1974-04-23

ROUTINE PROCEEDINGS


[Stage Direction]
First report of Standing Committee on Procedure and Organization in both official languages-Mr. Lambert (Edmonton West).
[Editor's Note: For text of above report, see today's Votes and Proceedings.]

Mr.  R. Gordon L. Fairweather@Fundy-Royal: that the first report of the Standing Joint Committee on Regulations and Other Statutory Instruments, presented to the House on Tuesday, April 9, 1974, be concurred in. Motion agreed to.


REGULATIONS AND OTHER STATUTORY INSTRUMENTS- CONCURRENCE IN SECOND REPORT OF STANDING JOINT COMMITTEE
Mr.  R. Gordon L. Fairweather@Fundy-Royal: that the second report of the Standing Joint Committee on Regulations and Other Statutory Instruments, presented to the House on Tuesday, April 9, 1974, be concurred in.


[Stage Direction]
Motion agreed to.

Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In view of the fact the Minister of Transport (Mr. Marchand) has now introduced Bill C-27, which concerns railway relocation and grade crossings, and in view of the fact many municipalities are holding their grade crossing plans pending passage of this legislation, thereby creating severe urban traffic problems, I move, seconded by the hon. member for Burnaby-Seymour (Mr. Nelson):
That consent now be granted by this House for passage of Bill C-27 at all stages, without debate.


Mr. Speaker:: This motion requires the unanimous consent of the House. Is there unanimity?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I have a question for the Minister of Finance which he would never expect today. I should like to ask him whether he is now prepared to indicate the date on which he will bring down the budget?


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, God willing, I expect to present my budget to the House of Commons at eight o'clock on the evening of Monday May 6.


Some hon. Members:: Hear, hear!


Some hon. Members:: Chicken!


Robert Lorne Stanfield: Mr. Speaker, I should like to direct a supplementary to the government House leader. Can he assure the House that the budget debate will commence practically immediately after presentation and continue uninterrupted by other House business until the budget debate is completed and all question put?


Hon. Allan J. MacEachen (President of the Privy Council):: Mr. Speaker, the answer to the first question I think is yes, practically immediately, the next day if need be. As to the second part of the question, I have not considered it. I do not foresee circumstances at this point that would oblige us to interrupt the debate but I have always been somewhat skeptical about casting my bread upon the waters, especially in light of the question put by the Leader of the Opposition.
Oral Questions BUSINESS OF SUPPLY

April 23, 1974


REQUEST FOR DESIGNATION OF OPPOSITION DAY THIS WEEK OR NEXT
Robert Lorne Stanfield: Mr. Speaker, some ten days ago the government House leader refused to commit himself to an opposition day this week or next week but indicated it was something he might very well favourably consider as the time approached. Now that the time has arrived I should like to ask the government House leader whether he is prepared to allocate a day this week or next week as an opposition day in the House?


Allan Joseph MacEachen: Mr. Speaker, in view of the budget itself and the nearness of its date of presentation I doubt whether it would be wise to distract the hon. gentleman by putting down an allotted day.


Mr. Speaker:: Is the hon. member for York South rising on a supplementary?


Mr. Lewis:: No, Mr. Speaker.


Mr. Speaker:: The Chair will recognize the hon. member for Northumberland-Durham on a supplementary.


THE BUDGET
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, I should like to ask the Prime Minister if he can now tell the House why the budget of the federal government will be presented only after all provincial budgets but one have already been presented-


Some hon. Members:: Oh, oh!


An hon. Member:: Go back to the bush league.


Allan Frederick Lawrence: -at a time when we are looking for some initiative and leadership from the federal government? Will he also tell us why the federal government waited almost 15 months before making the announcement it made today?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I think the hon. member should recognize that in this House the government does not determine its dates according to provincial decisions. We make our own decisions.


CONSUMER AFFAIRS
Mr. Terry Grier (Toronto-Lakeshore):: Mr. Speaker, my question is for the Minister of Consumer and Corporate

Affairs. It arises from reports that retail beef prices will go up anywhere from 12 to 30 cents by the end of this week despite the fact that prices being paid to beef producers as recently as yesterday have not been rising. What steps is the minister taking to prevent these retail price increases, and what assurances will he give the House that no unjustified increases will take place?


Hon. Herb Gray (Minister of Consumer and Corporate Affairs):: Mr. Speaker, it is my information that there were some increases in the price of cattle during the week of April 15 to 19. I am having further inquiries made. Our action as the government will follow as a result of the information we have, particularly any reports from the Food Prices Review Board.


Terrence Wyly Grier: I might say that the minister only needs to check the livestock commodity price index reported daily in the press to get the information he appears to be seeking.


Mr. Speaker:: Order, please. Will the hon. member please ask his supplementary question.


Terrence Wyly Grier: May I ask the minister whether he is investigating the allegations which are being made by the Cattlemen's Association that packing companies are taking advantage of uncertainties in the present beef situation to raise their profit margins and their prices to the retailers to unwarranted levels?


Herbert Eser (Herb) Gray: I am having that aspect looked into and I particularly welcome any findings of the Food Prices Review Board in this area.


Terrence Wyly Grier: The minister has frequently referred to the findings of the Food Prices Review Board in regard to beef prices. Can he advise the House when the long-awaited report of the board on beef prices is expected to be published?


Herbert Eser (Herb) Gray: I will be happy to check into that and advise the hon. member as soon as I have the information. I understand that the board is meeting on April 25 and it could be that the result of this meeting will be the report in question.


FINANCE
Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I wish to direct a question to the Minister of Finance.
Because of indications that the international monetary system is a cause of inflation in all industrialized countries, can the minister tell us whether he intends to put forward concrete measures to protect the Canadian economy against the detrimental effects of this system in order to enable Canadians to control their own economy?
April 23, 1974


John Napier Turner: Mr. Speaker, I think this subject could be discussed during the budget debate.


David Réal Caouette: Mr. Speaker, I wish to ask a supplementary.
Could the minister tell the House if he looked into the speech made by Dr. Otmar Emminger, Deputy Director of the Central Bank of West Germany, who recognized that the most eminent experts consider now the international monetary system as the ideal inflation-producing machine. If so, can the minister say if he has taken measures to stop the havoc wrought by this machine?


John Napier Turner: 
CONSUMER AFFAIRS
Mr. James A. McGrath (St. John's East):: Mr. Speaker, my question is supplementary to the one asked by the hon. member for Toronto-Lakeshore and it is directed to the Minister of Consumer and Corporate Affairs. Yesterday the minister indicated that he was seeking further information on the increases in retail beef prices. Has the minister now obtained this information? May I ask the minister whether, in view of the urgency of this matter, he has consulted the chairman of the Prices Review Board to see if an interim report can be made available to the Canadian public?


Herbert Eser (Herb) Gray: Mr. Speaker, my staff has been in touch with the board in this regard. The inquiries which are under way are well advanced but not yet completed. I will pursue my hon. friend's suggestion further.


THE BUDGET
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, my question is also to the Minister of Finance who has finally announced the long overdue budget date. In light of the fact the Economic Review of the Department of Finance was tabled on April 25 in 1972 and April 12 in 1973, will the minister indicate to the House when the latest review will be tabled?


John Napier Turner: April 29, 1974, Mr. Speaker.
Oral Questions


Otto John Jelinek: The Minister of Finance stated that the delay in the introduction of the budget was due to the complexities of the latest round of oil price negotiations. In light of the fact that both Alberta and Saskatchewan have already presented their budgets, an indication that there was awareness of the benefits and burdens of the latest oil price negotiations, why has the minister consistently delayed the introduction of the federal budget which the whole country has been awaiting for so many months?


Mr. Speaker:: Order, please. This is argument which perhaps might be useful during the budget debate.


BUSINESS OF SUPPLY
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I have a question for the government House leader. In view of the lengthy delay in presenting the budget and in light of the fact the government fears to allow an opposition day to the opposition parties, will the government House leader now take into consideration the proposition I made to him a few days ago about estimates and bring estimates back into the House in order that the Prime Minister, the Minister of Finance and their colleagues can be challenged and hopefully impeached for their high misdemeanours against the people of this country?


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: Mr. Speaker, there has been no delay in bringing forward the date of the budget. In fact, the contrary is th'e case. The hon. member will have full opportunity to move amendments on that day or the day after if he wishes. In the meantime, if he would consult with his colleague, the opposition House leader, I would be glad to consider a way by which we could allow estimates to be considered on an allotted day. However, I am not going to go beyond that in terms of providing an opportunity to challenge, except on the main financial policies of the government.


POST OFFICE
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, I should like to put a question to the Postmaster General.
Can he give the House the assurance that, throughout Canada, cheques for unemployment, old age security pensions, veterans' pensions, welfare allowances, family allowances, will not be delivered late? If not, what specific steps will the government take?


Hon. Andre Ouellet (Postmaster General):: Mr. Speaker, of the four million family allowances cheques which

April 23, 1974
Oral Questions
have been mailed, over 3,400,000 have already been delivered. With regard to those that have not, extraordinary arrangements have been made locally to ensure that the recipients will get their cheques. I cannot say publicly what those arrangements are; this the hon. member will surely understand. However, I shall be pleased to tell him privately what they are.
Moreover, I wish to advise the House that, as for all other cheques, the officials of my department are keeping close day-to-day contacts with those of the Department of Supply and Services.
I wish to remind the hon. member that the old age security pension cheques will not be delivered before the end of this week, so that we will be able to take, in their respect also, the steps which may prove necessary in case the postal conflict has not been settled before the end of the week.


William Heward Grafftey: A supplementary question, Mr. Speaker.
Could the hon. minister assure the House that these arrangements will apply to rural districts as well? They may apply to urban districts, but could he assure the House that the cheques will be distributed also in rural districts throughout Canada?


André Ouellet: Yes, Mr. Speaker.


Mr. Speaker:: Order, please. The Chair will recognize the hon. member for Brandon-Souris for a supplementary, then the hon. member for York South and then the hon. member for Charlevoix.


POSTAL WORKERS' STRIKE-POSSIBILITY OF EARLY SETTLEMENT-CONSIDERATION OF POSITION OF CODERS AND SORTERS BY MANPOWER COMMITTEE
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, my supplementary question is for the Postmaster General. In view of the growing public concern over the total collapse of Canada's postal service, what assurance can the minister give us of an early settlement through the efforts of the mediator?


André Ouellet: Mr. Speaker, I would like to remind the House that Mr. Taylor who has been asked to discuss with the parties involved to find a solution stated during the luncheon hour while the two parties interrupted their meeting that the purpose of those discussions was to find some means to end up the illegal strike now under way. According to Mr. Taylor, there is always hope of an early settlement.
I would like to remind hon. members, especially those of the official opposition, to be patient and responsible enough to enable Mr. Taylor to do his work without encouraging by hasty statements the workers to carry on their illegal strike.


Walter Gilbert Dinsdale: In view of the fact this whole mess has been created because the Postmaster General has failed to activate the manpower committee provided for under the

collective agreement signed last March, as his contribution to a reasonable solution is the hon. gentleman now prepared to state publicly that he will activate that committee and refer the critical issue of discrimination between coders and sorters to the deliberations of that committee as provided under the collective agreement which he has ignored up to the present time?


André Ouellet: Mr. Speaker, I have already publicly stated that I hoped that the two parties would find some factors to solve the problem within the manpower committee. I am pleased to see that the hon. member has finally understood it.


Mr. Speaker:: Order, please. The Chair undertook a moment ago to recognize the hon. member for York South.


REQUEST FOR RECONSIDERATION OF RATE OF COMPENSATION TO OIL COMPANIES TO ACHIEVE SINGLE PRICE ACROSS CANADA IN LIGHT OF INCREASED PROFITS
David Lewis: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. I was originally going to address it to the Minister of Finance but I gather he has ascertained that God is willing for him to tell the House what he may do and say in the budget on May 6. I should like to put this question to the Minister of Energy, Mines and Resources. In view of the increase in the profits of Imperial Oil in the first quarter of this year of more than 100 per cent over the same quarter last year, which amounts to a profit of $1 million per day, as much as Canada spent per day in the last war, and this on the basis of $4 per barrel oil rather than the increased price, may I ask whether the government is now ready to reconsider the rate of compensation to those oil companies that is now promised to them in order to have a single oil price across Canada?


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: Mr. Speaker, I think the government's view would be, in view of the fact that there is more than one company operating here and more than one company that does not have western producing properties as the company in question does, that any change in this regard should be dealt with by fiscal measures rather than by changing the compensation program.


David Lewis: May I ask the minister whether the government would then consider, which can surely be easily done, a difference in compensation between the multinationals like Imperial, Shell and Gulf that have made immense profits and those companies that do not have oil properties in the west instead of paying the huge amount of roughly $1)4 billion per year to corporations that have made immense profits on the $4 per barrel price and will have astronomically larger profits on the $6.50 or $6.70 per barrel price?
April 23, 1974


Donald Stovel Macdonald: Mr. Speaker, the hon. gentleman asked me to consider that, and I will.


UNEMPLOYMENT INSURANCE
Mr. Gilles Caouette (Charlevoix):: Mr. Speaker, I should like to direct a question to the hon. Minister of Manpower and Immigration.
Because of the postal strike, special measures have been set up to ensure delivery of unemployment insurance cheques. But those involved in a decision delaying the administration of unemployment insurance could get cash advances from the Quebec social welfare plan. Is the minister now aware that pursuant to a directive originating from district offices in the province of Quebec, all offices are prohibited from advancing moneys to unemployment insurance beneficiaries at grips with the commission?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Mr. Speaker, I believe the hon. gentleman is referring to a routine precaution or caution which was sent out with regard to cases of unemployment insurance in dispute. I can assure the hon. member that we are quite prepared to take emergency measures to look after particular cases of hardship, particularly those arising from delays in the issuance and delivery of cheques due to the postal strike.


FEDERAL-PROVINCIAL-MUNICIPAL AFFAIRS POSITION OF GOVERNMENT ON PARTICIPATION IN TRI-LEVEL TASK FORCE STUDY OF PUBLIC FINANCE
Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, my question is for the Minister of State for Urban Affairs. In view of the fact the Canadian Federation of Mayors and Municipalities yesterday in its presentation to the federal government protested that it was experiencing opposition and an impasse with regard to the tri-level process, will the minister now state unequivocally that the government will participate in a tri-level task force study of public finance to develop the concept of tax sharing that the municipalities have long been pleading for?


Hon. Ron Basford (Minister of State for Urban Affairs):: Mr. Speaker, I indicated yesterday that I think we have the very enthusiastic support of the Federation of Mayors and Municipalities. We also, as a government, indicated our complete support for the holding of a third national tri-level conference this year or early in 1975. I indicated that decision by the federal government to the provincial ministers responsible.
Oral Questions


Douglas Roche: Mr. Speaker, I can only conclude, and I am trying to interpret, that the minister's answer was yes. It was not very clear. That is why I asked for an unequivocal statement. I now ask the minister, what factors led to this change in federal policy since at the national tri-level meeting in Edmonton last fall the minister warned the municipalities that if they persisted with their request for a task force to study tax sharing it would wreck the tri-level process. Was not the federation yesterday protesting against the impasse when it met with the government?


Mr. Speaker:: Order, please. I have to interrupt the hon. member. I suggest that it is not in order to ask the minister to indicate what factors led to a decision. This kind of information would normally be given to the House by way of a statement on motions.


Douglas Roche: Mr. Speaker, I have to rise on a point of order because it is very important to the municipalities and to the House to obtain a clear position from the government as to what it will do with regard to the study on tax sharing. The federation came before the Progressive Conservative Party today because they wanted to make a presentation to the next government of Canada.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Douglas Roche: My point of order is that the federation told us that the government had said yesterday that it would receive their brief very favourably. I direct my question to the Prime Minister. Will the Prime Minister now give us a clear, firm statement that the federal government will participate in a tax-sharing study on a tri-level basis?


Mr. Speaker:: Order, please. I am not sure whether the hon. member had a point of order. He has asked a different question. I suggest that his first supplementary was not in order. Perhaps the Prime Minister could reply to the hon. member's redrafted supplementary, following which I will recognize the hon. member for Calgary North who also has a supplementary.


Pierre Elliott Trudeau: Mr. Speaker, the answer is that we will. We want to proceed with the study which was agreed to by all parties at the last tri-level conference. There was agreement there to undertake a study. We repeated yesterday to the mayors and municipalities that we are in favour of that study. We hope the official opposition is in favour of it. We know that some provinces are trying to drag their feet, but we want the study to go forward.


POSITION OF GOVERNMENT ON HOLDING OF REGULAR TRI-LEVEL CONFERENCES
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to ask the Prime Minister a question. As the municipalities seem to be starving for lack of proper financing and as Mr. Bird, on behalf of the Canadian Federation of Mayors and Municipalities, asked for regular tri-level conferences to assure that municipalities of various kinds, urban and rural, get an equitable share of the taxes collected by the federal government at that level,

April 23, 1974
Oral Questions
will the Prime Minister assure the House and the people, and particularly the municipalities, that there will be regular and meaningful tri-level conferences?


Pierre Elliott Trudeau: Yes, Mr. Speaker, I can give that assurance so far as this government is concerned. The hon. member probably realizes that some provinces do not seem to be as enthusiastic about the process as we are, but it was a federal initiative of this government. We are very much in favour of it. We think it would be much better for the municipalities than the priorities for tomorrow conference proposed to them by the official opposition, which is really a meeting between the federal and provincial governments at which the municipal governments are not one of the levels of government participating.


Mr. Speaker:: The Chair will recognize the hon. member for Calgary North for a supplementary, then the hon. member for Esquimalt-Saanich and then the hon. member for Greenwood.


Eldon Mattison Woolliams: Mr. Speaker, from the Prime Minister's answer I assume that he is in agreement with the statement made by the provincial government of Ontario that they would share on the basis of dollar and dollar and that he is in accord with that kind of financing.


Pierre Elliott Trudeau: Of course not, Mr. Speaker. The hon. member is talking about a subject completely different from the one he raised in his first question. His first question was about tri-level conferences. Now he is talking about fiscal sharing arrangements. He should get his questions straight.


EXTERNAL AFFAIRS
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, my question is addressed to the Secretary of State for External Affairs. Is it true that in the design of the new Canadian passport the Canadian coat of arms which contains the Crown and other royal symbols is to be eliminated and, in addition, that the design removes the special exhortation to Her Majesty's representatives round the world and in her name to give aid and comfort to those who hold this document and seek such assistance?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, I have not heard of any of these suggestions.


REPORTED MASSACRE OF CIVILIANS BY PORTUGUESE COLONIAL TROOPS IN MOZAMBIQUE-REQUEST FOR REPRESENTATIONS
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is addressed to the Secretary of State for External Affairs. In light of the recent confirmation by a group of Portuguese officers of the earlier accounts by Catholic priests of the massacre of civilians by Portuguese colonial

troops in Mozambique, will the Secretary of State for External Affairs take the opportunity to repeat to Portugal, an ally of Canada in NATO, our abhorrence of the repression of the remnants of the Portuguese colonial empire in Africa and will he urge Portugal once again to grant freedom to the independence movements in these areas?


Mitchell William Sharp: Mr. Speaker, on the first part of the question, I have no independent confirmation of the reports on the radio this morning. I should like to say, however, that Portugal clearly must be held responsible for any such atrocities committed by their forces against innocent civilians in those African territories. I am happy to repeat two statements I have already made. First, I have urged the Portuguese foreign minister, and I will do so again whenever I have the opportunity, to negotiate with the liberation movements for the independence of the colonial territories. I would remind the hon. member that in the United Nations we voted in favour of a resolution calling for the establishment of an impartial and responsible commission to inquire into reports of massacres in the Portuguese territories.


Francis Andrew Brewin: In posing my supplementary, Mr. Speaker, I should like to tell the Secretary of State for External Affairs-


Mr. Speaker:: Order, please. The hon. member should ask a question rather than tell something to the minister.


Francis Andrew Brewin: I will do so, Mr. Speaker, but the minister should look at the Manchester Guardian-it is a liberal newspaper, "liberal" with a small "1"-and he will find it contains a report on this matter. My question is this: will the minister go beyond what he has said and raise this matter publicly in NATO which purports to be a defender of human rights? Will he consult with the other allies in NATO to ensure that NATO is used as an instrument to deal with this affair?


Mitchell William Sharp: I would not give an undertaking to raise this issue publicly in the NATO forum. In the first place, it would not be public; NATO meetings are not in public. Again, an effort to raise issues of this kind in a NATO context has been made and it has been uniformly non-constructive and has only led to long and futile debate. However, we are very much concerned about these reports and we shall be consulting with our allies.


THE CANADIAN ECONOMY
Mr. Don Blenkarn (Mississauga):: Mr. Speaker, my question is directed to the Prime Minister. Will the right hon. gentleman undertake to introduce legislation having to do with inflation and housing in the interval between the present date and May 6 when the budget is to be
April 23, 1974

Oral Questions
brought down so that we may get on to dealing with these problems which are bedevilling people in urban Canada?


Pierre Elliott Trudeau: That, indeed, is one of the reasons we are hoping to use some legislative days before the budget to introduce important legislation against inflation-


Some hon. Members:: Football!


Pierre Elliott Trudeau: We hope the House will permit us to get on with these measures very soon.


MORTGAGE INTEREST RATES-REQUEST FOR STATEMENT ON GOVERNMENT'S PLANS
Donald Alex Blenkarn: Mr. Speaker, my supplementary question is directed to the Minister of Finance. On April 19 I pointed out to the Prime Minister that the unsettled interest rate situation had destroyed the entire mortgage market in metropolitan Toronto and I asked the Prime Minister to have you, sir, make a statement on motions about the mortgage market. Would you now-


Mr. Speaker:: Order, please. Would the hon. member direct his question to the Chair.


Donald Alex Blenkarn: Would the minister now make a statement on motions as to the interest stance so that mortgage companies can get on with the business of lending to private builders, or will the government make private representations enabling the mortgage market to know where it is going so that some houses can be built in this country?


John Napier Turner: I think I had just better work on my speech for May 6.


SOCIAL SECURITY
Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, my question is directed to the Minister of National Health and Welfare. I do not want to distract him from protecting underpaid football players in Canada. It has to do with a matter I raised five or six weeks ago. Has he had an opportunity to review the regulation under the family allowances legislation under which orphaned children are struck off entitlement to allowance on the death of both parents when an estate of more than $1,600 a year is left?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Yes, Mr. Speaker, this matter has been reviewed and we are examining various possibilities of amending the regulations so as to improve the situation. However, this process is not yet completed.


CONSUMER AFFAIRS
Mr. William C. Frank (Middlesex):: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. I can well understand his need to consult with his colleagues on occasion. As beef processors claimed a lengthy time lag between producers and consumers when beef prices to producers were declining but an extended time lag does not seem necessary when the reverse is taking place and prices are rising, has the minister ordered an immediate investigation into this specific circumstance and, if not, will he undertake to do so?


Herbert Eser (Herb) Gray: This is an aspect I am looking into in line with answers I have given to other hon. members.


FINANCE
Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I would like to put a question to the Minister of Finance.
Will his May 6 budget put forward a valid answer, off the beaten track that led us to inflation, to solve investment problems in the public sector in Canada, for municipalities, school boards and provincial governments, through loans granted by the Bank of Canada at administrative costs?


John Napier Turner: I take note of the question, Mr. Speaker, but the hon. member should not get impatient.


BEEF PRICES-ACTION TO PROTECT PRODUCERS FROM BLAME FOR INCREASES
William Charles Frank: I should like to direct my supplementary to the Minister of Agriculture. Since it now appears that beef producers are once again to be the whipping boys in relation to the current rise in the consumer price, and bearing in mind that the biggest weekly supply of Canada beef reached the Toronto market last week, may I ask the minister what action he is taking to protect producers and prevent them from being blamed for yet another display of fancy footwork by the food distributors?


Hon. E. F. Whelan (Minister of Agriculture):: In reply to the hon. member I would say that the facts speak for themselves. The market shows there has been no tremendous increase in the price of beef to the beef producers of this nation. The statistics show there are 37.5 per cent more meat products in storage in Canada at this time than

April 23, 1974
Oral Questions
a year ago and there is no basic reason at all for the price of beef to be increased by 20 cents a pound as some are suggesting.


Some hon. Members:: Hear, hear!


Eugene Whelan: The hon. member can tell that to his friend from St. John's East.


AIR TRANSPORT
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I should like to direct a question to the President of the Treasury Board. I have just received a press wire and I hope Your Honour will give me a bit of leeway. It states in part:
A union spokesman in Montreal says the federal airport firefighters are expected to end their two-week strike later today even if a nation wide vote rejects the latest federal offer.
The union spokesman said the firemen would report to work on one condition, namely, that a mediator be appointed immediately to reopen negotiations. He said-


Mr. Speaker:: Order, please. The hon. member asked for leeway but, really, he should attempt to ask his question without quoting the document to which he has referred. The hon. member will, of course, be given all possible leeway because this is an important matter.


Lincoln MacCauley Alexander: I had to give the President of the Treasury Board some indication of what the press wire said. Since the firefighters have stated they will go back to work, as I understand it, in half an hour under certain circumstances, can the President of the Treasury Board give the House an assurance that he will pursue this matter and see to it that a mediator is appointed forthwith?


Hon. C. M. Drury (President of the Treasury Board):: am glad to give an undertaking to pursue the matter in any way that is likely to lead to the cessation of this illegal strike.


REGIONAL ECONOMIC EXPANSION
Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, my question is also prompted by a wire but I will not read it. I should like to take the House from Mozambique to Eskasoni, Nova Scotia. My question is directed to the Minister of Regional Economic Expansion. Is the minister aware of a commitment of funds from his department for Micmac Fisheries Development Co-operative Limited engaged in oyster farming, funds which to date have not been forthcoming? If the minister is not familiar with either the project or the commitment, will he be good enough to look into the matter and make a report? As he

well knows, coming from Newfoundland, time is of the essence where a project of this nature is concerned.


Hon. Donald C. Jamieson (Minister of Regional Economic Expansion):: As to the second part of the question, I shall be pleased to look into the matter immediately. My recollection is that I did receive a representation with regard to the catching of what I believe were described as baby oysters by this group. It is probably the same one, and action is being taken on it.


PREVENTION MEASURES BY TOWN OF LUMSDEN, SASKATCHEWAN-POSSIBILITY OF FEDERAL FINANCIAL ASSISTANCE
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, I should like to direct a question to the Minister of the Environment in relation to the reply by the Prime Minister yesterday to the hon. member for Assiniboia. What are the other ways, referred to by the Prime Minister, by which the town of Lumsden can receive federal assistance in the heroic efforts its people are making to prevent their town from being flooded?


Hon. Jack Davis (Minister of the Environment):: Mr. Speaker, federal financial assistance is available to the provinces and through the provinces to the municipalities for all works of a temporary nature and for all outlays in the nature of compensation. In other words, temporary works such as the dykes now being built and sandbagging are subject to the formula for cost sharing.


AIR CANADA
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, in the absence of the Minister of Transport I should like to direct my question to the Prime Minister. As Air Canada has laid off some 4,800 employees and these layoffs have been labelled as a complete violation of the collective agreement, what action will the government take to rectify the violations of the agreement by Air Canada management?


Mr. Joseph-Philippe Guay (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, on behalf of the Minister of Transport I would like to say it is true that there has been a lay-off of over 4,000 employees. This is an issue which has arisen before during Air Canada strikes. It has been discussed at length by the company and the various unions. We understand that the unions involved can follow the grievance procedure provided for in the collective agreements. However, Air Canada does not feel it is in violation of any provisions of the collective agreements.
April 23, 1974


A. Daniel McKenzie: Mr. Speaker, as there is a difference of opinion between Air Canada and the unions, will the government request Air Canada management to call back the employees who were wrongfully laid off?


Joseph-Phillippe Guay: Mr. Speaker, I will bring the second question to the attention of the minister.


FINANCE
Mr. Perrin Beatty (Wellington-Grey-Dufferin-Waterloo):: Mr. Speaker, my question is for the Prime Minister who last Friday took responsibility for the decision by the Bank of Canada to increase interest rates and thereby mortgage rates and indicated that this decision was made following consultation with the government. At the time the decision was made by the government to allow the Bank of Canada to increase interest rates, what effect did the Prime Minister expect this would have on the cost of housing? In other words, would it cause housing costs to go up or down?


Pierre Elliott Trudeau: Mr. Speaker, I did not indicate that this particular decision was taken after consultation with the government. I did repeat what the Minister of Finance has said, that the policy of the bank is in general accord with that of the government, and that the governor of the bank had, indeed, as he always does, informed us of the action he was going to take.


Mr. Speaker:: Order, please. I bring to the attention of hon. members that we have just about reached the end of the question period, but perhaps we might have one or two additional questions without supplementaries, with the co-operation of hon. members, of course.


AIR TRANSPORT
Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I want to direct my question to the President of the Treasury Board and it is somewhat supplementary to one asked earlier. The President of the Treasury Board has now given a clear indication that if the firefighters return to work he will appoint a mediator. I would ask him to repeat that because this, of course, is all the assurance they want. Can he give us some indication whether or not an agreement has been ratified yet, or when he might know?


Charles Mills (Bud) Drury: Mr. Speaker, I am sure the hon. gentleman is aware that under the collective bargaining process a mediator is sought with the consent of both parties to the discussions. At the present time the Treasury Board has a settlement
Oral Questions
with the union, and it would be difficult to see what role a mediator would play.


J. Michael Forrestall: Mr. Speaker, they need the minister's assurance. Are you withdrawing it? Give it once again.


AGRICULTURE
Mr. Jack Murta (Lisgar):: Mr. Speaker, I should like to direct a question to the Minister of Agriculture. Since the minister some months ago assured the House that there would be an adequate supply of fertilizer for all parts of Canada this year, can he assure the House at this time that there will be an adequate supply of fertilizer and also an adequate supply of chemicals for use this summer?


Eugene Whelan: Mr. Speaker, we do realize that there are some problems still existing in distributing fertilizer to areas throughout the country and that there will be some shortages in some parts of the nation. There is an increase in the production of fertilizer; in western Canada, for instance, it is 68 per cent more than two years ago, so it is away up there. Nitrogen production is away up in Canada. We have met with the chemical industries that are supplying different chemicals and understand they have found other sources in other parts of the world and, according to the information we were given about a week ago, they hope to be able to meet the demands for all of Canada.


THE MINISTRY
Mr. Tom Cossitt (Leeds):: Mr. Speaker, I have a question for the Prime Minister arising from his announced trip beginning Thursday to certain centres in Ontario, including the Ontario Liberal Party annual meeting in Sudbury. Will he tell the House whether he will make use on this trip of any aircraft belonging to the Department of Transport or the Department of National Defence and, if so, what factors have led to this method of spending public funds?


Pierre Elliott Trudeau: Yes, Mr. Speaker, just like the Tories who flew back to their ridings last week on DND aircraft, I intend to-


Some hon. Members:: Oh, oh!


Thomas Charles Cossitt: Mr. Speaker, I rise on a point of order.


Mr. Speaker:: Order, please. I understand the hon. member is rising on a point of order. If it does not take too much time I will see the hon. member for Winnipeg North Centre.


Thomas Charles Cossitt: On a point of order, Mr. Speaker, I directed a question to the Prime Minister on a matter of concern to

April 23, 1974
Oral Questions
many Canadians, and I do not feel that the question should be answered by a non-answer. Is the Prime Minister the hon. member for Sudbury? That is where he is flying in a departmental aircraft. I think that this kind of answer to the question is arrogant, out of order and is an affront to parliament and to the Canadian people.


Some hon. Members:: Oh, oh!


John Napier Turner: I see you have finally found a use for that guy.


An hon. Member:: He has lots of Liberal experience, John.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. May we have order, please. The hon. member for Winnipeg North Centre.


AIR TRANSPORT
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I should like to direct a question to the President of the Treasury Board. In view of the fact the air traffic controllers in their collective bargaining with the Treasury Board have followed the law at every point, and in view of the fact they have given two weeks' notice of their date for a legal strike, will the President of the Treasury Board assure the House that the board is making every effort during this two-week period to reach a just settlement with the air traffic controllers so their strike will not be necessary?


An hon. Member:: There goes the budget.


Charles Mills (Bud) Drury: Mr. Speaker, that, with the help of the mediator, is our firm intention.


Mr. Speaker:: Order, please. Is the hon. member for Saint John-Lancaster rising on a point of order?


Mr. Bell:: No, Mr. Speaker, I want to ask a question but it will keep until tomorrow.


Mr. Speaker:: If the hon. member feels his question might keep until tomorrow, we will call orders of the day. Is the hon. member for Wellington-Grey-Dufferin-Water-loo rising on a point of order? Perhaps he should be recognized first and then I will call orders of the day.


Henry Perrin Beatty: Thank you, Mr. Speaker. Actually I rise on a question of privilege which relates to the question I asked the Prime Minister. While I appreciate the fact you are very anxious to move on to other matters, the fact is that I asked the Prime Minister a question which he did not answer and at the same time he inadvertently misled the House. I think he should at least be given an opportunity to correct the mis-statement he made to the House. I have in mind the

fact that on page 1581 of Hansard for last Friday the Prime Minister is reported as having said:
The long and short of it is that the governor of the Bank of Canada decides what the interest rate will be but in consultation with the government-
While he was busy debating the question I had asked him the Prime Minister said to the House that in fact there was consultation about the interest rate with the government, and I think he should be given an opportunity to clear up any misconception which might have been created.


Mr. Speaker:: I am not sure whether the Chair should allow the Prime Minister to answer a supplementary question. The question raised is hardly a question of privilege. However, if the Prime Minister wishes to do so he will be recognized for the purpose of replying to the hon. member's question.


Pierre Elliott Trudeau: Mr. Speaker, I thank the hon. member for giving me this opportunity. I would refer him to my answer of that day and the reference I was making to the answers of the Minister of Finance. What I indicated was that the Minister of Finance had given a very good description of the relationship between the governor of the bank and the Minister of Finance. The essence is that the governor of the bank has to have a policy with which the government agrees, but there is not day by day consultation on every matter on which the governor of the Bank of Canada decides. However, it is the practice that before increasing or for that matter decreasing the bank rate he will advise the Minister of Finance and in this case I am quite certain he did so.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, April 22, consideration of the motion of Mr. Lalonde that Bill C-22, intituled Canadian Football Act, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Mr. J. H. Horner (Crowfoot):: Mr. Speaker, when I began my remarks shortly before ten o'clock last night, I had referred to what I thought was a rather misleading statement by the minister when he said we have no professional baseball in Canada and that, therefore, he and the government would not necessarily have to be concerned about baseball. We have many semi-professional baseball teams across the country. Attempts are being made to establish leagues in Canada. The main difficulty in respect of baseball in Canada is in attracting people to watch the game. This has been a severe problem in the city of Calgary where I know many people have attempted to
April 23, 1974

establish a semi-professional league. At the present time the game does not have sufficient drawing power to attract great audiences. However, it might do so some day. We might be able to entice Americans to come up here to play baseball and thereby encourage Canadians by providing them with an opportunity to learn from the best there is in the business. This is one aspect of football. Over the years we have encouraged American players to play football in Canada so that we could learn from them, the best in the business. Many of our young players have gone to United States colleges to learn to play football and then returned to Canada. It is true that a few remain in the United States to play football there.
I was quite disappointed when I read the speech of the hon. member for York West (Mr. Fleming). I had thought he was a long-time admirer of the former leader of the Liberal party, Mr. Pearson. However, it seemed to me that he was preaching for a cause which was not necessarily football but rather a personal cause within the Liberal party. Certainly Mr. Pearson, well known by many people to have been a great admirer of sports, would have been very hesitant to put his stamp of approval upon the minister's legislation. But this government, of course, is doing a number of things the former Liberal government would never have done.
The hon. member for York West stated that he had received communications from the various mayors across Canada. He did not include Mayor Drapeau of Montreal among those. The minister, in closing his speech during the debate, said that this bill will go to the committee and that the committee will be at liberty to call all the witnesses it wishes. Well, in respect of the Bill C-18 concerning oil, the committee was told there was a desire to get the bill back into the House the next week and, therefore, it was hardly possible to call witnesses. This question perhaps has been better aired and maybe witnesses would be prepared to appear before the committee on Health, Welfare and Social Affairs to discuss the pros and cons of the Toronto Northmen operating in Toronto or in Buffalo or in Seattle. Surely, among the witnesses who should be called are the COJO people from Montreal or Mayor Drapeau, because Montreal generally gets what Montreal wants. We should know exactly what it wants so that we can support or not support this bill from the proper outlook one might form here in Ottawa.
Let us take a look at football itself. The Canadian game of football was originally called rugger. An article which appeared in the Globe and Mail for April 17 says that rugby football originated in England. This game has been changed and somewhat modified. We have adopted the American rules. We took the forward pass and we used American imports. Even the scoring system was changed to correspond with the system in the United States. A touchdown originally counted for five points, but we increased it to six points to correspond with the value of a touchdown in the United States. It is said in this article that the west was the first to use American imports. It goes on to mention Fritz Hansen. I knew Fritz Hansen but did not know he was an American. Certainly, many Americans have come to Canada to play football and have remained in Canada.
Canadian Professional Football
The minister has no precedent for this particular piece of legislation. He mentioned that the Grey Cup game is a great national event for all Canadians. It has been said that this event stimulates an interest in sports, that it has become symbolic of athletic competition because it brings east and west together and thereby contributes to the unity of the nation. If the minister wants to bring together east and west he could make a contribution to the eastern part of Canada. He does not seem to be doing anything to encourage the playing of football in the maritimes. He does nothing to subsidize a team in St. John's, Newfoundland. That is where hockey is presently taking over. The people love the game. I am sure there are many people there who would like to play football and have the benefit of the salaries paid by the CFL or the WFL. I do not see Mr. Lalonde giving any help to teams in St. John's, Halifax or to any other Canadian team.
The minister goes on to say that without denigrating the value of free enterprise, even its most vocal proponents would concede that government must be prepared to intervene on occasion to protect the legitimate interest of all Canadians. Then, it is stated that various actions have been taken by the Canadian Government to control the operations of numerous aspects of the private sector, such as in banking, foreign investment, broadcasting, and communications. Well, it is nice I suppose for the football players to realize they are part of that eminent group of bankers, broadcasters and communicators, but certainly we must ask what we are doing for the young Canadian who wants to play ball and get paid the best money possible. Recently reference has been made in the newspapers to the Toronto Northmen signing three players from the Miami Dolphins. In addition, however, they signed up a Canadian boy named Stevenson from Edmonton. I do not think the Edmonton Eskimos could pay him enough. Who would say that young Stevenson should not accept more money from the Toronto Northmen? I do not believe any thinking Canadian would blame Stevenson for taking more money from the Toronto Northmen to play in that league. Why should he not do so? His athletic career will last only a few years and he should get the money while he can.
Mr. Lalonde made a few erroneous statements-


Mr. Speaker:: Order, please. I am sure the hon. member knows he should refer to hon. members either by their constituency or by their official position in the government.


John (Jack) Henry Horner: I am sorry, Mr. Speaker. I was referring to the Minister of National Health and Welfare. He made a number of erroneous statements. Apparently the minister said on a radio program that the World Football League would go after CFL players even if the Northmen were allowed to operate in Canada, and the World Football League would probably set up teams in Montreal and Vancouver. The Minister knows full well that he has had an offer of a written guarantee from the Toronto Northmen to the effect that if they are allowed to operate in Toronto they will honour the CFL contract, and will in no way attempt to raid the CFL, except, when a contract on a player's option was available.

April 23, 1974
Canadian Professional Football
The minister also knows full well that if the Toronto Northmen were allowed to operate in Toronto the government would then have the determination as to whether or not there would be another world football team operating in Canada because Mr. Bassett has that franchise and is prepared to turn it over to the government or to the CFL, whichever the government felt would be better. The Northmen have also offered to make payments for the next ten years that will equal the payments the Argonauts have made into the equalization fund in 1973.
It has been said that the Regina team sorely needs these equalization payments. If one wanted to look at their books one would find that their operation has been rather a success financially. I am not saying that they are as well off as they would want to be, nor am I saying that they are rolling in cash, but they are far sounder as a financial enterprise than are the Montreal Alouettes. The Canadian Football League has sent every member of the House their blue brochure which outlines the average payments of the Argonauts which have been $55,000. I do not think that $55,000 divided into eighteen will make or break the Canadian Football League. The people in Regina to whom I spoke on this matter said that their big problem is to fill Taylor field with spectators. We will fill Taylor field with spectators if we provide them with a good brand of football and if the economy of the local citizens allows them to pay the price of the tickets. I do not think they will have any trouble maintaining the Regina football team. If the economy worsens so far as grain prices are concerned, Taylor field might have difficulties. If the Regina team does not find successful replacements for their all star quarterback and their running back, then they may have trouble filling Taylor field.
But it will not matter what happens in Toronto because Mr. Bassett and the Northmen have also promised not to televise the games of the World Football League anywhere in Canada. That is a bigger commitment than they are prepared to make if they have to move to Buffalo. If they move to Buffalo, CTV already has a contract with them to televise their games in Toronto. The amazing thing is that even though the Toronto Northmen will be operating in Buffalo, the fact they are owned by Canadians will allow compliance with the Canadian content rule of our broadcasting system, so their games can be broadcast in Canada if they are forced to move out of Toronto. It seems to me that it will be more detrimental to filling Taylor field in Regina if I, or a person in or near Regina, can sit at home and watch the World Football League on television. It may not be a Canadian team, but it will be owned by Canadians and may have Canadian players on it, so we may be more content to sit at home and watch that game than pay the price of a ticket to watch a game in Taylor field.
So it seems to me that Bill C-22, rather than helping the Canadian Football League, is in fact doing it harm. It will be detrimental to the Canadian Football League if the Toronto Northmen have to move out of Canada. If they are allowed to remain in Canada, it may be difficult for the Toronto Argonauts, but if there is no broadcasting of the games in Canada the other teams will not hurt, provided the Northmen live up to their commitment that they will make the equalization payments the Toronto Argonauts

have made. The book I have here says that last year the Toronto Argonauts paid $50,000 in equalization payments, and the average payment has been $55,000. I do not think the Northmen will quibble about the other $5,000, but they are serious and they will have a team on the World Football League. The World Football League will become an empire.
If they are forced to go to the United States then, as they have said publicly, they will openly raid the CFL, and the CFL will be in severe danger. There will be far more Stevenson's who will opt to go for the higher money. Stevenson, from Edmonton, had a perfect opportunity; he was breaking into professional football. Born in Edmonton, he went to the United States to learn how to play the game. He was offered big money and went for it. There will be all kinds of American players now playing in CFL who will, in fact, be offered contracts and no attention will be paid to their existing contracts. Jack Gotta, the former coach of Ottawa Roughriders, has stated that he would not mind having five members of the Grey Cup champions, the Ottawa Roughriders, on his team in Alabama. I suppose he would be prepared to pay somewhat more than they are getting up here, and he knows exactly what they are getting here having been their coach. If we want to help the CFL in Canada, then every member of the House should defeat this bill, but if we want to kill the sport and kill the hopes and aspirations of many young Canadians who believe that through sports they can achieve their fame, then we should support this bill.
The Minister of National Health and Welfare has never been much of an athlete or he would not have put this bill before the House. I know nothing of his past but I judge the man by his attempts to stifle sports in Canada and I am very disappointed in his attitude to that matter.


Mr. Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Speaker:: All those in favour of the said motion will please say, yea.


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.


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


Mr. Speaker:: Call in the members.


EXPORT AND IMPORT PERMITS ACT
Robert Knight Andras: that Bill C-4, to amend the Export and Import Permits Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said; Mr. Speaker, in introducing this bill for second reading, it is my intention to outline the basic reasons for proposing the amendments to the Export and Import Permits Act as set out in the measure before us. As I am pinch-hitting for my colleague, the Minister of Industry, Trade and Commerce (Mr. Gillespie), who will be returning tomorrow from a trade mission, I shall confine my remarks to the fundamental objectives of the bill and try to be as brief as possible. We can go into detail while in committee to whatever extent may be necessary.
Under the terms of the Export and Import Permits Act, the Governor in Council may establish a list of goods called an "export control list" whereby the export of any article can be made subject to control for certain purposes as specified in section three of the act. The first objective of the bill is to add the following two purposes to those already set out in section three:
to ensure that any action taken to promote the further processing in Canada of a natural resource which is produced in Canada is not rendered ineffective by reason of the unrestricted exportation of that natural resource;
to limit or keep under surveillance the export of any raw or processed material which is produced in Canada in circumstances of surplus supply and depressed prices and which is not a produce of agriculture.
Under section five of the same act, the Governor in Council may also establish a list of goods, called an "import control list", whereby the import of any article may be made subject to control for certain purposes as specified in that section.
The second objective of Bill C-4 is to add the following purpose to those for which imports can be made subject to control;

April 23, 1974
Export and Import Permits
to restrict, for the purpose of supporting any action taken under the Farm Products Marketing Agencies Act, the importation in any form of a like article to one produced or marketed in Canada the quantities of which are fixed or determined under that act.
The third objective of Bill C-4 is to repeal section 27 of the Export and Import Permits Act setting out the expiry date of the act.
The first point I would draw to the attention of the House is that, apart from the deletion of the expiry date, the proposed amendments constitute enabling legislation. The fundamental concern of the government in respect of both the proposed amendments is to establish further purposes for which products can be placed on the export control list to ensure to the maximum extent possible that proper economic advantage is derived from raw or processed materials produced in Canada.
The object of the amendment to enable the Governor in Council to place items on the export control list in order to promote further processing of a natural resource produced in Canada is self-evident from the wording. The amendment will provide one of the means which may be needed to promote the processing of resources in Canada in cases where such processing can be internationally competitive and consistent with sound industrial structure. This is not to imply that the most desirable or the most effective way to encourage the processing of resources is by introducing export controls. Quite the contrary. The government's general approach is to focus on constructive co-operative tools such as multilateral trade negotiations, taxation policy, existing programs of industrial support, consultation with industry and the foreign investment review process. Nevertheless, it is conceivable an occasion might arise when, despite such positive efforts or in conjunction with them, it might be necessary to make the exportation of some natural resources subject to control if further processing in Canada is desirable and is to be achieved.
The object of the proposed amendment to limit or keep under surveillance the export of raw or processed materials produced in Canada in circumstances of surplus supply is to establish a provision which can be used, if needed, to ensure that proper economic advantage is derived from raw or processed materials produced in this country. Occasions may arise when Canada possesses a particular material in abundance, as well as an influential place in the international market with respect to its price. In such circumstances, over-supply from Canadian sources could result in reducing prices or holding them at an inappropriately low level having regard to such factors as the capital invested in production, the long term need, and the future value of the material involved. In this situation, various steps to promote appropriate pricing might be possible; for example, international or national co-operative marketing arrangements. However, one advisable step might be to make the material in question subject to export control for a time. The proposed amendment in respect of material in surplus supply would make it possible to initiate such action and to do so with a promptness which would yield best results.
Hon. members will have noted that agricultural products are excluded from the amendment dealing with materials in surplus supply. The reason is that there are no situations involving products, other than those already under the control of the Canadian Wheat Board, in which

Canada would have the necessary strength in world markets to influence the price of a commodity through unilateral export restriction.
At this point, Mr. Speaker, I should like to turn to the proposed amendment aimed at establishing an additional purpose for which imports can be made subject to control. The amendment is as follows:
to restrict, for the purpose of supporting any action taken under the Farm Products Marketing Agencies Act, the importation in any form of a like article to one produced or marketed in Canada the quantities of which are fixed or determined under that act.
As hon. members know, the Farm Products Marketing Agencies Act, which became law in 1972, allowed for the creation of national farm marketing agencies to promote strong, efficient and competitive industries having due regard to the interests of producers and consumers. To date, such agencies have been established to deal with eggs and turkeys. Under the act, agencies have the power-in respect of eggs and poultry only-to determine quantities which may be marketed in interprovincial and export trade by setting production or marketing quotas.
It is possible that in future a supply-management program of this kind could be undermined, on occasion, by an influx, or the threat of an influx, of low priced products, particularly from other countries. Therefore, it is being proposed to permit the application of import controls, if required, to support the operation of national supply-management programs for eggs and poultry. This is not to imply, of course, that it would be the intention of the government, if it did decide to apply import controls on eggs or poultry for a particular period, to attempt to insulate the Canadian market for these products for longterm trends in international prices.
One point to which I should like to draw the attention of the House is that, if this amendment is enacted, it does not mean that an agricultural product will be automatically added to the import control list because a supply-management program is being implemented under the Farm Products Marketing Agencies Act. In fact, if the authorities concerned under this act believe that a particular product should be added to the import control list to complement a particular supply-management program, they will have to make a specific recommendation to this effect. Then, the government will, of course, examine the case and decide whether or not to recommend to the governor in council the desired addition to the import control list, as well as establish the duration and conditions under which import controls will be exercised for the particular product or products in question.
Finally, Bill C-4 proposes the repeal of Section 27 of the Export and Import Permits Act which states that "This Act shall expire on the 31st day of July, 1974". The act, which was enacted in 1947, has been repeatedly extended. The last extension, which established the existing expiry date, took place in 1969.
It is proposed to repeal Section 27 since the inclusion of an expiry date in what is, in effect, ongoing enabling legislation, is, first, inconsistent with the fact that the act was intended to implement various international commitments, as well as complement other acts of parliament

which are not subject to expiry dates; and, second, leads to unnecessary administrative expense both for industry and government departments, as well as introduces an element of uncertainty in private companies' export sales efforts on long lead-time delivery items in contracts with certain potential purchasers. As hon. members appreciate, the repeal of Section 27 would simply mean that the act's continued existence is at the pleasure of parliament.
Canada has various ongoing international commitments that are implemented under the Export and Import Permits Act which are not subject to expiry dates corresponding to the limited duration of the act, the time and extension of which I just described. These include export control commitments in respect of military equipment and strategic supply; controlling trade, for instance, with Rhodesia in keeping with the United Nations' resolutions on Rhodesia; implementing international commodity control commitments, for example on cocoa; and administering cross-border arrangements with the United States to facilitate Canadian trade. The act is also used on an ongoing basis, as required, to complement action initiated by agencies named in Section 5(b), that is the Agricultural Stabilization Act, the Fisheries Prices Support Act, the Agricultural Products Co-operative Marketing Act, the Agricultural Products Board Act, and the Canadian Dairy Commission Act. None of these five acts contain an expiry date. In addition, the Export and Import Permits Act is used on a continuing basis for implementing import controls which are deemed necessary as a result of recommendations to the government made under the Anti-Dumping and Textile and Clothing Board Acts.
In referring to the various other acts for which the Export and Import Permits Act may provide complementary support, perhaps I should mention at this time that the act does not, of course, include any provisions, nor are any provisions being proposed, whereby items are automatically added to the import control list or export control list at any time as a result of action initiated under any other act. When items are added or deleted from the import or export control list, the government takes and must continue to take a decision in each case having regard to its international commitments and the recommendations which may be made to it by departments, agencies or boards, as well as whatever other significant circumstances prevail at the time.
I might add also that the Canadian Dairy Commission Act is the only act of the group of five named in subsection 5(b) for which the Export and Import Permits Act is being used to provide complementary support at the present time. In this connection, 10 products are on the import control list: Animal feeds containing more than 40 per cent of non-fat milk solids, butter, certain butterfats, cheese of all types, dry buttermilk, dry casein and caseinates, dry skimmed milk, dry whole milk, dry whey and evaporated and condensed milks.
The inclusion of an expiry date in the act leads, as I said, to unnecessary administrative expense for industry and government departments. For example, it is customary practice to issue export permits covering a six-month period to reduce the work of applying and issuance to a minimum. However, once the act approaches its expiry date, as is the present situation, this economizing of effort
Export and Import Permits
cannot be achieved so that additional applications must be filed and processed this year.
Another example is that it is customary to issue certain export permits for periods of one year for aircraft replacement parts in cases where companies have specific ongoing commitments to export items on an urgent rush basis in order that aircraft will only be grounded for a minimum length of time but, during the calendar year in which the act is due to expire, the business of arranging these special permits must be done twice. The same situation does exist, as a matter of fact, in respect of approximately 400 special calendar year export permits which have been issued to logging and pulpwood firms. Similar difficulty is being encountered on the import control list side in respect of shirts, where approximately 65 importing companies are involved.
An expiry date in the act can also introduce an element of uncertainty in private companies' export sales negotiations with potential purchasers, particularly in countries which are on the area control list. State-trading countries are accustomed to obtaining export permits and, indeed, in most cases, require that a permit be issued to cover a long-lead delivery item before completion of a final sales contract. Cases have arisen, however, where it has been impossible to issue an export permit for long lead-time items since delivery was scheduled after the expiry date of the act.
Therefore, industry and government obviously have been required to go to considerable lengths in such instances to provide as much reassurance as possible to potential buyers, short of a definitive commitment, that export permits will be granted. Since it is hoped that Canadian exports of long lead-time, advanced technology products will expand to state-trading nations, it would be useful to reduce administrative impediments and irritations in dealing with these potential customers to a minimum.
For these reasons I hope that hon. members will join with me in recognizing the urgency of dealing with these matters and, hopefully, will give prompt passage to the bill.


Hon. Paul Hellyer (Trinity):: Mr. Speaker, this bill is received with somewhat mixed emotions. It gives to the government a very substantial increase in its arbitrary powers, which has in fact the potential for consequences which are far beyond those that might appear inevitable in the short-run or on cursory examination. Curiously enough, the vehicle for this new broad range of powers is the Export and Import Permits Act, envisaged primarily as an act to protect the vital interests of Canadian security from a defence and security standpoint. One wonders if it is a sign of the times, based perhaps on the experience of the Arab world in using a resource, namely oil, as a strategic weapon, that we now consider raw materials in that sense or is it merely a question of expediency that an existing act is being used for the purpose of obtaining new powers with objectives far removed from those associated with the main purport of the original act.
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April 23, 1974
Export and Import Permits
The proposed amendments have the effect of introducing economic dirigisme with somewhat nationalistic overtones. Clause one will permit the cabinet to restrict the export of any natural resource produced in Canada if national policy requires the further processing of the product in this country. In addition, the cabinet would be permitted to restrict the export of raw or processed material other than agricultural products in circumstances of surplus supply and depressed prices.
On the agricultural side the cabinet, in addition to the powers already explicitly provided in the act, will be able to limit the import of any article under the Farm Products Marketing Agencies Act similar to articles produced or marketed in Canada where the quantities are fixed or determined under the act. With the general objective of increasing the extent of processing of Canadian raw materials in Canada it is difficult to argue. This is a view which is widely held. I think Canadians are tired of being hewers of wood and drawers of water. They feel we should have a greater participation in the processing of our own raw materials. This is a perfectly legitimate aspiration of Canadians. There are many examples one can think of.
Uranium, for instance, is a natural resource which obviously will come into increased demand around the world. It is a rare commodity in the sense that it has such a vast power potential. It is, in fact, one of the great resources of the world. It can be used as a trade-off to other power sources. It will have a profound effect not only as an alternative to the burning of fossil fuels, for example, but consequently as an economic limitation of a sort to the pricing of other energy sources. It has often been suggested that we should enrich uranium in this country and take advantage of the tremendous increase in value added that that would entail. It has also been suggested we should refine more of our oil in Canada and should export, to the extent that we do export oil from this country, a higher proportion of refined and finished products, thereby ensuring a greater return to Canadian industry and greater opportunities for Canadians to participate and thereby benefit from the higher technology and techniques involved.
Some of our entrepreneurs are doing the same thing in respect of lumber. We are now developing at a very rapid rate trade in pre-fabricated houses which are being exported to France, Japan and elsewhere. One could make a case for the encouragement of a greater degree of processing of these materials, including Canadian lumber, in this country. Of course, another example where we have long complained that United States markets were not available to us to the extent they should be, is in the field of fine papers from our forest products. These are merely indicative of the types of processing opportunities which are available to us as Canadians.
There is a long list. I have not attempted to enumerate in any exhaustive way the wide variety and scope which is available to us, but have merely indicated that there are areas where we could increase the extent of processing in Canada, and consequently benefit in a very material way from the availability in this country of the vast natural resources we have. I suggest this is an area which deserves perhaps more study than we have given it, and that we

should undertake as a matter of urgency a study of the areas in which Canadian value added could be achieved, with a minimum of capital investment and a maximum return to Canadians. The whole question of resource development is a very controversial one, in respect of our renewable resources less so than when one discusses the non-renewable resources. When it comes to renewable resources I think the principles are fairly widely accepted. The principle of course is that we should manage our forests, our fisheries and our farms in such a way that we are able to optimize the yield on a sustainable basis. It is just a matter of common sense that we introduce policies that will give us, on a long term projection, the maximum yield which can be obtained without destroying the basis of the annual harvest.
We have much to learn in these areas. Our forest management techniques although quite excellent in some areas are perhaps not as good as they could be. I am sure that hon. members who are particularly interested in the fishery would say we have much to achieve in this area, including the development of international agreements which will not only enable but require our partners in the world to use the discretion necessary in order to maximize the yield on a long-term basis. But in these areas there are some established principles. The principles are really those I have stated, a maximization of the long-term sustainable yield.
When it comes to the question of non-renewable resources the determination of what one might call the best interest is not so easily made. Extreme positions range all the way from a full-speed ahead type of unlimited exploitation on the one hand, to an attitude of leave the resources in the ground for future generations and only use what is immediately required in Canada by Canadians, on the other hand. These are the extreme positions. I would suspect, as is ordinarily the case, that some middle ground would make the most sense for Canada. I urge the government once again to consider the desirability of cost-benefit studies in these areas. Seldom have I heard- as a matter of fact I have never heard-a discussion of this very important question based on sufficient information as would answer the question whether it is in Canada's long-term interest to accelerate exploitation of certain resources and to use the yield from those resources to repatriate the ownership of Canadian equities in many areas, including manufacturing facilities, as against the inevitable appreciated value of the resources if left for exploitation at some future time. I do not say that the answer to this question will be a categorical one but I do say that any good manager-and certainly this would apply in the present case in so far as a government of Canada is concerned-in order to make the decisions which are in the best interests of Canada should have that information available to him.
So, it would be very worthwhile without any further delay to have some top notch economist work out the long term benefits of Canadian equity ownership of industry, for example, and to compare what the yield would be to Canadians as consumers and as taxpayers by following different courses, whether they would realize the most benefit from an accelerated exploitation of some limited
April 23, 1974

April 23, 1974
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apply pressure, direct or indirect, to extend the scope of the Farm Products Marketing Agencies Act beyond that which is required or determined by the farmers themselves. They should not be subject to subtle pressure from the government or the civil service which may have its own ideas as to how things should be done.
Finally, I think the minister has made an acceptable case for the deletion of the expiry date of the act. I think its original inclusion was related to the cold war and the hope the day would come when it would not be necessary to have this kind of legislation on the books. In those circumstances, it should have a periodic review by parliament. With the kinds of powers now being asked for, and the extension of the scope of the act as to what is really an economic dirigisme, it would seem proper that the act be accepted as a permanent piece of legislation and given a fair trail. It should of course be subject to amendment at any time in the normal way, but without the consequent problems that arise from statutes with a specific expiry date.
We will support this bill, Mr. Speaker, notwithstanding the far-reaching consequences. We reserve the right in committee to examine in detail some of the more profound and possibly far-reaching consequences that are difficult to really come to grips with at first glance. At the same time, we think these powers are probably a legitimate extension of government in the present context and we will go along through second reading to the committee stage.


Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I wish to pick up the point with which the preceding speaker concluded his comments. He referred to the fact that the act to be amended by this bill originally came into being to deal with the armament trade. I think that is highly symbolic of the kind of situation in which Canada finds itself, whether it is governed by the Liberal party at the federal level or the Conservative party. We do not have an act directly, primarily or fundamentally concerned with resource development which is in force at the federal level. Instead, we are gradually inching our way toward some kind of resource management policy by means of amending an act that was originally passed to deal with trade in armaments. This is symptomatic of the kind of resource management we have had in Canada for many years under the Liberal government and for a brief period under the Conservative government since world war II.
What we have in Canada in terms of resources is a situation where our country is rich in resources but poor in policy. We have wealth and poverty together, poverty of ideas and programs, but rich in potential. I do not think there is another country that has allowed its resources to be plundered in the systematic way for short-range financial gain that we have permitted in this country. What has happened has been that the federal governments of Canada have taken a very short-run view. They have looked at the resources of northern Ontario, and it is interesting to note that the minister who introduced the bill is from northern Ontario, as well as similar kinds of mineral deposits in part of the prairies and from the rich resource province of British Columbia, and allowed them to be sold to the highest bidder on the world's markets.

This action provided jobs in the short-run at a faster rate than would otherwise have been the case. I think that point must be acknowledged. However, that is the sole virtue for such a policy.
Since world war II, more jobs have been created as a result of that policy than would have been the case had we adopted a sensible resource management policy which was concerned with the long-run development of Canada as an independent trading nation, and diversified the foundation of its economy by having a much higher percentage employed in the manufacturing sector.
I want to briefly outline a basic shift in policy that is required. I am speaking in terms of the general objectives of this bill. I am under no illusion. This bill in itself only deals with this question in the most peripheral way. None the less, one can take the opportunity of indicating that we really need a much broader bill, one that goes far beyond the details of this one in terms of implementing the general purpose to which the minister alluded at the outset.
The minister said that the purpose of this bill is to give manifestation of the government's concern. He said there should be a proper management of resource export policy to ensure, and I am just summarizing his words, that maximum or proper economic advantage come to Canada. That is precisely what has been neglected in the past. It has been a short-term policy rather than long-term. It is precisely the stated objectives of the minister's speech that we should be concerned about in terms of the future of Canada, especially future generations of Canadians.
What we need is a full implementation of the steps that have so far been partially implemented by this government in the life of this parliament, that is a full fledged commitment to a two price system in terms of our natural resources. We now have a two price system for agricultural products and we have a two price system for oil. We got the latter grudgingly from the government of Canada in the middle of last December. But this has had distinctly important advantages for Canada in the short-run and in the long-run. I will come back to that in a minute, Mr. Speaker.
What we need, and I want to assert this now, is an extension of the two price system beyond these two commodities, to a whole range of other commodities. I will list some of them before I suggest in a general way what the benefits would be from such a program for the people of Canada. I should like to suggest that such a two price system, one for export and one for import, be applied to energy resources-oil, natural gas, coal, uranium and hydroelectric power. In metals it should include copper, lead, zinc, gold and silver; in non-metallic minerals, gypsum, salt, asbestos, phosphates; and forest products, including lumber.
What we need at the federal level is a natural resources marketing board in each of these areas, that would take as its basic objective, the need to establish a two price system; one for Canada and Canadians and one for world exports.


Paul Theodore Hellyer: That is the Russian system!
April 23, 1974


John Edward Broadbent: I heard an interjection from somewhere saying that is the Russian system. I am not at all sure that in detail that is the Russian system. But apart from a lot of negative aspects of that society, if they have the kind of system that I am about to detail, I think it is a remarkably good idea. Just because it is in effect in a fundamentally totalitarian society like the Soviet Union, whose basic negative components all in this House would reject, is no reason we should automatically conclude that they might all be wrong. I understand, for instance, that the Soviet Union has developed good medical techniques for operating. I am certain that even certain Conservative members of parliament if they needed brain surgery-and someone has said that some of them do-would not reject techniques that were originated in the Soviet Union!
That digression aside, Mr. Speaker, I should like to go on. First of all, in terms of dealing with inflation, we want to be able to protect Canadian businessmen as well as Canadian consumers. We want to ensure that when world demand for our natural products is increasing, the price that is established at the world market level may not be the price paid to Canadian producers for that portion of the product sold to Canadian consumers. This applies directly to a number of petrochemical products.
A businessman from Montreal telephoned me about three weeks ago. He was concerned that he could not get a certain product because the multinational corporation in Canada which controlled its production was shipping it all to the United States. In this case it was not simply a matter of price, but of getting the commodity at all. As a result, part of that enterprise is going out of business and those consumers who were buying the product will no longer get it. The kind of control of resources which I have suggested would ensure that Canadian needs were met, and that related to that the price established in world markets need not be duplicated in Canada but that lower prices could be made to prevail in Canada where the natural resource is located.
The government recognizes this principle in its oil policy, as a of which they have developed, and I think sensibly, a two price system for oil: one that will meet the needs, in some sense, of the oil producing provinces to get world prices for their products and also to ensure that Canadians who have natural resources are not charged the higher world price level. So, there is that benefit. We get lower prices in terms of natural resources for Canadians and, second, we ensure that Canada's needs in terms of supply are met.
The third point I want to make is worth elaborating at greater length. It is my view that developing a two price system of this kind for natural resources in the areas I have outlined would provide the best foundation for building a competitive secondary industry in Canada. This is a much better system to ensure that Canadian secondary industry has access to commodities that we have in this country at lower prices, simply because the product is located in this country, than trying to build secondary industry either on the basis of higher tariffs which simply build in inefficiency and protect firms that are not innovative or this is the alternative approach that has been used by this government trying to encourage the development of industry in Canada by having absurdly low taxation
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levels in the corporate sector. I repeat the point: making sure that Canadian businesses have access at lower prices to Canadian resources is the best way of ensuring that we can get a manufacturing industry under way that is competitive, in world terms, in Canada. That is why an overall national strategy is essential in terms of dealing with natural resources. It is much better than a tariff policy and is much better than reducing corporation taxes to ensure an industrial growth for Canada.
Let me give an illustration from an area of the economy that I am particularly concerned about because it is in my constituency. I refer to the automotive industry. As a result of action taken by this government, we have had a significant reduction in corporation taxes to manufacturers in the last few years. This has affected my constituency directly, as it has affected many other manufacturing constituencies. But have the benefits of the special tax concessions really amounted to much? In introducing the measure the Minister of Finance (Mr. Turner) said that he wanted three things: he wanted to improve our trade and manufacturing; he wanted to increase jobs, and he wanted to see the benefits of reduced taxes passed on in the form of lower prices to consumers.
In every aspect of manufacturing, and particularly but, not exclusively automobiles, the minister's stated objectives were failures. In terms of improvement in trade, the fact is that in 1973 our manufacturing deficit increased to $6.4 billion. This is up from a deficit of $4.9 billion in the previous year and $3.7 billion in 1971. In other words, one of the objectives of reducing the corporate taxes, namely, to increase trade in manufacturing, failed. We continue to have a mounting deficit in manufacturing trade. The corporate tax reduction did nothing to alleviate that trend which is many years old and is continuing. In terms of increased employment, the fact is that in manufacturing there was an increase of some 6 per cent in jobs last year. During the same year employment in sections of our economy concerned with trade went up by 6.2 per cent and in construction, by 9.6 per cent. Again I say that the corporate tax reduction approach did not necessarily bring about any great increase in the number of employed, because in those sectors where the tax reductions did not apply, namely trade and construction, the sectors just mentioned, there was a greater increase in employment than in those sectors where the tax reduction did apply. So, the objective of the Minister of Finance (Mr. Turner) does not seem to have materialized.
I hardly need to elaborate on the theme of price reductions for consumers. Our inflation rate now approaches the highest levels of other western economies. There has been no reduction in price. By following the route favoured by this government, that of reducing corporate taxes for the manufacturing sector of our economy-and I will not document cases because that has already been done many times by members of the NDP-you bring about increases in profits. Profits in the corporate sector are now at their highest since the Korean war. Clearly, that approach does not work. Reducing the corporate tax simply benefits those who control the corporations. That action gives them higher profits, but does not produce any net benefits which could not be exceeded by other meas-

April 23, 1974
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ures relating to other aspects of economic policy. I have just discussed those.
If we want to ensure the development of our economy, we do not need lower taxes for our corporations, nor higher tariffs to protect the inefficient; we need measures to make sure that industry in Canada will have access to our resources at prices lower than those available for the manufacturers of the United States, Japan, France and West Germany, who now purchase great amounts of our natural resources.
Let me give an example of what this means in the automotive industry. At present, a large proportion of bumpers for automobiles on both sides of the Canada-U.S. border depends very substantially on the production of Canadian nickel which comes from northern Ontario. At present, on the Canadian side of the industry we are witnessing many lay-offs because of the cutback in the production of certain automobile models in the United States. If we were to say to Canadian producers, "You can get your nickel at a lower price, establish it in Canada, than American producers can," that would mean that our firms which will compete in Canada with United States firms for contracts will be in a much better competitive position. That, it seems to me, is what can be done in almost every other aspect of Canadian manufacturing. We could give our manufacturers that sort of advantage on the basis of the resources existing in Canada. Let us not give them artificial protection by means of tariffs; let us not protect them artificially by means of lower taxes which bring negative effects for the rest of the population.
Let us give them an advantage that is appropriate in a country rich with natural resources. I gave the foregoing illustration on the basis of what I know from having studied that industry directly. If you provide nickel to Canadian producers at prices lower than you provide it for American producers, the result would be an increase on this side of the border of some thousands of jobs. The stated purpose of the bill is to give the federal government greater control over resource policy and to ensure that maximum economic benefits will accrue to Canada from resource management. Let me conclude my observations on the bill by saying that an over-all two price system such as I have just suggested for natural resources is absolutely essential. The bill, unless supplemented and fortified by such a national policy, would be almost totally useless in meeting its stated objective. It would look fine in print; it would sound splendid when ministers made speeches about it around the country; but, in terms of bringing positive benefits for the people of Canada, it will be entirely without substance.
I want to add one final point. If we establish over-all control over the export of natural resources, if we regulate the amounts of non-renewable resources in particular which can be shipped abroad, we can, at the federal level, control the rate of depletion of our non-renewable resources. We also need that kind of policy in Canada, a policy which has not been brought in because of the commitment made by the present and previous federal governments to create the greatest number of jobs in the shortest time. If we implement the kind of over-all control over natural resources which I am suggesting on behalf of my party, we would ensure for future generations in

Canada a continuing number of jobs based on important Canadian resources. Further, they will not simply be jobs in our mines and forests; they will also be jobs in our cities and towns, in the manufacturing centres.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Laniel):: Order, please; it is five o'clock. 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 Scarborough East (Mr. Stackhouse) - finance-statement of minister concerning level of corporate profits and necessity to pass on cost increases; the hon. member for Selkirk (Mr. Rowland)-publishing- intention of Houghton-Mifflin to expand into Canada- government position; the hon. member for Southwestern Nova (Mr. Haliburton)-post office-proportion of employees working on mechanical sorting devices recruited from within service.
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, public bills, private bills, notices of motions.



PRIVATE MEMBERS' PUBLIC BILLS


J. Michael Forrestall: that Bill C-109, to provide for the constitution of a federal transport commission of inquiry (impartial investigation of transport accidents) be read the second time and referred to the Standing Committee on Transport and Communications.
He said: Mr. Speaker, the bill before the House has been brought forward at my initiative. Similar bills have been brought forward in the three preceding Parliaments. The bill flows from the concern felt not only by myself, but by the transportation industry in general and particularly by the aviation component. It represents an attempt by some of us to bring Canadian legislation and thinking into line with that of the rest of the international community. We are talking about the removal of any possibility of conflict when legislation requires regulatory bodies to conduct investigations arising within the parameters of the very regulations for which those bodies are responsible.

mmm
April 23, 1974

The need for action in this area is urgent, and the degree of urgency is increasing with the passage of time. I do not wish to burden the House unduly with statistics, but the number of train accidents-incidents, perhaps-is running well in excess of 4,500 annually. In 1970, there were 787 accidents involving trucks. In 1972, there were 1,429; the number had almost doubled. The same trend is noticeable in the case of registered aircraft-500 accidents in 1969 and 715 in 1973. Even a cursory review of the statistics will show a similar trend in all the media of public transportation where federal jurisdiction is involved. The number of marine fatalities continues to rise. In 1969, over 400 vessels were involved. Well over that figure was recorded in 1973. What is obvious from all the statistics is that we should be more concerned than ever about the manner in which we proceed with the investigation of these accidents.
My files continue to grow as correspondence flows in from all segments of the transportation industry as well as from the travelling public who, after all, must look to parliament to produce legislation which will make their travel, whether for business or pleasure, as safe as possible. Moreover, we should ensure that when accidents do happen the circumstances lend a little more knowledge to the governing bodies concerned, so that eventually travel can be made safer. Of even greater importance, the investigation of these accidents should be free from any possibility of conflict of interest.
We talk about conflict of interest. In this connection let me point out that the Air Accident Investigation Branch of the Ministry of Transport is responsible for NOTAM. I see the parliamentary secretary in his place across the way. I suggest that this is not what is required in the interest of safe travel and efficient safety and accident investigation in Canada. I shall not refer at length to the bill in my name which has been before the House for a considerable period; I have been through it on a number of occasions, after all, but I do wish to read into the record the explanatory note which accompanies that bill. The measure is entitled "An Act to provide for the constitution of a Federal Transport Commission of Inquiry (Impartial investigation of transport accidents).
The purpose of this bill is to establish a permanent but impartial commission of inquiry to investigate transport accidents which are within federal jurisdiction. Under present laws, many of these transport accidents-perhaps resulting in loss of life-are investigated by the federal body which is responsible for making and enforcing the rules under which the transport operated when the accident occurred. There is an obvious conflict of interest in such cases.
The commission I propose in this bill-and I note that this proposal has received the widest possible support from the various transportation sectors in Canada-would have exclusive but selective authority as against any other federal body to investigate all accidents resulting in death, injury, or property loss involving any transport under federal authority. However, the commission need not exercise this authority in cases where it felt the public interest would be sufficiently served through an investigation by the appropriate federal regulatory body, that is, in cases where the federal body would not be impeded in its investigations by a conflict of interest.
I go on to suggest in this bill that the commission should also have authority to investigate safety standards and
Transport Commission of Inquiry practices and to recommend changes. I propose, further, that the commission should report its findings and recommendations, if any, to parliament so as to provide opportu nity for public debate. Provision is made also for any person whose conduct or judgment becomes an issue during the investigation to appear and be heard, or, in the event of his death or other disability, to have his interests represented by a person appointed by the commission.
The application is as broad as possible. It covers transport by rail, by air, by water, by pipeline in the course of moving bulk material from one province to another or beyond the limits of any one province, by motor vehicle and so on. This will mean consideration of the Railway Act, the Aeronautics Act and the Canada Shipping Act in addition to other legislation. I think it is understood that we are dealing here with transportation involving a connection between two provinces. Since the philosophy is sound, transport by aircraft, ship or motor vehicle used by Her Majesty in the right of Canada is also covered, the implication being, of course, that accidents involving modes of transport owned by the several government departments, including the Armed Forces, the RCMP and other somewhat separated Crown agencies like the CBC, should be included.
I think it is important to review this principle for a few moments. The area of precedent that comes to our attention is that other western countries, for example the United Kingdom, have separated this responsibility for regulatory authority, if you will, from the investigative responsibility. The United States started to take this very firm step 10 or 12 years ago and finally separated the responsibility totally about eight years ago, in fact in 1966. Australia is now moving very rapidly in this direction, but Russia and France continue to hold out, although France is in the process of looking very seriously at the validity of such a move. Virtually all western nations have moved toward the removal of any possibility of conflict of interest, but Canada, as I have indicated, remains certainly alone on this continent in not having done this.
I do not think this is because we fail to recognize the importance of this. I do not want to be political about it and perhaps I should be generous to our good and charming parliamentary secretary, as I know he is somewhat in sympathy with this proposal, by suggesting it is because we have not found the useful vehicle or means for doing so. I hope that in the minister's review of the needs of his department in respect of reform he will find high on that list of recommendations to his colleagues in Cabinet a procedure which will remove this responsibility to an independent commission. It is time to end the uncertainty that we create in this manner in the minds of our friends in other nations, as well as in Canada, in the various sectors of the transport industry.
I should like very much to see the substance of this bill referred to the Standing Committee on Transport and Communications. We sought in the past to have this subject raised in the committee. We would like to hear evidence, and hear what the various sectors of the transport industry have to say about this. I have been somewhat surprised in the last three, four or five years that the government has not acceded to even this simple step. We

April 23, 1974
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have ample precedent in this House for referring the subject matter of a private member's bill, without referring the bill itself, to standing committees for investigative work. I hope that out of this debate, and perhaps as a prelude to the minister's efforts within his own department, such a step could be considered. I feel strongly about this, as most members of the House are aware. I am encouraged, by contact with various sectors of the transport industry, in my belief that any attempt by the minister to bring forward such a bill designed to achieve the desired aim and principle, will receive nothing but the widest possible support, as it certainly will from this side of the House.
I think the government does recognize its fallibility in areas such as this, as I think any government would. Again I am encouraged by the minister's comments in the House the other day in response to questions I raised. At the time I felt I should ask a supplementary question in connection with an accident involving a DC-8 at the Halifax International Airport, specifically dealing with whether the minister did not then feel it was time to move in this direction. The minister was kind enough to reply, and I quote from page 1227 of Hansard from April 8, 1974:
Mr. Speaker, when I spoke in the House a few weeks ago I think I mentioned that I would favour an independent board in such cases, and that whenever a new policy was introduced this would be part of it.
What I am concerned with today is the word "when". I am concerned with the delay in getting on with what the minister indicates will hopefully be a series of reforms including this one, but we do not know when that will be. We may have an intervening general election, in which case there would be no delay whatsoever. You will have it in front of you very shortly under the order of government bills along with, I am sure, a virtually parallel list of reforms in the ministry of transport.
All that I really seek to do here, through the medium of a private member's bill such as this, is to transfer the professional and technical expertise from the responsibility of the ministry of transport to another body so that as time passes there can be no question of conflict. I would ask of this commission that it report to the House through some other minister, perhaps the Minister of Justice (Mr. Lang), but that is unimportant, and that it do so in order that the Canadian travelling community using various transportation modes will know there cannot be any possibility of repetition of the examples we have seen. I will not repeat them as they are a matter of Hansard record. Rather I would cite only one, and that I refer to briefly, being the situation in which we have seen individuals enter the service of government in the ministry of transport, maturing and advancing in that service, winding up heading different sections of the same branch. In this situation, we would have one responsible for regulation and one responsible for investigation.
We have in front of us, now still unresolved, a situation in which we caused two highly professional and competent men who have known one another for all their lives to be pitted against each other and in conflict. This resulted from permitting a situation to happen in which it is very clear that in part the regulatory authority failed to do something that the investigative authority had to uncover. Honourable men would do this and I am not suggesting

that the honourable thing was not done. What I am suggesting is that we do not need to impose upon our public servants in this particular area of transportation accidents, regulation, investigation and so on, the burden of this type of conflict.
I note with some satisfaction that there are others in this Chamber who would like to comment on this matter. I hope the parliamentary secretary can shed some light on the intention of his department, at least in respect of the philosophy of such a move as this. I would ask hon. members if they could exhibit some agreement in respect of this matter by finding some way of referring to the Committee on Transport and Communications the subject matter, if not the bill itself. I thank the House for its understanding and patience during my remarks on this matter for probably the twenty-third time since I first introduced it.


Joseph-Phillippe Guay: Mr. Speaker, I should like to commence my remarks by congratulating the hon. member for Dartmouth-Halifax East (Mr. Forrestall) for the continuing interest he has shown in this House and elsewhere in promoting safety in transportation. He has undoubtedly devoted a good deal of his time and energies in the preparation of this bill and as a result deserves, in my opinion, a great deal of credit. Possibly in not too long a time we will give him that credit for the dedication he has shown in promoting the idea. The hon. member also has been responsible for publicizing the inherent danger of possible conflicts of interest in accident investigation in Canada, a process which is always helpful in molding public thinking and engineering the climate of change. While the hon. member has publicly advocated a change in investigation and report procedures, the government has been quietly behind the scenes reviewing the advisability of a somewhat similar change. I will say more about that at a later stage.
At this stage I should like to make clear that I am not an opponent of the idea embodied in this bill. I think, however, the matter has not been looked into to a sufficient degree at this time to convince me that the time is quite yet ripe to proceed with the commission of inquiry to investigate transport accidents, or indeed that the method of appointment and operation of the commission of inquiry as set out in the bill is the best one.
The idea of creating some type of accident investigating body responsible for investigating accidents in all modes of transportation coming within the jurisdiction of the Parliament of Canada has been under consideration in the Department of Transport for more than a year. On instructions from the Deputy Minister of Transport, a study has been initiated within the public service to study the pros and cons of the idea of creating an independent body, and a report following the study has been submitted to the Minister of Transport (Mr. Marchand). The study was participated in to some degree by representatives from the air, marine and railway administrations, and from the surface administration. The actual report was prepared by an official on loan from the Department of Justice. This official held a number of meetings and travelled to Wash-
April 23, 1974

ington to interview officials of the United States National Transportation Safety Board. The official also interviewed representatives from the United States Department of Transportation so that he would have the benefit of representations from the department responsible for regulating the modes of transportation as well as from the members of the independent board.
As members may be aware, in the United States a reasonably independent board has been set up and has been functioning for some time somewhat along the lines of the commission of inquiry envisaged by Bill C-109.1 can say quite frankly that there appears to be mixed views concerning the efficiency and usefulness of the board which is in operation in the United States as compared to the methods of accident investigation employed in that nation prior to the creation of the independent board, although the general opinion appears to be that the board is a moderate success. The officials also reviewed accident investigation procedures in the United Kingdom. I should like to emphasize that they went elsewhere.
I think it will be apparent to hon. members that the agencies responsible for the regulation of the various modes of transportation must have a continuously up-to-date knowledge of accidents which take place in the mode for which they are responsible. It is, therefore, not only desirable but also essential that each mode maintains some degree of accident investigation capability. At the present time the only qualified and trained air investigators are employed within the ministry of transport in the air administration. Similarly, the only trained and technically qualified railway accident investigators are in the employ of the Canadian Transport Commission. The marine administration has up to the present time maintained a three-man special accident investigation section with duties restricted to that particular activity.
The immediate creation of an independent federal transport commission of inquiry could very well result in the creation of a body which would be totally unable to obtain the necessary qualified staff to carry out its duties. One result of this possibility could be the retention of unqualified or incompetent persons to carry out a function on which the basic day-to-day safety of every member of the travelling public might depend. On the other hand, the newly created commission of inquiry might be able to attract the majority of the existing personnel from the various administrations. This could well result in at least temporary short-staffing, causing deficiencies in the continuation of the regulatory process. It therefore appears desirable, if not essential, that before proceeding with the creation of any independent accident investigation entity, a thorough review should be completed which would establish the optimum size of the commission and the level and number of supporting staff which would be required and the inter-relationship between the investigation entity and its staff on the one hand and the regulatory organizations on the other hand. If a good deal of care is not taken in this area, the government may well find itself faced with a situation in which there is a total duplication of personnel in the administrations and on the staff of the commission of inquiry.
Another interesting point which hon. members might wish to consider is the possibility that the independent
Transport Commission of Inquiry accident investigation board might itself conceivably be in a position involving conflict of interest. It might be possible, for example, for the commission of inquiry to investigate an accident and through inadvertence or inexperience or incompetent staff overlook the actual cause of a number of fatalities in a particular mode of transportation. This failure on the part of the commission of inquiry could very well result in the commission being reluctant to divulge the real cause of the fatalities in due course because the revelation of the cause would at the same time demonstrate to the public the commission's earlier incompetence. The point I am trying to make is that it is very difficult, if not impossible, to remove every element of conflict of interest in every situation. The best that can be accomplished it seems to me is to keep conflict of interest situations to the minimum.
In making these remarks I have not referred to the situation in the case of surface transportation other than railways. This omission results, as hon. members well know, from the fact jurisdiction of this House over highway transportation is considerably limited by the constitution. We have adopted safety standards for automobiles and some components and there appears to be considerable federal jurisdiction to ensure that manufacturers provide reasonably safe vehicles for the public's use. There is considerable doubt, however, whether there is any federal jurisdiction to ensure that intervening agencies do not render unsafe the vehicle which was originally safe. Accident investigation in the highway field is usually done by provincial organizations and, in particular, by the police. The surface administration in the Department of Transport, and in particular the motor vehicle safety division is, however, taking an increasingly active role in this area. It is expected that the operations of the motor vehicle safety division will increase as time goes by as the investigation of individual highway accidents sometimes reveals design deficiencies which do not come to light in any other way.
I notice that Bill C-109 appears to obligate the proposed commission of inquiry to investigate all accidents in modes of transportation coming under the jurisdiction of Parliament where the public interest so requires.
I think there will always have to be some degree of selectivity in the investigation of accidents. As I pointed out earlier, railway accidents occur on an average of one a day and aircraft accidents occur with a regularity of almost two a day on the average. We are also painfully aware of the fact that accidents on the highways occur with even greater regularity. The creation of an organization and staff sufficient to investigate all of these accidents could be expected to bankrupt the public purse. I am advised that every air accident is investigated, at least to some degree, even if the investigation only involves the filing of a report by the person having knowledge of the incident. Perhaps consideration should be given to the setting up of some procedure or directing personnel to review reports of incidents and accidents which come to the knowledge of the regulatory officials or accident investigators, with a view to carrying out a more detailed investigation if anything appears to be amiss or if the public interest appears to make this desirable.
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Transport Commission of Inquiry
In this regard I am advised that even before the study to review the possibility or advisability of creating some type of independent accident investigating board the air administration was already considering a proposal to set up an accident review board which would consist chiefly of persons other than Department of Transport officials. This development need not await legislation.
As I stated earlier in my remarks, I am not at this time unalterably opposed to the principle embodied in Bill C-109. In fact, I support the principle. On the other hand, I am not sufficiently in favour of the bill to support it. The principle being advanced is in fact a very good one, but I think it is desirable, before proceeding with such a measure, to have available and to give full and adequate consideration to an analysis of all the factors involved. Because whatever body we set up will be of a permanent nature. This process is now taking place and some type of proposal, similar in principle to this bill, should be forthcoming without too much delay.


A. Daniel McKenzie: Mr. Speaker, I would like to compliment the parliamentary secretary on his remarks, but I would also like to point out that many of the matters he brought up would be better discussed in committee. With respect to finding qualified people for an independent inquiry board, we could arrange interviews and we might even import people from other countries.
I have been quite anxious for some time to speak on this important bill presented bv my colleague, the hon. member for Dartmouth-Halifax East (Mr. Forrestall). Bill C-109 would provide for the formation of a federal transportation committee of inquiry to investigate transport accidents. Such an impartial committee has long been needed in Canada and would be especially valuable right now in view of the many problems created by this government's disastrous transportation policies. The Minister of Transport (Mr. Marchand) has admitted that transportation in this country is in a state of chaos and has promised many changes and a vast re-organization of his department. When this will come about is anyone's guess, but personally I am not optimistic.
My scepticism regarding the government's intention to revamp and revitalize transportation in this country is based upon my own experience with the Department of Transport over the past 18 months. During this time I have done virtually everything I can in an effort to alert the minister to the many serious problems involving Air Canada, especially at Dorval where the air maintenance base is located.
I have repeatedly called for a full scale investigation into the Dorval operation. I have written letters to the minister and to the president of Air Canada. I have spoken to the press and have held a press conference. I have spoken numerous times in this House, and I have travelled to Dorval and reviewed the situation with the employees there, with many of whom I am in constant touch. Yet to my knowledge none of my charges concerning the problems with Air Canada at Dorval have been investigated, and if by chance they have, the investigation has been conducted intra departmentally and in secrecy.

My colleague is correct when he asserts that there is a serious conflict of interest here. Even though Air Canada is a Crown corporation, it is still a case of the Department of Transport or Air Canada investigating itself. Thus, there is a very real need for an independent federal transport committee of inquiry to investigate any and all accidents relating to transportation in Canada. Such a committee could also investigate certain charges and allegations made by individuals and unions concerning the safety of our transportation modes. Only through an independent body such as this could the people of Canada be guaranteed proper and credible investigation into transportation accidents in Canada.
I am positive that such an impartial committee would, upon investigating the deteriorating Air Canada situation at Dorval, discover that the problems there relate directly to air line safety. These problems include overstaffing in some departments and understaffing in others. While overstaffing results in extra costs through duplication, understaffing often results in failure to comply with MOT regulations. This fact has serious implications in regard to safety. Then in addition outdated systems which are responsible for much inefficiency are in widespread use; equipment is not performing properly, attributable to poor servicing; basic training in rules etc. for employees is poor, and many are unaware of MOT standards, requirements and general procedures; and little effort is made by officials to obtain MOT required manuals or old out of date manuals which would acquaint and familiarize employees with particular subjects.
This brief list is far from exhaustive. There are numerous other instances of incompetency and inefficiency. The alarming fact, however, is, as I mentioned, the possible safety hazards incidental to such an arrangement.
Generally, this is the situation at Dorval today, a situation which I have endeavoured to bring to the minister's attention. I should also point out that I have not been alone in the effort to acquaint the Department of Transport and Air Canada with the current state of affairs. Many individual employees and several unions and associations, the most notable being the Canadian Air Line Employees Association, have also tried to draw attention to what they see as a dangerous situation with regard to safety. For example, a recent bulletin of the regional shop committee customer service at Dorval stated that, because first level Air Canada supervisors are concerned only with running a schedule operation, they are, like other Air Canada employees, forced to discuss problems at the second level of management. One problem these men would like to discuss is safety. Their collective agreement clearly specifies that management is responsible for initiating and monitoring all practices necessary to ensure the safety and health of employees as well as the safety of all equipment. But the regional shop committee at Dorval has had to deal with second level management and supervise many safety policies themselves.
As well there is the September, 1973 letter, sent to Mr. R. J. Thatcher, director of maintenance quality at Dorval, from eight inspectors. The letter is a critical one, presented by the men with the aim of achieving a much more effective inspection program at Dorval's unit and support shops. It contains an exhaustive list of areas where radical
April 23, 1974

changes are needed so as to maximize Air Canada's maintenance operations and minimize safety risks. To my knowledge, no heed has been paid to the suggestions of these inspectors. Why? Because Air Canada investigates itself. It is called conflict of interest.
With regard to specific safety dangers and accidents relating to Air Canada at Dorval, I can discuss many, but a few will suffice. Most recently there was the serious incident on March 26 involving flight 526 from Quebec City. While climbing at 14,000 feet this DC-9 aircraft lost cabin pressure. Only 40 per cent of the oxygen masks on board were operational. This is absolutely inexcusable. Fortunately the aircraft landed with no injuries to the passengers on board. It turns out that this plane was only 26 hours off its "A" check. Air Canada conducts its layover checks at Dorval after a plane has flown some 50 hours. So what went wrong? Unfortunately, we will never know. However, with an independent commission investigating such incidents and reporting to parliament, the public would know.
As things are now, the public is misled by Air Canada on incidents concerning safety. After I brought this matter up in the House, the freshman president of the air line, Ralph Vaughn, had the gall to deny that the just mentioned incident ever occurred. He actually said, and I quote:
We have found that these charges have no basis in fact and it is unfortunate that Mr. McKenzie continues to make these allegations.
However, these are not my allegations. Rather they are the facts as stated in the daily aircraft performance summary sheet issued by the maintenance branch at Dorval. Also the Minister of Transport (Mr. Marchand) admitted in committee that there was an oxygen problem on flight 526. So there is a conflict between the minister and Mr. Vaughn.
Another incident involving Air Canada safety which was hushed up by the air line concerns their L-1011 aircraft, a jet which has been, according to Air Canada, performing far below the goals set by the manufacturer. On May 19, 1973, Air Canada flight TO20 was forced into an emergency landing after a fire on board. Upon investigation it was discovered that the number one engine had two boroscoping ports open and that the fire was caused by hot gases blowing on to the engine fire wire from the open boroscoping ports. Fortunately once again there was no major accident or injuries, but think of what could have happened, Mr. Speaker. Your guess is as good as mine concerning what Air Canada and the government have done to prevent such an incident from happening again.
Then there are the incidents concerning five Air Canada flights which occurred between January 24 and February 22 of last year. Flights 296, 634, 625, 238 and 280 flying on January 24, February 13, February 15, February 19 and February 22 all did so at tremendous risk to their passengers. A March 22, 1973 daily aircraft performance summary issued by the Dorval maintenance branch stated that in all cases the engine push/pull control cables, with the exception of aircraft number 709, were in various states of distress ranging from moisture in assembly and lack of
Transport Commission of Inquiry lubrication on the cables to worn cables and deterioration of teflon linings in the conduits. The summary also said that these things went unnoticed "as a result of a breakdown in the routine C-3 maintenance check." This in turn was due to the fact that job tickets were not issued for the work. Why? Nobody knows except perhaps Air Canada.
These, then, are but a few examples involving Air Canada and safety at Dorval Incidents of this nature seem to occur now daily on our public air line and I am quite sure similar things happen to and on our other transportation modes. We simply must have some sort of federal commission to investigate these and other incidents, whether it be Air Canada, CP Air or another air line that is involved, and whether it be an air, rail, ground or water transportation accident or incident.


Mr. Charles Turner (Parliamentary Secretary to Minister of Labour):: Mr. Speaker, the purpose of Bill C-109 as set out in the explanatory note is to establish a permanent and impartial commission of inquiry to investigate transport accidents that are within federal jurisdiction. The explanatory note further suggests that under present laws many transport accidents, sometimes resulting in loss of life, are investigated by the federal body that is responsible for making and enforcing the rules under which the transport operated when the accident occurred. It is suggested that there is an obvious conflict of interest in such cases. It seems to me that the statement contained in the explanatory note setting out the reasons for the introduction of this bill could stand some analysis.
It is true that in the case of railway accidents, as an example, a good deal of the regulation of the railways is done by the railway transport committee of the Canadian Transport Commission. The same commission normally investigates railway accidents and attempts to determine their cause. It may be an over-simplification, however, to suggest that because an entity regulates a mode of transportation it is in a conflict of interest position when it investigates an accident involving that mode.
It can be argued, I think with a considerable degree of justification, that the regulatory agency needs to conduct accident investigations to determine what changes in its regulations may be necessary or desirable in the interests of safety. Although the personnel involved in this type of responsibility are human like everyone else, it is probably safe to say that they are dedicated to the objective of insuring that the mode of transportation for which they are responsible is as efficient and, in addition, as safe as human ingenuity can be expected to provide. In an area in which it is very difficult for anyone to maintain any degree of secrecy, it appears highly unlikely that the railway transport committee could, even if it so desired, hide from the public's knowledge the fact that a railway accident resulted from some deficiency in the railway transport committee's regulation of the railway industry.
In the case of other modes of transportation, for example the air mode, the regulatory agency is organized in such a way that there is no responsibility, direct or indirect, of the air investigation branch to the portion of the air administration which is responsible for the act of regulation of the air industry. In fact, the accident investigation branch and the regulatory portion of the administration are independent from each other and independently report
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Transport Commission of Inquiry to one public service official who, in turn, is responsible to the deputy minister and on up the line through the minister to parliament. It can be argued, as a result, that there is really no direct conflict of interest at the accident investigation level. There is no reason why the accident investigators should not feel free to recommend what they wish and to make whatever findings they wish arising out of any particular accident.
While the suggestion has been made that there is a conflict of interest situation in existence in the various modes of transportation coming under federal jurisdiction, I do not know of any case in which it has been specifically alleged that the facts giving rise to an accident have been hidden from the public view or in which recommendations have been altered in order to protect any regulatory body or personnel. It 'may very well be, therefore, that the suggested conflict of interest does not exist to any extent, or if the possibility of conflict of interest does exist, there may be very little chance that in practice injustice to the public may result. By the same token, I know of no concrete evidence to suggest that the regulatory process suffers to any degree as a result of the present method of investigating accidents in the various transportation modes.
I think it might be of some value to hon. members if I give a very brief summary of the actual procedure which is followed in the investigation of accidents which occur in each mode of transportation coming under federal jurisdiction. I will start with the air transportation mode.
At the present time, there are presently registered in Canada approximately 13,000 aircraft. The registration of aircraft is growing at the rate of 10 per cent per year. These aircraft are involved in an average of between 600 and 700 accidents per year; and the accidents to which I refer are those which meet the International Civil Aviation Organization's definition of accidents. This definition includes accidents which result in substantial damage to aircraft or serious injury or death to a passenger. The air administration maintains a roster of trained accident investigators. Canadian accident investigation experts enjoy the opportunity and privilege of developing their expertise in co-operation with their counterparts in the United States. Both Canada and the United States provide their investigators with the same manuals and standards for use in accident investigation.
The considerable number of aircraft accidents in Canada resulted in the creation of teams of accident investigation experts which are available in the various air regions in Canada. In the case of very large accidents, a plan which is in continuous existence and which has been adopted by the International Civil Aviation Organization is brought into play. Under this plan trained investigators head up each element of a team of investigators in an attempt to investigate and determine the cause of the accident. In this regard the Aeronautics Act has been amended to give full recognition and powers to accident investigators, such as the right to interrogate persons, to enter premises, and to inspect.
Information and materials supplied to accident investigators are maintained on a confidential basis and this

confidentiality has been supported by the courts. The purpose of the investigation is to promote and maintain safety, not to assign blame for the accident to any individual or groups of individuals. The creation of major accident investigation teams is an important development because it makes it practically impossible for the Crown or for public servants to hide the action of their own regulators or personnel should they be guilty of wrongdoing. When a major investigation team is set up the team leader and the heads of the various groups are the only personnel from the Department of Transport who are involved. The rest of the investigators come from a number of sources, including the air industry, universities, research laboratories, aircraft manufacturers and the like.
In the case of major accidents it is the practice for the Minister of Transport (Mr. Marchand) to appoint a person to conduct a public inquiry into the cause of the accident. In practice the person appointed is invariably a judge with long experience in the courts. The reports of the various components of the accident investigation team are then adduced as evidence in an open hearing before the judge and the witnesses are available for cross-examination by interested parties. The report of the judge is almost invariably made public, and the report is usually made the basis for whatever changes in the regulatory process may appear desirable as a result of the judge's findings. Less important aircraft accidents are not, of course, given the same treatment as more serious accidents, but even then a careful investigation is carried out and in due course the accident report is made available to the public.
Marine accident investigations are carried out under the authority of the Canada Shipping Act and reports are made to the Minister of Transport. Shipping accident investigations consist mainly of preliminary inquiries which are held in camera, followed, where the circumstances appear to justify it, by a formal investigation which is held in public. The marine administration at the moment employs only three persons, whose sole responsibility is the investigation of marine accidents.
Under the recently enacted shipping casualty reporting regulations, all ships, as opposed to only Canadian and British vessels, are now required to report casualties in Canadian waters to the nearest coastal radio station, which reports are passed to the appropriate region for action. Upon receipt of such a report in any region, a marine surveyor is detached from his normal duties and dispatched to carry out an investigation, his report being passed to the marine investigation section in Ottawa for assessment and any recommendations considered necessary regarding follow-up action.
The field officer appointed to hold a preliminary inquiry is usually a nautical surveyor, and he may be supported by engineer and/or hull surveyors. Only in cases of major casualties is an officer of the marine investigations section sent to investigate. Where no other action is considered necessary following a preliminary inquiry, a summary report of investigation is prepared for release to the public on request.
Preliminary inquiries in the marine field are held in camera, each witness being interviewed separately with no one present other than his counsel, should the witness desire to retain counsel. The witness is informed that he
April 23, 1974

has this right. Every effort is made to encourage full and frank statements, each witness being afforded the protection of the Canada Evidence Act.
Formal investigations of marine accidents are conducted in four main categories of accidents. The first category is where the casualty is one giving rise to a considerable degree of public concern-that is, where the public confidence in the mode of transportation is at stake. The second category is where the casualty has resulted in some major loss of life, either to passengers or to crew. The third category is where the minister has been unable to determine by the normal investigative process what the casualty was all about. And the fourth and final category is where the casualty may involve lessons or practices which the Minister of Transport may wish to bring to the attention of the maritime industry.
While the Canada Shipping Act empowers the Minister of Transport to appoint any officer of the government of Canada to be a commissioner to hold a formal investigation, the practice has been to appoint a member of the bench in the same way as judges are appointed in the case of aviation accidents. In addition to the commissioner, assessors are selected and appointed by the minister to assist the commissioner in technical matters which may arise in the course of the public inquiry. The conduct of formal investigations is governed by the shipping casualties rules made under the Canada Shipping Act.
The investigation of railway accidents is covered by sections 225 and 226 of the Railway Act. Under the existing requirements, railway accidents must be reported immediately and the Canadian Transport Commission maintains an office that is open 24 hours per day to receive such reports. Following receipt of a report, a district inspector is immediately dispatched to the accident scene. The district inspector's report and any information provided under section 225 of the act are privileged and cannot be released except with an order of the Canadian Transport Commission.
In carrying out accident investigations, the inspector has all the powers of a court. On average, the railways have one accident per day. Thirty per cent of the accidents are caused by motor vehicles colliding with the sides of trains. Of these accidents, 80 per cent take place at protected crossings and 50 per cent take place in daylight. In 1968 an amendment was made to the Railway Act requiring trains to carry reflective markings on their sides but there was no marked improvement in the accident rate. A public inquiry is usually held by the Canadian Transport Commission in the case of major accidents with the objective of finding the cause of the accident and trying to avoid a recurrence. As in the case of the other modes, the purpose of the investigation is not to find fault.


The Acting Speaker (Mr. Boulanger):: It being six o'clock, this House stands adjourned until eight o'clock tonight.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Export and Import Permits


[Stage Direction]
The House resumed consideration of the motion of Mr. Andras (for the Minister of Industry, Trade and Commerce) that Bill C-4, to amend the Export and Import Permits act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Donald Alex Blenkarn: Mr. Speaker, I am pleased to see this bill being debated. I hope it represents a new commodities policy which will govern the export and import of raw products. I want to talk about a commodities policy, and I hope, by bringing in this bill, the government is facing the realities of the present day. We must recognize what Canada is, what our role has been, and what it is our potential to become.
We learned at school how trade in this country was originally developed by the fur trade. Our people trapped animals and sold furs to the markets of Europe, where they were made into articles of valuable clothing. After that we began cutting timber. In Ontario, the white pine and the oak were reserved for Her Majesty's ships, and large rafts of timber were floated down the Ottawa river, to be exported to foreign markets where the wood was manufactured into useful products of greater value. That has been the history of Canada. We have exported from our soil iron ore, coal, nickel, copper, zinc and asbestos. From our forests we took lumber, turned it into pulp and shipped it to foreigners in other countries, there to be processed into higher .valued articles of ultimate use. In truth we were labelled a nation of hewers of wood and drawers of water. That has become almost a cliche when describing Canada's role.
In the seventies we are faced with a new concern. New mining machinery, manned by one or two men at the most, is capable of tearing out whole mountains of ore, new shovels can load unit trains which can quickly haul the resources of this country almost untouched by human hand, to foreign lands. Very little employment results for Canadians. The upshot is that we are exporting the lifeblood of the nation without getting any of the real advantages from those raw materials.
What we have seen as a result is a flight from the small towns, from the remote places in the country, to the cities. We have seen unemployment rising to a high of 17 or 18 per cent in Newfoundland, unemployment of almost unbelievable proportions in the northern parts of the prairie provinces among the Metis and the Indians there. Yet from those very areas of Canada we have shipped out by boxcar loads, by pipe line, by unit train and by large trucks the very lifeblood which could make those areas grow and prosper.
We all know that manufacturing industries in this country are no more than 75 per cent efficient on an average compared with equivalent operations in the United States.

April 23, 1974
Export and Import Permits
Yet today we see a foreign exchange rate that indicates that our dollar is worth $1.04 on the market in comparison with the United States dollar. If we were classified according to the efficiency and productivity of our manufacturing industry, our dollar in relation to the United States dollar would probably be worth not more than 75 cents. A great deal of the problem is caused by our willingness to pour out the raw resources of this country to the markets of the world unprocessed and untreated, raw resources that a hungry world, a world dying for unprocessed raw products of our forests, soil and farms, so easily consumes. We have all seen or heard of the brown-outs in New York. We have all heard of factories in other countries closing because there is no energy available to them. What we do here is pollute our rivers, our streams and our air to produce raw materials for someone else's factories, hydroelectric power for some one else's air conditioners.
It is about time this government, or any government which is to govern the country during the seventies and for the balance of the century, showed concern about the resources at our disposal. We sold coal to Japan at one time because we could not sell it anywhere else, and we sold iron ore to the smelters of the United States because we could not sell it anywhere else. We have sold our pulp and pulp logs to other countries because we could not sell these materials anywhere else. We have discounted our lumber and sold it cheap because we could not sell it anywhere else. The reality of 1974 is that the world is starving for the raw commodities we can produce. Anyone, even Simple Simon, could sell pulp in today's world. Simple Simon could sell wheat to a hungry world. Simple Simon could sell iron ore and coking coal to starving smelters in Japan. Anybody could sell to the people in New York City a little extra electricity, especially when they have a brown-out and the air conditioner is not working because there is no power.
It does not require any imagination to sell our raw materials in the world of 1974. Anyone can do so, and that is exactly the problem. The raw commodities of this nation have been bid up and bid up. The consequence is that our dollar stands at $1.04 in comparison to the United States dollar, when on the basis of productivity, on the basis of manufacturing efficiency, it should be considerably less, possibly 75 cents.
I hope the minister in presenting this bill is putting forward a new policy with regard to commodities. I trust when I vote for this bill, as I intend to do, that this is what the minister has in mind-that we shall not just give away our resources, holus bolus, as in past years. We should be selling beef, Kobi beef, not feed grain; we should be selling J-cloths, not pulp; we should be selling steel, either in billets or in some other way, not iron ore and coking coal. What we need is a new commodities policy. We must look after the interests of the people of this country objectively.
In the past, Canadian producers have produced without any guarantee that they could sell their products. We have seen the price of wheat fall as low as 60 or 70 cents on the black market in western Canada, way below the cost of production. We have seen paper mills very close to going bankrupt because they could not sell their products. We have seen oil producers come begging on hands and knees

to Ottawa for a chance to sell their oil on the Canadian market, and they have been turned aside because somewhere along the line some of us Canadians could buy the same product cheaper from another country. We have sold iron ore from British Columbia. We have raped whole mountains of ore. We have built railways and ports at government expense and sold that ore at prices below the cost of production. Indeed, at one time the financial statement of McIntyre Mines looked like a disaster. I don't blame producers today for saying: "When we had the product and wanted to sell it, you would not buy; now there is a world shortage we intend to get every penny these products will fetch. We have been diddled in the past, but now its our innings."
It is time we made a reanalysis of the nature of the economy of Canada in terms of commodities. It is time we looked at things not only from the producer's point of view and the consumer's point of view, but from the point of view of long-term national interest, and developed a fair commodities policy. I should like to spend a few minutes illustrating what I mean by a fair commodities policy as I see it in this country today.
First of all, this nation must analyze in terms of commodities what we can produce as a nation effectively and cheaply, or at least as cheaply as any other country in the world. Having made that analysis we must determine that those basic commodities which we can produce cheaply or as cheaply as anyone else in the world are Canadian commodities.
Secondly, we must determine that those Canadian commodities hold a monopoly position on the Canadian market, so that when there is a surplus of cherries in Oregon they cannot be dumped on the Toronto market, driving prices down and hurting our producers. Or if there happens to be an offhand surplus of beef on the Chicago market, we must see that they cannot dump it in Toronto, putting our livestock producers out of business. If there is a surplus of steel in Sweden, they cannot be permitted to dump it on the Canadian market and put our steel producers to the wall.
Let me talk about surpluses for a moment, since commodities represent a big part of the picture in respect of the economy of this world in 1974. I say to you, Sir, that if bread was 10 cents a loaf I doubt that you would eat one more slice than if it was a dollar a loaf. The truth of the matter is that price increases do not materially affect the demand for commodities until or unless there is a competitive product. The truth of the matter is that it takes an enormous increase in the price of commodities to reduce the demand and, in the converse situation, it takes an enormous decrease in the price to increase the demand.
It has been well said that less than a 1 per cent surplus in the production of copper on the world market will drive the price below the cost of production, whereas less than a 1 per cent surplus on the market will increase the price three or perhaps four times.


Mr. Whicher:: The same applies to beef.


Donald Alex Blenkarn: The same applies to beef and to wheat and to barley and to corn and to potatoes. This basic
April 23, 1974

theory applies to all the basic commodities we produce as a nation. What this country must do for the producer is to make sure that at all times we will be the final banker of last resort for commodities. This may mean that as a nation we will have to build some storehouses in which to put aside some commodities in times of surplus, allowing them back on the market in times of deficit; but we will bankroll on the basis of the efficient producer's cost of production.
We have done that in Canada already, it is now new. Not very long ago when the uranium industry seemed likely to collapse in this country we paid for the stockpiling of uranium at $8 a pound. Today the price of uranium is $20 a pound. Not long ago, and indeed for some 10 or 12 years, we financed the gold mines in order to keep them in business. Some of that gold which we bought from these mines, taking into account the subsidies to the mines, probably cost us $40 or $45 an ounce. It may have even cost us $50 an ounce. But look at the price of gold today. It is very close to $200 an ounce, so we as a nation did not lose anything. Indeed, this was probably the finest investment the government has ever made.


Some hon. Members:: Hear, hear!


Donald Alex Blenkarn: So in terms of bankrolling commodities, this is the type of approach a large commodity producing country must always look at.
Lastly, Sir, in times of excess world demand or excessive high prices we must consider a two-price system. We must look at the situation and make sure that those in Canada who manufacture and convert commodities into usable goods in society are able to buy the raw materials at a price on which they can operate in order to produce and sell.
As an aside, I suppose that might have something to do with the inflationary situation we have in Canada. I do not think a commodities policy is essentially an inflationary policy, but it has certain side effects on the inflation situation. The government suggests that inflation is a world problem, and consequently throws up its hands and says nothing can be done about it. The truth of the matter is that Canada is perhaps the greatest contributor to world inflation, because we have allowed our raw materials to escalate in price on world markets. Countries like Great Britain and France have had to pay the kind of premium prices we in Canada demanded. We have put inflation into their economies, and stupidly we have even put it into our own economy.
As a result of this stupidity the price of pulp and paper has doubled in Canada, yet we export 66 per cent of all the pulp and paper we produce. Indeed, we control the pulp and paper markets of the world. We have allowed the price of that commodity to double in our own economy because we have said we will sell to Canadians at world prices. Thus Canadians have brought inflation into their own markets for their own commodities, and this has probably been the greatest contributor, aside from monetary policy and government expense, to the inflation in this country.
I did not intend to talk about inflation tonight, but I suggest that a commodities policy which was sensible would have very materially reduced the cost of living for all Canadians. We would not now be talking about prob-
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lems in respect of feed grains, the excessive cost of feeding animals and all the rest of it, with everything going higher and higher, had we adopted a sensible commodities policy.
One of the basics to a commodities policy is a quota system, and that is permitted under the amendments to this act. This would enable the government to set a quota on the production of raw materials exported from Canada. I suggest that is very much like the policy of the Progressive Conservative party of the province of Ontario under the late George Drew, when the province banned the export of pulp logs, and later under the late Leslie Frost, who banned the export of pulp.


Mr. Baker:: And built an industry.


Donald Alex Blenkarn: Yes, and built an industry here. We could build an industry in respect of every processing operation of raw material. I should like to point out to the hon. member who interjected that two-thirds of all the pulp produced goes into the making of paper, and one-third of all the pulp produced in this country is exported from Canada as pulp.
You cannot eat pulp, you cannot drink it, you cannot wear it and you cannot live in it. You can use it to manufacture something else, however. Yet one third of the pulp produced in this country is exported in the raw state, none of it from the province of Ontario. Here is a situation where it is high time a federal government concerned about employment and about opportunity stepped in. Recently we had a two-price situation in respect of oil. While I am not particularly impressed about the use of export tariffs to control the export of raw products-and I intend to say more about that later-the oil we export from Canada goes to refineries largely in the Chicago area. Those refineries turn our oil into anti-freeze which is put in tin cans. They turn it into gasoline which is put into pumps. They turn it into chemicals and nylons. Yet we continue to export raw crude to those refineries.
Clearly it should be the policy of this government, if we are to export oil, that this oil should be exported as oil in tin cans, or in the form of gasoline, or as chemicals, or as pantyhose and that type of thing. We should not continue to export our raw crude, our raw butane and our raw chemicals. We should get down to the business of exporting finished products that every society demands. I had this brought home to me once by my father when he was dealing with the Japanese and importing commodities into Canada. You will recall, Sir, the fancy printed scarves the Japanese made out of silk with embroidery along the edge. These were sold as a package. I asked him: "Why do you not buy the silk in rolls and embroider it here?" He said: "Son, the cost of silk scarves packaged and shipped from Japan is exactly the same price as a roll of silk unprinted, untreated and unpackaged".
What was happening in respect of the Japanese in that case is exactly the type of activity a government interested in industrial development should take on as a pattern in Canada today. Is there any reason we should not sell steel at the same price as we sell the makings, the iron and the coal? Is there any reason we should not say that we will sell Kobi beef at the same price as the calves and the

April 23, 1974
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grass? We can say that if they want to raise beef, look after it and slaughter it, that is all right, but they can buy Kobi beef here already packaged.
Is there any reason that we should sell lumber and not pre-cut homes with furniture for them at the same price at which we sell our lumber? The same applies to pulp. We can say that we will sell it at the same price as toilet tissue and J-cloths. That would be using the raw product of Canada developed in its best fashion for the markets of the world.
I hope the minister, in using these controls that will be given to him under this legislation, will use them in that type of discretionary fashion. I realize it is not possible to have one blanket law covering all commodities. The situation in respect of each commodity is slightly different. In respect of some it may be drastically different. That is the reason it would be very difficult to spell out exactly what should happen in respect of every commodity covered by the Export and Import Permits Act. I suggest the minister should follow that approach, look at things and say that we will reduce the quota of raw product exported from Canada and demand of our customers that if they want the raw product they must buy the finished. We should organize the trade of Canada so that the price product of the raw will be the same price as the manufactured. In this way we could build a decent society and as a nation get what we deserve from the raw products of our soil, our farms and our mines.
Some people may say that the cost of what I am talking about is pretty enormous, that it includes subventions and the bankrolling of producers. It may include significant tax changes in favour of manufacturers or processors. Some of these are approved of and some are under attack by members of the New Democratic Party. I say that as a nation which can afford $3 billion for unemployment insurance and manpower surely we can afford to say that work is beautiful and that Canada is worth working for, that it is worth using the resources to make ourselves grow as a nation. Canada has huge advantages in 1974. The world is crying for raw products. The only thing that can be done with a raw product is manufacture it, and if people are crying for the raw product they will take the finished product. It may not be as easy to sell the finished product as the raw product, but only if we take advantage of our position will we as a nation be able to grow and be a nation which the Leader of the Liberal party said will be our destiny in the twentieth century.
I fervently hope that with the passage of this bill the government will use its ability, initiative and the advantage Canada has as a nation to make this country grow. While I have grave doubt as to the managerial ability of the government, surely even simple Simon can sell raw products in this world today.


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, the bill which is before us today is long overdue vis-a-vis the industrial development of Canada. It is designed basically to do two things. It is designed to give power to the government to restrict the export of our raw material unless processed in conjunction with government policy. Secondly, it gives the government the power to control the export of any surplus raw material we have in Canada

selling at depressed prices. I think both things are commendable. I believe both are long overdue.
There are a couple of matters I should like to raise of concern to me. The first is that the government should use this policy once it is adopted, because for all too long in this country we have been exporters of raw material and importers of manufactured goods. We have been a hinterland economy responding to the whims and wishes of multinational corporations and United States entrepreneurs. We export most of our raw materials to the United States and we import manufactured goods. Canada imports more manufactured goods than any other industrialized nation in the world and that is why a bill of this sort should be part of an industrial and economic policy to develop Canada for the future. We must see it in that light, not as a solution but as a step toward developing a nation that is regionally balanced and has a rational economic policy, a nation that is in control of its own economic destiny. I hope that this bill will move us a long way in that direction.
Because of the fact that we are an exporter of raw materials, that we have had a very high unemployment rate, and the extraction of raw materials is capital intensive rather than labour intensive, we have built into our economy a high level of unemployment structurally. A bill of this sort, taken together with another more comprehensive policy, will go a long way toward getting rid of some of the structural unemployment in our economy.
The former member for Duvernay, Mr. Kierans, stated in the House a number of times that a $100 investment in the extractive industries would probably provide about $5 to $6 worth of wages, but that a $100 investment in the manufacturing or processing industries would probably provide wages of about $25 to $30. Despite those facts, over the years we have had a government that has pursued a policy that has given incentives to the mining, gas and oil industries to extract their resources from underground and ship them across the border to be processed elsewhere. It is about time that that policy was changed for the benefit of all Canadians.
This bill in itself is very subjective. I hope that this government does have some policies regarding the processing of raw materials in this country, but I realize that in many ways the bill must be subjective because all commodities are different and cannot be treated the same. For example, it might be to the advantage of Canada in some areas not to do too much smelting because of pollution problems. But those are things that can be taken on balance if we have a comprehensive industrial and economic policy. Those things would be part of that policy.
Another thing that we should consider in the upgrading and processing of raw materials is regional balance. This is missing in the bill before us today. The bill gives the government the power to insist that producers of raw materials manufacture them in this country in the national interest; but it says nothing about where that processing should take place. For all too long most of the manufacturing has been concentrated in the golden horseshoe in southern Ontario, in Montreal and in Vancouver.


April 23, 1974

When this bill reaches the committee stage we should take a serious look at amending it so as to give the government the power to direct where the manufacturing, processing and upgrading should take place. There is no reason why the petrochemical industry should not be located in the prairies, primarily in Alberta but also in Saskatchewan. That is where the raw material is. Why can there not be more upgrading of the raw material in the prairies? Why can there not be more processing of nickel in the Sudbury area? Why does Sudbury have to be an exporter of nickel, the hinterland of the south or of American cities? We should amend this bill to give the government power to direct that processing be done in the region where the material is produced in its raw form.
In looking at the development of resources in this country we should also consider the establishment of a two price system for many of the basic resources we have in Canada. I do not see any reason why some artificially high world prices should influence the price of our commodities. We in Canada are very fortunate to possess most resources. We have iron ore, nickel, copper, potash, hydro electric power and many other resources which are necessary for any nation. Indeed, we have almost any resource that one can think of. The only thing we do not have is a tropical climate and some of the tropical foods that are produced in such a climate.
Since we have these resources, and since abroad such resources as oil are sold at artificially high prices, we should consider a two price system in Canada. If we had a two price system for basic commodities such as oil, lumber, iron ore, lead or zinc-we have it for copper, wheat and oil-we would make our industries more competitive because we could sell their products at a lower price than can our competitors, such as Japan, western Europe and the United States. We would also be providing more jobs since manufacturing is labour intensive. We would help fight inflation because we would be importing less inflation from abroad. We would have a better grasp of our economy and we would be able to do more regional planning.
Those are some of the advantages which a two price system for basic commodities would provide. This has to go hand in hand with some export controls and with greater public investment in some of the resources of this country. I think that could be done. A national development policy is something that Canada needs desperately.
In the Toronto Star issue of yesterday the lead editorial came out in favour of a two price system for some of the basic commodities to which I have referred. 1 should like to quote four of five short paragraphs from that editorial. It reads:
Canada has one of the world's largest deposits of potash and is self sufficient in oil, two of the basic ingredients in fertilizer. But because of shortages in the U.S., Canadians will pay 20 per cent more to make their flowers and vegetables grow this year.
Canada is one of the world's great growers of evergreen trees. Because of world demand, primarily in Japan, the home handyman has to pay 20 per cent more for a sheet of plywood made from them than he did last year.
We produce far more white beans than we consume. But because anchovies disappeared for two years from the waters off Peru, an acute shortage of protein material developed. Canada's white beans, a protein substitute shot from $11 to $60 a hundredweight last year.
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All these are instances where developments outside Canada caused large price increases for goods that are abundant within our borders.
More and more, Canadians wonder whether there isn't some way to escape this kind of externally produced inflation, by having one price for Canadians and a higher price for exports.
I think that the view expressed in the editorial of the Toronto Star is a valid one. We produce an abundance of some commodities for which world prices are artificially high. The Minister of Finance (Mr. Turner) says that we would be unfair to our trading partners and would be inviting retaliation if we had a two price system. I do not buy that argument because I say that we would be selling those commodities at world prices; we would not try to get a higher price than other producers in the international market. All we would be doing is developing an industrial strategy for Canada, an economic strategy and a development plan that would help control inflation, produce more jobs and make our industries more competitive. These are important considerations in discussing the bill before us.
One last thing that I want to mention is that in upgrading our resources in Canada we should take a look at our taxation system which favours the development of capital intensive extractive industries over the development of processing and manufacturing. I will give the House one or two examples. I have here some corporation taxation statistics, series 1965-70, which are very revealing about the gifts and handouts made to the extractive industries. The profits of the metal mining industry in that six year period before taxes amounted to $3,165 million. On that income before taxes they paid federal and provincial corporation taxes on only 10.8 per cent. I think that is grossly unfair. Certainly it would be grossly unwise to permit this to continue in planning and developing a rational economy in this country. During the same period of time, the gas and oil companies paid taxes on only about 5.7 per cent of their profits while the ordinary Canadian, the retail merchant, the farmer and others, paid tax on everything they earned.
In closing, I support the bill before us, but I strongly suggest we cannot look at it in isolation. It should be part of an over-all development plan for this country, an industrial economic strategy that would make this country the greatest by far of any nation in the world.


Mr. Henry Latulippe (Compton):: Mr. Speaker, I am pleased to say a few words on Bill C-5. This bill, as far as we can see, is quite important.
An Act to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways System-I am mistaken, Mr. Speaker, it is rather Bill C-4, an Act to amend the Export and Import Permits Act. I quote:
Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
1. Section 3 of the Export and Import Permits Act is amended by adding thereto, immediately after paragraph (a) thereof, the following paragraphs:
Mr. Speaker, the regulations on imports affect a great number of citizens, especially Canadians and we would like to export as much as we can, but we are now realizing

April 23, 1974
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that our domestic consumption must increase, because exports do not alter our national economic conditions.
Mr. Speaker, for instance, if in 1974 we produced for $125 billion, consumed and exported for $75 billion of this production and exported for $25 billion of the $75 billion that was consumed in the country, if we exported for $25 billion of our production and re-exported for another $25 billion, this does not affect at all the national total of $125 billion of production in Canada. Exports, even though they are very important, do not solve the basic problem of the economic situation that we now face.
Mr. Speaker, exports and imports must balance and, when there is a difference between the two, this affects the value of currency. For instance, if we export to the United States more than the United States export to us, they will have a favourable balance with us. At the present time, for instance, the Canadian dollar is worth maybe 3 per cent more than the American dollar. This depends on the exports.
If the opposite happens, Canada will have to depreciate its currency. When a country must pay royalties or has more exports than imports, it has an unfavourable payment balance, it must reimburse, as in the case of the United States. If our payment balance with the Americans is unfavourable, we have to pay the difference in American currency.
If we did not have enough tourists to consume our products and give us American capital, and if we do not have American capital, we have to depreciate our currency accordingly and lower the value of our products. The Americans therefore pay less for our goods than Canadians can. This is the result of an international agreement which, I am sure, could be reformed. In fact, money should not depreciate to such an extent, it should keep a certain value, and goods should not depreciate by as much.
Mr. Speaker, exports and international exchanges should not, once again, alter the total amount of a country's national production. At most, they mean entries on the books under credit and debit, and adjustments at the end of the course as I said before.
Mr. Speaker, since the subject of the bill is rather general in nature, we can generalize somewhat about the economic situation, and speak of exports, transports, Canadian companies, Crown companies and state companies. We can say, Mr. Speaker, since it concerns Air Canada to some extent, that it had an income of $45,492,000 in 1972. It paid $32,487,000 in interest, had a deficit of $8,648,000 and carried over a debt of $640,114.
Mr. Speaker, since this is a transport company with which we must deal and agreements must be entered into with foreign countries to carry on air transport activities I will say that according to the report I have here the year 1972 was one of the best I think for Air Canada, yet they managed to register a deficit of $8,648,000.
Mr. Speaker, the CNR had an income of $48,257,000 in 1972 and it paid $66 million-


Mr. Speaker:: Order. I hesitate somewhat to interrupt the hon. member for Compton (Mr. Latulippe) but I take

the liberty of reminding the hon. member that we are considering Bill C-4, an Act to amend the Export and Import Permits Act. I think that even with the fullest indulgence it would be quite difficult for the Chair to allow an hon. member to speak to the financing of the CNR or Air Canada. That subject was discussed on several occasions in recent months in connection with legislation dealing vaguely and perhaps even remotely with the financing of the CNR and Air Canada but I do not think that even with the wildest imagination it would be possible to establish a relationship between Bill C-4 now before us and the financing of Air Canada and the CNR.
I urge the hon. member for Compton and all hon. members to limit themselves to the principle of the bill now before us.


Henry P. Latulippe: Mr. Speaker, it is true that I perhaps wandered somewhat from the subject but I will try as much as possible in the few minutes available to me to come back to the subject and talk to the amendments to the act.
Mr. Speaker, the purpose of this bill is to permit the governor in council to limit the import of any article that, under the Farm Products Marketing Agencies Act, is limited in respect of production or marketing in Canada. It deals with farm products and all sorts of other products. I thought, Mr. Speaker, that the financing of Air Canada with its international scope could come under that item. That is why I was speaking about Air Canada and I ventured to make comparisons between the CPR and the CNR to say that those large companies registered deficits, to say that they pay considerably high interests on borrowed money. Interest rates, Mr. Speaker, are a great source of difficulties for us. The same applies also to our exporting trade with other nations.
Mr. Speaker, if we are unable to do as much business as we should like with other countries, it is due to commercial and financial factors. Because we are unable to offer finished goods at prices sufficiently low to compete with other nations, it is like being held in a vice exerting increasingly more pressure all the time. It is becoming more and more difficult to make deals with other countries.
Interest on loans are the main reason for the high costs of living and production. And then, the second major cause is financing. Those who operate all sorts of industries and create all sorts of goods are faced with taxes which keep on increasing, so that marketing their products becomes next to impossible.
Let us consider, for instance, the 11 per cent tax on building materials and the 12 per cent excise tax. They raise thhe price of Canadian products to such an extent that it has become difficult to increase production.
If we want to export at a cheap rate and get commodities to export at a better cost, we must first reduce our rates of interest which cripple the Canadian industry. We must also reduce certain taxes and certain export duties in order to compete with any country. We could produce more, Mr. Speaker. There is an overproduction of about $50 billion in 1974 and if there is overproduction, we certainly have products to export. But since we have to import for about the same amount, our national accounts

April 23, 1974

remain the same. Therefore, Mr. Speaker, we have to produce at a better rate if we really want to export. There are all kinds of ways we could use to produce at better rates. They are logical ways that should be studied. Many things have to be reconsidered in our economy. Reforms must be made in the various segments of the economy if we really want to produce here at a cheaper rate and if we really want to become an exporting country. There are all kinds of commodities that we can produce. We have in Canada, Mr. Speaker, everything needed for that, including the necessary engineering and the modernized industries.
In the food stuff sector, for instance, we could have produced at least 10 per cent more in 1973. Our national production could have been better by at least 10 per cent and if we made low-interest credit available to farmers, thus enabling them to buy the farm machinery they need, and even if we granted the compensated discount on certain farm machinery or machines used in trade and industry, we could, Mr. Speaker, produce at a much cheaper rate. And if we lowered the rates of interest, which is the most important factor, we could lower the production cost.
At present, we have a surplus of about $50 billion in capitalization, and all this surplus supply is piled up in warehouses, in department stores, and this is financed through the bank financial formula at an interest rate of 12 per cent, which cannot possibly lower the price of products. To lower the price of products, we could finance all these stocks, all these inventories, at much lower interest rates, and we could thus cope with imports in all kinds of fields. That is the main point I wanted to stress.
There would be so many things to say about this bill, but other members have dealt with a great variety of matters and I do not intend to repeat what has already been said. The previous speaker almost made the same speech as mine a moment ago. I wanted to make practically the same comments as he did. Therefore, under the circumstances, so many things having been said, I will conclude my remarks and resume my seat.


Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, I have a few comments to make on Bill C-4, to amend the Export and Import Permits Act. There is no doubt that the government has again moved to placate the NDP by bringing in this bill. One wonders if it is the result of yet another telephone call between the hon. member for York South (Mr. Lewis) and the Prime Minister (Mr. Trudeau).


Stanley Howard Knowles: You don't mean that!


William James Kempling: Oh, I do mean it very much, my hon. colleague. There are some hidden factors in this bill that require explanation. For instance, why does the government seek to have this act expire on July 31, 1974 and become a permanent statute? This bill removes the act from the control of parliament and places it in the hands of the Governor in Council. It places in his hands complete control over the Export and Import Permits Act. This is another example of the government circumventing parliament and removing from the House any consideration of
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commerce conducted under the Export and Import Permits Act. It creates a situation whereby the Governor in Council can, by order in council, exert tremendous power over what has been a relatively free market.
For years we have been striving for certain export markets. We now find that we may be denied some of those markets if a particular product is placed on a certain list. I agree that we should process more of our natural resources in Canada, but this has to be done in the context of world supply. If, for instance, we ship less copper to Norway or Japan because of an action of the Governor in Council, will we lose this market, say, to Chile or some other world producer of copper that does not have these restrictions?
Where do the amendments fit into the GATT negotiations? Are they not in fact another tariff? Are we, on the one hand, negotiating at GATT conferences for freer access to markets and a general reduction of tariffs, and then imposing new kinds of tariffs by placing export and import permit controls in the hands of the Governor in Council? We will want to hear from the minister, when this legislation goes to committee, just where this fits into our whole trade picture. Where will these amendments fit into the total transportation picture? What freight rates will apply to the semi-produced natural resources we are talking about?
We know what happened to rapeseed cake production in western Canada. Lack of a comprehensive policy has cost the Canadian taxpayer hundreds of millions of dollars over the last several years. Bringing before Parliament half a policy without the other half smacks, I say, of political mischief. As I have said, this is a move to placate the NDP and nothing more.
If there were parallel legislation which would encourage industry to process more raw materials or natural resources, or provide that our program will be staged over a period of time to allow our customers overseas to adjust to our new policy or provide that our negotiators at GATT negotiate on the basis that a percentage of our natural resources will be processed, which percentage will be increased over a period of time until we reach an optimum level, then I would say that this is a pretty good bill. We shall put these questions to the minister and expect answers in committee.
We are putting power into the hands of the governor in council to restrict the export of certain products which will be placed on a list. We are not told which products will be on the list, or why. We are asked to make the Export and Import Permits Act a permanent statute, not subject to parliamentary review. Personally, I am not confident that the government can carry out this function.
At present the government has power under the act to restrict exports. There was no move on the part of the government to restrict the export of finished lumber, even though domestic demand for lumber for the housing market has reached unbelievable heights. In the United States we saw the government move to restrict the export of lumber from the west coast because there was a shortage which was driving up the price of housing. The United States government moved to cut the export of lumber to Japan by some 30 per cent. The Canadian government did
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not move; Canadian exporters picked up that market, to the detriment of the housing industry of this country and to the detriment of home buyers. How can the government justify this lack of action and remain credible? How can it ask parliament to give this act permanent statute status, with no review by parliament? Is it any wonder we have lost confidence in the government? The Canadian people are fast losing confidence in it.
I should like the minister to explain how, by exporting a product in semi-finished or partly processed condition, this can have any effect on the price paid for the product on the world market. It does not make sense. My instinct tells me the potential customer will shift his purchasing to where he can buy that product at the price he wants to pay and in the state of manufacture he wants for processing in his country.
On the import side, the government, with this bill, is moving into supply legislation by limiting the importation of any article which, under the Farm Products Marketing Agencies Act, is limited in respect of production or marketing in Canada.
Subsection 5(1) of the act being debated reads in part:
The Governor in Council may establish a list of goods, to be called an Import Control List, including therein any article the import of which he deems it necessary to control for any of the following purposes ...
I have serious reservations about this. I know that we face many serious supply problems, but why are we moving into this field? It is evident that the government made grave errors in certain farm production policies it brought forward. On the one hand, the government is playing the consumer against the producer; on the other, it is playing the producer against the consumer and using the threat of imports against the producer. In the process it may wreck an industry.
We talked recently to people in the cheese industry, who told us that Ontario used to produce and export 100 million pounds of cheddar cheese. That production has almost been lost because of the disastrous industrial milk policies sponsored by the government. It is plainly evident to anyone that the fiscal and monetary policies of the government are just not working. It is also evident that the selective controls used by this government are not adequate. This whole business, it seems to me, is like a machine which is running out of control. You pull a lever here, but it is still running a little rough; you push a knob there, but it is still running a little rough; you put a control on here, add a product to a list, use a regulation or order in council, and keep it out of parliament so that it cannot be criticized or questioned. I do not think this is any way to go about it.
I wonder how these controls will affect our export trade? Let us look at some of the markets with which we trade. I see that on our trade with African nations in 1972 we incurred a trade deficit of $58,509,000. In 1973 that deficit had more than doubled to $135,550,000. How will this legislation affect products traded with the African nations? How are we to better our deficit position, or will it be worse? For example, look at our trade with South Africa. In 1972 our trade deficit with South Africa was $15,147,000. In 1973 it almost doubled to $27,597,000. How will this legislation affect products which are traded back

and forth? Some of them certainly fall within the scope of this bill. Will that situation change?
Our trade deficit with Middle East nations in 1972 was almost $129 million. In 1973 the deficit had risen to $182 million. So we go. We will see the same pattern emerging from our trade with Pacific rim nations, Scandinavian nations, and so on down the line. We all see our trade deficits increasing. Our trade deficit with the Scandinavian countries of $42 million in 1972 rose to $59 million in 1973. Our trade deficit with Pacific rim countries of $58 million in 1972 has moved up to $65 million.
The most telling figures concern South American countries with which we do a good deal of trade. In 1973 we imported from South American countries $751 million worth of products. We exported only $379 million worth, leaving a trade deficit of $371,731,000, more than double that of the previous year. So when we talk about export and import controls, we should look at our total trading picture and see what is happening. No doubt this bill will be referred to committee, where I am sure we will take a serious look at it and have some serious talks with the minister and his officials to find out what they expect to achieve with this bill.
I am somewhat disappointed about the way in which this legislation has been brought forward. It seems the government follows a pattern in its legislation of mixing good things and bad things together. They include in a bill a provision which is not too palatable and then offset it by a provision which may be more acceptable. They play one aspect against the other. I guess this is called politics, but I do not think it is good legislation.
When the bill goes to committee members on this side will ask some searching questions as to where it is leading us. We shall want to know what plans the minister has in store for the processing industries, whether parallel legislation will be brought down to help establish processing plants, and so on. Where they will be established is another question again. Certainly, if we propose to urge industry to carry out more processing in Canada we shall need to ensure that the necessary financial arrangements can be made, that the economy of the country can stand it, that the transportation facilities are such that they can handle the situation, get the products to the market or to the ports in good condition at the lowest possible price, so that there may be a chance to compete with similar products manufactured elsewhere in the world.
We must also consider where this bill will lead us as far as GATT negotiations are concerned. I am a little worried about this aspect. Among the people negotiating on the government side at GATT I see no one who has ever been prominent in business. Most of the Canadian representatives have spent the greater part of their lives in the Civil Service. I know of no one who can claim any great industrial background. I wonder what the other delegates will say when they look at these provisions, for this is really another type of tariff and it may be placing an added burden on our representatives at a time when international trade is so vital to Canada.
April 23, 1974


Mr. Don Mazankowski (Vegreville):: Mr. Speaker, the bill before us brings back memories of the infamous Bill C-176 which was bandied about the House of Commons for a couple of years or longer, the bill which attempted to make agriculture a public utility, the bill which set out to impose a program of supply management and a system of production control on agricultural products.
Bill C-4 deals in part with that very act, the Farm Products Marketing Agencies Act. It has to do with the imposition of import controls on any product which comes under the auspices of that act. It seems strange to me that the government should be asking us to legislate in this manner today when we were told during consideration of the marketing bill in the last parliament that any provision for the implementation of import control was totally unnecessary.
It is precisely to this area that I wish to direct my comments this evening. I repeat that members on this side had very serious reservations about Bill C-176. In particular this question of import controls gave rise to misgivings. It was our contention that supply management would be totally ineffective in the domestic market unless some provision was made with respect to import control. Members of our party pleaded with the minister and with government supporters to remedy the defect but they declined to incorporate in the bill the provisions we suggested, displaying their intransigence and their stubbornness. They assured us our fears were unfounded. So when we look at clause two of Bill C-4 as it is presented to us today, all we can say is that it is a classic example of a government flip-flop, the sort of thing which has created such a huge credibility gap as far as any government announcement is concerned. It is a wonder to me that a government so narrow-minded and so afflicted with tunnel-vision has been able to survive for so long.
Tonight I wish to place on record some of the words which were spoken at the outset of the consideration of Bill C-176. The hon. member for Kent-Essex (Mr. Dan-forth) in his remarks on the second reading of the bill, as reported in Hansard at page 815, on November 2, 1970, stated:
Nowhere in this bill is there an indication of implicit power in an agency, council or even in the minister himself, to control imports. This is a major weakness. If you cannot control imports, it renders almost valueless attempted supply management,...
That is precisely the position we took. The minister of agriculture at that time was the hon. member for Medicine Hat. We are grateful to the present member for Medicine Hat (Mr. Hargrave) who drove him out of office. It is because of his intransigence and ignorance that the former minister is not sitting in this House. Thank God for the present hon. member who came upon the scene to relieve him, and also to relieve us. Anyway, the former minister said this, as reported at page 831 of Hansard for November 3, 1970:
I can also advise the hon. member, and I am sure this will relieve some of his anxiety with respect to the matter, that under these international agreements as I understand them, although there is some complexity about this, we can impose the same kind of supply management provisions on imports as are in fact applied to our domestic producers. That is the case with respect to some of the international agreements. It seems to me that here is a balance which allows us, first of all, to take into account the interests of our domestic producers and also
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allows us to respect the international agreements we have made.
I am not suggesting because it will be easy to do this in all cases, because of course different points of view are taken from time to time depending on a country's own interests. However, I would like the hon. member to understand why it would not be possible to transfer automatically to a marketing agency set up under this bill the authority to deal with imports. It must remain the responsibility and prerogative of the government to change tariffs, or to change the impediments to trade coming into Canada, if you wish to call them that. I suggest that one can be made compatible with the other.
We then took that argument into committee. As hon. members recall, the Standing Committee on Agriculture dealt very extensively with Bill C-176, and this same argument was put forth in the committee when the hon. member for Battle River at that time, Mr. Downey, posed these questions to the chairman of the committee. I quote from page 25:24 of the proceedings and evidence of February 25:
-I was going to propose somewhere in the bill in regard to import controls. At what point or after what existing clause does he feel this would be appropriate.
I think it very important that we consider this matter at the present time because of the parallel situation we presently have going on in the Finance Committee, with the Textile Bill presently before it. During our hearings it was said many times that production controls were not practical without import controls.
Mr. Downey went on to address a question to the minister as follows:
Does the Minister feel that there is some degree of acceptability in this type of an amendment? Do you feel that it may be practical?
Mr. Olson then replied:
No, Mr. Chairman. I do not think it ought to be in the bill and I have stated that many times before this committee. I have also stated under our international agreements that we have the power or the authority, without violating those agreements, to apply essentially the same kind of regulations to some imported products as we apply to the supply management of our own domestically-produced products. The Governor in Council could delegate that kind of authority for administration if he chose to do so.
Mr. Downey then went on to state:
Mr. Olson, the same type of import tariff controls exist in the textile industry. Are you saying as Minister of Agriculture that you would not support the same kind of extra controls and protection for the agricultural industry in Canada that you were prepared to support as a member of the government for the textile industry?
The then minister, Mr. Olson, replied:
We have done this, Mr. Chairman, with many agricultural products including dairy products and grain products.
What the minister was really saying, then, is that there was no necessity for providing import controls in respect of the items that would come under the aegis of the agricultural products marketing bill.
It was at the report stage that the then hon. member for Battle River, Mr. Downey, moved another amendment to the Export and Import Permits Act which in fact would have achieved the same purpose that the provision in clause 2 of this bill attempts to achieve. At that point in time this amendment was voted on and defeated.
I simply want to point out that although members on this side of the House were accused during the consideration of that bill of filibustering and blockading, I remind

April 23, 1974
Export and Import Permits
hon. members opposite that we did pinpoint a number of major weaknesses in the bill, among which was the absence of any mechanism for control of imports. You cannot conceivably exercise a program of supply management without some measure of import control on products coming into the country. The exercise we were engaged in was not a filibuster but an attempt to improve this obviously bad piece of legislation, and I suggest it was bad in that it took over two and a half years for that bill to pass through all stages of this House. I suggest the bill took that long during those stages because of the dedication and determination of a number of members who considered its impact and proposed amendments to make it workable. Because of their intransigent position, the government failed to recognize some of the inherent shortcomings we pointed out when attempting to make that bill workable.
I think the piece of legislation before us now, particularly the provisions in clause 2, represent a classic example of this government's backtracking. One of the major products covered under the farm products marketing bill was eggs and other poultry products. Today we find egg producers in a very serious state of affairs because of the tremendous importation of eggs from the United States. It is the egg producers who are asking parliament to expedite the passage of this bill, as they are faced with the prospect of a depression in prices due to the huge number of eggs coming in from across the border. Many of the egg producers in Canada are being literally driven up against the wall because of high input costs.
Naturally I support this legislation, as I know hon. members in our party will support it, but I want to remind hon. members on that side of the House that they alone do not have all the answers in respect to good legislation in this country. They and they alone do not have a monopoly on good ideas. Had they considered and accepted our amendment in the first place they might have been saved a great deal of embarrassment. I think the type of backtracking evident in this bill is a classic example of this government using its arrogance and intransigent attitude to hide its ignorance.


Mr. John Harney (Scarborough West):: Mr. Speaker, I am afraid I could not possibly turn a phrase like the one turned by the hon. member for Vegreville (Mr. Mazan-kowski) who just sat down, but I should like to make a few remarks about the bill before us. I might say at the very beginning that the specific bill before us skirts very closely to that part of the Export and Import Permits Act which could lead to a fair amount of controversy.
The bill we are now studying, specifically that part in respect of Section 3(a), which comes very close to sub-section (b), allows the governor in council to produce a list of goods which may not be re-exported from Canada; that is to say, goods which are imported into Canada to be reexported to other countries. This is the rather infamous part of the act which allows the governor in council to prevent the exportation of goods produced in one country to another country, using Canada as a vehicle.
However, part of the bill before us does deal with a very important matter. It is a very short part but very important, and its importance is not so much in the amount of power it provides the government as an indication that

there are the beginnings of a change in our thinking in this country about exports and their relation to our total production and the wellbeing of the people of Canada.
Most of us have been brought up in a certain cultural ambience. In this cultural ambience we have certain articles of faith that have been passed down to us without this ever having been questioned. One of these articles of faith held dearly and without question by most Canadians is that to export is a good thing, and that the more we export the better off we all are. I submit that this is an article of faith which is so firmly lodged in the Canadian consciousness that it is something we have inherited from the days of the Montreal fur merchant.
Of course, to them export was a good thing, because to export massively meant more money and profits for them. They can also justify the exportation of that commodity, and later on persons can justify the exportation of other commodities because such exportation satisfies a very real and physical need of the mother country. But we are now a country on our own and we have to begin to bring into question this ancient tendency of our economic fate, which is simply that we must export not only to survive but to thrive.
In a small, very hesitant way this bill begins to question that tenet. We did some questioning earlier this year when we slapped an export tax on petroleum. For the first time in the history of this country we told ourselves it was not our duty to export everything our land could produce. We began to tell ourselves that perhaps it was our duty to satisfy Canadian needs first. To very many people in this House or in this country, that was a milestone in our history. It was the first time this ever really happened.
Beyond this milestone, probably just part of a kilometer further on, we have this bill which brings into doubt some of the beliefs we have had for a long time. The bill, in effect, says that we shall empower the Governor in Council to state that it will not be to the benefit and to the wellbeing of this country to export certain goods unless they are processed, fabricated or manufactured to a further state. Here we have evidence that we are beginning to stop thinking of ourselves as merely hewers of wood and drawers of water.
While going through the Toronto terminal II yesterday, which is something I must do in order to get to Ottawa, I went through one of the security mechanisms which the Department of Transport have installed to check everybody, including members of parliament. I noticed one of these mechanisms was a particularly handsome one and I stopped to look at it. It was made of wood, a commodity we produce in quantity in this country. But although it was made of wood, it was not made of wood from this country. It was made in Finland in a place called Kuopio, a marvellous community which I had the opportunity to visit last year.
This reminded me of a principle of economics, production and exports which the Finnish people have had now for some time. It is very simply this: no resource that is developed and produced in Finland is exported out of the country unless it is manufactured, processed or fabricated to the nth degree. This is not the first time, of course, that
April 23, 1974

we have had products of wood made from wood grown in Finland arrive in Toronto. Somehow the Finnish people are able to produce lumber and sell it at competitive prices in Toronto, in a country which if it has nothing else at least has a lot of wood.
I agree that the principle behind this bill is very good because I think we are beginning to tell ourselves two things. First, the more we can put into a product in terms of skill, effort and intelligent work, the more our return will be from it. That is fairly obvious. The other thing we are beginning to learn is that the most important aspect in the production of a resource is not the wages we gain through the production of the resource, not even the profits that the exploiting companies make in developing the resource, and indeed not even the taxes that we can gather from taxing the profits of the exploitation of that resource. The most important aspect of the production of a resource is the end use. Who is it in this world who will benefit ultimately from the use of the resource which we produce? We are now beginning to see the light, that the end use of the product is the most important aspect of the production of that product. We are now beginning to see the light and tell ourselves, very slowly I grant, that perhaps it is not to our benefit to try to flog all of our resources on the world market, but that perhaps it is to our benefit to put Canadian needs first.
The hon. member for Yorkton-Melville (Mr. Nystrom) made the point, very effectively and succinctly, that we have to begin developing an industrial policy for this country which will satisfy the needs of the people first. One of the absolutely essentia] notions behind an effective industrial policy for Canada would be one that would insulate the people of Canada from the vagaries of the world market. They know this country can produce enough to satisfy their real needs.
We have all the right in the world to wonder, these days particularly, why it is that the prices of the goods we produce in abundance are getting beyond our reach. Perhaps the economists, those practitioners of the dismal science, may try to explain how it is that a commodity they produce in abundance can be priced beyond their reach; but the good people of Canada, in the main simple, direct folk, will refuse to understand that kind of casuistry, and they will be absolutely right. They, along with many other people and some people in this House, are beginning to understand that what we must do in order to develop an industrial policy to satisfy Canada's needs first is to begin attacking two of the great unquestioned tenets of our industrial economic philosophy in this country. The first is that we must export whatever we can not only to survive but to thrive; the second is that in order to have wellbeing we must have economic growth.
Some members of this House may say that what I am saying is absolute heresy. I can understand that they think this way, because the Minister of Finance (Mr. Turner) stood up a few weeks ago in this House and said that the ultimate objective of the economy is to create jobs. What utter absurdity! Surely the ultimate objective of the economy is not to produce work but to produce wellbeing, in the same way as the objective of the exploiters of the resources or commodities of a country is to produce satisfaction and wellbeing for the people living in that country,
Export and Import Permits
not simply to flog the resources as quickly as possible for whatever profit can be made by the exploiting corporations.
I will end by making one single observation, and it is this. In the history of this world, those countries whose economies have tended to have a large export quotient have been the poor countries. Conversely, generally speaking, those countries which were wealthy were countries which had developed and well balanced internal economies which consumed the major part of their production. Many small countries in this world, countries which we call underdeveloped, can boast of having a very high export quotient, but the higher the export quotient very often the poorer the country.
Because it is a step in the right direction, I support this bill. I would be in favour of seeing the bill define the powers that are listed. It would be much more clear and perhaps indeed should be mandatory. But nevertheless it is a small step, and perhaps the first light of the dawn of a new day. I think that in a few years from now, maybe 25 years or so, Canadians will wonder how practically the entire population of the country could have accepted as an article of faith the thesis that a total drive for ever greater exportation, particularly of unfinished goods, could have led to the wellbeing of the people of this country. As I say, because it is a step in the right direction I am glad to lend the bill my support.


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, it seems to have become quite a habit with those members who apparently still support the government that every time a bill comes before this parliament they say; Let us have the question, let us have closure immediately and get on with something else. I do not know what they think the purpose of parliament is if members are not given some opportunity to debate a bill such as Bill C-4.


Stanley Howard Knowles: We have heard your speech before. It is the same speech.


Sinclair McKnight Stevens: This is a new one. Yesterday evening when I spoke on another bill I mentioned that we had already indicated to the Minister of Industry, Trade and Commerce (Mr. Gillespie) that if he wished to bring this bill forward we would give it a speedy passage and not delay it. The hon. member for Trinity (Mr. Hellyer) indicated that we were willing to see this bill go to committee and that we support it in its broad outline. But that does not mean that the members of my caucus or any other member of the House should be denied the right to speak on this bill. I say that because I think it is unfortunate, for example, that the Minister of Industry, Trade and Commerce was not in the House to introduce the bill although the acting minister made a good presentation.
I think it is particularly relevant to point out that the report that we are proposing to amend in this bill has not yet been tabled in the House of Commons. I am referring to the report that is required by section 26 of the act, which provides that as soon as practicable after the 31st day of December of each year the minister shall prepare and lay before parliament a report on the operations under this act for that year. I have checked with the library and I

April 23, 1974
Adjournment Debate
find that the report has been received well before that date every year for the past five years. I did not go back any further.
It is a very full report. In 1972, for example, the report consisted of 13 full pages. I think it is very informative regarding exactly what has transpired under the act in each of the years under review, and it is regrettable that the report is not before the House as we consider the amendments before us. I urge that the acting minister contact the department to see whether it could be tabled tomorrow in order that, as the debate continues, we could have the advantage of it.
In dealing with the 1972 report, to show the impact of this act I think it is relevant to point out that the report gives a statistical summary of the export permits processed during 1972. In that year, applications received for export permits totalled 10,633. In the same year, the officials issued 10,024 export permits. They refused 431 applications and cancelled 81 export permits. Also they handled 2,321 import applications, and 2,287 import permits were issued. There were 315 applications refused and six import permits cancelled. There were 528 import certificates issued in 1972.
I mention those figures to indicate that this legislation is relatively important; and I suggest that if the amendment contemplated to Bill C-4 is passed by the House, the legislation could well become much more important than it has been in the past. In fact, when I hear that the NDP are almost enthusiastically in support of this legislation, I wonder if it should be reviewed.


Stanley Howard Knowles: That was said by the hon. member for Trinity.


Sinclair McKnight Stevens: I wonder if there is something in the legislation that I have not noticed, although I feel that it would have far reaching effects if applied to the export of various resources from Canada.


Mr. Speaker:: Order, please.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Doug Rowland (Selkirk):: Mr. Speaker, on April 15, as reported on page 1420 of Hansard, I asked a question of the Secretary of State (Mr. Faulkner) designed to elicit his response to the announced intention of the American publishing house of Houghton-Mifflin Incorporated to locate a branch plant in Canada. The question was motivated by the very clear evidence that the Canadian publishing industry, for a variety of reasons, is in imminent

danger of collapse and that foreign intrusion into the Canadian market will hasten that collapse.
It is odd that on the day when this House has given second reading to a bill designed to protect Canadian football we should be discussing the future of the Canadian book publishing industry, without any stated governmental guideline beyond the minister's professed belief that "a substantial portion" of the industry should remain in Canadian hands. That is a statement which he admits is subjective in the extreme and which cries out for definition, a definition which is not forthcoming.
Without in any way suggesting that the continued existence of the Candian Football League and the annual Grey Cup spectacle is unimportant or that they are not an expression of Canadian culture, I venture to state that the continued existence of an independent Canadian book publishing industry might be of at least equal importance, and that the incursion of Houghton-Mifflin into the Canadian market constitutes a danger to the independent Canadian book publisher equivalent to the danger presented by the World Football League to the CFL, and that action of equal vigour is required.
The final report of the Ontario royal commission on book publishing outlines clearly on page 51 the way in which Canadian owned publishing houses have been damaged by the establishing of subsidiary companies in Canada. I quote:
Most non-Canadian publishing houses are branch plants of long-established British or American houses that first sold their books here through Canadian publisher-agents. We have been reminded frequently that representation of foreign principals has always been an important prop to the creative side of our country's publishing industry; we have also been told that such agencies face many problems. We have come to think that one of these must be that if a Canadian publisher agent does not succeed in selling his principal's books he may lose the agency, but if he sells them too successfully he may lose the line anyway, when his principal decides to open up here on his own. After all, the foreign publisher says, my books are being purchased by bookstores, schools and libraries across Canada. Why should they be promoted and billed in the name of another publisher, perhaps halfheartedly (he may suppose) alongside a number of lines other than my own? It's hard enough to earn a single profit in book publishing; it is even harder to earn two profits-one for an agent and one for a principal. And if original publishing is what is wanted in Canada, he rationalizes, all the more reason for me to open up there so that I can do my share of it.
The commission outlined the advantages that each subsidiary company possessed in its competition for the Canadian market. I again quote:
-the momentum of the backlist of its own parent company; the fact that it enjoys "a cost advantage" ... as overwhelming as the economics of this advantage are easily explained, "the international momentum of information and promotion (which) favours imported books," and "the size and sophistication of its sales organization".
The extent of the problem is even clearer when one looks at the Ernst and Ernst reports finding that 65 per cent of the books sold in Canada were foreign publications and a further 10 per cent were adaptations of foreign publications. Small wonder then that the Independent Publishers Association on March 21 wrote to the minister in the following vein:
"It has just come to the attention of this Association that a new subsidiary American publishing company is in the process of establish-
April 23, 1974

ing itself in Canada, the company involved is Houghton-Mifflin, one of the larger U.S. publishers.
"We wish to see this company prevented from setting up here and would ask that you and your officials intervene directly. Already the strength of the subsidiary companies, largely on the basis of their imported titles, is far greater than that of domestic firms. If your objective of seeing that the majority of the industry becomes Canadian-owned and controlled is ever to be achieved then the entry of any new subsidiary firms must be prevented."
It is a well known fact that the Canadian book publishing industry is on the verge of collapse. Increasing cost of fine paper are hastening that process; the locating of yet another foreign publishing house in Canada may well further accelerate the process of collapse.
We are acting on football. We have acted in respect of Canadian ownership and content in the electronic media. We have legislation which attempts to support the growth of Canadian periodicals. Why not the book publishing industry? The Independent Publishers Association suggests as immediate measures that, and I quote:
No further takeovers of existing (Canadian) companies should be allowed, and existing branch plants should be prevented from expanding by adding new agency lines.
They further recommend to the minister in their letter of March 21:
As part of a policy for the development of a domestic publishing capacity the entry of new subsidiaries in the future should be prevented.
These measures are admittedly negative in character, but they are designed to meet a crisis. If I had time, I would add to them the five suggestions which I made in a speech reported in Hansard for February 16, 1971. However, time does not permit. I would ask the government at this point what action it intends to take and when it intends to take it.


Hon. James Hugh Faulkner (Secretary of State):: Mr. Speaker, I very much share the hon. member's interest about this particular issue. I obviously share his confessed concern for the viability of the Canadian publishing industry. He referred to the speech I made to the Canadian Book Publishers Association in January where I said at that time on behalf of the government that a major segment of the publishing industry in Canada should be Canadian-owned. I think the arguments are clear and are shared by members of this party and of the hon. member's party.
Adjournment Debate
I also pointed out to him in response to his question that up to this point the measures we adopted were measures of positive support to Canadian-owned publishers and that this was one means of ensuring a viable Canadian publishing industry.
As far as the particular issue of Houghton-Mifflin is concerned, I have received one brief, on April 7 I think it was, from the Canadian Book Publishers Association and I received another brief on April 22 from the Independent Publishers Association. Both expressed the same concern about the implications of the expansion into Canada of Houghton-Mifflin.
Since receiving these briefs, I have been in touch with the Ontario government and it is my hope that we will be able to explore this question jointly and co-operatively. The discussions on the question and its implications will be continuing.
The Canadian Book Publishers Association specifically recommends that a screening agency be established to review the possible establishment in Canada of new foreign-based publishing houses during what has been described as this delicate period. This possibility is receiving serious consideration in my department.
Traditionally, the interests of such screening or review agencies have been exclusively directed to economic and business oriented questions. It is my view that this should be expanded to comprehend cultural interests as well.


POST OFFICE-PROPORTION OF EMPLOYEES WORKING ON MECHANICAL SORTING DEVICES RECRUITED FROM WITHIN SERVICE
Mr. Charles E. Haliburton (South Western Nova):: Mr. Speaker, it had been my intention to raise certain matters which are of concern to me with regard to the Post Office Department this evening. However, in view of representations which have been made to me by the minister with regard to the nature of progress in the postal strike itself, I have agreed not to raise those matters which I had intended to raise this evening.
I wish to ask the Chair for assistance in this regard, possibly to permit me to raise the same subject at a later date when negotiations will not be at such a delicate stage.


Mr. Speaker:: The hon. member's request, of course, will be granted. His position on the list will not be prejudiced by his forbearance this evening.
Motion agreed to and the House adjourned at 10.10 p.m.

Wednesday, April 24, 1974