution and eliminate competition in the resale of its product.
It goes on for approximately half a page to speak about illegal retail price maintenance and the fact that current legislation cannot deal adequately with the problem. The final paragraph deals generally with the commission and the powers it has to meet this problem.
Last year, in the Toronto Globe and Mail of December 6, there appeared an article by Professor Donald N. Thompson of York University. As some hon. members know, he is a member of the advisory committee to the Minister of Consumer and Corporate Affairs on competition policy and has served as consultant to the U.S. federal trade commission and the U.S. department of justice on antitrust and trade regulations. The first paragraph of this article reads as follows:
Buried in the middle of the new competition bill introduced recently by Consumer and Corporate Affairs Minister Herb Gray is a short section on refusal to sell, which could have a tremendous impact on the way products are marketed in Canada, on the prices paid by consumers, and the shopping alternatives open to them.
This provision was also buried in the middle of the minister's address yesterday and in the speech by the NDP spokesman, the hon. member for Toronto-Lakeshore. In the minister's statement yesterday there are two short paragraphs at page 482 of Hansard. The first deals with the practices dealt with in the bill which are: refusal to deal, consignment selling, exclusive dealing, tied sales, and market restrictions. The minister indicated that such practices could be used to prevent the free operation of market forces and limit the consumer's choice. The second short paragraph indicated the minister's opinion of the RTPC's power to handle this problem.
March 14, 19V4

The hon. member for Toronto-Lakeshore dismissed this provision in about ten or eleven lines most of which dealt with his experience on the food prices committee. In my opinion, this is cavalier treatment of a provision which could have profound effect on businesses and consumers alike. What I shall seek to find out in the committee is where this and other provisions of the bill relate to the bill's purpose. The bill's purpose, as set forth on page 1 of the book, "Proposals for a new competition policy for Canada", reads as follows:
The purpose of the Combines Investigation Act is to assist in maintaining effective competition as a prime stimulus to the achievement of maximum production, distribution and employment in a mixed system of public and private enterprise. To this end, the legislation seeks to eliminate certain practices in restraint of trade, and to overcome the bad effects of concentration, that tend to prevent the economic resources of Canada from being used most effectively to the advantage of all. The Act also contains provisions against misleading advertising, which were introduced in 1960 and 1969, to utilize the investigative capacity of the act for the protection of the consumer.
What I and my colleagues wish to determine in committee, and possibly in this debate, is the relationship between this stated purpose and the effect of the failure to supply provisions. For example, there are those who seem knowledgeable in this field who suggest that refusal to sell may result in more vertical integration, and I was interested by what the hon. member for Waterloo-Cam-bridge (Mr. Saltsman) had to say about it. I should like to quote again from Professor Thompson's article in the Globe and Mail as follows:
From the manufacturers point of view, taking away the right to refuse to sell would have a huge impact on existing marketing systems of distribution. There would be pressure for manufacturers and retailers to expand into "non-resold" private brands, those distributed through vertical ownership systems. This might even serve to increase vertical ownership integration in marketing channels.
This refusal to supply provision, ostensibly for the protection of small business, may therefore have the very opposite effect. I invite hon. friends to my left in the NDP, who from time to time are inclined to indicate some concern for small business, to consider this in committee. Remember, Mr. Speaker, the small businessman is totally dependent on brand name merchandise. If there is evidence that this legislation encourages non-braqded products, let us hear that evidence. If there is evidence that this bill will encourage vertical integration, let us all be aware of it, because small business has no greater enemy or more serious threat than the vertical integrator, unless it be the government itself from time to time.
It is said that the refusal to supply provision will encourage potential discounters. Professor Thompson is of this opinion. He says in his article in the Globe and Mail:
One result of this tacit resale price maintenance is that many potential discounters, who depend on brand name hard goods for their customer attracting power, are unable to obtain goods from suppliers who refuse to deal. Thus no city in Canada has develop discount retailing to anything like the extent it is practiced in a number of large U.S. cities. Toronto comes closest to having widespread discounting, followed by Montreal and Vancouver. But Halifax, Quebec City, Winnipeg and Edmonton have little or no brand name hard goods discounting, largely because of the refusal of manufacturers to sell to discounters in these centres.
Let us assume, for the sake of argument, that Professor Thompson is right. What I do not know, and what I hope
Competition Bill
to find out, is the value of these discounters, and whether the consumer does get a better deal for his dollar. I have seen some of these so-called discount operations in the United States, and I tend to agree that many of these operators do discount with respect to 5 per cent of their goods, but the other 95 per cent is sure no bargain and certainly no discount. Their success in the United States is not so much attributable to legislation comparable to Bill C-7, because refusal to deal is not part of U.S. anti-trust laws so far as I am aware. The success of discounters in the U.S. occurred in the marketplace because many old-established retailers got out of date and did not keep pace with modern merchandising methods. Therefore, I want to know more about these operations of discounters and whether they improve the lot of the consumer or not. The refusal to deal prohibition may have tremendous impact on the distribution business in Canada. What has been ignored is the simple fact that the distribution business is composed of small business, not big business.
The minister claims to be concerned about small business and holds this legislation forth as protection to and encouragement for small business. What I do not understand is whether the minister suggests that the refusal to supply provision will assist those in, or those wishing to enter, the distribution business. It seems to me that the very opposite could be true. It seems very possible that big businesses, many of whom to date have used distributors, may be encouraged by this legislation to perform this function themselves. I suggest to the minister another side effect. If the distribution industry is threatened and reduced in any substantial number, what effect will this have on the small manufacturer who is totally reliant on independent distributors for the marketing of his products? These, then, are to me serious questions, and bland assurances from the minister do not answer them.
The minister seems to be saying, in the refusal to supply provisions in this legislation, "Trust us. Big Brother won't mess things up." I say to him in reply, "Don't tell us what you won't do; tell us what you will do. give us some [DOT] examples of refusal to supply problems and what you would do to correct them." The minister says that the refusal to supply provision was included because of complaints received mainly from small business. I would like to hear some of these complaints and I would like to hear what Bill C-7 will do to correct the situation.
What also concerns me about the bill's refusal to supply provisions is that the minister, although he claims this to be for the protection of small business and resulting from the complaints of small business, wants in the bill to take two bites at the apple. Refusal to deal is dealt with first in part IV under the heading "Matters reviewable by the commission." These are the amendments in proposed section 31.2. Therefore, alleged infractions are subject to review by the RTPC. But later in the bill, under the heading "Offences in relation to competition", the minister takes another bite. I refer to proposed section 38(6) which reads as follows:
No person shall, by threat, promise or any like means, attempt to induce a supplier, whether within or without Canada, as a condition of his doing business with the supplier, to refuse to supply a product to a particular person or class of persons.
542

March 14, 1974
Competition Bill
Proposed subsection (8) reads:
Every person who violates subsection (1) or (6) is guilty of an indictable offence and is liable on conviction to imprisonment for two years.
This total or partial overlapping in sanctions is in itself rather remarkable, but what is even more astonishing to me is that neither the minister nor any other Liberal spokesman has made any attempt whatsoever to justify or explain this. Therefore, in committee we want some explanation of the thinking that led to this double-barrelled approach. I would like to be convinced that the minister understands the marketplace. I would like to be convinced that this legislation has not confused provincial responsibility for fair business practices with federal responsibility for combines legislation. I would like to be convinced that there is compelling reason to infringe on the seller's fundamental right to deal with whom he pleases.
I hasten to say to the minister through you, sir, that much of Bill C-7 is welcomed by all members of all parties, but as a word of caution I say that parts of the bill require extremely careful scrutiny including, in my opinion, the refusal to supply section. Therefore, I urge the minister to proceed cautiously on such matters in the interests of both consumer and businessman alike.


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I too am pleased to join in the second reading debate on Bill C-7 as I feel it is rather remarkable that the minister who introduced the bill is so anxious not only to get it through second reading but also through committee. I noticed, when he introduced the bill on March 13, that he concluded his remarks by saying:
I therefore urge the House to give second reading to this bill as quickly as possible so that it can go at the earliest possible stage to committee for detailed but, I hope, speedy consideration and decision.
There are three words there of a nature to indicate the minister's anxiety to get this bill through the House. He says "quickly," "earliest" and "speedy," and this in a speech made by the minister only two days after the bill was introduced in the House. Why is there such a desire to pass it speedily through the House without giving it due consideration at the second reading stage? In the same speech the Minister of Consumer and Corporate Affairs (Mr. Gray) raised an alarm in my mind by a comment he made a little earlier when he said:
Let me now take a moment to pay tribute to the Minister of State for Urban Affairs (Mr. Basford) and to the Minister of Manpower and Immigration (Mr. Andras) for their efforts which helped lead to the bill now before the House.
If there we needed any reference to undermine our confidence in this bill, that is it-his referring to the Minister of State for Urban Affairs and to the Minister of Manpower and Immigration as if that in some way was a recommendation for the speedy passage of the bill. I would remind you, Mr. Speaker, that the Minister of Manpower and Immigration is conducting the Unemployment Insurance Commission affair, which is a colossal calamity for this country. At the present time it is costing the taxpayers of Canada something over $1 billion. The Minister of State for Urban Affairs is attempting to cope with his portfolio, but as was witnessed yesterday by his pitiful little speech concerning what he hoped to do with respect to rising housing prices, I think the House would agree

that it is certainly a department that needs a new minister.
I make these general comments because, like the hon. member who preceded me, I have serious doubts, not only whether the minister who has introduced this bill understands the marketplace but, more important, whether the civil servants who prepared the bill and told him to get it through the House understand the marketplace. I say that because while there is reference in the bill to the Bank Act and certain amendments are proposed to it, the minister leaves the supervision of competition or lack of competition among bankers to the Inspector General of Banks. That may sound quite innocent, but many members of the House realize that the Inspector General of Banks has a staff of two; that is, the Inspector General himself and two assistants, including his secretary. Is it to be taken seriously that a competition act is going to be administered tightly, in the usual sense, by a staff of one man, an assistant and a secretary, bearing in mind that the banks that he is required to supervise have gross assets of $80 billion?
Why are the banks put into a sacred position? Why has the government chosen to be so gentle with the banking community? For example, if we are speaking about competition, surely it is relevant to point out that in the last 12 months the banks earned $358 million, which is more than triple what they earned a decade or so ago. I mention this figure because I think it is relevant to point out that while the banks earned that money, based on the Toronto stock exchange indices we find that the general manufacturing field earned $47 million; the food processing industry earned $49 million; the construction and materials industry, $26 million. Various other sectors of the business community had relatively low earnings compared to the banking community, whose earnings have grown probably more quickly in the last decade-certainly since 1967, the year of the great sell-out by the present government to the chartered banks-than practically any other sector of the business community. In fact, Mr. Speaker, based on the Toronto stock exchange indices listing of January of this year, I was surprised to find that the banking community had the second highest earnings of any sector in the nation. The only sector that had higher earnings was industrial mines.
Instead of giving hasty second reading to this bill, surely we should ask why, exactly, the minister gave favoured treatment to the banking community. And not only why did the minister give such favoured treatment to the banking community, but do the minister and his civil servants really understand how the marketplace operates in Canada? It is very nice to come in with a competition act, it is very nice to speak about competition-it is a motherhood thing-but we must be on our guard because we have a minister who at the behest of his civil servants is trading on the motherhood issue of competition to create more bureaucracy in this country.
Speaking of bureaucracy, surely it is time that people became alarmed, and in particular members of this House, at the fantastic growth of our civil service. In a current issue of the Canadian Tax Journal there is a very enlightening article by David B. Perry who points out that now
March 14, 1974

one in eight people are employed by government in Canada. One person in eight is now somehow employed in government at either the provincial, municipal or federal level! As we know, the number one employer is the federal government, and here we have them lunging ahead to employ more civil servants, in more bureaucracy, so they can bring in what they say is a more competitive marketplace.
I would suggest that they do not accurately understand the marketplace at the present time. Let them look at the entire economic fabric of Canada; let them have another royal commission on banking, such as that which was commissioned by the Conservative government in 1961, to get the facts on what is competition in Canada and how it can be freed.
I would say that any chartered bank in Canada can restrict or open up competition more than any other force that we might consider. Not only do I feel that the government does not fully comprehend the problems they are attempting to deal with but, most unfortunately, I think they perhaps inadvertently do not realize that the more they submerge business with bureaucracy, the more they lessen competition. How often have members of this House been told by small businessmen that they cannot carry on, and the final straw that breaks their backs is mounting governmental supervision and paperwork that they have to keep filing with some bureaucracy, mainly at the federal level. I have a client in my law office who is also a constituent and he has written to me in desperation.
Mr. Speaker, I see it is almost ten o'clock, but perhaps I could continue because I should like hon. members to know the plight of this relatively small businessman who feels that bureaucracy is essentially forcing him out of business in spite of the fact that he is earning only, on average, $20,000 a year.
However, may I call it ten o'clock, Mr. Speaker?



PROCEEDINGS ON ADJOURNMENT MOTION

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

Walter David Baker: Mr. Speaker, on March 5, 1974, at page 167 of Hansard, I asked a question of the Minister of Consumer and Corporate Affairs (Mr. Basford) which was answered in the usual fashion of passing the question to another minister, the Minister of Energy, Mines and Resources (Mr. Macdonald). That question dealt with the differential in home-heating oil that is charged to consumers in the Ottawa area notwithstanding the fact that one-half of the supply of oil was carried, before the pipeline was closed, by the pipeline which brought frozen-priced, western-oriented heating oil into the Ottawa area. As a result of this act of what I would
Adjournment Debate
respectfully call malfeasance, consumers in the Ottawa area are being charged eastern offshore prices for domestically frozen-priced oil. The minister's answer was tentative. He suggested that the extra costs were incurred in part as a result of the refurbishing of the pipeline which was used for carrying the product.
Subsequently the matter was again raised in the House. I received a letter from the minister which indicates that his officials had conducted a study with regard to the price of home-heating oil in the Ottawa market. This the minister kindly sent to me. Having seen the document which purports to be the study undertaken by the officials of his department, I can only say, with the greatest respect to those officials, that this document ought not to be dignified by being called a study.
I am informed that 12 million gallons of heating oil were pumped into the Ottawa area through this pipeline during the first quarter of 1974. But the differential with regard to those 12 million gallons was 7 cents a gallon, which means that the total differential consumers in this area paid would amount to $840,000. If the differential were 5 cents per gallon, Ottawa consumers would have paid an extra $600,000 during that period. That being so, why has the minister suggested that it would appear the oil companies did not make a windfall profit?
Let me now deal with the reasons given for the differential. First, there is the refurbishing of the pipeline. I suggest that it is wrong in principle to charge consumers the cost of refurbishing the pipeline. Surely it is not up to Gulf or Imperial Oil or any other oil company to bear the cost of refurbishing the pipeline. This matter, obviously, should be included within the rates of the Interprovincial Pipeline company. So that reason is without foundation. Second, with respect to the cost of the product itself, there is a table attached to the minister's letter which shows the price of western Canadian crude oil and of crude oil entering eastern Canada. Those prices are $4.50 per barrel on the one hand and $6.50 per barrel on the other.
The table deals with transportation costs. If the minister relied on such an incomplete study as this one, and if the department was prepared to rely on such incomplete information, I suggest that the minister and the department virtually misled consumers in this area.
Another reason for the differential is listed under the heading, "Additional supply costs". Under that heading the table lists an item which reads, "Rail freight to Regina from Edmonton verus lake tanker from Clarkson to free supply for eastern Canada". Think about that for a moment, Mr. Speaker. Consumers in the Ottawa area are being asked to pay higher prices because, in effect, they are asked to subsidize the oil used by the rest of Canada.
The next item in the table reads, "Extra processing on Edmonton product transmitted with IPPL crude". The figure given is without foundation. It is not based on any report prepared by officials or the deputy minister. This indicates that this study was not undertaken with sufficient care. Actually, the government relied on information supplied by the companies and not on data it had gathered itself.
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Adjournment Debate
The pipeline is now closed. In my respectful submission, consumers of the area have been ripped-off and this government, which is really the friend of the major oil companies, the banks, the large corporations and other industries has once again demonstrated that frienship. In conclusion,
I suggest the government should reconsider its decision to allow the pipeline to close. It could be used to bring in other petroleum products from the west such as gasoline and so help this area, assuming that gasoline is more expensive here than in parts west of here to the detriment of consumers.
Mr. Speaker, I am not satisfied with the answer given to me by the minister.


Mr. Herb Breau (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, never have I heard such demagoguery so late at night. The hon. member made an unsubstantiated charge on March 5 and he has twisted his words tonight to justify what he said which was not substantiated.
As you will recall, Mr. Speaker, the supply outlook for the Montreal area and the whole of eastern Canada east of the Ottawa Valley line looked rather serious late last year as a result of the Arab oil embargo. The government then considered a number of emergency measures to ensure minimum disruption of supply. Because the threatened shortage would centre on the large Montreal refinery complex, and because the Ottawa area is normally supplied from Montreal refineries, one of the emergency measures adopted was arranging an alternate supply for Ottawa. This was accomplished by opening up an unused link in the Trans-Northern pipeline to enable the delivery of petroleum products to Ottawa from Toronto refineries.
By this means an equivalent amount of oil was freed for use in the Montreal area where the supply shortage appeared most imminent. The pipeline was restored to use for this purpose in December and used in January, February and March. Because the overseas supply situation improved early in the year, Trans-Northern pipeline deliveries never had to exceed 12 per cent of the Ottawa area demand in those three months. In fact, they constituted only 8.5 per cent and 5.4 per cent in January and March. Supply conditions now appear to be returning to normal and there are no plans to use this pipeline for delivery into Ottawa in April.
Analysis of the cost experience of the two principal oil companies using this pipeline shows that for one of the companies the cost of supply by this route was more than the product delivered from Montreal on which the Ottawa price structure is based. For the other company, there was a saving of less than one-half a cent per gallon on the volume moved by the Trans-Northern pipe line. When this saving is weighted into the company's total heating oil trade in the Ottawa area, the supply cost saving amounts to one-tenth of a cent per gallon, an insignificant fraction of the Ottawa price of 33.5 cents per gallon.
The department has concluded, therefore, that there is no substance to the suggestion that low cost western oil is being sold in Ottawa at an excessive profit. In closing, I would add this: for the hon. member to say the Ottawa consumer should not pay the cost of refurbishing the

pipeline is something I cannot understand. I wonder who he wants to pay for it.


MANPOWER-OPPORTUNITIES FOR YOUTH PROGRAM-LEVEL OF BUDGET IN SUDBURY AREA
Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I rise tonight to pursue a question I put to the Minister of Manpower and Immigration (Mr. Andras) on March 11 concerning the Opportunities for Youth program and the projected cutback for northern Ontario as compared with the rest of the province. I might say that the program has worked very well in my constituency and it has won the respect of the community. Sault Ste. Marie is one of the areas which pioneered the community advisory group.
With reference to the cutback in grants to northern Ontario I would draw the attention of the parliamentary secretary to the brochure prepared for applicants in 1974. On page four, this booklet states:
Preference will be given to projects submitted by young people who need assistance in financing their education, who are members of low income groups, ethnic or racial minorities, native people, handicapped or who are from isolated communities or areas offering few employment possibilities.
Despite this stated policy, Opportunities for Youth, under the Department of Manpower and Immigration program for 1974, is planning to cut the Ontario budget by some 14 per cent. Funds available to northern Ontario will be cut by some 33 per cent. My question is this: how can the minister justify such a disparity since northern Ontario meets all the criteria to which I have just referred to a greater extent than does the rest of the province? Regarding the financing of post-secondary education, I would point out that 70 per cent of the graduates from the north central Ontario high schools go on to post-secondary education and need summer employment; they need assistance in financing their further education.
With regard to members of low income groups, the per capita income in northern Ontario is the lowest in the province. With regard to the ethnic, racial minorities and native peoples, the percentage of the population composing these groups ranges from 25 per cent in the district of Algoma to 45 per cent in the Sudbury district. With regard to the criteria for those living in isolated communities, 50 per cent of the population in northern Ontario live in towns of under 20,000 population, with vast distances between them. With regard to few employment possibilities, the minister's own department in a job market report for northern Ontario predicts that there will be high unemployment for youth in the north this summer.
Despite northern Ontario exceeding the criteria, the greater budget cut for OFY will hit the north rather than the south. I ask, Mr. Speaker, where is the justice, where is the concern, for the young people of northern Ontario under this projected budgetary allotment? I suspect that the new formula for funding is to blame for this situation. This new formula, as I understand it, is based on two criteria: firstly, the number of young people in an area, which has a one-third weighting factor; and secondly, the job availability index, which has a two-thirds weighting factor. But, Mr. Speaker, the Manpower statistics for
March 14, 1974

northern Ontario are not accurate as far as young people are concerned because there are few Manpower centres in the north and there are great distances between these Manpower centres. The result is that not as many young people are registered with Manpower centres in northern Ontario compared with the south. Therefore, there is a bias toward large urban areas in southern Ontario where young people are registered with CMC. It is projected that the penetration rate of CMC for youth applications for jobs is about 30 per cent in the north.
In conclusion, Mr. Speaker, I put two questions to the minister tonight. Firstly, how does the minister justify such budgetary discrimination against northern Ontario in projected OFY funding? Secondly, will the minister give a commitment here and now to restructure the OFY grant formula so that the disadvantaged north will receive its fair and just share of Opportunities for Youth grants?


Mr. Mark MacGuigan (Parliamentary Secretary to Minister of Manpower and Immigration):: Mr. Speaker, while it is true that most regions of Canada will receive less funds for the OFY program in the summer of 1974 than they did for the OFY program in the summer of 1973, I should like to reiterate the reply which my minister gave to the hon. member when he put his question on Monday, March 11, as reported in Hansard at page 353:
The final sub-provincial allocations have not yet been struck.
In fact, although the share for the province of Ontario has been increased-that is, the proportion-the allocation will still be smaller than last year's. Last summer the Department of the Secretary of State funded 1,211 projects in Ontario at a cost of $8,929,843. However, hon. members on both sides of this House will be aware that the total budget for the OFY program of 1974 has been reduced from that of last summer. As my minister indicated in his letter to members of February 28, the budget for the summer of 1973 totalled $35,315,159, while $25,625,000 has been set aside, after costs of administration, for allocation under the 1974 summer OFY program. Members will recall that the letter also provided a table of the allocation of funds by province.
As far as the allocation for each labour market area is concerned, the answer of March 11 stands. I do not know where the hon. member got his information, but I do know that the preliminary figures that he provided are wrong and bear no relationship to fact even as preliminary figures. In fact, his figures are made up out of whole cloth. When the final allocation is made, it will take into account the freshest data on this year's employment opportunities available to students in each labour market area. At that time my minister will be happy to give hon. members the correct allocations for each labour market area.
I might add that the preferences which the hon. member quoted obviously refer to the distribution of grants within a particular labour market area and not to allocation within a province. They are not the criteria for sub-provincial allocation.
Adjournment Debate


EXTERNAL AFFAIRS-GARRISON WATER DIVERSION PROJECT-FEDERAL REPRESENTATION AT MEETING BETWEEN NORTH DAKOTA AND MANITOBA GOVERNMENTS- GOVERNMENT POSITION
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I rise tonight to speak on a matter which is of much concern both to me and to the people of Manitoba. I am referring to the infamous Garrison diversion unit, a huge United States irrigation project currently under construction in North Dakota. This project has immense environmental implications for Canada as it will seriously degrade the water quality of Lake Winnipeg and two Manitoba rivers, the Souris and the Red. According to wildlife ecologists with the Manitoba department of mines, resources and environmental management, Manitoba will be the sewer of the project. It is thus imperative that the federal government continue to convey in a forceful manner Canadian opposition to the scheme.
To date, $60 million has been spent on the first phase of the project which is designed to channel great quantities of water from the Missouri River to irrigate some 250,000 acres of U.S. farmland. It is estimated that a further $500 million to $1 billion may be spent before the project becomes a reality. Incredible as it may seem, this money is being spent to irrigate 250,000 acres of semi-arid land that already supports workable dry land agriculture. Even more astounding is the fact that the dam and diversion project, with an awesome network of reservoirs, canals, roads and bridges, will consume nearly as much land, 248,000 acres, as will eventually be irrigated.
As was mentioned, the deleterious environmental effects this mammoth scheme will have on Canada are many. Run-off water from the project will be diverted into the Souris River and the Red River flowing from North Dakota into Manitoba. The salt content of the Souris will be doubled or even tripled, seriously polluting a river which currently serves as the water supply for the town of Souris and indirectly, through the Assiniboine River, Portage La Prairie. In addition, it is impossible for towns and cities to attract industry when the water supply is polluted.
Even more serious are the fish, bacteria, parasites, fungi and other junk that will flow into the Manitoba when the Garrison project joins the watersheds of the Missouri River and the Red River for the first time since the glacial age. As well, ecologists fear that the Garrison diversion will destroy 26,000 to 39,000 acres of North Dakota wetlands and threaten an additional 34,000 acres, which could seriously affect migration of Canadian waterfowl. The project could also alter the immigration patterns of the birds and interrupt their mating cycles. On top of this, the increased water flow could increase incidents of waterfowl poisoning. Scientists have also pointed out that nutrients flushed from irrigated soil in North Dakota will reach Manitoba, accelerating the growth of algae, and possibly turn Lake Winnipeg into another Lake Erie, thus destroying the fishing industry and recreational areas on the lake.
These are but a few of the potential environmental repercussions of the Garrison diversion unit. Even though the Garrison project was conceived by the United States government in 1965, it was not until April, 1969, that Canada formally acknowledged the existence of the

March 14, 1974
Adjournment Debate
scheme with a message to the U.S. State Department. Nonetheless, it is to the government's credit that this message, like others sent in October, 1971, January, 1973, and October, 1973 asked the United States to stop work on the project, calling for a moratorium on construction. The government must now press for some definite answers from Washington. For while the latest reply from the Unites States stated that they would "comply with their obligations" under the boundary waters treaty of 1909, formulated by the International Joint Commission, construction continues at the Garrison site.
The possible pollution of the waters of the Souris River and the Red River resulting from the Garrison scheme would violate article IV of the boundary waters treaty and principle 21 of the 1972 Stockholm declaration on the human environment. Article IV of the treaty provides:
The waters herein defined as boundary waters and waters flowing across the boundary shall not be polluted on either side to the injury of health or property on the other.
Does this mean that the United States intends to halt construction? If so, when? When are we to get some final answers? When is this United States-Canada meeting regarding the diversion to occur? As yet the government has refrained from involving the International Joint Commission in the problem. Instead, negotiations are supposedly being conducted at the intergovernmental level.
In lieu of the apparent inertia characteristic of these intergovernmental negotiations, perhaps it might be wise to involve the commission in the discussions. After all, Manitobans need all the assistance they can get in fighting the Garrison diversion unit. This is because Premier Schreyer and the provincial NDP government have adopted a "wait and see" attitude, waiting to see what damage the inflowing waters cause before acting to correct the situation. Hon. members were probably as surprised as I was to hear Mr. Schreyer's comments regarding the scheme. After a meeting with North Dakota Governor Arthur Link and other American and Canadian officials concerning the project, Mr. Schreyer stated that his government intends merely to monitor the situation until it can be "proved conclusively that the project is having a harmful effect on Canadian waters". One has to wonder how much more proof the premier needs. Mr. Schreyer went on to say that in the meantime-
There is no point agonizing and speculating and attempting to cause something to stop.
Thus, it appears that it is up to the federal government to defend the interests of the people of Manitoba and protect our province from becoming the sewer for another American dream.
In conclusion, I implore the federal government, specifically the Minister of the Environment (Mr. Davis) and the Secretary of State for External Affairs (Mr. Sharp), to continue to pursue the matter forcefully with the United States so as to achieve a halt in construction of the Garrison diversion unit pending a full investigation of all possible environmental effects on the waters of Manitoba.


Mr. William Rompkey (Parliamentary Secretary to Minister of the Environment):: Mr. Speaker, I am pleased that the hon. member has supported the position we have taken in this matter. I assure him that we have been pursuing the matter fully, and intend to do just that.
It might assist the hon. member if I outlined the recent sequence of events relating to the Garrison project in North Dakota. Last October, Canada sent another in a series of notes to the United States state department outlining Canada's opposition to the Garrison diversion project insofar as it adversely affected the Canadian environment. It was our estimate at that time that the irrigation project in the Souris loop planned as part of the Garrison scheme would at least double and perhaps triple the average total dissolved solid content of the Souris River entering Manitoba.
Our diplomatic note contended that such degradation of the waters would violate article IV of the boundary waters treaty which prohibits trans-boundary pollution to the injury of health or property. This note was sent with the full knowledge and support of the Manitoba government. On February 5, the United States replied that no work currently under way under the Garrison project would affect Canada, and that no work would be undertaken that might affect Canada unless it was clear that the United States obligations under the treaty were met.
The United States note, which has been made public, concluded by suggesting a Canada-United States meeting on this matter when some further special United States studies have been completed. It is probable that this meeting will take place next month. On February 25, the governor of North Dakota, at his request, led a United States and North Dakotan delegation to Winnipeg to meet with Premier Schreyer. As the Minister of the Environment has already informed the House, federal Canadian observers were present and participated in the discussions. A communique was issued following the meeting, specifically stating that Manitoba welcomed the assurances of the United States state department that the United States would meet its treaty obligations not to pollute Canadian waters to the injury of health or property.
I can state categorically that the Canadian and Manitoba governments have worked closely together throughout the history of this matter. Indeed, Premier Schreyer at the press conference following the meeting with the governor of North Dakota specifically stated that Manitoba had been well served by the federal government's efforts to stop or modify the Garrison project. Any suggestion that there is a difference in view between Winnipeg and Ottawa on this issue does not accord with the facts. We have been pursuing the matter forcefully and we will continue to do that.


The Acting Speaker (Mr. Boulanger):: Order. The motion to adjourn the House is now deemed to have been adopted. Accordingly, the House is adjourned until tomorrow at 11 a.m.
Motion agreed to and the House adjourned at 10.28 p.m.

Friday, March 15, 1974