1974-01-08

ROUTINE PROCEEDINGS


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, I would ask you to designate an order of the day for consideration tomorrow of the ways and means motion with respect to the removal of the customs tariff applied to certain oil products, tabled in the House on October 23.


ROYAL CANADIAN MOUNTED POLICE
Hon. Warren Allmand (Solicitor General):: Mr. Speaker, following the request by the right hon. member for Prince Albert (Mr. Diefenbaker) on January 3, under Standing Order 41 I would like to table, in French and English, copies of RCMP administrative bulletins Nos. 54 and 78, as well as a copy of a letter I sent to the right hon. member explaining the contents of bulletin No. 78.


Mr. Diefenbaker:: Mr. Speaker, I rise on a point of order. I asked for production of the various declarations that were made by the Royal Canadian Mounted Police, not an explanation of them, and I take the strongest possible objection to the minister filing self-serving explanations in a letter to me. If he wants to deal with this matter he can do so. I would be very happy to hear him explain on motions what took place, but that self-serving addition of his explanation of the unexplainable just cannot be justified.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The Chair has some procedural reservations about what is proposed by the Solicitor General. The point made by the right hon. gentleman certainly deserves serious consideration. I wonder whether it is competent on a minister, under the Standing Order, to propose to table copies of a letter addressed to another member. I would think that a minister is always justified under the Standing Order in tabling what the Standing Order identifies as a document or paper, but I would doubt whether that would extend to an exchange of correspondence between a minister and a member. I would think that that part of the
proposed tabling by the minister might be held in abeyance.


FINANCE
John Napier Turner: Mr. Speaker, I would like to table the report of the Superintendent of Insurance on Co-operative Credit Societies for the year ended December 31, 1972.


TRANSPORT
Mr. Perrin Beatty (Wellington-Grey-Dufferin-Water-loo):: Mr. Speaker, I rise under the terms of Standing Order 43. The urgency of my motion arises from the disastrous effects of poor passenger travel facilities in southwestern Ontario and the unwillingness of the federal government to make public information it possesses concerning this problem. I move, seconded by the hon. member for Perth-Wilmot (Mr. Jarvis):
That the problem of passenger travel in southwestern Ontario be referred to the Standing Committee on Transport and Communications for immediate consideration.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is no unanimity; the motion, therefore, cannot be put.

January 8, 1974
Housing Cost, Old Age Pension


FISHERIES
Mr. Frank Howard (Skeena):: Mr. Speaker, I should like to ask leave of the House to move a motion under Standing Order 43 in a case of very urgent and pressing necessity, namely, the fact that the halibut catch on the west coast this past season has been the lowest it has been for over 40 years and the halibut fishery is in great danger of complete destruction by overfishing, particularly by foreign fleets and there is therefore a need that immediate consideration be given to this question. I should like to move, seconded by the hon. member for Burnaby-Seymour (Mr. Nelson):
That the Standing Committee on Fisheries and Forestry be authorized to conduct forthwith an inquiry into all aspects of the halibut fishery in the Pacific Ocean and waters adjacent thereto.


Mr. Speaker:: The hon. member's motion requires unanimous consent.


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


PARLIAMENTARY SECRETARIES
Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, under Standing Order 41(2) I should like to table, in both official languages, copies of an order in council concerning parliamentary secretaries.


SOCIAL SECURITY
Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, pursuant to Standing Order 43, I request the unanimous consent of the House to raise a matter of extreme importance, relating to the majority of the elderly population of Quebec.
Because a majority of elderly persons living in rest homes in Quebec are subject to lodging and board increases each time the federal government increases old age security pensions, I move, seconded by the hon. member for Bellechasse (Mr. Lambert):
That a committee of the House consider means by which each increase in federal old age pensions is not taken up by increases in provincial lodging costs for elderly people, in order that pension increases are for the benefit of pensioners and not lodges.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is no unanimity; the motion, therefore, cannot be put.


OIL SHORTAGE-MEASURES TO COMPENSATE SERVICE STATION OWNERS FOR LOSSES-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Jean-Marie Boisvert (Drummond):: Mr. Speaker, under the terms of Standing Order 43, I request the unanimous consent of the House to move a motion pertaining to a very important matter.
As owners and renters of gas stations or garages are now losing a considerable amount of money owing to lower sales as a result of the false shortage of oil and also because they have less maintenance and repairs to do on trucks and cars, I move, seconded by the hon. member for Richmond (Mr. Beaudoin):
That this House study the advisability of compensating those taxpayers through a rebate paid by the government or the Bank of Canada on every gallon of gas sold or through a special tax deduction.


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


Some hon. Members:: Yes.


Some hon. Members:: No.


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


INDUSTRY
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, pursuant to Standing Order 43, I request unanimous consent to move a motion dealing with a very urgent matter since it contributes to higher unemployment.
Seconded by the hon. member for Rimouski (Mr. Allard), I move:
That the House examine as soon as possible the serious problem facing Quebec foundries which, unable to get cast iron, must refuse to make the essential parts and pieces that would keep small and medium-size industries in business. Moreover, that the House seek ways of authorizing the Minister of Industry, Trade and Commerce to arrange for a better distribution of the metal so that large corporations such as
January 8, 1974

Chrysler, Ford and others will not compete unfairly against small industries.


Mr. Speaker:: The House has heard the motion. The provisions of Standing Order 43 require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is no unanimity. The motion cannot be put.


FISHERIES
Frank Howard: Mr. Speaker, with respect to the extreme difficulties of the halibut fishery on the west coast I seek unanimous consent, if I may, to move another motion on this matter, seconded by the hon. member for Burnaby-Seymour (Mr. Nelson):
That this House express the opinion that the indiscriminate activity engaged in by Japan, the Soviet Union and South Korea in the halibut fishery in the Pacific Ocean is not in keeping with the needs of proper conservation practices.


Mr. Speaker:: This motion requires the unanimous consent of the House under the terms of Standing Order 43. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, my question is addressed to the Prime Minister who, on September 4, told the House that the government intended to move ahead with an oil pipeline to Montreal. That is about four months ago. Can the Prime Minister tell the House precisely what is holding up the commencement of this project or holding up an application being made to the National Energy Board, which the Minister of Energy, Mines and Resources yesterday said might be made in the spring? Why is this whole project still in the discussion stage after four months?


Pierre Elliott Trudeau: Mr. Speaker, I believe the minister also indicated yesterday
Oral Questions
that he expects to be able to announce a decision very soon. I want to repeat that assurance to the House. The hold-up, to use the expression of the Leader of the Opposition, is due to the fact that we have tried to ascertain provincial preferences as to alternate routes, alternate ways of laying down the pipeline. In the meantime we have proceeded, as the House knows, through the Canadian Commercial Corporation with regard to the guarantee that there would be a supply of pipe. For that reason we are still confident that the deadline I announced will be met.


Robert Lorne Stanfield: The Prime Minister spoke about consulting with the provinces about the route. Can he indicate what provinces the government is consulting about the route and what provinces, if any, the government is consulting about the size of the pipeline and the volume of oil to be carried through the pipeline?


Pierre Elliott Trudeau: Mr. Speaker, consultations have been mainly with Ontario and Quebec. There may have been other consultations but I know of those two in particular. We have ascertained, in the case of Quebec, what appears to be a slight preference for one route over another. In the case of Ontario, they have refused, I understand, to indicate a preference for one route over another.


Robert Lorne Stanfield: Has the government of Canada reached any understanding or agreement with the government of Quebec about the size of the Quebec market for oil or the volume of the oil used in Quebec that would be dedicated to Canadian crude? In other words, has the government of Canada consulted the government of Quebec about the amount of Canadian crude which would be dedicated to the Quebec market, and have any discussions taken place with the Atlantic provinces in this respect?


Pierre Elliott Trudeau: Mr. Speaker, so far as I know the discussions have been general. The question is not only one of the amount of crude but of the time over which such various amounts would be deliverable in the eastern market. With regard to consultation with the Atlantic provinces, I would have to defer on this matter to the Minister of Energy, Mines and Resources who has been, of course, closer to it than I have been.


Robert Lorne Stanfield: Mr. Speaker, I apologize, but may I direct one further supplementary question either to the Prime Minister or to the Minister of Energy, Mines and Resources. Is the decision to supply roughly 250,000 barrels a day to those markets in the east based upon consultations with the eastern provinces, or is it based upon some other consideration because, of course, 250,000 barrels a day would constitute only about one-quarter of the market of those five eastern provinces and therefore would offer the prospect of supplying only about one-quarter of the market?


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: Mr. Speaker, the other relevant question of course is the productive ability of the western Canadian sedimentary basin to supply additional markets in eastern Canada without at the same time creating difficulties in regard to our export arrangements to the United States.

January 8, 1974
Oral Questions
This has been a matter of discussion with both the consuming and the producing provinces.


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, I have a supplementary question for the Minister of Energy, Mines and Resources. Yesterday the minister said that the main obstacle to reaching agreement was the question of route and availability of supply. Does the difficulty arise out of the fact that unless the pipeline from Manitoba to Sarnia is twinned there is only a spare capacity of 250,000 barrels, which would be only half the target the minister has set and less than one-third of the requirements of eastern Canada? Is the delay due to the difficulty in the government making up its mind whether to extend the pipeline from Sarnia or to build a northern pipeline, and is the Interprovincial Pipeline Company opposing a northern pipeline and insisting on the pipeline being extended from Sarnia?


Donald Stovel Macdonald: As I indicated yesterday, Mr. Speaker, what has to be done is make a choice of route as between three possible routes, each of which has different characteristics. In response to the hon. member's first question, the mere question of twinning the line between Manitoba and Sarnia is not the principal obstacle.


Thomas Clement (Tommy) Douglas: Will the minister state definitely where the difficulty lies with regard to making a decision? Has the government not reached a decision as to the route or is there some opposition from Interprovincial to building a northern line which would have a larger capacity and which would be entirely within Canadian jurisdiction?


Donald Stovel Macdonald: Mr. Speaker, the question of route is a decision to be taken by the government. The simple choice is between the Sarnia route which could be achieved at an earlier date or an all-Canadian route which would take something like two years longer to achieve.


Mr. Speaker:: Order, please. Hon. members will note there are five or six members seeking supplementaries on this first question. The Chair will recognize the hon. member for Nanaimo-Cowichan-The Islands on a last supplementary, the hon. member for Prince Edward-Hastings and then attempt to complete the first turn of the questioning. I will return to this subject for further supplementaries after we have completed the first round of questioning.


Thomas Clement (Tommy) Douglas: In view of the statement which I understand the minister made on radio last night that the government hopes to begin construction of this pipeline by mid-summer, does the minister still hold to the target date of completion of this pipeline by the autumn of 1975?


Donald Stovel Macdonald: Mr. Speaker, that obviously depends as, I just said, on which route is selected.


REQUEST FOR STATEMENT ON GOVERNMENT'S PLANS FOR SUPPLYING QUEBEC AND ATLANTIC PROVINCES WITH CANADIAN OIL
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a supplementary question for the Minister

of Energy, Mines and Resources. As Quebec and the Atlantic provinces will require a minimum of a million barrels of oil a day by the time the Montreal pipeline is completed, will the minister take the first opportunity on motions to outline to the House the government's plans for supplying the requirements of these areas from Canadian resources in view of the fact the absolute outside maximum capacity of the Montreal pipeline will be only 500,000 barrels a day and then only if the line west of Sarnia is looped, a policy which the government has not yet decided upon?


Donald Stovel Macdonald: Mr. Speaker, it would be the intention to indicate on motions the government's position with regard to this.


Some hon. Members:: When?


Donald Stovel Macdonald: I certainly hope within the next two weeks. I assume parliament will be sitting next week. On the question of providing a million barrels a day, the capacity does not exist in Canada to provide for all of the Canadian market. As the Prime Minister indicated in earlier statements, the government's goal is for the purpose of increasing Canadian production to meet Canadian needs.


Mr. Speaker:: The hon. member will be recognized for a last supplementary. As I said, I will then try to complete the first turn of questioning before the end of the question period.


George Harris Hees: As the Prime Minister stated it is government policy that the government is aiming to make this country self-sufficient in oil and as it is up to the government to find additional resources, will the minister outline as soon as possible the government's plans for building a pipeline from Montreal to supply the Atlantic provinces so that they can be supplied by Canadian resources as well?


Donald Stovel Macdonald: Mr. Speaker, I thank the hon. member for his unqualified endorsement of a national petroleum company.


SUPPLIES ALLOCATION BILL-ALLEGATION THAT REPORT STAGE MOTION GIVES VETO POWER TO SENATE RESPECTING DECLARATION OF NATIONAL EMERGENCY
Mr. David Lewis (York South):: Mr. Speaker, I have a question for the Prime Minister. In light of the discussions with respect to the program for the remainder of the session, I should like to ask the right hon. gentleman whether he has studied the report stage motion related to Bill C-236 in the name of the Minister of Energy, Mines and Resources which gives the Senate the power of veto with regard to the question whether a declaration by the government that there is a national emergency requiring an allocation program is to be revoked or not. Has the Prime Minister studied this provision which would give the Senate a veto of that kind regardless of the decision of the House of Commons, and is it the intention of the government to retain this particular provision in the report stage amendment?
January 8, 1974


Pierre Elliott Trudeau: I must confess my own impression is that it would be a parliamentary declaration involving a position taken by both Houses. I would have to verify whether the text implies otherwise and perhaps report to the House again after discussion with the Minister of Energy, Mines and Resources.


David Lewis: In view of the fact that subclause 9 of Motion No. 1 in the order of business for today provides that "if either House of Parliament negatives the motion that an order made under subsection 1 be concurred in, the order is thereupon revoked"-


Mr. Speaker:: Order, please. The Chair will allow the Prime Minister to reply to the hon. member but I am sure he appreciates that we are now clearly anticipating an order of the day and I doubt we should become involved during the question period in a discussion of the business which will be coming up later today or tomorrow. However, subject to this caution the Prime Minister might be allowed to reply.


Pierre Elliott Trudeau: I will simply let my previous answer stand.


David Lewis: In view of the fact that some members of the other place, some Senators, are directors of oil corporations and businesses related to the oil industry, and bearing in mind that this is the elected House of Parliament, will the Prime Minister give consideration to revising the motion in the name of the Minister of Energy, Mines and Resources so that the House of Commons will be given the final right of decision on this issue rather than the Senate?


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. The Chair must refer again to the suggestion made a few moments ago that we are becoming involved in debate relating to an order of the day and are clearly anticipating that debate. I would hope the important matter raised by the hon. member for York South might be considered and debated in some other way than during the question period.


SOCIAL SECURITY
Mr. Rene Matte (Champlain):: Mr. Speaker, I wish to direct my question to the Minister of National Health and Welfare.
Does the minister intend to take specific action so that old age security beneficiaries may receive the full increases in allowances which, at least in the province of Quebec, are being grabbed by senior citizens' homes?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, 1 already contacted many times my provincial counterparts on this matter, but I think the hon. member will have to call upon his colleagues of the
Oral Questions
National Assembly of Quebec so that appropriate representations may be made to solve the problem.


OIL-JUSTIFICATION FOR ESTIMATED SUPPLY SHORTFALL IN EASTERN CANADA AND PRICE INCREASES
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I have a supplementary question for the Minister of Energy, Mines and Resources. Have there been any late inventories taken which would satisfy the minister that the estimated shortfall of oil supplies for eastern Canada can be justified, and is the minister able to tell the House whether or not some of the increases already made in the price of crude in eastern Canada can be justified in light of these circumstances?


Donald Stovel Macdonald: Mr. Speaker, it seems to me that the hon. gentleman is mixing the two questions of price and supply. In terms of supply, the recent judgment given to the standing committee by the chairman of the technical advisory committee was that at the moment the anticipated levels of interruption later this winter have not been changed, though we have had the advantage of a rather milder winter so far than we had anticipated. With regard to the question of price, as the hon. gentleman may recall-he can examine the proceedings of the committee-detailed calculations regarding the cost increases of the various eastern Canadian refiners were set out there. In addition to those, there may indeed be action at the retail level on the part of individual retailers to obtain a higher level of price, but my understanding is that these are wholesale levels to which the refiners have adhered.


James Aloysius McGrath: I wonder whether the minister would reply to the first part of the question, which is prompted by the substantial inventories in place at Come-By-Chance, Newfoundland. In face of these inventories, is the minister now prepared to re-examine the estimated shortfall?
M~. Macdonald (Rosedale): That had been taken into account in the earlier estimates that were made. It appears that the refinery may be in a position to start moving some heating oil, and if anticipated difficulties do not materialize there the inventory situation, of course, will be much improved.


RELATIONSHIP OF QUEBEC POSITION TO DELAY IN COMMENCING OIL PIPELINE EXTENSION TO MONTREAL
Mr. Hewara Grafftey (Brome-Missisquoi):: Mr. Speaker, I should like to put a supplementary question to the Minister of Energy, Mines and Resources.
On January 7, the minister indicated that this government had had discussions only with the Interprovincial Pipelines Corporation. Can he tell the House whether the
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January 8, 1974
Oral Questions
fact that the Quebec government has not yet declared itself in favour of the building of an oil pipeline partly explains the delay in the implementation of this project?


Donald Stovel Macdonald: No, Mr. Speaker, I believe that the Quebec premier has declared himself in favour of the building of such a pipeline. I think that his provincial colleagues are now obviously in favour of such a pipeline.


OIL PIPELINE EXTENSION TO MONTREAL-PLACING OF SURVEY CONTRACTS
Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, my supplementary question is for the Minister of Energy, Mines and Resources and it follows up a question I asked him yesterday as to what specific group in the government is negotiating with Interprovincial Pipelines. My question today is this. Since there is only one person in this group, namely, the Deputy Minister of National Defence, it may be that part of his responsibilities is delaying the negotiations. Is he asking this company with which he is negotiating that all contracts for surveys be done through firms in Montreal?


Donald Stovel Macdonald: No, Mr. Speaker, that is not a consideration at all.


Mr. Speaker:: The Chair will recognize the hon. member for a supplementary and then the right hon. member for Prince Albert.


Francis Alvin George Hamilton: Is there anybody else in this group with Mr. Cloutier who has responsibility for putting forward these ideas?


Donald Stovel Macdonald: Mr. Cloutier has been carrying on the discussions but in this regard he has, of course, been conferring with representatives of the National Energy Board and of my own department. With regard to the details of the construction work, in particular the contracting out of surveys and so on, in the normal course this would be arranged between the pipeline company, if indeed it is to be the Interprovincial Pipelines, and the individual surveyors concerned.


Francis Alvin George Hamilton: Mr. Speaker, may I ask one further question for clarification purposes. Is the minister receiving any complaints in regard to pressure being exerted on them to let their contracts to Montreal firms?


Donald Stovel Macdonald: Certainly I have not received any complaints from Interprovincial Pipelines. The position has been taken by the Association of Consulting Engineers of Canada that, to the greatest extent possible, Canadian engineering talent should be used in extending this pipeline. This seems to me to be a reasonable objective on the part of the engineering profession in this country generally, bearing in mind, however, the importance of speed in this particular case.


INCOME TAX
John George Diefenbaker: Mr. Speaker, I would ask the Minister of Finance a question regarding the recent judgment of the Federal Court of Canada which indicated that the belief we have all had, that income tax returns are confidential has no basis in fact and is a myth. In view of that judgment, and of the concern of the millions of Canadians who pay income tax that their returns should not be available for inspection or examination, would the minister consider bringing in legislation that would definitely assure the taxpayers of this country that they will not be, as far as their returns are concerned, put into a goldfish bowl where what they have stated therein confidentially can become public information?


John Napier Turner: Mr. Speaker, I want to thank the right hon. gentleman for bringing this matter to my attention earlier by way of notice. May I say to him that I share his concern about the implications of the recent decision of the Federal Court of Canada. Frankly, I would operate from the general principle that information given to government for one confidential purpose should not be used for another purpose. Particularly in income tax matters, where our system is based upon the principle of voluntary assessment and confidential disclosure, this becomes even more important. I have discussed this matter with my colleague, the Minister of Justice, and we will see what remedy need be taken.


CANADIAN NATIONAL RAILWAYS
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, may I direct a question to the Minister of Transport. In view of the present energy crisis, and in view of the fact the House is presently debating the annual CNR financing bill, will the minister request Canadian National Railways not to carry out its intention to cancel, effective the day after tomorrow, the Rapido train service between Toronto and Montreal?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, I can discuss this problem with the president of the CNR. They made the first decision without consulting the department. I presume they would like to make a second one, but I should like to discuss the matter in the meantime.


Leslie Gordon Benjamin: Mr. Speaker, in view of the fact that both trains have been carrying capacity or near capacity loads, and in view of the fact the Turbo leaves Montreal at 4.30 p.m. and the Rapido leaves at 4.31 p.m., would the minister request Canadian National Railways not only to retain the Rapido but to have it leave Montreal in the morning rather than at the same time as the Turbo train?
January 8, 1974


Mr. Speaker:: That is, of course, a representation. The hon. member for Yukon has a supplementary to the previous question and will be recognized for that purpose; following that, I will recognize the hon. member for Calgary South.


FORTHCOMING FIRST MINISTERS' CONFERENCE-REPRESENTATION FOR YUKON AND NORTHWEST TERRITORIES-EQUALIZATION OF FUEL COSTS
Mr. Erik Nielsen (Yukon):: Mr. Speaker, my supplementary question is for the Minister of Energy, Mines and Resources and has to do with the upcoming conference of first ministers on the 22nd and 23rd of this month. In view of the vital interest that residents of the Yukon and the Northwest Territories have in fuel products, particularly in the question of the equalization of fuel costs as between consumers in various parts of Canada, can he inform the House what arrangements have been made for representation of those two northern territories at this conference? At the same time, can the minister say whether or not the commissioner of the Yukon was expressing government policy when he supported equalization of fuel costs for residents of the north as well as of Quebec and the Atlantic provinces?


Donald Stovel Macdonald: Mr. Speaker, my understanding is that discussions are still going on with the provincial premiers regarding arrangements for the conference. I think I am correct in saying no arrangements have yet been made for representatives from the two territories. Indeed, I do not think any final arrangements of any kind have yet been made. I have not seen the statement of Commissioner Smith, but I would be glad to consider it when I have had a chance to examine it.


Erik Nielsen: Can the minister say whether it is federal government policy to consider the two northern territories in relation to the question of equalization of fuel costs as between other regions of Canada?


Donald Stovel Macdonald: Mr. Speaker, I would be glad to consider that as a representation.


OIL-INQUIRY WHETHER SUPPLY CRISIS EXISTS IN LIGHT OF PRODUCTION BY COME-BY-CHANCE REFINERY
Mr. Peter C. Bawden (Calgary South):: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. In view of the emergency powers the government is seeking under Bill C-236, which is coming before the House this week, and in view of the fact he said on January 4 that if the Newfoundland refinery went on stream this would change the shortfall figure, having in mind the fact that at the present time this refinery has a throughput of 84,000 barrels a day, will the minister indicate whether this will change the shortfall and whether in fact we will no longer have an energy crisis in Canada,
Oral Questions
thus virtually eliminating the need or certainly substantially reducing the need to declare a national emergency?


Donald Stovel Macdonald: Mr. Speaker, this will depend on the continued success of the proprietors of the Newfoundland refinery in bringing the refinery on stream, the availability of ice-hardened ships to move the product to the Montreal market, which is the shortest market, the degree of cold we have this winter and the intention of the Arab countries to increase the withholding of oil supplies from the Canadian market. On the basis of that I think the best position for Canada to take is to acquire the ability to react to a very sharp drop in supplies to Canada if that should materialize, and on that basis for parliament to pass the necessary legislation.


OIL-NEGOTIATIONS WITH SAUDI ARABIA FOR RESUMPTION OF SHIPMENT OF SUPPLIES TO CANADA
Peter Colwell Bawden: Mr. Speaker, I have a supplementary question for the Secretary of State for External Affairs. In view of the fact the largest cutbacks in crude oil supply to Canada are in respect of the supplies from Saudi Arabia, will the minister say exactly what negotiations are presently under way between Canada and Saudi Arabia for the resumption of crude supply to Canada, and does the minister believe this government is doing everything possible?


Mr. Speaker:: Order, please. Perhaps the minister might reply to the first part of the hon. member's question. I should remind hon. members in passing that we appear to be still on the first question and we are running short of time. It may be that we will spend the whole question period on the same subject. I am not sure whether that is what hon. members wish, but some thought should be given to moving on to another subject.


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, the information we continue to get from our ambassador accredited to Saudi Arabia is that Canada is not being boycotted. However, we are still struggling with the fact that, even though we apparently are not being boycotted, oil is not being delivered to us.


Some hon. Members:: Oh, oh!


John George Diefenbaker: No boycott, but a bypass.


Peter Colwell Bawden: Mr. Speaker, I have a further supplementary question for the Secretary of State for External Affairs. In view of the extreme confusion that seems to exist in the minister's department, and in view of the fact Saudi Arabia has relaxed its embargoes in respect of Europe, Japan and other countries, will the minister say why Canada has not been able to negotiate similar favourable treatment for this country?


Mitchell William Sharp: Mr. Speaker, we have had no difficulty in negotiating with the Saudi Arabian government, none whatever.


An hon. Member:: No, just in getting oil.
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Oral Questions


Mitchell William Sharp: We have had assurances from that government that Canada is being treated the same as all other countries except the United States and Holland. That continues to be the situation, but this kind of instruction has apparently not been conveyed down the line in an adequate way.


AGRICULTURE
Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I should like to put a question to the Minister of Agriculture.
Since for about a month Quebec co-operatives and farmers are unable to obtain feed grain, especially wheat and oats, because the Montreal warehouses are empty, can he tell us whether he is aware of such conditions and if so whether the department intends to act to improve the situation which I find most difficult for producers?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, we have been talking with these people who are using grain and I have no evidence at all of any producer who has gone without grain. If any member of the House has any evidence of producers who have gone without grain he should bring that to my attention by being more specific. We also have the upgrading of rail shipments of grain to eastern Canada, and the Wheat Board will be responsible for any extra increase in the cost that may be involved.


Some hon. Members:: Hear, hear!


Léonel Beaudoin: I should like to put a supplementary question, Mr. Speaker.
Can the minister say whether he has received letters about the matter from Trois-Rivieres, Sherbrooke and Quebec co-operatives?


Eugene Whelan: Mr. Speaker, I have received many letters of concern but no letter pointing out that they have done without grain.


TRANSPORT
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is directed to the Minister of Transport and arises from my question to him yesterday and his reply regarding the release of the report of the Canadian Transport Commission on rail passenger services. To quote his reply, the minister said:

-I have received a report and it has been communicated to all interested parties.
Has the report been communicated to any member of parliament representing that area, to any elected municipal representative or to the standing committee of the House on transport?


Jean Marchand: No, Mr. Speaker, it has not been released to all those persons.


Some hon. Members:: Oh, oh!


William Herbert Jarvis: Mr. Speaker, in light of the minister's answer I wonder if I might ask him, through Your Honour, what parties are more interested than the elected representatives in this House?


Some hon. Members:: Hear, hear!


An hon. Member:: Answer the question.


William Herbert Jarvis: Mr. Speaker, I rise on a point of order and I do so most reluctantly, never having done so before. Yesterday and today I have tried to determine who the Minister of Transport considers to be interested parties in respect of passenger rail services. Obviously it is not members of parliament, elected members of the provincial House, municipal representatives or the standing committee of this House. I think it is perfectly logical to ask the minister whom he considers interested parties in respect of passenger rail services in western Ontario.


Some hon. Members:: Hear, hear!


AGRICULTURE
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, my question is directed to the Minister of Agriculture. What action has he taken with regard to the request by the Minister of Agriculture for the province of Alberta for assistance to those farmers in the northern region of the province who suffered severe losses because of an early snowfall and the inability to harvest their crops?


Eugene Whelan: Mr. Speaker, I met with the Minister of Agriculture for Alberta and we discussed the very matter the hon. member brings to our attention today. In view of the fact that advance interest free payments on grain under the snow are being made, in addition to further consideration we are giving in respect of aid in transportation, etc., and the program the province of Alberta has initiated itself, although that has not been finalized at the present time, we hope to be able to work out an agreement with them very shortly.


Donald Frank Mazankowski: Mr. Speaker, my supplementary question is directed to the Minister of Agriculture. Am I to take it from his reply that the federal government is not
January 8, 1974

prepared to assist in any way in so far as cash acreage payments as requested by the Alberta Minister of Agriculture are concerned, in view of the fact that in previous similar circumstances the federal government has contributed on an acreage basis in other years?


Eugene Whelan: Mr. Speaker, I could go into great detail in respect of my discussions with the Alberta Minister of Agriculture, which continued until nearly two o'clock in the morning when I was in Alberta.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please.


An hon. Member:: That might be hard to explain.


Mr. Fairweather:: You were lucky to get to bed at two.


John Napier Turner: How did you get to bed
so early?


Eugene Whelan: Mr. Speaker, I think it is fair to say that the hospitality of the people of Alberta is always wonderful, but I should explain that the Alberta legislative assembly sometimes sits until late. It sat until after eleven o'clock the night I spoke to Unifarm, and I went by Air Canada instead of taking DOT and the plane was an hour late.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. The hon. member for Vegre-ville has a supplementary question. He will be recognized by the Chair, but I would point out to hon. members that only five minutes are left before the end of the question period. If hon. members insist on having two, three or more supplementaries on every question, we will get into trouble.


Donald Frank Mazankowski: With all due respect, Mr. Speaker, I am not interested in what the Minister of Agriculture was doing with the Minister of Agriculture of the province of Alberta until two o'clock in the morning. I am simply asking for an answer to the question I posed. The Minister of Agriculture of the province of Alberta submitted to the federal Minister of Agriculture a request that the federal government make a cash payment of up to $4 per acre and share the cost of the transportation program. My simple question is whether the Minister of Agriculture is prepared to contribute in any way, shape or form with respect to an acreage payment as was requested by the provincial Minister of Agriculture?


Eugene Whelan: Mr. Speaker, to clarify one thing that I said earlier, may I point out that it was twenty minutes to four, Ottawa time.


Some hon. Members:: Hear, hear!


Eugene Whelan: I want to point out that this is a very serious issue. The Minister of Agriculture of Alberta did make some modifications in his request and unless he wants to make those public I will not do so at this time. But may I say that we are considering those modifications
Oral Questions
at present and I hope a decision will be made. I hope the acreage payment is different from what he first stated, if that is what the hon. member wants to know.


OIL PIPELINE EXTENSION TO MONTREAL-SIZE AND THROUGHPUT OF POSSIBLE NORTHERN ROUTE LINE
Robert Lorne Stanfield: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources who has indicated that he is considering a choice between a pipeline from Sarnia going east with a capacity of 500,000 barrels a day and probably carrying 250,000 barrels a day and a more northern pipeline which would take two more years to complete. What is the size and volume contemplated with regard to this northern pipeline?


Donald Stovel Macdonald: Mr. Speaker, the same volume would apply in each of the three cases, a possible early throughput of 250,000 barrels a day up to a capacity of 500,000.


Robert Lorne Stanfield: In the circumstances, what would be the possible reason for subjecting the people of Quebec and the Atlantic provinces to two more years of uncertainty with regard to supply? What possible justification would there be for this if there is no increase in volume involved?


Donald Stovel Macdonald: The question is whether it would be desirable at this point to seek an all-Canadian route for additional pipeline throughput in Canada.


Some hon. Members:: Hear, hear!


FISHERIES
Mr. Ed Nelson (Burnaby-Seymour):: Mr. Speaker, my question is for the Secretary of State for External Affairs. In view of the deep concern of the west coast halibut fishermen over the excessive taking of halibut, not only by Japan but also by other nations which are not signatories to the Norpac agreement, will the minister assure the House that Canada will make every effort to secure an international agreement that will include such nations as South Korea and the U.S.S.R.?


Mitchell William Sharp: Mr. Speaker, I have been advised that an agreement has now been reached with the Japanese that affords substantial protection to halibut stocks in the areas in question in the Bering Sea. My department, in conjunction with the Department of Fisheries, will be in a position to release the details in a few days. We are carrying on discussions with the U.S.S.R. and South Korea along similar lines.

January 8, 1974
Oral Questions


Nels Edwin Nelson: My supplementary is for the Minister of the Fisheries. Can the minister assure the House that similar restrictive quotas, such as those recently placed on the Bering Sea halibut fishery, will not be extended to the fishing grounds in the Gulf of Alaska?


Hon. Jack Davis (Minister of Fisheries):: Mr. Speaker, I think I can give the House that assurance.


PARLIAMENTARY SECRETARIES
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Prime Minister and it is in relation to the order in council he tabled earlier today. In view of his often declared intention to rotate parliamentary secretaries to recognize and reward talent and to promote those who are able, and in view of the fact that the 17 names he tabled today are identical, with the exception of one addition of a person who will share a part of the responsibility with another man who is already there, with those of the previous holders of this office, is that an admission that there is no talent to recognize and no one to promote or is it just another flip-flop in the Prime Minister's political philosophy?


Pierre Elliott Trudeau: Mr. Speaker, if the hon. member would care to refer to the press release that will be issued this afternoon-


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Oh, oh, what? Surely it is permissible to issue a press release without incurring the wrath of the opposition-


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: -concerning an order in council which has been tabled in the House previously. If the hon. member wishes to refer to the practice established in the previous parliament, he will see that it was to give parliamentary secretaries what I call double terms so they would be in office for a period of approximately two years. I figured that this would permit the rotation of a large part of our talent within a given parliament-


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: -and at the same time permit a stint in office which should be long enough to allow a member to acquire good experience as a parliamentary secretary.


Some hon. Members:: Hear, hear!


John Patrick (Pat) Nowlan: I have a supplementary question for the Prime Minister. Since it is a standpat parliamentary situation with a few musical chairs with the same names, does the Prime Minister anticipate a cabinet shuffle with whatever talent he has left prior to the next session?


Mr. Speaker:: Order, please. The hon. member for St. Paul's.


John Patrick (Pat) Nowlan: I rise on a point of order, Mr. Speaker, I think the Prime Minister-


George Harris Hees: No.


John Patrick (Pat) Nowlan: My friend, the hon. member for Prince Edward-Hastings says "no", but I do think the Prime Minister had half risen from his seat. This is a rather interesting question in view of the precarious state of parliament and the precarious state of many people in it.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Mr. Speaker, as to half rising, I realized that you are a better judge than I of what is a serious question.


Mr. Speaker:: Order, please. We are running short of time. Perhaps the Chair would be allowed to recognize the hon. member for St. Paul's. We will have to call orders of the day very soon.


TRANSPORT
Mr. Ron Atkey (St. Paul's):: Mr. Speaker, my question is for the Minister of Transport. In view of the commitment made on behalf of the government by his colleague, the Minister of State for Urban Affairs, at the tri-level conference in Edmonton on October 27 to establish a transport development corporation to co-ordinate research, development, promotion and marketing of urban transportation systems and the commitment to undertake a program of railway relocation in urban centres on a 50 per cent costsharing basis, would the minister advise what has happened to the bill to implement these policies which his colleague told the tri-level delegates in Edmonton would be tabled in the House before the middle of November?


Jean Marchand: Mr. Speaker, I think the bill is in its final drafting form now and it is likely that it will be introduced in the House.


Ronald George Atkey: I have a supplementary question for the Minister of State for Urban Affairs. Given the fantastic growth in the number of public transit users in our urban areas and the resulting strain on existing bus, streetcar, subway and dial-a-bus facilities, would the minister explain his unfulfilled promise made in Edmonton to the tri-level delegates and the millions of public transit users in our cities who cannot await a further throne speech of vague election goodies-


Mr. Speaker:: Order, please. The hon. member for Okanagan Boundary.
January 8, 1974


SOCIAL SECURITY
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker, my question is directed to the Minister of National Health and Welfare and may I say I sent him notice of it. Can he confirm to the House that it is the government's attitude at this time that overseas service with the Canadian Armed Forces cannot be considered as physical presence in Canada for old age security pension purposes, and therefore those who served Canada overseas are placed at a disadvantage compared with those who did not serve overseas?


Marc Lalonde: Mr. Speaker, it is not a matter of a government attitude, but of legislation voted by this parliament many years ago, including the Old Age Security Act, and the provisions of this act apply not only to the Armed Forces, but to all persons who leave Canada for any reason whatsoever, whether they be religious organization members, civil servants or private business employees, to name a few.


Some hon. Members:: Shame, shame!


Marc Lalonde: Mr. Speaker, I am afraid that several hon. members are crying "shame" about their own legislative record since this act was voted by parliament.
However, Mr. Speaker, regulation 15 of the Old Age Security Act provides that an absence from Canada by members of the Armed Forces in relation with their work will not be considered as an interruption from residence here if they return to Canada after having completed their duties abroad.
As for the other problem, I am studying this matter and I hope to have an answer later on this subject.


George H. Whittaker: Mr. Speaker, in view of the minister's answer, and having regard to a case currently before his department pertaining to this matter, will he undertake to look into the situation and report back to the House as soon as possible?


Marc Lalonde: This is exactly what I said a few minutes ago, Mr. Speaker. This is a matter which I had previously considered within the forthcoming review of the Old Age Security Act. However, in view of the opposition we are encountering with respect to the passing of a number of amendments to the Canada Pension Plan, by way of systematic obstruction on the part of some hon. members of the opposition, I wonder at what speed . . .


Mr. Speaker:: Order, please. We have run out of time, but the hon. member for Humber-St. Georges-St. Barbe might be allowed to ask a supplementary, after which I will see the hon. member for Saint John-Lancaster.
Canadian National Railways and Air Canada


Mr. Jack Marshall (Humber-St. Georges-St. Barbe):: Mr. Speaker, my supplementary is directed to the Minister of Veterans Affairs. In view of the incident recounted by the previous speaker in which a war veteran with six years' service was denied eligibility for the old age security pension because of the denial of Canadian citizenship to him while he was serving his country, would the minister investigate this situation from the standpoint of the War Veterans Act and consult with his colleague, the Minister of National Health and Welfare, to ensure that this discrimination is overcome?


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Yes, I will, Sir.


Some hon. Members:: Hear, hear!


BUSINESS OF THE HOUSE
Mr. Bell:: Mr. Speaker, I have a question for the government House leader. In view of the indefinite status of today's business, and in fact of the remaining days of this session, can the minister now clear up this situation by telling us whether the wiretapping bill will be brought forward, and in what form?


Mr. MacEachen:: Mr. Speaker, it is my intention, hopefully, to bring forward that bill some time this week. That is my present plan.


Thomas Miller Bell: Mr. Speaker, when the minister does get to the point of making a decision on this, will he keep in mind that this party is prepared to sit to see that that bill does go through this session?


Some hon. Members:: Hear, hear!


Mr. Knowles (Winnipeg North Centre):: As a supplementary question, may I ask the minister if he will also keep in mind the fact that this party is prepared to pass a motion immediately if it is designed to send the bill back to the Senate in the way we sent it to Their Honours the first time?


Some hon. Members:: Hear, hear!



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, January 7, consideration of Bill C-164, to authorize the provision of moneys to meet certain capital expenditures of the Canadian Nation-
[Stage Direction]
January 8, 1974
Canadian National Railways and Air Canada
al Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, as reported (with amendments) from the Standing Committee on Transport and Communications, and motions Nos. 1 and 2 (Mr. Blenkarn).
Mr. Arnold Peters (Timiskaming):: Mr. Speaker, transportation is becoming more important to development in Canada, and as its form changes obviously the attitude of Canadians to transportation will have to progress with the times. Last evening I mentioned that Canadians now have a chance to take a new direction with respect to the development of rail transportation, following the retirement of the President of Canadian National Railways after a long and faithful career devoted to the railroad industry. In appointing a new president I hope the government will keep in mind the opportunities now existing to develop a new direction for Canadian National.
The two amending motions before us suggest that extra money be made available for transportation. One of the sacrifices I suggest is CN Tower Limited, which is building a most prestigious tower surpassing in size and height everything else in the city of Toronto, and the purpose of which is reported to be the installation of an antenna to allow better communications to be undertaken by Canadian National.
I am in agreement with those who say that the fundamental responsibility of Canadian National is to operate transportation facilities, and that less attention should be paid to the fringe elements which, rightly or wrongly, Canadian National has accumulated in its portfolio over the years. As a matter of fact, the only changes made in the transportation system have been disadvantageous. We are now providing service to fewer rail passengers and will be encountering immediate difficulties in transporting freight. Allowing Canadian National to continue expenditures in fields other than transportation is not in the interests of transportation as it should develop in Canada within the next decade.
The hon. member for Regina-Lake Centre (Mr. Benjamin) has just mentioned the fact that Canadian National has been operating two trains out of Toronto one minute apart. If there is anything more idiotic than that, I have yet to hear of it. It might be more advantageous to use two engines and twice as many cars in one train. We do not use one engine with ten boxcars on a freight train, and then five minutes later send out another train with as many boxcars. We have used as many as five engines and 220 boxcars. It seems to me that this would be the logical way to operate a passenger service. The discussions that have taken place have amply demonstrated that the management of Canadian National is not seriously considering the problems that we have with transportation and is not doing anything about them.
It is interesting to note that a number of hon. members have voted for a safety report that was specially commissioned. It is also interesting to recall that the former member for Moose Jaw, John Skoberg, continually pointed

out that these safety regulations were being violated. Solutions were offered to most of the safety problems encountered by the Canadian National and other railways. These problems are well known; they are certainly well known to the people who work on the railroads. I think they are also known to everyone connected with safety in both the Canadian Safety Association and the provincial associations. Now, we have a study which again indicates that changes have to take place before we can develop a modern, up-to-date and viable transportation facility. It is, therefore, necessary to consider the amendments that are before us in terms of whether they help in providing a transportation facility. It is my opinion that they do not. They may produce some effect on the communication facility, but they do not provide any type of facility that will assist in the transportation arrangements in this nation. One wonders if money saved in that field could be better used in other fields.
I have no quarrel with the Canadian National building the Queen Elizabeth Hotel in Montreal. The station is in the basement and there are complete services in the hotel for the travelling public, some of whom arrive by train. But this parliament allowed the stupid mistake-one that I tried to prevent-of moving the rail facilities from downtown Ottawa. The late Alex Caron and I should probably have our names engraved on the Convention Centre which used to be Union Station because that is all we were able to salvage from the old railway station. If we had trains arriving in downtown Ottawa and downtown Montreal today, we obviously would not be considering STOL aircraft flying from Rockcliffe to Ste. Helene Island in Montreal in order to provide rapid transit. This would have been provided by rail had the railway station not been moved four or five miles away from the core of Ottawa while the Montreal station remained in the core of the city. It may be to our advantage to keep the downtown core connected by rapid transit and the best way to do that may be to maintain facilities in the core of cities. But the CNR towers in Toronto do not accomplish that; they are not providing that type of facility and there is no indication that the employees of the business offices in the towers will use rail transportation. The railroad is obviously not going to move from Union Station to the CNR tower in Toronto. That is a prestigous office building which involves the investment portfolio of the Canadian National Railways but it does not provide a transportation facility.
If the government is wise in its appointment of a new president for the Canadian National Railways we will be looking at rapid ground transportation into the high Arctic, as well as in the east and in the west, and the provision of transportation to meet the needs of the people of this country, rather than a CNR tower.


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise to make a few brief remarks in support of the amendment presently before this House which was proposed by the hon. member for Mississauga (Mr. Blenkarn). It seems to me, Mr. Speaker, that the fact that this piece of legislation is before us under these particular circumstances, indicates some rather poor administrative and legislative procedures in the government's handling of this important
January 8, 1974

question of the financing of Canada's major Crown corporation.
The major difficulty which gives rise to some of the spirit-and as far as that goes, the basis for the fact that members have found it necessary to make amendments to this bill-is, as the hon. member for Mississauga has pointed out, that the CNR has abandoned to a large extent its primary function. This point has also been made by the hon. member for Timiskaming (Mr. Peters) and other members who have preceded me in this debate.
The difficulty in which this House finds itself when discussing this important piece of legislation was precipitated, I suggest with deference, Mr. Speaker, by the unusual and somewhat reprehensible practice followed by the present head of the CTC, when he was a minister in this place, of interrupting the established procedure for the appointment of auditors. We now have the rather ridiculous situation where we have one auditor coming, one auditor going, one auditor gone and two auditors hanging on. We have the firm of Cooper and Lybrands which is going to be entrusted with auditing the CN for the next few years as the result of an amendment proposed by the hon. member for Timiskaming which was accepted in committee and now forms part of the bill. It was a good amendment because it gave a little stability to a precarious situation. At one stage we had a situation where a firm of auditors had been appointed approximately for 40 years, and then were discharged. This made it most difficult to have an annual report submitted because those auditors enjoyed the so-called sanctity of parliamentary approval, while their successors have not received it.
In the last session of this parliament the government introduced the predecessor of this bill, the Canadian National Railways Financing and Guarantee Act, 1971. That bill covered the financing period from January 1,
1971	to June 30, 1972. The government brought the bill on for second reading on March 6, 1972 and on April 21, 1972 the debate on second reading was adjourned. The government never proceeded with the bill during the life of that parliament. This indicates the respect they must have for this particular piece of legislation.
In this session, Your Honour, the government introduced Bill C-164 on March 19, 1973, which relates to the financing period of January 1, 1973 to June 30, 1974. The only retroactive provision with respect to the year 1972 appears in clause 13, but it is not adequately set out. In effect, we now have a bill covering the CNR and Air Canada financing for the period from January 1, 1971 to June 30, 1974, a 3V& year period. There is a six-months hiatus not covered by the bills that extends from July 1,
1972	to December 31, 1972.
It is obvious that neither the ministry of transport nor the government are treating this legislation with the respect it deserves. It is equally obvious that the financial affairs of CN and Air Canada are controlled by the government alone. The annual financing bill in many respects is a mockery. It is designed to delude the public and its representatives in this House into thinking that they control these two great and important public utilities.
Canadian National Railways and Air Canada
In essence, the CNR has only to give the government a promissory note for whatever hundreds of millions of taxpayers' money it wants. And, if Air Canada wants any money, it can include that sum in the amount on the face of its promissory note. I, therefore, think that Parliament should be more selective in approving and authorizing funds. That, of course, is the spirit and intent behind the amendments proposed by the hon. member for Mississauga.
It is obvious that CNR has neglected its primary function, that of moving goods and services efficiently. Canadian National, in particular, needs to modernize its transportation capabilities. The current energy crisis has shown that in this country we are not fully capable of coping with this situation from the point of view of transportation. I am sure that is apparent to the Minister of Transport (Mr. Marchand). Unfortunately, the situation of CN has become so critical that nothing can be done over the short term. Ironically, the energy crisis may bring about the development and improvement of the Canadian National system. This sort of thing appears to be happening in the United States. According to a recent article in the Wall Street Journal, the energy crisis will cause an extended use of Amtrack. Clearly, it is in the interest of the United States to improve the capability of its railways, and that system is an experiment in that direction. What is Canada doing?
Both the present Minister of Transport and his predecessor in office have said repeatedly that the CN financial structure, as well as transport policies, are in desperate need of revision and modernization. The fact that the schedule of the Rapido train was changed without the knowledge of the Minister of Transport shows that there is a lack of direction with regard to that major utility. The fact that the President of Air Canada did not know about the proposed airport head tax until he read about it in the newspapers indicates a lack of consultation. It is obvious to anyone speaking to top executives of Air Canada, as well as other air line and CN employees, that there are morale problems. That this situation has been allowed to develop is an indictment of this government.
The situation was much the same under the former minister of transport. In March, 1972, as recorded at page 808 of Hansard, he said:
I agree with the claim that a reorganized structure is necessary in order that members and the country generally can obtain more information, and obtain it more easily, about all aspects of transportation. With this objective in mind, I propose to bring before the House in the next session three important pieces of legislation on which work is proceeding at the present time.
Remember, that was said in March, 1972. I continue:
The first of those is a bill designed to reconstitute Air Canada as a separate Crown corporation, thus divorcing it, as it were, from the CNR. I will also introduce a Canadian National Railways revision act and a companion piece of legislation covering amendments to the Railway Act. Hon. members will know how involved and far reaching these changes are; they have been asking for them for the last two or three years.
Following the commitment given by the former minister of transport, the present minister has been making announcements and promises. Unfortunately, there has not been action. The minister knows how desirable it is to move passengers quickly and efficiently between major

January 8, 1974
Canadian National Railways and Air Canada eastern Canadian cities and other centres. I suggest, in all seriousness, that it would be sensible to do as the hon. member for Crowfoot (Mr. Horner) suggested last night, divert some of the funds slated for the airport at Pickering and for the STOL experiment, to the Canadian National, in order to enable the railway to construct a modern and efficient roadbed which would permit passengers and goods to be moved at speeds between 100 and 125 miles per hour from one eastern Canadian city to another. This would be of great benefit to us all. Professor Lukasiewicz of Carleton University has suggested that the standard of Canadian transportation lags very badly behind that of other modern countries in the world. While modern western industrial nations are placing increasing emphasis on improving their public transport systems, Canada is doing the reverse.
Canadian National Railways, as the hon. member for Mississauga suggested yesterday, is entering the hotel business to an ever increasing extent. In addition, it is acquiring expensive real estate, building a tower, and is involved in 38 subsidiary enterprises some of which are not related to, or collateral to except under the loosest definitions, the business of transport by rail. The company is more interested in doing these things than in fulfilling the kind of role which Canadians have a right to expect it to fulfil.
Britain at present is testing an electric train, or a diesel electric train which can go 130 miles an hour. Research and development in the Canadian National company in this area has been pitiful, as is evident if one looks at the work entitled "Institutionalization of Canadian Rail Obsolescence", by Professor Lukasiewicz.
It was apparent, as the hon. member for Vegreville (Mr. Mazankowski) suggested, that officials of Canadian National and Air Canada were not overly frank with the committee. They were reluctant to tell us of the duties of top management officials, although the committee did learn about collateral ventures in which the railway was engaged. Information which the committee justifiably required was not always forthcoming. In examining the basis on which the officials of these companies had refused to divulge information, I learned that a similar problem had arisen in the U.K. in connection with select committees. In this may I read from May's Eighteenth Edition, page 654. This paragraph deals with "select committee on nationalized industries" and reads:
A demand for some new parliamentary machinery to scrutinize the activities of those industries and services transferred to public ownership after the second world war ...
There is little difference between a nationalized industry in the U.K. and a Canadian Crown corporation such as Air Canada or the CNR. Although I cannot quote in detail reports regarding the activities of the committee in question, it is said on page 655:
For the first decade of its existence the Committee investigated on average one nationalized industry each session. In 1966-67 the membership of the Committee was increased and since then the Committee has conducted its enquiries by means of sub-committees either examining two subjects concurrently or else separate aspects of one industry.
If it were permitted under the rules, we should make an effort to follow this practice and procedure in the Canadian parliament, so that Crown agencies such as Air Canada and the CNR could be more accountable to the public. It is
[Mr. MacKay.l
obvious from the committee proceedings that the trend is for the bureaucrats in these Crown corporations to proceed further and further away from their primary roles. It must be obvious at this time that the people of Canada have a right to expect better performance from their major Crown corporations. When answering a question today, the Minister of Agriculture (Mr. Whelan) made reference to the fact that Air Canada was an hour late. Everyone laughed because this is what we have come to expect.
If we look at the record of the scheduling of Canadian National Railways, we see that it is a terrible record wreck. Most of the time they will not even guarantee that a passenger will arrive at a particular time. It appears their attitude is they will sell someone a ticket and he will have to take his chances on when he will get there. Canadians have a right to expect something better than that.
With regard to the need for secrecy as to what these Crown corporations are doing, the activities of their main executive officers, how much they are paid, on what basis they were appointed and so on, this is something the people of Canada are interested in knowing. To say that divulging this information would somehow prejudice the operations of these enterprises is patently ridiculous. If they are of any value, they should be paid the going rate. If they are paid something less than that or are merely redundant and have positions that are not necessary for the operations of Air Canada or CNR, they should be removed.
It would be very interesting for the committee and the House of Commons to know on what basis the continuation of the present situation exists whereby Air Canada and CNR are still intertwined in their directorship. It would be interesting to know why this venture into the Canadian aerospace industry was initiated by the officials of Air Canada. It would be interesting to check further into the Wardair situation. Each time members of this House attempted in Committee to find out why these things were done, whose idea it was, whether guidance was given from the minister or on what particular basis the directors or officials proceeded, we were told, as the hon. member for Vegreville (Mr. Mazankowski) said, that the confidentiality of the matter precluded answering this type of question.
As far as CNR is concerned, I do not see why it should be permitted to continue to expect the people of Canada to provide funds for ventures like the CN tower until it has decided to proceed with its primary role of moving people and freight for the benefit of Canadians. There was never a time in this country when commodities were in such short supply in various parts of the nation. We have a feed grain shortage in eastern Canada. The British Columbia apple industry and lumber industry are cramped because of a lack of adequate rail facilities. The problems involved in moving wheat are well known.
I had a little difficulty last night following the logic of the hon. member for Regina-Lake Centre (Mr. Benjamin). I do not want to misquote him. I think he said that CN wanted to build this tower because CP has one in Calgary. He pointed out that he did not think this was necessarily a
January 8, 1974

good thing because the customers of CP had to pay for it. If it is not a good thing for CP, I fail to see why it should be a good thing for CN, even though it is a Crown corporation.
In any event, it seems clear that the principles involved in the amendments of the hon. member for Mississauga deserve support by all members of this House for the simple reason they are an indication that parliament is master of the activities of CNR and Air Canada. It would indicate the parliament of Canada does not approve of so much emphasis being placed on collateral activities such as hotels, towers and this type of thing, the cost of which should be scrutinized and deleted from the estimates for the calendar year 1973. Let these projects be financed, if they are necessary strictly from internal earnings. The fact that this direction is given by Parliament will be an indication to the officials of CNR that parliament is disturbed, and rightly so, about their activities in fields not directly related to transport. It should be a warning to Mr. MacMillan who indicated that intermodal methodology of handling business is a good thing. I do not know what he meant exactly by "intermodal methodology," but that is what he said in one of his answers in committee. As far as the Canadian parliament is concerned, intermodal methodology by C.N.R. should be confined to moving freight and moving people, not building towers and hotels.


Mr. Charles H. Thomas (Moncton):: Mr. Speaker, I spoke in the debate when this bill was before the House for second reading on April 13. At that time I referred to the bill as an exercise in futility and an affront to this parliament. Nothing that has transpired since that time has altered my opinion of the bill. In fact, events since that date have served to buttress my opinion and reaffirm my conviction that this government, as it does from time with the CNR financing bill, is again playing games with this House.
This bill is a ridiculous exercise. I hesitated to speak on it again because I have spoken so often on similar bills over the past five years that I am beginning to wonder if there is any way of getting through to this government. I thought I would try once more to convince the government they should at least heed some of the advice of their own cabinet ministers who have said over and over again that this is a bad form of legislation, that there is no proper control over the financing of these two corporations and a new method of financing should be introduced. The hon. member for Central Nova (Mr. MacKay) read some statements by previous Ministers of Transport and the present Minister of Transport (Mr. Marchand) promising that legislation would be forthcoming to provide financing for these two Crown corporations in such a way that parliament would have some control over their spending, which in aggregate has been hundreds of millions of dollars every year.
This is a good time to look at the history of these financing bills. I say that because whether we agree wholeheartedly with the principle of the amendments, it is simply to bring before this House the fact that CN and Air Canada have grown beyond parliament. They have gone beyond the priorities that were set for them when they were formed many years ago. They have certainly gone beyond the priorities established for them in the National
Canadian National Railways and Air Canada Transportation Act. It is time to examine what has happened since Bill C-164 was introduced to determine to what extent parliament is being bypassed by CNR and Air Canada.
Members on both sides have heard the comments made in the House by various ministers that new legislation would be brought down. They have attended meetings of the committee and heard witnesses dodge questions which were put to them, withhold complete answers, hide behind the cloak of confidentiality and in other ways avoid giving true answers to members of parliament. The presence on the order paper of amendments of the type we are considering is a good reflection of what went on in committee, and the way members on this side feel about the type of financing bill we are being asked to pass.
Bill C-164 was given first reading on March 19, and second reading on April 13 and 16. Twelve speakers took part in the debate at that time. Yet despite the government's assertions that this is an important piece of legislation the bill was set aside for six months and was not considered again until October 18 at which time there were five days of debate during which 46 speakers took part. Surely, we cannot accept the contention of the government that we have been delaying important legislation when 46 members feel obliged to say something about the operations of the two corporations concerned, as, of course, they are entitled to do.
Once the bill went to committee, it was handled very expeditiously in my opinion. The committee met on November 8, held 12 sittings and heard a number of witnesses. It reported back on December 20. I have described the bill as an exercise in futility but I would modify that opinion to this extent-it is an excellent vehicle for securing the attendance of officials of the CN and Air Canada before the committee. It gave us an opportunity to put questions to them which we had raised without success in the House. On each occasion the minister had sidetracked them in the usual way by saying he would take them up with the CN or Air Canada.
Perhaps the best witness I can call in support of my view that we are being asked to conduct an exercise in futility is the Minister of Finance (Mr. Turner) who also appeared before the committee. Someone asked him directly why the bill was necessary. He said, in effect, that if the bill were not passed the CN and Air Canada would have to borrow money on the commercial market and pay more for it. After all, the legislation before us is not necessary to enable those companies to borrow money. They already have that power under existing statutes. The minister added that the bill was necessary, too, because it gave parliament control over the appointment of auditors. One of my hon. friends has shown how little control parliament does, in fact, exercise over the appointment of auditors. The minister himself admitted that this appointment to the result of a cabinet decision taken without consultation and slipped into the bill for approval by parliament later. This is the way in which the government effectively bypasses the section of the act which says parliament must appoint the auditor each year.

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Canadian National Railways and Air Canada
The frustration which boils up regularly in this chamber is nothing new. It appears every time a financing bill comes before the House. It is felt not only by members of the opposition. Objection to this type of financing is also taken by cabinet ministers, by a previous minister of transport and by other responsible members of the government. I recall questions being directed to the present Minister of Regional Economic Expansion (Mr. Jamieson), then Minister of Transport, when one of these bills was before the House back in 1971. We were complaining about the fact that so many of the expenditures outlined in the bill had already been made. Since there was nothing we could do about them, what was the point of discussing them?
On this point, I should like to quote from the committee report, issue No. 1. of the third session of the 28th Parliament. We were questioning the Minister of Transport of that day about the desirability of this type of legislation. He said:
This is really to permit them (the CNR) during 1971 to cover commitments made prior to that time.
He went on to say:
It is not an entirely satisfactory system from the standpoint of the committee or I may say from the standpoint of the government. I have been saying to both these corporations that they should really adopt a further forward forecasting mechanism and I have been trying to get both of them on a five-year forecasting period ... As I say, I agree with you that it is not a very satisfactory way of doing things because in a sense we are really approving something of which a good deal has already been done.
Later, I asked the minister a further question, to which he replied:
I do not want to take the responsibility for something which has been embedded in the system for decades, really, but nevertheless it is something which in my judgment we ought to get rid of or improve in some way so that we do not find ourselves in this kind of situation involving, in a way, an after-the-fact judgment.
This is what we have been complaining about. What is the point of spending days and weeks questioning officials in committee when, in fact, the money has all been spent and there is nothing one can do about it? Yet despite the views expressed by the then Minister of Transport and the promises he made in the House, nothing has been done to change the situation.
When the present bill was before the committee, I questioned the Minister of Finance about this method of financing. As members will see if they turn to issue No. 19 of the committee proceedings in the first session of the 29th Parliament, I asked him, as reported on page 25, whether he agreed that this was a proper way to finance large corporations. He replied:
No, I think it is not a satisfactory way, Mr. Thomas. I think these bills are important enough to be dealt with expeditiously by Parliament.
In reply to a further question I put to him, the Minister of Finance said:
I agree with Mr. Thomas, Mr. Chairman. I think we have to develop some more permanent mechanism for the financing of these two corporations while allowing for parliamentary control either by way of the Department of Transport estimates or through some other mechanism. I agree this is not a satisfactory procedure.
I do not know what further evidence the government needs. If they will not listen to us on this side of the House complaining that parliament is being bypassed or ignored,

surely they will listen to the brains on that side. The Minister of Finance, the Minister of Regional Economic Expansion (Mr. Jamieson) and the Minister of Transport (Mr. Marchand) all agree that this is bad legislation, that parliament has been bypassed. Since they continue to bring in the same type of legislation, hon. members should not wonder why I claim that the government is deliberately mocking this House and affronting our intelligence. This is the kind of thing that leads to amendments of this nature.
There is a feeling among members of parliament that the CNR and Air Canada are going on in their own merry way and have forgotten the primary purpose of their incorporation. The CN was designed to run a railway. Air Canada was designed to fly aeroplanes. Yet we have no control over these corporations or can give them no direction as to how they spend their money, so naturally we should not be prepared to accept this kind of legislation. In fact, I contend that if parliament is to retain any control over the spending of these two corporations, some definite changes must be made in the financing of CN and Air Canada. I suggest that much of the mess we are in now began with the National Transportation Act of 1967. I was not here at that time, but I understand what parliament was trying to do. Although the act was viable and satisfactory in the conditions prevailing at that time, it is becoming more obvious every day that the conditions which applied in 1967 no longer apply today.
When the act was passed in 1967, it was felt that transportation should be placed on a profit making basis, or at least on a compensatory basis. The railways were instructed to make a profit, and this accounts for some of the difficulties today. Members of this House rise and fire broadsides at the CN, but in all honesty the CN is only doing what the House instructed it to do by statute. As a result, we now face an almost insurmountable obstacle: we have given the CN instructions to do just what it is doing today. We have told CN to go out and make money and not to worry about giving service.
I suggest that we are not going to change the situation by lambasting the CNR and Air Canada. Let us put the blame where it belongs, that is on ministers who have said that the whole set-up at the moment is wrong. Let them back up their words by bringing in legislation to correct the situation. I suggest they start by bringing in amendments to the National Transportation Act, which would provide some method whereby the government could tell CN and Air Canada just what their priorities are, and that we do not want them building hotels and towers until and unless they provide a proper freight and passenger train service in this country.
There are many priorities that some body should be laying down for both the CNR and Air Canada. I do not want to go into the details here since I do not have the time, but speakers both today and previously have mentioned the fact that there have to be massive infusions of capital into the CN to improve freight services in this country. Reference has been made to the present ridiculous situation where we are unable to get sufficient boxcars to move our wheat or to move our feed grains. There is a shortage of cars to move potash and a shortage of cars
January 8, 1974

to move coal. Indeed, there is a general shortage of boxcars. Surely in such a situation, instead of worrying about hotels and towers in the air, the CN should be doing something to correct this shortage of rolling stock.
We have also heard about skimping on money they have spent on the maintenance of road beds, and about how crews have been cut down to the point where there is not proper supervision, as a result of which more and more accidents are occurring than ever before. The hon. member for Crowfoot (Mr. Horner) referred to a report which outlined some of the problem areas about which he has been warning this House for years. For example, just last week there were two serious derailments in New Brunswick. Fortunately, freight trains were involved and there was no loss of life, but there was a tremendous dollar loss. I shudder to think what might have happened had passenger trains had been passing over this roadbed. Although I have not yet seen the report on this accident, it appears that this was a case of too heavy traffic passing over the rails which the roadbed could not handle, so it gave way. Instead of spending money on hotels and towers, the CN should do something now in terms of facing up to the tremendous influx of passengers they will have to haul over the next five years as a result of the energy crisis.
Before I sit down I should like, in the limited time I have, to mention another area that has caused me a great deal of concern. This is a grey area that has been very frustrating. Every time I try to get an answer to questions we have the old game of shuffle ball, going from the Minister of Transport to the railways, then back to the minister, and so on back and forth. I am referring to the matter of pensions. This has been an ongoing grievance with the unions, rightly or wrongly-and I am not taking sides. However, what I am saying is that there must be an honest and frank appraisal of the CN pension scheme. I admit that this appraisal is now underway and we are expecting to have Judge Hall's report soon. But I certainly hope that that report will not be the end of the line. While the pension proposal that has been agreed on is a start in the right direction, it is certainly not the ultimate.
When we were discussing pensions in the committee two or three years ago, I was one of those who opposed the suggestion that pensions be made part of the bargaining package. What I have seen since then has confirmed my opinion that we made a grave mistake in suggesting that pensions be included in the bargaining package, and I should like to tell the House why I say that. When you deal with a group of employees whose ages extend from 17 to 65 you find a great difference of opinion existing among those employees. As far as the young men are concerned, they think of bills they have to pay today and tomorrow and are interested in wage increases and hours of work. They think of a pension at age 65 as something away in the future and are not interested in it. On the other hand, employees in their fifties are thinking about retirement. Therefore you find a conflict of interest, and this is apparent with the pension proposals that have been agreed upon. The younger members are quite happy with it, whereas anyone who has been employed prior to 1956 is very unhappy and feels he has been cheated. This is what happens when you bargain for a mixed group such as this.
Canadian National Railways and Air Canada
I do not know what the answer is. We have allowed pensions to become part of the bargaining process, and since the precedent has been established I doubt we can change the situation now. But this is one area in which the government should give direction to the CNR so that the whole pension mess will be tidied up.
In conclusion, I should like to say a few words on behalf of those ex-employees of the CN who have no one to speak for them. I refer to employees who have gone on pension and are no longer union members. These people have been continually overlooked, except of course for any representations made by individual members of the House. Now is the time when the government should tell the CNR it has a moral obligation to these people. Let us know how much is needed to bring their pensions up to a level similar to that of public service employees. If we have to find funds to do this, let us find them, but let us not have the CNR hide behind this cloak of not having the money to do it. It is for these reasons I think the amendments are good. They put into question the whole direction of CNR policy, and I hope members of the House will give them serious consideration.


Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, I have sympathy for the idea behind this amendment, although I doubt that I will in the final analysis support it.


An hon. Member:: Oh, come on.


Alfred Pullen Gleave: Perhaps I can be persuaded. The idea behind the amendment is that the first concern of the railroad, particularly the CNR, should be to serve Canada as a transportation system. I suggest this is a perfectly sound and useful argument. I do not know the purpose of building this tower in Toronto. It may be some kind of a prestige project so that the CNR will have the tallest building with the needle on top. It will only occupy that position of prestige until someone or some corporation somewhere decides to build a tower with a needle on top 30 feet higher. The CNR will have this sort of thing going for it, which I suppose is something, but I know a great number of people who are dependent on rail transportation, including those in industry, business and farming who will not be impressed at all by the fact that the CNR has the tallest building in Toronto. I know a great many men and women employed by the CNR who have the rather quaint idea that pensions and wages are more important than having the tallest building in the city of Toronto.


Some hon. Members:: Hear, hear!


Alfred Pullen Gleave: A number of people in those categories communicate with me by telegram and by letter quite regularly regarding their concern about pensions. I received copies of two telegrams recently, one directed to the Chairman of the Standing Committee of the House of Commons on Transport and Communications. This telegram is signed by Mr. H. K. Beckett, Chairman of the Biggar Railway Employees Association, in which he states:
We hereby request your presenting before transport committee suggestion for recommendation by your committee to railway arbitra-

January 8, 1974
Canadian National Railways and Air Canada
tor Justice Hall that railway pension study of Commissioner Dr. Deutsch not be included in final wage and rules report of Justice Hall.
We suggest also you recommend to federal Minister of Labour, Justice Hall, and Dr. Deutsch that no action toward finalizing railway pension issue be taken prior to a hearing before your committee of the associations concerned with the railway pension issue in Canada.
The wage and rules issue under arbitration can then be concluded.
Pension study can be provided necessary time required to do a full report after House reconvenes in February 1974.
Another request I received from the same association suggested that this House continue in session until the reports of Dr. Deutsch and Justice Hall come before this House. Both of these seem to be reasonable requests. These are the types of statements being made by people throughout the country, and they do not have much to do with the building of that tower in Toronto.
Another thing which has come to my attention, and this has been mentioned by previous speakers, is the matter of rolling stock, as related to the transportation of grain and lumber, the real business of the railroad. A question which appeared in Hansard for January 7 at page 9087 is as follows:
How many railway cars designed for hauling grain have been built for Canadian National Railways in the past 12 months?
The answer to that question was none. Here we have a railway which is in the business of moving grain and, along with the CPR, is the sole method of accomplishing this movement. However, no cars have been built in the past 12 months for this purpose. The railway gives the excuse that the Canadian Wheat Board purchased 2,000 grain cars in 1972. As an excuse for doing nothing, they cite the emergency action the Canadian Wheat Board took in 1972 to provide rolling stock. Someone asked whether the railway was considering putting concrete ties or sleepers, as they are called, under the rails. The answer was no, they had no intention of modernizing the system to that extent. The company was also asked how many locomotives it leased, and the reply was that they were leasing a certain number from United States railroads. This is of real concern when we realize we have a rail transportation system under the direction of individuals who have been either unwilling or without the imagination to plan the modernization of these facilities in order to carry out the transportation task required in Canada.
If the government, on behalf of the CNR, brought a request before this House for almost any amount of money to modernize this transportation system, to purchase rolling stock or to purchase or lease locomotives, I am sure there would be no difficulty in getting approval. If the government were to bring forward proposals that would satisfy the questions that have been asked here during the last hour, and during the question period, in respect of the development of a passenger service which would rapidly move people between our large centres of population, such as Toronto, Montreal and the golden triangle, I am sure they would receive the approval of hon. members.
If the company came forward with a proposal for a well-designed system which could rapidly move feed grain into Quebec and the Maritime provinces, where it is needed, I am sure it would get approval for whatever amount of money was needed. If the company asked for money in order to improve its service between Thunder Bay and Vancouver, I am sure there would be no question

about giving approval. No one criticized the company when it proposed to double-track the line between Winnipeg and Portage la Prairie. The company has no difficulty in getting approval for this kind of improvement which is essential to the provision of a good transportation system.
Why then do we not have, through the Minister of Transport (Mr. Marchand), who in the final analysis is the responsible minister, a request to this House for the financing that is needed to provide in absolute terms a rail transport facility which can serve the needs of Canadian industry, Canadian business, Canadian farming and Canadian citizens? Why does the Minister of Transport not put such a program before the House instead of waiting around? I have asked the Minister of Transport and the minister in charge of the Canadian Wheat Board if they had assurances that the CPR and the CNR would provide the facilities to move the grain out of western Canada. Their reply was that the CNR and the CPR had given such a commitment. I do not question the ministers' sincerity in the answer they gave me, but if the CNR or the CPR have ever given that commitment, they did not live up to it. There are only 10 million bushels of wheat in Thunder Bay in facilities which have a capacity of 70 million additional bushels.
The same situation exists in Vancouver where there are only three million bushels of wheat. When you know that one boat can take a third of that amount, you realize the nature of the problem. As I said, the responsibility rests with the government. When the Canadian Transport Commission reported a couple of days ago that the safety precautions of the CNR were inadequate, what answer did they get? The Canadian National Railways said that the conclusions reached by the Canadian Transport Commission in its report last week on railway safety were based on outdated figures and did not reflect current conditions. The report is not outdated, Mr. Speaker, and it does reflect current conditions. It is the CNR which is outdated and which does not reflect current conditions. The same is true of the Minister of Transport when he brings this bill before the House.
Many Canadian citizens are getting pretty fed up with this sort of approach. I do not know who is making policy in this country with regard to railroads.


Mr. Stackhouse:: The NDP.


Alfred Pullen Gleave: I do not know whether it is the CPR or the government. If you read the history of the CPR as it relates to the history of this country, you would find it rather difficult to untangle who was making policy, the CPR or the government. One might have reason to hope that by 1973 the government of Canada might have been able to sort out its responsibilities and to discharge them. I say that this government is not discharging its responsibility to the Canadian people in terms of railway transportation. It is a colossal failure and it stands condemned before the House for the proposals it is putting before us. Any one who sat on the Standing Committee on Transport and Communications and listened to some of the answers we got when we were asking about transport could not
January 8, 1974

help but come to the conclusion that many questions were not being fully answered, that we were not receiving a full picture of the needs of Canadians.
I should like to go back to the safety report and point out that it is a disgrace to ask men to run trains under conditions which the Canadian Transport Commission says are unsafe. By what right do we, the people of Canada who own the railroad, ask men to drive trains at high speeds under conditions which are unsafe? The statement by the CNR management that the CTC's report is out of perspective, with no consideration given to the massive workload imposed on the CNR during the past decade, does not make sense. What do they mean by "massive workload during the last decade"? What do they think the CNR was created for except to carry a massive workload? It was not created as a scenic railway to run across the mountains, thus enabling people to sit in a car with some windows up on top and look at the scenery. It was created to move a massive amount of freight and passengers across the mountains. If those who are responsible for the direction of the CNR have not conveyed their need for facilities to meet the demands of the Canadian economy to the minister responsible, then they have not discharged their responsibility. If the minister responsible, having been informed of these needs, has not acted, then he is not discharging his responsibility.
This country needs somebody like Harry Truman who put up a little placard on his desk which read "the buck stops here". It is about time we had someone who had that kind of courage and that kind of attitude. This applies to the CNR and to the government in the present energy situation. However, I will not discuss the energy situation now because it is not the subject matter of our debate here. I could give you, Mr. Speaker, endless references to the requests that have come to us as members of the necessary service by both railways. These go right down to the local level. I continually receive letters and telephone calls from people in small towns in my constituency who tell me they cannot get a satisfactory express service. Most of them have given up hope of riding a train anyway, but they still hope to get some express service, either by truck or by rail. All too often they are dismayed and disappointed at the type of service they are offered. This is inexcusable.
I do not think anyone now expects a passenger train to stop at every whistle stop as it goes across Canada, but people do expect express to be delivered to the various towns by one means or another. After all, the people who live in those towns order goods which they want delivered, unless we expect to get to the point where everyone will have to get into his own individual truck or car and drive 60 or 70 miles to the nearest main shopping centre to pick up what he needs once or twice a week. That is a possibility. I grew up in the pioneer days in Saskatchewan when you did that. You just sat all winter on the farm, and twice a month hooked up a team to the sleigh and went the ten miles to town. Maybe you took in a load of grain. There, you gathered up groceries and the rest of your needs and hauled them home, then waited for another two weeks. If the concept of the government and of CN is that we should regress to those days, well, it is one way of running a country. It is not very efficient. But it is possible to slow our economy down to that pace.
Canadian National Railways and Air Canada
Sometimes we wonder, considering the answers we get, whether the railroads are really thinking in terms of a modern transportation system, or whether they are really thinking of how little service can be given and still get away with it. I hope that, as a result of this discussion and of the proceedings in the Transport Committee some new ideas will filter down to those responsible for running the CNR and Air Canada. Maybe some of those ideas will even reach those responsible in the government, so that instead of excuses we can have an adequate, working railway transportation system for the people of Canada.


Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, as an ordinary citizen living on the Prairies, even before I was of voting age, I developed certain ideas about what railways were all about, even the CNR. In those days, the railways were carrying grain from the Prairies to the ports. They were carrying goods to the Prairies, and carrying people out to the coast, as we used to say, or down east.
As a freshman member of parliament I brought some of those preconceived notions into this House with me. I thought railways, and the CNR in particular, had as their prime function railroading and that, in the course of carrying out that function, deficits might be incurred. I had heard, again before I came into this House, that the CNR was frequently required, for national, social and economic reasons, to operate lines which were not otherwise economic, in the interests of Canadian unity. That was fair enough and if, in the course of operating these lines and the main line globally, deficits were incurred then CNR could come back to this House, make its explanation, show that it had managed its affairs properly and ask for further finances in order to continue to serve the nation, carrying goods in, across and out of Canada, and carrying passengers at the same time. I understood this to be a legitimate method of operation.
Then, I began to look at some of the reports that came flying across my desk when I became a parliamentarian who still held those old fashioned notions about what railways were all about. I saw the bills that were coming in, and the reports. For example, late last year the Auditor General's report came across my desk. I was thumbing through it and I noticed that the Canadian National Railways was not one of those Crown corporations which report to parliament and have their books audited by the Auditor General. I also noted on page 187 of the 1972 report, under a heading "Loans to and Investments in Crown Corporations" there is a table which shows the comparable balances at the close of three fiscal years, 1970, 1971 and 1972, of the indebtedness of the Canadian National Railways.
In 1970, there was a total of $2,156,770,000. In 1971, it was $2,361,000,000. It had gone up about $150 million. In 1972, it was $2,590,000,000. I did not even have to make the subtraction, because I found out on page 189 that there was an increase over the previous year in the indebtedness of Canadian National Railways of $229 million, all of which was part of this $2,590,000,000.
This $229 million was itemized on page 189, and I found among other things that there was a loan to Air Canada of

January 8, 1974
Canadian National Railways and Air Canada $14 million, and then another temporary financing to Air Canada of $14,373,000, making a total of $28 million or, if you like, 10 per cent of this overdraft. So I say to myself that CNR started out being a railroad. It started to borrow money to carry on its railroading business, and then it began to go into the money business itself by lending money to another Crown corporation, Air Canada. This I found very strange. Some of my preconceived notions about what railways were all about began to crumble.
Now, I see Bill C-164. Here, there is reference to railroad property. That seems to be a legitimate requirement for funds. Then, there are funds for branch lines, again a legitimate operation, in the amount of $13 million. There is $31 million for equipment, which does not seem to be very much when you consider all the complaints we have heard about the lack of box cars to carry grain. Then, there is an item for telecommunications which is all right, Mr. Speaker. But then, we come to hotels and the CNR Tower. Here again, we find another type of activity in which the railway has become involved. First of all, it gets into the money lending business. I was talking to a colleague yesterday about this. He showed me an item for interest being paid by Air Canada, and I think it was to the CN, which amounted to something like $20 million a year. This I find most peculiar.
Corporate business in the present day has been known to diversify in order to invest its earnings. This seems to be a legitimate occupation for corporations which have profits. I would like to underline the word "earnings". There are a good number of Canadian corporations which earn more than they need for their normal activities, and so diversify. It is a form of insurance, if you like. It is insurance to help them run their other activities, but I do believe this activity is only justifiable when these are earnings from the principal operating function of a corporation such as the CNR. Let us go back and apply that principle to CN. Does it make sufficient earnings in its principal operation to justify diversifying and cross-insuring its activities? I suggest that it does not, because it seems to come back quite frequently to the Canadian parliament to seek more funds. These are not just funds for operating a railway, but funds for making pie in the sky. I find this very odd. I would rather have meals on wheels than pie in the sky made by the CNR.
I went back to my original ideas about railroads then and I do not think they were all that wrong. The Canadian National was conceived to provide transportation to those parts of Canada not served by the first railway line across the country; a most legitimate operation in the interests of Canadian unity. No one questions that. Members from this side of the House cannot bring forward measures to spend money; this must be done by the government. If the government comes forward with measures to support the legitimate activities of the railway, such as building boxcars, building grain cars and hopper cars, they will get their money quickly. I agree with the remarks made by the member who spoke just before me on this point. Why should we start building castles in the sky?
The hon. member for Regina-Lake Centre (Mr. Benjamin) complained about the emphasis that was being placed on the hotel and meal business by the hon. member for

Mississauga (Mr. Blenkarn). It was the hon. member for Mississauga who introduced the amendment in order to focus attention on these particular aspects. He knew that other hon. members would be speaking on other aspects of the legitimate business of the railways, and his concern was to focus attention of the activities which were at best remotely related to railroading.
I think the CN must be reminded from time to time, and this is our opportunity to do so, that they have a responsibility to this parliament and that the taxpayer is not going to continue advancing funds for non-railway activities. That is the purpose of this amendment. Surely, there are enough transportation problems for the CN to solve to keep it busy. In solving them, the CN can come to parliament and ask for financing if it should run into financing difficulties, but it must stay with its legitimate activities. We are being asked to approve $14 Vi million out of a total advance of some $225 million; about 7 per cent of the total is being requested for non-railway activities. I submit, Mr. Speaker, that it is time we drew the line, that we examined the activities of the CN and directed them to focus their attention on their prime activity.
On the radio this morning I heard a technical officer of the Canadian Transport Commission who was involved in the preparation of the report made on railway safety. From his comments I was surprised and dismayed to learn that Canadian railways, and CN in particular, have reduced thair track inspection standards in the past few years. There used to be a track inspection daily, and from this man's comments I understood that this inspection now takes place four times a week. It has been halved. At the same time, Mr. Speaker, we complain about finding people to do jobs when there are lots of people and lots of jobs to be done. This reduction in track inspection procedures has been made, despite the fact that the track and the roadbed are being asked to carry heavier loads more frequently and at faster speeds. If this does not account for accidents, where are we to look?
Last spring I had occasion to travel home on the CNR. Just to make it real, there was an accident in northern Ontario, so our train had to be diverted to the CPR and go across 300 or 400 miles before rejoining the CN tracks. We were four or five hours late getting to the Lakehead, but I enjoyed the trip and cannot commend it highly enough to any hon. member who wishes to see what this country is all about. In the course of two or three days on the train I talked to various members of the crew and was distressed to find that the service I had been used to was seriously downgraded. I was used to seeing linen, silver and finger bowls on the dining room table. Why not?
I heard comments from American tourists who were most upset because they used to take that train back and forth across Canada for the sheer enjoyment of the good service. I am afraid they did not enjoy that particular trip. While they got the service from the people, because they were faithful servants of the railway, they did not get the service from the railway. It appeared that just before the crew set out on that trip they had been told their jobs were to be downgraded and they could like it or get off. Some of them had put in 30 years service and could not easily find other employment. I visited the chef in the kitchen and the washup crew, the whole lot, and found
January 8, 1974

that these people had been downgraded and their wages correspondingly reduced. This is no way to run a railroad, Mr. Speaker, to downgrade the whole operation.
We find the railroad that was originally set up to carry goods and people back and forth across Canada now engaged in the money lending business, the ultra high rise business and hotel business. It is a bad employer, too, which it has no right to be. A few moments ago the hon. member for Moncton (Mr. Thomas) spoke about the pension problem. This is a matter which was brought to my attention soon after I became a member of this parliament. I learned that the pensions paid to railway employees in this country were absolutely disgraceful. We must ensure that this situation is remedied, Mr. Speaker. Meantime, we await with interest the report of Mr. Justice Hall. If it meets the situation of the employees, I assure you I will give it my full support.
In my naivete, also, I like to think that although there have been a good number of speeches on these amendments, and although there has been repetition about diversification, the proper functioning of the railroad, highrises and so on, these repetitions will persuade members of this House to support these amendments and have non-railways functions removed from this particular part of the bill. These repetitions may well serve the purpose. Perhaps a "once over lightly" touch is good for eggs, but not for railways. Let us hope, at any rate, that some of those who for one reason or another-or for lack of reason-would normally support this bill in its entirety, or this particular clause, will, either because some particular reference has struck home, or as reasonable beings, as railroad users, as the children of railroad users or, finally, as the representatives of retired railroad workers who receive letters complaining about the deplorable pension situation, support this particular amendment.
For these reasons I chose to stand up and make a few comments today in support of these amendments. I did this so that the CN can concentrate once again on its primary purpose, namely, that of moving goods and people across the country, since the railways should serve as a sort of unifying force, and provide, perhaps, certain associated services, but keep off the "pie in the sky" kick.


Mr. John Harney (Scarborough West):: Mr. Speaker, on second reading of this bill I discussed the CN tower in Toronto and suggested that that tower is being built not as a communications project, but as a PR project. Without doubt, the citizens of Toronto did not notice the tower when construction first began. Since then, newspapers in Toronto and newspapers serving other parts of Canada have been publishing photographs showing the height of the tower on such and such a day or in such and such a week. I admit that it is an imposing structure. Indeed, anyone who at the beginning opposed its construction will think it not simply imposing, but browbeating.
We know how difficult it is to resist hoopla. The construction of the CN tower in Toronto is the single largest act of PR hoopla we have seen in this country for quite some time. I do not think CN needs the tower. Actually, CP decided it did not need the tower. Let us not forget that originally the tower was supposed to be a combined
Canadian National Railways and Air Canada project. At any rate, CP felt that it did not need the tower and did not need to spend money on the tower.
I suggest, as I suggested on second reading, that CN had in mind much more than a mere tower when it decided to build that monstrosity. It wanted to swing public opinion in the Toronto region behind the metro centre project, which is the major project in the area, not the tower. The tower is simply the most evident part of the project. It serves as a lever on public opinion. Standing there, it says to the public, "Look at what CN can do for you, in building this tower. It will give you, the citizens of Toronto, the tallest tower in the world." As the hon. member for Saskatoon-Biggar (Mr. Gleave) suggested some time ago, it will be the tallest tower in the world until somebody, somewhere else, builds a taller one.
CN and CP have put a lot of pressure on the city of Toronto to develop the area south of Front Street in the way CN and CP want the area developed, which is not necessarily the way which will serve the interests of the people of Toronto or of the southern Ontario region. That is why I was afraid of the tower and opposed its construction. I felt it would be used as a PR lever; indeed, that is happening today.
In a way, the tower is symbolic of the approach of the CNR to the people of Canada and, indeed, to the members of this House. There are perhaps more shuntings in the CNR approach to parliament than you will find along CNR tracks. Members of this House today have tried to stand up and say how they feel. The railway companies of this country have been making a mockery of the original intentions behind the acts incorporating those railways. Time and time again, we have had reason to say that the interests of the people of this country have been let down. We speak of Canadian National Railways. Let us look at that name. We all know of the wag who once said that the Holy Roman Empire was neither holy, nor Roman, nor an empire. It is beginning to look as if the CNR is not going to be a national railway, in the sense in which that term was originally used.
It is not too often that we, in this House, stand up and compliment bodies set up by this House for their decisions. I was pleased to receive today, as I am sure other hon. members were, the report of the Railway Transport Committee of the Canadian Transport Commission in the matter of Section 260 of the Railway Act, and in the matter of the applications by the CNR and CPR for the discontinuance of certain passenger services across Canada. Certain regions need to be served by the railways in their passenger carrying capacity. Despite this obvious need, the railways have had the gall and audacity to apply for suppression of these services. I am, therefore, pleased to read part of the decision and order of the Railway Transport Committee. It felt that there was an overriding claim on the part of the public, a claim overriding the specific and special interests of the railways. After taking into consideration the major arguments of the railways, the committee decided to turn down the application.
May I read into the record the last paragraph of the decision of the committee, as follows:
Many of the services under consideration in this Decision carry relatively few people, and, in all cases, these services operate at a level well below their capacity. This is primarily because of the marked

January 8, 1974
Canadian National Railways and Air Canada
preference of the travelling public for the private automobile, and also because, in most instances, alternative means of public transport are available. But-
This is a very important "but".
-in considering the future transportation needs of the areas affected at this time, the Committee must take into account the probability of future changes in established travel patterns in Canada because of the looming energy crisis, and must see how change affects the demand for the services under review in this Decision, before considering the discontinuance of any of them. The Committee determines that these services should not be discontinued.
At long last, we are beginning to see some light at the end of the tunnel. The committee has been made painfully aware of the situation which looms before us. It calls it the "looming energy crisis". It is obvious to the committee, as indeed it should be obvious to the railways and as it is certainly obvious to most thinking people in Canada, that one of the most economical ways in money terms to transport passengers is by railway.
I know many members have travelled to other parts of the world, certainly to Europe. They have admired, and possibly even envied, the rail service offered to the people of Britain, Germany, the Netherlands and so on. If you stand in the station of Frankfurt, you will see hundreds, indeed thousands of people filing through that station, not just at rush hour, but at all times of the day. One thing that impresses most of us in this House about European railways is the scheduling. There are trains leaving for all parts at almost all times of the day. I wish to point out that it is not the presence of the passengers that causes the schedule to be so extensive, but the other way around. The fact that the schedule is extensive and does provide service attracts passengers to the railways.
One of the gambits the railways have used over the past few years in Canada to prove to this House that railway operations are not profitable has been to point out that they are not used by the Canadian public. One of the ways they have made apparent the railways are not being used has been by simply driving people away from using their services. In major ways, they have done this by cancelling trains, cancelling services, by making the simple act of getting a ticket at a railway station extremely frustrating or making the problem of getting from the railway station to one's home a difficult one, if not impossible.
I know that members of this House have had the good fortune of going to Montreal, but the misfortune of landing back at the Ottawa railway station. Just the other night I came back from Montreal along with a fair number of passengers. I had to wait outside the CN station in the cold for well over half an hour around the hour of midnight to be transported from the railway station to my home by taxi. I was not alone. A half hour after the train arrived, there were still 22 people waiting for a taxi. The reason the taxi service is so bad is there is a franchise or monopoly handed out by CNR to a particular service in this city. I must say the service is abysmal. It is almost as abysmal as the service we get at the airport here in Ottawa.


Alfred Pullen Gleave: That bad?


John Paul Harney: I wish to point out to the hon. member for Saskatoon-Biggar (Mr. Gleave) that it is terrible.


Mr. Basford:: City Council just turned down a request for 100 more taxis.


Reginald Francis Stackhouse: We need more free enterprise
competition.


John Paul Harney: The hon. member for Scarborough East (Mr. Stackhouse), the constituency cheek by jowel to mine, says we need more free enterprise competition. At that level, by all means. I agree with him. When it comes to running taxis, we socialists have no intention of taking them over.


Mr. Paproski:: That's a surprise.


John Paul Harney: I am simply trying to underline the point that in almost every way the railways are trying to chase people away from their services in order to prove that people do not want them. I doubt whether that is truly the case. I am convinced the people of Canada would be more than willing to use the railways if they provided adequate service.
A few days ago it was reported in the Globe and Mail that a study which had been made indicated that a rapid transit service could be provided from the centre of the city of Toronto to a point 20 miles east at a cost of approximately $100 million. That may sound like a staggering amount of money, but when you consider that this $100 million is for the total cost including setting up new grade levels, new approaches, building stations, refurbishing the tracks, setting up a new signals system, providing for rolling stock and so on, you discover that is not an awful lot of money. Twenty miles for $100 million is really quite cheap when you consider that expressways cost $24 million per mile. To build the same expressway facilities over the 20 mile stretch would, by simple multiplication, cost $480 million. The service provided by the expressway system may not be as fast, efficient or safe as that provided by local surface rail service.
The same article pointed out that CNR was not necessarily ready to make the right of way available for mass urban transit because it had other priorities to consider. It had priorities given to it by the statutes of this parliament and other priorities established over the years. The first priority was intercity travel. The second priority was the carrying of industrial freight, that is service to industry. Somewhere down at the bottom of the pile there was perhaps a priority, or at least a notion, which would indicate the railway had some duty toward the transportation needs of our urban populations.
If that is the case, I would like to ask where in the statutes of this country we will find the priority for real estate. I do not think we will find it. Originally, it was understood that hotels could be built to service the public travelling on the railways. However, as the railways are proud to point out, there are now very few people travelling on them. What justifies their massive interest in real estate? I suggest the very least we can do is re-inspect the priorities we have given to the railways and tell them there is indeed a very real need for the use of their tracks,

lights of way facilities, station facilities and so on by the urban travelling public in this country.
As I said a while ago, I was delighted to read the line in the transport committee report about the looming energy crisis. It should be obvious to even a beginner in high school that one of the cheapest ways to transport people over distances, long or short, is by rail, whether you calculate it in terms of kilo-calories per passenger mile or any other way.


Leslie Gordon Benjamin: How do you spell that?


John Paul Harney: M-i-l-e. There is no doubt that the most efficient use we can make of energy when it comes to transportation is through rail traffic.
Another aspect of energy conservation occurs to me. We shall need to decide very soon how the fossil fuel supply in our possession can best be used. It is obvious there are certain very inefficient ways of using it; for example, using fossil fuels, oil, let us say, to produce thermal electricity which has an end use of heating buildings is terribly inefficient. There is scarcely a thermoelectric plant which can produce electricity at an efficiency greater than 40 per cent. What we should try to do, therefore, is use fossil fuels for purposes for which other fuels are not practicable. Certain types of transportation vehicles must carry their own fuel along with them; long distance traffic could not be tied to hydroelectric wires, and neither could automobiles. Trains, on the other hand, can operate electrically with great success.
Again, if we turn to the European example we find they have managed to electrify thousands of miles of railway line. Here in Canada I doubt whether there are any lines which operate electrically. This was not always the case. We used to have electric trains, and I do not mean toy trains, either. A few years ago I was living in the City of Guelph, and at that time they were just about to extend highway 401 so it would reach Guelph. I remember saying to an old resident: Isn't it great to know that as soon as they build the 401 to Guelph you will be able to get to Toronto in an hour or an hour and ten minutes? He said: Maybe, but 50 years ago we could get there in 55 minutes. And how did he do it? By means of the electric railway which served Guelph, Barrie and other places on the line. The Minister of Transport (Mr. Marchand) says a commuter rail service is to be established between Richmond Hill and Toronto. I can, myself, remember taking a train between Quebec City and St. Anne de Beaupre. It was an electric train, a very good, fast train and I am sure it made very efficient use of the hydroelectric power produced in the area.
People have been talking lately about developing rail service in this country, particularly for rapid transit use, and there has been a tendency to talk in Flash Gordon terms about the facilities we ought to install. The Prime Minister of Ontario has proposed an elevated linear-motored railway of European design for Toronto. The design has not really been tested yet, so there is a proposal to test it at the CN Exhibition within a year or so. All kinds of machines are tested on exhibition grounds. Ferris wheels and roller coasters are tested there and they work
Canadian National Railways
very well, but I doubt that the context of an exhibition will give us any real opportunity to test the workability of this futuristic and questionable design. On the other hand, there is much experience from years past of the efficient use of light rail traffic, and we do not need to go very far to re-establish the use of this kind of traffic along rights of way which serve urban populations.


The Acting Speaker (Mr. Laniel):: I regret to interrupt the hon. member but the time allotted to him has expired.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Laniel):: 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 Winnipeg South Centre (Mr. McKinnon)-Urban Affairs; the hon. member for Nickel Belt (Mr. Rodriguez)-Immigration; the hon. member for Dartmouth-Halifax East (Mr. Forrestall) - Labour conditions.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of Bill C-164, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, as reported (with amendments) from the Standing Committee on Transport and Communications, and motions Nos. 1 and 2 (Mr. Blenkarn).
Reginald Francis Stackhouse: Mr. Speaker, the key word in this debate is surely the word "priorities". The question is not whether the railroad should be erecting and maintaining hotels; it is not whether the railroad should be erecting and operating a communications tower. The question is this: what does the railroad value most? What does it regard as its chief social obligation? It is clear from the debate which has taken place that hon. members across this country from one coast to another, the representatives of the people, are not convinced that

January 8, 1974
Canadian National Railways
this national railway is putting people first. It is clear that service to the people does not enjoy the priority we expect it to be given. Instead, we find the thinking of the executives of the CN is dominated by what might be called a "monumentality"; it is striving to erect a monument to the system itself rather than using available resources to develop the services which our society urgently needs.
As one thinks of what the spokesmen for the railway had to say when defending the construction project one is reminded of the movie, starring Charlie Chaplin a generation ago, called "The Great Dictator". Chaplin and Jack Oakie played the parts of Hitler and Mussolini and in one scene they were seated in two adjacent barber chairs. First one jacked up his chair, and then the other, until finally each of them was hitting the ceiling. We get the impression that executives are motivated by a desire to erect a building higher than those possessed by their rivals. What we are criticizing is not the construction of a hotel or a communications tower but, rather, projects which take first claim on the resources of the railway company at a time when the primary need is the service of the people, particularly the improvement and introduction of rapid transport facilities in major urban areas such as Metropolitan Toronto.


Some hon. Members:: Hear, hear!


Reginald Francis Stackhouse: It is more in the interest of the ordinary person in Toronto that the rights-of-way entering into the heart of this massive metropolitan area be used for rapid public transit than resources be committed to some tourist attraction. The proposed tower may become an interesting construction which many visitors to the city will enjoy seeing; they may derive a certain pleasure from eating pie in the sky in a revolving restaurant a thousand feet above ground, but the real need of the working people is for efficient, rapid transit within their financial capacity.
Within the Toronto area there is mile after mile of line which could be used in this fashion. Indeed, a report of the CNR recently issued indicated it was possible to adapt a right-of-way for rapid transit purposes, connecting Toronto Union Station and Pickering, a distance of 20 miles, at a total cost of only $100 million. This averages out at $5 million per mile, in contrast to the $24 million per mile proposed for the Scarborough expressway. If this project is feasible, and according to the research study made by the CNR it is, surely it is incumbent upon all authorities concerned, including the railroads, the federal government and the local authorities, to give such construction priority. That is the purpose of this debate. It is not that we are against anything as much as that we want a reallocation of values. We want a renewal of the policy that puts people first, of the policy that asks what it is that people in this area require most.
What can be said about the needs of the people of metro Toronto can also be said of the needs of people in communities right across this land. One of the things that disturbs me is the lack of initiative being shown by the government in regard to meeting the needs of people in the various urban centres of Canada. For years now the

CNR has financed the deficits that have been incurred by the commuter service into the city of Montreal. For example, in 1970 the CNR had to pick up a deficit of $2.1 million. In 1971, the deficit was $2.2 million and in 1972 it was $2.4 million.
I do not criticize the CNR for picking up these deficits in operating Montreal commuter trains; I think the commuter service into Montreal is a fine one that meets the needs of a vast number of people. If the CNR were picking up the deficits of a commuter service into Toronto, then I expect a lot of people would object. From all corners of the country as well as from all corners of this House, we would hear words of protest. But here is something being done to meet the needs of people living in a major metropolitan centre of Canada, and we would like to see the same kind of initiative being taken both by the company and the government to meet the needs of vast numbers of people in other centres who are trying to make their way to work and home again day by day.
Fortunately, the federal government is at last shaking itself out of its lethargy on this issue. We recently had an announcement regarding partial federal financing of a commuter train service from Richmond Hill to Toronto. However, I note that the maintenance costs of that service will be have to be borne by the Ontario government, including all deficits. In this regard we would like, first of all, to acknowledge the initiative that the federal government has shown, but we would go on to ask, does the government have to stop there? Although it may not be too little, too late, it is certainly too little in light of the needs of today's society.
What bothers me is that day after day the Minister of Transport (Mr. Marchand), when asked serious and practical questions by members of parliament, stands up and defends his lethargy by saying that he has no real influence over the CNR. I point out that the CNR is totally owned by the people of Canada, and the minister, as spokesman for the people of Canada, surely has a responsibility to get the CNR to take action. Expressways and city streets are clogged with cars and trucks day after day and can rightly be described as the largest parking lots in this country. On the other hand, vast railroad rights-of-way are lying empty. Thus, we wonder at the lack of initiative on the part of this so-called Minister of Transport. We would say to him that, good as this gesture of assistance to metro Toronto is in terms of the Richmond Hill-Toronto commuter service, it is not enough for the people of the area. Certainly, it is not enough when we add up the needs of communities in every province in this country.
I would couple with this the need for the railroad itself to begin again to give priority to the provision of passenger service. One of the things that impressed me from reading the opinions of railroad executives was the way in which they seemed to be rather unhappy about having to carry passengers at all, and on those occasions when I have travelled by train I have been impressed by how fitting their opinions have turned out to be. If the railways say they simply want to carry freight, they sometimes give me the impression they are treating people like freight. There was a time when riding on a train was a reasonably pleasurable experience. Now, you cannot even get a decent
January 8, 1974

meal on a train or find a railway journey that is enjoyable. In this time of crisis we would submit to the leaders of the government and the management of the railroad companies that it is absolutely imperative to begin to give priority to railroad passenger service once again.
I say that for three reasons. First of all, there is a pollution crisis in our cities through over-use of gasoline powered motors. For example, in the United States the environmental protection agency has ordered that all cities in the U.S. reduce hydrocarbon emissions by 93 per cent by the year 1977. Pollution has reached a critical stage and we must liberate ourselves from our dependency upon gasoline powered motors.
My second reason is congestion. In metropolitan Toronto alone there is a concentration of 850,000 motor vehicles, about one for every 2.3 persons in the urban area. This degree of congestion is strangling metro, as it is strangling every urban community in North America.
My third reason is allocation. We have been presented with a bill that calls for the appointment of an energy allocation board. This legislation purports to set up an agency to allocate energy according to need. I should like to use this word "allocation" in order to focus the attention of the House upon the need to allocate transportation services to the end that we will have adequate railroad services which will liberate us from our dependency upon motorcars, upon expressways, upon the kind of transportation facilities that today are polluting our cities, congesting them and making us overly dependent upon oil resources.
Therefore, we urge the CNR and all of the railroad companies in the land, along with the government, which surely has some responsibility here, to give priority to people in this country, and to see to it that the railroads offer them the opportunity to do something serious and creative in the urban communities in this land. These communities are presently facing a transit crisis, but these communities can find a solution to this crisis if railroad rights-of-way are used to their maximum potential. Therefore, instead of giving priority to the development of new tourist attractions which the people may or may not need, we wish the CNR would give priority to working out with the provincial and local authorities, with the encouragement and support of the federal government, ways by which existing railway tracks and rights-of-way can be utilized for rapid public commuter transportation which would free our great cities which are now in danger of strangling to death.


Mr. Fred McCain (Carleton-Charlotte):: Mr. Speaker, there is one thing about this debate that is more notable than any other, and that is the absence of the Minister of Transport (Mr. Marchand).


An hon. Member:: His parliamentary secretary is here.


Fred Alward McCain: From what I have seen of the presence of parliamentary secretaries it would lead me to believe this is a courtesy extended to the opposition, but their voices have not been very loud. If their conversations behind the curtains are the same as their statements in the House of Commons, or if there is no difference between their words
Canadian National Railways
behind the curtains and their words in caucus, then their voices are not well heard.


Mr. Guay (St. Boniface):: On a question of privilege, Mr. Speaker. The hon. member does not know what he is talking about and that is obvious. In addition, he is certainly not speaking on the subject before the House at the present time.


Fred Alward McCain: We have both expressed our opinion, Mr. Speaker, so we will let the matter stand there.
We are talking about transportation and amendments to this bill. During the discussion of this bill in the committee and in the House, a wide range of policy needs have been expressed by members interested in the subject of transportation in general, with air and rail transportation being the principal subjects. There has been a very distinct attack on the transportation system in Canada by those who have studied the system, by those who have used the system and by those who have written about it.
Let us look at the press of December 24, where we find a report that the Deputy Minister of Transportation has indicated that governments will have to decide how to make the most efficient use of fuel, money and the facilities of transportation. Members of this House have stated time and time again that one of the building blocks, perhaps even the cornerstone of our economy as we move from sea to sea, is the transportation facilities with which we are provided. Inasmuch as the Canadian National Railways and Air Canada are government owned in their entirety, it becomes the responsibility of government to see that these services are rendered in the interests of the public.


Some hon. Members:: Hear, hear!


Fred Alward McCain: Certainly, we can find fault with individuals in the administrative staff of Air Canada and individuals in the administrative and operating staffs of the railroad. We can cite instances where individuals have not served the public as public servants should, but the whole blame in respect of poor administration can be clearly and squarely laid on the Minister of Transport and the government of which he is a member. That burden of responsibility has been shrugged off with a degree of irony and sarcasm. We have seen reports submitted to the minister in respect of the needs of this nation, and I suggest the responsibility rests with the minister, yet he has not spoken, nor has anyone else on the government side, in a responsible way about these needs.
Let us take as an example the meeting which took place in Nova Scotia more than a year ago. A report in respect of this meeting appeared in the Chronicle-Herald of January 7, as follows:
More than a year ago, a transportation "crisis" seminar was held in Wolfville, following which the sponsor, the Annapolis Valley Affiliated Boards of Trade .. . pressed Ottawa and the provincial governments for a better deal in transportation. High on the list of recommendations was boosted subsidy rates to assist Atlantic businessmen.
That sparked a meeting between the Council of Maritime Premiers and Transport Minister Jean Marchand last April, at which time it was proposed that subsidies on westbound goods would be boosted.

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Canadian National Railways
This meeting was in April, and the date of commitment was January 1, we presume of 1974 although the article does not say so. The article continues:
Atlantic-area residents, weary of decades of pleading for more help and less hinderance from Ottawa in the East's bid for a fair and just transportation deal, can only hope that the federal government will be just as slow to approve freight rate increases as it has been to grant better subsidies.
The effect of any subsidy is apparently again to be wiped out, because we find that the railroads are now asking for a substantial increase in rates, as high as 33 lA per cent in some parts of Canada. We find also that there is considerable concern about safety on the railroads. In 1959, there were 40 trains which went off the tracks. In 1969, the total had climbed to 69, and in 1972 it jumped to 132. This, then, became the subject of a board of inquiry under the Canadian Transportation Commission. Again, I submit that this is one aspect of the matters with which this bill deals. It deals with money to be spent for facilities in transportation, and safety is a very vital area in which money should be spent. The report of that commission suggested a slowdown for trains using existing tracks. I ask what this will do to an industry which is already short of cars? What will this do to a country which is pleading for a better transportation system, more efficient and faster movement of goods across the country?
The policies of this government, as embodied in the 1967 act, have permitted a decline in the safety of railways to the point where accidents have increased from 40 in 1959 to 132 in 1972. The government has sat idlely by while the railroads have reduced their maintenance staffs by roughly 80 per cent from what they were 40 or 50 years ago when trains were moving slower and hauling smaller loads. There is reference in this report to the inspection of the tracks. This inspection was carried out on a daily basis as the crews went back and forth on their little cars. The tracks were inspected superficially by eye, and the crews stopped for a closer inspection where necessary, using the appropriate tools. Today, it may be weeks before a maintenance crew ever sees a piece of track. Of course, there has to be an inspection survey, but what has been the result of the cut in the work force?
Just a matter of weeks ago, I was talking with a friend of mine who happens to be a reasonably senior engineer on one of our rail lines. He told me that if he knew any other way to make a living he would get out of his engine. He said that the safety precautions on the railway were so much poorer than when he started some 20 years ago it was shocking. He said the only reason he did not get out of the service was that he had so much invested in his pension, such as it is, he could not afford to quit. After many years of service his opinion was that the application of safety measures had deteriorated.
Under this government, and under the 1967 act as administered by the CTC, we find that the application of safety measures has deteriorated in a frightful way, detrimental to the best interests of Canada. There is only one group of people responsible for that situation. The president of the CNR is not entirely responsible: it is the policy under which the government has allowed the CNR to operate; and it is the ministers, not just the Minister of Transport (Mr. Marchand) but all the ministers in the shuttle service that has been provided by the Prime Minis-

ter (Mr. Trudeau) and by the Minister of Transport. That shuttle service has included several ministers, and they are all jointly responsible for this decline. It is detrimental to the safety and the economics of this nation. Let us put the blame squarely where it belongs-on the shoulders of the government, the Minister of Transport and the Prime Minister.
All these little side efforts of the CNR give me great concern. I am concerned because the tower that is now being built in Toronto was initially intended to be a joint project: it was to be a CP-CN structure. We already have co-operation and joint ownership of a communications system in this country with CN-CP stockholders. Why did the CPR not want to participate in investment in the tower? Why did they accept other real estate opportunities rather than invest their money in the tower? One can only guess that the answers were not forthcoming when this bill was investigated in the committee. I think one must assume, from the lack of information, that we have put ourselves in a position of commitment with respect to the tower, that it was not to be as profitable as was suggested by some and that CPR found it more advantageous to invest money elsewhere or accept other land development opportunities. This is what one would normally assume. If that is not the case, then let us have an answer. Why did they get out? The answer was not forthcoming.
We have had car shortages in the lumber industry, the grain industry and in agriculture in general. We have had difficulties in the transportation of fertilizer, to name but a few products that have had a squeeze. This squeeze did not come upon us without statistical evidence being relayed to the government to indicate that it was about to happen. Wc have had an increase in tonnage handled and cars loaded in the rail structure of the country over the years, and at the time that increase in loading has been taking place there has been a decline in the number of cars available for the railroads to carry the increased load.
The statistical evidence is available in the various documents presented to the committee, and in other locations as well. Why would any government allow a decline in the carrying capacity to take place on an annual basis when the load requirement was increasing on an annual basis? It is all right to say that the wheat and lumber movements were unusual, but the railroad has to base its operation on the long-term average and the anticipated increases which accrue in the business of this nation. An intelligent government would have ensured that the CNR was following the direction of the statistics and was prepared to accept the extra burden of transportation which inevitably was to come upon it. It is not unusual for transportation or any other industry to run on a cyclical basis, and I do not blame management; I blame the government for the fact that this cycle could not be met.


Some hon. Members:: Hear, hear!


Fred Alward McCain: The ordinary course of events would have led the government in a different direction had it taken the care to take a look at things. One of the things about the system under which we operate is that the National Transportation Act of 1967 was supposed to set us up in a
January 8, 1974

competitive business so far as transportation is concerned.
I am quite prepared to accept the fact, as has been pointed out in particular by members on the extreme left of this side of the House, that there are some debt problems so far as CNR is concerned. But when we make this allegation I wonder whether we should not at the same time take a look at the bonded indebtedness of the competitor. If the CNR is not competitive with the CPR, the government should correct that situation. That is the first thing. Second, the government should say to the management of CNR, "Moneywise you are competitive. Now get to the business of hauling freight, and make it competitive."
The CPR has no competition. There is no point in blaming the CPR for what is happening. It is this government's administration of an enterprise which makes it unnecessary for that structure to be competitive and to seek out new business. This is the burden which has been loaded on CNR management. If it is unequitable and unjust, then the government, as the owner, should put them in a competitive position and say to them, "Gentlemen, get out and do the business as any businessman would." The government cannot compete in the free enterprise world if it cannot make a profit. Let us set up a financial structure in the CNR so that it is competitive with private enterprise. At the moment the structure is such that any user of the rails is paying the maximum tariff that his commodity will bear, and in some instances more than it can bear so that he is forced to disappear from the business world. If you look at the rates in eastern Canada, for instance, in the movement of grain you will find that grain is being moved on ton-mile rates which vary by 300 per cent.
I am not referring to western grain, but there are areas of surplus grain in this country. It is not competitive for the producer or for the railways, and it is just convenient for the railways to extract from that commodity, in certain locations in Canada, three times as much tariff as it is extracting in other areas. That is the type of management which the government has tolerated in the industry which it owns.
We find ourselves in an energy crisis, and without a policy in transportation which would show any awareness of energy savings that can be made. There has been no policy statement to indicate that transportation can be used in such a fashion as to conserve energy and, as the previous speaker said, to extend our petroleum reserves for as long a period as possible. There has been no such policy from the Minister of Transport, the Minister of Energy, Mines and Resources (Mr. Macdonald), the Prime Minister or anybody else. But there is a policy to build a tower, to refurnish hotels-and now we are asked to approve the unrelated expenditure of money under a transportation bill.
This morning I had a call from a dealer in grain in eastern Canada. On December 10 or 11 the subject of grain was raised in the committee when it was discussing the financing of the CNR. We were assured in the committee that the problem would be resolved. A meeting was held in the maritime provinces on December 17, if my memory serves me correctly. The Wheat Board representatives, the feed grain board representatives, feed purchasers and railroad officials-all the people interested in the transportation, provision and consumption of grain were there. But
Canadian National Railways
the call I received this morning told me that there are cars of grain, for which orders have been accepted, which have not moved since December 21. I am told that the grain available will be delivered irrespective of grade, and that the customers must accept the substitution which the Wheat Board wishes to impose.
If our transportation system is to be planned as the Wheat Board plans it for this kind of mix-up, then it is high time the government took a hand and found out what policy is necessary, because friends of mine are moving grain back and forth, trading it back and forth within their own mills so that those mills can continue to operate.
Even after the promise made by various cabinet ministers that this problem would be corrected forthwith, and even after the meeting was held in Moncton and assurances were given that the problem would be corrected, the problem is still acute in some areas. True, there has been an improvement. I can say this to the minister responsible for the Canadian Wheat Board, and to the chairman of the Canadian Wheat Board; but there is still much to be desired when a car of grain has been on order since December 21 and it has not yet rolled away from the elevator. That is a long while for a chicken to wait for feed. For once I can agree with the hon. member for Saskatoon-Biggar (Mr. Gleave). It is high time we had a definite government policy on transportation.


Mr. Speaker:: Order, please. I regret that I have to interrupt the hon. member, whose time appears to have expired.


Henry Perrin Beatty: Mr. Speaker, as I look around this chamber it is worth noting that the only members of the cabinet here to listen to this debate on the CNR financing bill are the Minister of Veterans Affairs (Mr. MacDonald) and the Minister of State (Mr. Haidasz), who is responsible for multicultural affairs. I appreciate that the Minister of Finance (Mr. Turner) and the Minister of Transport (Mr. Marchand) might not want to show their faces around here when this kind of legislation is being debated. I suppose I should not speak ill of the two ministers who are here: there is no doubt in my mind that the Minister of State knows at least as much about transport as the Minister of Transport.
My reason for speaking on these amendments is my belief that before the Canadian taxpayer is asked by the government to support CN hotels and grandiose projects such as the CN tower, he should at least be entitled to decent transportation provided by the CNR. My party's position on this is quite distinct from the position of the other two parties. The Liberals argue that whatever the management of CN wants to do is all right with them, and the NDP complains that CN has so badly served Canadians in providing such poor rail service that it should be given even more public money to waste on hotels that run into the red and on obscene monstrosities such as the CN tower. Our position is that until CN can do a decent job as a railway, its management should not be allowed to indulge in empire building in unrelated areas.

January 8, 1974
Canadian National Railways
I regret that the hon. member for Regina-Lake Centre (Mr. Benjamin) is not in the chamber. I could not help but feel a sense of wonder and awe as I followed his agile mind at work last night. He complained about the CN board of directors, he complained about the problems of the western farmer in getting proper service from the CN, and he complained that the railway does not meet the transportation needs of the people. But what was his answer to the problem of inept public management of this company? It was that the government should take over CP rail as well.


An hon. Member:: Hear, hear!


Henry Perrin Beatty: wonder whether I might be permitted to share with the hon. member who said "hear, hear", and with my other socialist friends, a story I heard recently that illustrates the sort of logic that the hon. member for Regina-Lake Centre uses when he says that the answer to the problem of too much socialism is more socialism. The constituency I have the honour to represent is largely rural. It contains some of the finest agricultural land in Canada. The eastern part of it, in Dufferin county, has considerable potato production.
The story is told about a couple of city slickers who decided that they would come up and make a quick dollar from the potato farmers in Melancthon township. The two were a father and son team from Toronto by the name of David and Stephen. They got in their truck and drove from farm to farm, buying up large bags of potatoes at $5 a bag until their truck was full. From there they drove into Shelburne, one of the local small towns, parked on the street and sold their potatoes for $5 a bag to the town's residents. Before long all the potatoes were sold, and they went home for the night. The next day they drove up again to Dufferin county and proceeded to buy potatoes at $5 for a big bag until their truck was once more full. Then they drove into Orangeville, where they parked on the side of the road and proceeded to sell their potatoes for $5 a bag to the local residents. By the end of the day all the sacks had been sold. After they had totalled up their earnings for the day, Stephen turned to David and said, "You know, dad, we haven't been making too much money on this deal." To which David replied, "You're right. I've been thinking about what we have to do about that. I've decided it's time we got ourselves a bigger truck." That is an example of the sort of logic employed by my socialist friends who claim that when the government has botched things up the only solution is to give the government more power.
I come from a constituency that has been ill served by the government and by the two railways. The private company would rather haul garbage than people to my area, destroying prime farmland in the process. Both it and the CNR have discontinued passenger service to my area, so that today not one passenger train passes through it. The effect of the discontinuance has been damaging to the development of the small towns which depend upon decent transportation for their survival. Many of our senior citizens have been trapped, unable to visit family and friends outside their home towns.

Each member of parliament from the area has had numerous complaints about the failure of both companies to keep their fences up and the weeds in check. But the answer of the railways is to strip back the number of section crews and the equipment those hardworking men need to do a proper job. In the meantime roadbeds are allowed to deteriorate to the point where trains have to be run upon them at reduced speed for safety. We have already reached the point where passenger service could not be restored without rebuilding vast stretches of roadbed in the area. And what is the answer of the government? It is to ask the Canadian people to spend their tax money subsidizing CN management's edifice complex while the area goes begging for decent treatment from the railways.
Repeatedly the people of my area have asked for help from the federal government, and repeatedly they have been refused. Even when the Standing Committee on Transport and Communications, which at the time had a Liberal chairman, a Liberal co-chairman and a Liberal majority, unanimously recommended in June, 1972, that service be restored, the government simply refused to act. When he was asked in this House what action he was going to take on the matter, the Minister of Transport, who confused the problem of the area with that of commuters trying to get to their jobs in Toronto, equivocated, stalled and talked of negotiations with the government of Ontario, or of local participation in the formulation of policy as requested by the municipalities.
He then simply conducted a local Gallup poll that completely bypassed municipal governments. And after claiming in the House yesterday, "I have received a report and it has been communicated to all interested parties", he disclosed that he suppressed the report for over a month, maybe because he does not feel that the local members of parliament, the affected municipalities, the chairman of the Standing Committee on Transport and Communications and the people of the area involved are interested parties.
Yet with this sort of record the government asks for the support of this House to give even more money to the CNR for projects that have nothing to do with the company's primary function, namely, running a railroad in an efficient manner. Mr. Speaker, the minister did not want to be made Minister of Transport. The Prime Minister (Mr. Trudeau) gave him his present portfolio after he had dropped the ball so badly as minister responsible for DREE and as campaign manager for the Liberal Party in Quebec that he had become an embarrassment to the government. If the minister still does not want this department, or if he is simply incompetent, then surely the people of southwestern Ontario should not be burdened with him. The Prime Minister should relieve him of his present responsibility and appoint him to the Senate where he can join the host of Liberal bagmen and campaign officials who are already working on the next election campaign at public expense. At least if he were in the Senate he could do no more damage to the people of my area.
The people of southwestern Ontario are a hardworking, industrious and independent group. They do not ask the government for hand-outs but they do believe that they
January 8, 1974

are entitled to the same sort of treatment from the government and the CNR as they would receive if they came from the Minister of Transport's riding. And they do not believe that their tax money should be going to subsidize hotels and CN towers until they have received the kind of service they deserve right now from the government and the CNR.


Mr. A. D. Hales (Wellington):: Mr. Speaker, the amendment before the House deals primarily with priorities in the expenditure of money by Canadian National Railways. The amendment states that money should not be appropriated for the building of CN towers and hotels.
Keeping in mind that the amendment relates to priorities and spending, I should like to say a few words about the participation of CN in the GO commuter service. I was delighted to learn yesterday that the government had agreed to give $13 million toward the operation of this service between Toronto and Richmond Hill. The province of Ontario has already agreed to operate a GO service between Toronto and Georgetown, the latter being 20 miles from the city which I have the honour to represent, namely, Guelph. The city of Guelph has a population of some 66,000 people. The present plan is to terminate the GO service at Georgetown and take the people by bus the 20 miles from Guelph to Georgetown. I do not think it is a proper priority for the CNR to stop the GO train at Georgetown and ask people from Guelph to take the bus for those 20 miles and then transfer to the GO train to Toronto.
1 appeal to the CNR to extend this GO service to the city of Guelph for the following reasons: first, the track is already there and, second, the equipment will be provided; the staff will be provided and the general overhead will be more or less the same. There is a place in Guelph where the GO train could stay overnight. The trains are heated electrically, so that is no problem. They could start and finish at the city of Guelph as easily as they can at Georgetown. When they think of priorities, I would hope the CNR, along with the province of Ontario, would consider extending the GO train service those extra few miles to the city of Guelph. There is presently a CN train which leaves Guelph early in the morning and comes back at night, but I understand this train is to be taken off. I am pleased that the government has seen fit for the first time to give money to the GO commuter service in Ontario. This proves that the private member's bill which I introduced last July, an act to amend the Railway Act, which simply recommended that commuter trains should be treated like any other service for the payment of subsidies on losses, has had some effect.
Speaking of priorities, Mr. Speaker, the CN line from Toronto to Stratford and on to Sarnia needs greater attention. Between Christmas and the New Year that train came into the city of Guelph; it was composed of three rail-liners which are three self-propelled cars hooked together. There was standing room only on these three cars and about 75 people were waiting to board them at Guelph. Surely the management of CNR could see the need for proper equipment at peak times such as this. It is
Canadian National Railways
hard for people to understand why the proper equipment is not available.
If we are to help in the environmental problem and to play our part in fighting the energy crisis, surely the railways must realize that they have an important part to play as well. They must realize that the main lines of the railways are here to stay and must be maintained and kept in good condition both as to track and general equipment. This must be a top priority. But I would say, Mr. Speaker, that as far as the CN is concerned the matter of priority leaves much to be desired.
I close by saying what I said at the beginning. I feel that the GO commuter train service for all provinces in Canada should be subsidized for losses. I am happy to know that the government has recognized this need and has seen fit to help the Ontario line. I hope that assistance will be available for other GO line services in other large urban areas of Canada. In the particular case in which I am primarily interested, I hope the GO train will go the full distance and will give the people of Guelph the service to which a city with a population of 65,000 is entitled.
May I call it six o'clock, Mr. Speaker?


The Acting Speaker (Mr. Laniel):: Is it agreed that we call it six o'clock?


Some hon. Members:: Agreed.


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


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, in rising to speak on the amendments to Bill C-164, I wish to state that I am in complete agreement with the hon. member for Mississauga (Mr. Blenkarn) with regard to reducing expenditures by CNR and Air Canada. I submit that no money should be paid to Air Canada until MOT has conducted an investigation into complaints registered by employees, members of parliament and the general public and a report has been made to parliament.
If one compares Air Canada with other airlines one will see the the operations of Air Canada leave much to be desired. Air Canada's virtual monopoly of Canadian air travel creates difficulty in measuring its productivity. There are no available Canadian companies of comparable size. Delta offers an example of an airline of comparable size in the competitive U.S. market. The comparison is one of a monopolistic public airline versus a private airline in a highly competitive market.
Let us compare assets. Air Canada possessed more total assets than Delta. Air Canada had assets totalling $834,262,000, while Delta had assets totalling $780,706,000. In spite of greater assets, Air Canada had less operating revenues. Delta had operating revenues valuing $757,569,-
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January 8, 1974
Canadian National Railways
000; Air Canada's operating revenues totalled $583,272,000. Therefore, while Air Canada had $54,556,000 greater assets than Delta, it had $174,307,000 less in operating revenues. It is interesting to note that the advantage of Air Canada in total assets is not to be found in the number of aircraft. Air Canada possessed 102 aircraft while Delta possessed 138. More specifically, Delta had 22,105,725 available seat-miles while Air Canada had only 12,169,049.
If one compares expenses one will see that Air Canada incurred fewer operating expenses than Delta. Delta's expenses totalled $682,117,000, while Air Canada's totalled $537,770,000. Although Delta's over-all expenses were higher, Air Canada spent $2,975,000 more on general and administrative expenses and $8,448,000 more on promotion and sales. In the area of passenger service Delta spent $1,513,000 more than Air Canada. Therefore, while Air Canada spent more on administration, promotion and sales, it spent less on passenger service.
A comparison of productivity indicates that Air Canada experienced a yield of 6.02 cents revenue per passenger-mile while Delta managed a yield of 6.50 cents. Therefore, Delta produced 8 per cent more in revenue per passenger-mile. This was accomplished in spite of a 17 per cent lower passenger load factor. Delta was also more efficient in cargo. Delta experienced expenses of 22.20 cents per available ton-mile while Air Canada experienced 24.28 cents. An historical survey of these operating expenses reveals that Delta has held them at a more stable rate. Air Canada fluctuated from 28 cents in 1963 to 22 cents in 1971.
Also speaking against the record of Air Canada is the brief submitted to members of parliament by the Canadian Air Line Employees Association. This brief, in criticizing Air Canada operations, deals first with procedures. It says:
Airline procedures sometimes seem to disregard reality entire. For example:
(1)	It is unrealistic to believe that employees may use the public address system regularly to summon supervisors or other staff members while at the same time they refuse public requests for a page on the grounds that they are not permitted to page. The customer does not know that it is a supervisor being paged at the same time that his request is refused-and he probably would not care. The purpose of the policy is eminently reasonable-i.e. the inaccessibility of the PA due to public pages; the method used to effect some control is completely irrational.
(2)	Qualified ticket agents were permitted to handle only domestic tickets in some offices until an indefinite point in the far distant future when the supervisor decided to designate them "international agents''.
Also, the union claims that initiation of automated check-in procedures at some airports had made it impracticable to attempt to offer some services which were available under manual procedures. For example, a seat request might be accommodated under a manual procedure; the request would not normally be considered under one-stop check-in procedures. Unfortunately, none of the company manuals or local bulletins have reflected the inability of an airport to consider such requests. The CALEA brief also comments on facilities. Working conditions have been so bad at times that the staff have threatened to leave the premises. Recently, the following incidents, symptomatic of problems in offices across the system, have occurred:

first, the heat in a ticket office became so intense that the manager refused to work there and a customer fainted; second, the temperature in an airport lobby reached 34 degrees. The management personnel on duty refused to take any corrective action until the union threatened to withdraw the staff and a senior union officer was called to the scene.
Then third, staff have had to complain long and bitterly about the failure of cleaning firms to maintain the premises in a clean manner. Fourth, safety hazards, such as loose wires on the floor, have been permitted to continue in the face of formal protests. In one instance an employee was injured so seriously that he was off work for approximately two months before corrective action was effected. Fifth, a cashier in one busy airport has a cubicle which is completely open in the rear to a well-frequented corridor. Although this fact is easily discernible, management do not feel there is any cause for alarm.
Then sixth, a cash register was provided for a major ticket counter which was too small to handle the volume of cash over more than two to three hours. The cashier then had a choice-leave the cash drawer open with money bulging out, or stop serving the customers briefly while the money was transferred to a safe. Seventh, employee rest facilities are dismal for the most part. Washrooms tend to be tiny, dull and sometimes dirty. Lunchrooms tend to be poorly furnished. In some bases, even the larger ones, there is not even a couch available in case an employee becomes ill and needs to lie down. The recent renovations at the Calgary airport have virtually created a firetrap for Air Canada counter employees.
It is a temptation to continue to recite further examples of poor facilities. The inadequacies cover a wide range of possibilities, as the examples indicate. Under "staffing" in the CALEA presentation it is stated that demands for overtime coverage and greater productivity have increased. The amount of overtime required, particularly for IAM and CALEA personnel, is known to have exceeded the federal maximum hours permitted, yet to our knowledge no report has been sent to the minister as required by law. Because of these increased demands, staff in some areas are suffering from some degree of mental, neural and/or emotional stress.
Air Canada has no known method for staffing their ticket offices. Maximum staff is limited by the facilities themselves. Shifts and meal/rest periods are scheduled in such a way that the staff on duty is greatest during the periods of greatest demand, normally during the noon hour. There are no published standards or statistics available to provide such information as maximum desired waiting period per customer, actual waiting period per customer per hour over extended periods in the past, or anticipated increase in customer demand.
The CALEA brief also refers to standards of Air Canada. Air Canada establishes levels of service which may vary between locations, for example offices such as airport, reservations or ticket offices, or between bases such as geographic areas, usually an urban area such as Montreal. Budget requests for the staff required to provide the level of service deemed acceptable in each location are subject to approval from more senior levels of manage-
January 8, 1974

ment. It is not unusual for these requests to be refused and an arbitrary cut in staff ordered.
With regard to automation there is great frustration among Air Canada employees. This is particularly evident in the case of one-stop check-in at airport locations. The airline cannot emphasize too strongly the need for accurate passenger counts, both because of the economic need to fill its aircraft and the safety aspect which demands an exact computation of the weight and balance of an aircraft. The anticipated computer load figures become increasingly inaccurate as each day progresses because no attempt is made to update passenger records to release space on later flights when it is no longer required.
The actual computer check-in totals may be seriously in error due to human error by the agents who operate it, customers who travel on other flights after they have been checked in, customers who are "lobby noshos" and miss their flight, computer malfunctions, and so on. The airline has recognized these problems and reinstated a manual procedure to verify the computerized check-in. Agents now verify the passenger count on board the aircraft before a flight is closed off. In the event of a computer malfunction, the agent may be forced to simply fill the aircraft and release it as he has no access to any information of the flight status, seat selection or passenger reservations. On a multi-destination flight this could affect several stations.
Also, under the heading of "employee morale" the brief states that with regard to relations, when one sees the age-old methods appear again in negotiations and grievances it is useless to claim to be more receptive when, in fact, management acts in as authoritarian a manner as ever. How senseless it is to claim to be concerned with correct procedures and administration of contract terms while at the same time members of management are imposing new and arbitrary interpretations which are bitterly contested by both the employees and the union. Women still have great difficulty in obtaining promotion. Frequently the person promoted is still the person who adhered to the party line or drank beer with the right people.
The company claims to be sincerely concerned for the welfare of its employees. Obvious safety hazards are permitted to continue. An example is the Air Canada facilities at Calgary airport. If an employee is overpaid, he is treated as if he had intentionally appropriated the money and all pay is withheld until the debt is discharged; yet if an employee is underpaid he may spend months attempting to recover his salary. One employee was underpaid in excess of $400 at the beginning of September, yet to date he has not received any satisfaction nor even a hope of satisfaction from the company.
Management ineptitude is sometimes so obvious that it cannot be overlooked. To quote one example, computerized check-in for one-stop check-in was installed in one location at a great deal of expense. When the installation was completed it was discovered that the counters were of the wrong height. An agent could neither sit nor stand in comfort on these counters. Needless to say, productivity suffered considerably.
Poor supervision is a predictable result when the company does little or nothing to select its most promising
Canadian National Railways
people and expose them to training and development courses in such pertinent areas as human and labour relations. These areas reflect problems similar to those experienced by CALEA members, although we do not have specific statistics to quote.
Also, the CALEA document mentions standards. They claim they have no information on the manner in which the standards are established for the various functions such as aircraft services, baggage, commissary, etc. The Winnipeg office also comes in for a great deal of criticism. Winnipeg is presently the site of Air Canada's financial operations. Much concern has been expressed in newspapers and by members of parliament regarding a rumoured move of the accounting computer from Winnipeg to Montreal. Naturally, Air Canada has denied any intention of moving their present Winnipeg accounting operations to Montreal. From past experience, including the manner in which Air Canada moved its operations from Winnipeg to Montreal, can one really accept the denials proferred by Air Canada? It should be noted that the first move is to take the computers from Winnipeg to Montreal and that this process is already under way. Can the rest of the accounting operation be far behind?
Another recent event in the finance branch of Air Canada was the transfer to Chicago or Toronto of the function of making up AC-CN credit cards. As well, the CALEA document comments on labour relations. For years Air Canada has attempted to suppress organized labour, and today their attitude is unchanged: it remains as it was before reorganization. In CALEA's opinion, Air Canada does not place enough emphasis on labour relations. This opinion is more than substantiated by the series of labour difficulties experienced by Air Canada in the past five years, with all the unions involves in strikes, partial strikes and slowdowns. The unions that deal with Air Canada also deal with Pacific Western Airlines. It is interesting to note that Pacific Western Airlines has been able over the past few months to conclude agreements with most of its unions in record time. One can only conclude that if Air Canada were to show an enlightened attitude toward organized labour, all parties concerned would benefit.
To summarize the CALEA brief, an attempt is made throughout to place emphasis on people-Air Canada's customers and employees. The tragic truth is that Air Canada does not recognize people as being all that important. They seem to place dollars above all else. It is so simple. If Air Canada became people-oriented, improvements could easily be achieved in employee morale, customer service, labour relations and profitability. Air Canada employees who are CALEA members are conscientious employees. However, they are disturbed and concerned about the direction being taken by this once great airline. Throughout this report they are appealing for the assistance of the government and their MPs to make Air Canada a great airline once again.
There have also been complaints in the Senate with regard to the Air Canada operation. Last June a Senator formally put forward a question in the following terms;
26695-67 J

January 8, 1974
Canadian National Railways
In view of the fact that the International Association of Machinists have, four times in seven years, disrupted the convenience of the Canadian travelling public by their almost criminal irresponsibility, can the leader of the government give any assurance that the government will take the necessary steps to either:
(a)	Upgrade the management of Air Canada, which must accept a
major share of the responsibility for the large number of strikes in
Air Canada in the past five years; or
(b)	Initiate steps to ban strikes in the essential services; or
(c)	Will the leader of the government in the Senate consider calling
Air Canada officials before the Standing Senate Committee on
Transport and Communications?
I have also received complaints from Air Canada employees who take early retirement. A recent letter I received from one of them calls attention to conditions which exist at Dorval. The aspect he mentions concerns morale, and we all know this has a great bearing on productivity, safety and health. Most of the persons in their respective trades study and learn their jobs through courses; others have to qualify for MOT certificates. It is very demoralizing for them when someone less experienced is made a supervisor over trained men, especially when that person is brought in from an unrelated department. Some of the promotions and replacements which have taken place have led to very bad morale at the Dorval base.
The Air Canada magazine retirement list printed monthly shows that the biggest percentage of early retirements is constituted by personnel who have been moved from Winnipeg to Dorval in the last three or four years. These are mostly men with service of 25 years or more. They are taking their retirement early, many of them only in their fifties. It must involve a great loss to the company when valuable, knowledgeable men with practical experience retire early. To fill the vacancies requires men of a high technical competence.
The following is a short list of promotions and demotions which have taken place. In the parts shop, the general superintendent was replaced. The retired employee asks why. Also, the assistant superintendent was replaced. Foremen were set up over senior and more experienced personnel, a senior planner over senior and more experienced planners. In the metal shop a general foreman was appointed from employees of the personnel department. Also in the metal section, foremen were set up over lead mechanics who acted also as general foremen on release of-


The Acting Speaker (Mr. Laniel):: Order. I regret to interrupt the hon. member, but his time has expired.


Stanley Howard Knowles: Mr. Speaker, the theme of most of the speeches which have been made on the two amendments now before the House is that the Canadian National should concentrate on running its railway. I should like to underline comments which have already been made to the effect that one of the ways of ensuring a good railway operation is to achieve the best possible relations between management and employees.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: I seem to be getting support for that proposition, certainly from this

side of the House, orally, and I suspect from the other side of the House, even though silently.


Joseph-Phillippe Guay: Hear, hear!


An hon. Member:: Good for you, Joe.


An hon. Member:: Half an hour late.


Stanley Howard Knowles: I am glad my friend and neighbour from St. Boniface (Mr. Guay) has broken the silence on that side of the House and expressed his agreement with the proposition I have made.


Mitchell William Sharp: Hear, hear!


Stanley Howard Knowles: Now I see I
have the applause of the Secretary of State for External Affairs (Mr. Sharp).


William Arnold Peters: Let's take a vote.


Stanley Howard Knowles: I see that the Minister of Labour (Mr. Munro) also applauded. How about the Minister of Industry, Trade and Commerce (Mr. Gillespie)? He is looking at me, but he is only smiling.
Let me go a step further and say that in management-employee relations one very crucial element is that of pensions. Now, imagine the member for Winnipeg North Centre referring to the subject of pensions!


Mr. Stanbury:: Off on a new tack.


Stanley Howard Knowles: I realize how surprised my friends are, but that only shows they either have not been around here very long or that they have not been listening. In the few minutes I intend to take, I want to emphasize the importance of improving railway pensions. Though there are many facets of this question, I should like to concentrate on one area, that of the annual escalation of the pensions of railway workers already retired.
I am fully aware of the negotiations which took place last year, which began even earlier, leading to a new pension package as part of the collective agreement which is being considered now by the Hon. Emmett Hall. I am also aware that Dr. John Deutsch is a special commissioner who is looking at one aspect of pensions. But the fact is that he is looking at only one area, namely, the percentage value of the pension package agreed to in the collective bargaining in relation to the total benefits of the employees. In other words, Dr. John Deutsch has no authority under the commission given to him by the Minister of Labour to go into the broad question of Canadian National or Canadian Pacific pensions; he is looking at the one narrow aspect to which I have referred. He will simply report to the Hon. Emmett Hall as to the percentage value of that pension package, and then Mr. Hall will have to decide whether to make any adjustment in the wages to be decided by him under the terms of his appointment.
So, Mr. Speaker, any suggestion that pensions are dealt with because Dr. John Deutsch is working on the matter is false. Any suggestion that the matter I am concerned
January 8, 1974

about tonight is covered by the collective agreement is also false-because I am thinking particularly of the pensions of retired railway employees, those who are already on the retired list and are drawing their pensions.
The point that I zero in on particularly has to do with the rate of escalation which in the Canadian National set-up has for a number of years now been 2 per cent per year. I point out that even that annual escalation is made on an ad hoc basis: it has not been written into the rules and it has not been established in any way that employees can count on it from year to year. True, it has been done every year since it was started, but this is by the grace of the company.
Even more serious than the fact that the annual escalation of CNR pensions is not guaranteed is the fact that it is still limited to 2 per cent per year. Not many years ago, when the escalation of pensions first commenced, that figure of 2 per cent was established and we were stuck with it for a long time. But our efforts have not been in vain; we have succeeded in that getting that 2 per cent ceiling removed in the case of most pensions paid under the aegis of the government. For example, if a person is receiving old age security he now receives every year, not simply an increase of 2 per cent but an increase that is equal to the actual percentage increase in the cost of living. The same is true of persons in receipt of the guaranteed income supplement.
Then, again, I could mention the pensions of retired public servants. For a number of years their pension increase was at the rate of only 2 per cent per year no matter how much the cost of living went up. Their increase is now geared to the actual percentage increase in the cost of living. The same is true of retired armed forces and retired Royal Canadian Mounted Police personnel. Many of those retired persons have still another grievance which I might mention in passing, namely, that they have to wait until they are 60 before getting an increase. But the point I am making is that those who get the annual increase get it at a rate equal to the actual percentage increase in the cost of living.
The same can be said of pensions paid to veterans. I am thinking both of the war disability pensions paid under the Pension Act and allowances paid under the War Veterans Allowance Act. Those benefits are escalated every year, not simply by 2 per cent but by the actual percentage increase in the cost of living. I point out that family allowances are in the same category now; they, too, increase not by a fixed amount but by the actual percentage increase in the cost of living.
I might even mention retired members of parliament. They have pensions and are in fact part of a preferred pension plan, although some of those who retired a number of years ago before the plan was improved do not think it is as good all that. But even they will discover this month, if they are over 60 years of age, that their pension will not increase simply by 2 per cent but will be increased by an amount equal to the actual percentage increase in the cost of living.
So I could go on, Mr. Speaker. I have not had the chance to check every last pension that is paid under government auspices, but I think I have mentioned enough of them and have studied the situation sufficiently to be able to make
Canadian National Railways
the general statement that pensions, allowances and superannuation benefits that are federal in their origin are now all in the position of being increased each year by an amount equal to the actual percentage increase in the cost of living.
Therefore, Mr. Speaker, I ask what is wrong with railway employees, and particularly with Canadian National employees? Why are they not getting similar treatment? Actually, I am as concerned about employees who worked for the CPR as I am about those who worked for the CNR and are now retired. They are not included within the provisions of this bill, but I think they ought to be. What bothers me is that far too often, I think, does the CPR decide upon pension policy and then that company browbeats the CNR to go along with the decision it has made.
In any event, we are now dealing with a bill that grants money to Canadian National Railways and so it is to the Canadian National Railways that we must direct our fire. I contend that employees of the Canadian National Railways are, in a practical sense, just as much employees of the government of Canada as are all these other groups to which I have referred. I think it is a shame, a disgrace- perhaps even calling it a crime would not be language that is too strong-that this particular group of people who work for the government of Canada have pensions that are restricted to an annual increase of 2 per cent, whereas all the others get an increase that is equal to the actual percentage rise in the cost of living.
I see my good friend the hon. member for St. Boniface over on the other side. May I still call him the Parliamentary Secretary to the Minister of Transport? I have not seen the order in council that was tabled today, so I do not know whether he was retained in that position or transferred.


An hon. Member:: Perhaps he was replaced.


Stanley Howard Knowles: I gather from the gestures he is making that he is still Parliamentary Secretary to the Minister of Transport.


Mr. Alexander:: You can tell from the smile on his face.


Stanley Howard Knowles: Then may I be the first to congratulate him. Not long ago he gave an answer on the "late show" to a question of mine on this particular subject which led a number of people to write me and say, "We are glad to see you have got Joe Guay on your side".


Joseph-Phillippe Guay: True.


Stanley Howard Knowles: I hear the hon. member say that is true, and I hope it is on the record. I know it is true: I know he thinks in those terms. But for heaven's sake, when are the Parliamentary Secretary to the Minister of Transport, the Secretary of State for External Affairs (Mr. Sharp) who pounded his desk a while ago, and the Minister of Labour, who is sitting over there, going to use their influence with the government? When are they going to use their influence with the government so the government will say to the Canadian National Railways, "You cannot stay out of step with all other federal authorities which are now paying pensions

January 8, 1974
Canadian National Railways
and escalating them each year by an amount equal to the actual percentage increase in the cost of living"?


Lincoln MacCauley Alexander: Those members you mentioned have no influence.


Stanley Howard Knowles: There are other aspects which have to be dealt with, such as the 50 per cent pension to widows of railway workers. I think this is a disgrace. I think the provisions for early retirement are not yet good enough and the formula itself needs to be improved. Some of these things can, of course, be the subject of collective bargaining, but so as not to weaken my case in respect of the main point I am trying to make tonight I come back to it and emphasize it. This parliament cannot rest while the government fails to say to the Canadian National Railways, "You cannot remain outside the family. You cannot, at a time when other pensions are increased every year by the full percentage increase in the cost of living, raise retirement pensions for Canadian National employees by only 2 per cent a year." This is a disgrace and it is a disgrace that must end.


Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I do not think it would be unfair or untrue to say that every member of this chamber shares the sentiments just expressed by one of our more distinguished senior citizens regarding faulty management of the CNR. I think we are in agreement for a variety of reasons but, if for no other reason, because-as has been pointed out by the hon. member for Winnipeg North Centre (Mr. Knowles)-this situation has existed for a long time and it is inhuman.
Let me join in the general theme of our discussion on this amendment which relates to the faulty management of the CNR. In the few minutes available to me I should like to touch upon another dimension which in its own way is equally as irresponsible and, indeed, borders on the criminal. I refer to the area of safety on the railway. I have in mind the number of accidents which have occurred not only in rail transportation but in all forms of transportation in Canada which fall within the purview and jurisdiction of the federal authority.
Perhaps, to set the tenor of my remarks, I should emphasize that the point I want to make-I have mentioned this on a number of occasions in this chamber in recent years- relates to the very obvious conflict of interest that arises in respect of transportation accidents when the body responsible for making and enforcing regulations is also charged with the responsibility of investigating those accidents and making judgments as to their cause, liability, and so on. It is in this area that I have an interest. I will keep my remarks in context by suggesting to you, Mr. Speaker, and other hon. members that what I am talking about is bad management. When I conclude my remarks I will place this subject in absolute perspective and in context with the amendment which is before us.
Since yesterday afternoon we have had before us the CTC report by the Railway Transport Committee entitled "Third report of the railway safety inquiry". When I refer to conflict of interest I have in mind management which permits this type of inquiry to be undertaken without any objection by a committee of the CTC. This is what I mean

when I suggest this is man's inhumanity, if you will, to man. This amounts almost to criminal action because of the failure by the commission to do something, and more often than not in this case the crime is failure to act rather than acting in a wrong way.
In August, 1970, the Railway Transport Committee, which is an arm of the regulatory body, decided to set up an inquiry into a series of train wrecks that occurred at about that time. This was a wise thing to do internally; there is no doubt about that at all. The committee decided to do this, and arbitrarily decided that as an arm of the regulatory body it was the only group competent and able to carry out this type of inquiry. I quote from the top of page 4 of their third report as follows;
-the committee decided to assign its two most senior and experienced officers with expertise in this field to the job of preparing reports on all aspects of railway operation and maintenance-
The field referred to here is that of safety. How could the two most senior people in this area properly advise their senior officials as to what is happening and what should be done internally to correct certain wrongs in respect of safety? the very fact that the decision to set up this inquiry was made in August of 1970, almost 3'/2 years ago, bears out this point. Had such an investigation been carried out by an independent commission of inquiry into these accidents on the CNR, I am sure this report would have been before the House within six months. Some 3 VS years later we still do not have the final report, and the committee has not indicated a date when it expects to submit it. All we have been told is that we may expect it some time in the future, and that is not good enough. The last people to complain about this situation are those in the management of Canadian National Railways, our national transportation system. We have not heard one word of objection and no complaint has been made. Indeed, I imagine management has welcomed this fact and has accepted it as sort of a whitewash.
When accidents occur in the transportation industry in Canada it is no longer tolerable that the regulatory body conduct its own investigations. This gives rise to a conflict of interest. I will not recite examples because I have put them on the record a number of time in recent years. How can a person working on one side of the room for perhaps most of his lifetime make an objective judgment as to safety measures or standards decided upon and put into effect by his friend working on the other side of the room? I suggest he just cannot do so.
We remain the only western nation which clings to this archaic and philosophically wrong method of investigating accidents. The CNR, Air Canada and the investigative branch of the Department of Transport have done absolutely nothing about this situation. I am not making any accusations or imputing any wrong motives to the members of that branch. Indeed, they are among the finest air accident investigators in the world: they have won several national awards for their high standards of investigative work. But the investigative body was a limb or a branch not even at arm's length of the regulatory body. For example, I wonder how many of the 13 or 14 points made by the judge in the hearing of the tragic DC-8 crash in 1970 have been fully implemented by Air Canada. We
January 8, 1974

know some of them have been implemented immediately, but I wonder if all of them have.
I am talking about the growing rate of accidents in all modes of transport-air, shipping, rail, interprovincial trucking and busing. The carnage of the highways and in the air as a result of these accidents grows every year. The amount of information made available to the public is negligible. We have not had half a dozen public inquiries into serious Canadian transportation accidents in the last 15 years. That is not good enough. What this country needs and what management groups such as CNR must do is to urge all governments to move as quickly as possible toward the establishment of a commission of inquiry removed from parliament, so that the possibility of a conflict of interest cannot arise and so that users of the national transportation system, be they Canadians, visitors to our country or exporters into our country, can use our transportation facilities with safety and to their satisfaction.
I regret the removal, for example, mentioned by an earlier speaker in this debate, of the direct control over Crown agencies, not because they should be the day to day concern of the House of Commons but because in the absence of responsible management principles in areas such as safety not even the House of Commons and not even our colleagues in the other place have any way of questioning management regarding whether the fullest means of ensuring safety in areas of transportation are being taken. I regret the loss of parliamentary control, if for no other reason than for that reason, and I think every member of this chamber should regret it. When the remotest possibility of a conflict of interest arises and the loss of life is the consequence of an accident, all of us should remember that we have sat here and done nothing.
Equally important in the management of CNR is exactly that type of body that could urge upon the government the necessity of removing from the purview of the regulatory body or agency the responsibility for investigation. With regard to air accidents in 1972, there were 155 fatalities and some 629 accidents, 83 of which were fatal. With regard to projections to the end of last year, the figures I have are to November 30 of last year and they show that there were 161 fatalities from 745 accidents.
Rail accidents are in another area of management. I know that different criteria are involved here, but how on earth can anyone expect to understand what is going on when Statistics Canada report that there were 1,922 accidents in 1970 and the Standing Committee on Transport and Communications reports that there were 4,622 in the same year? Those figures have grown to 4,818 according to the committee, and 1,963 according to Statistics Canada. Again we have a discrepancy with regard to fatalities. According to Statistics Canada, the number increased from 180 fatalities in 1970 to 226 in 1972, but the committee reports 195 in 1970 and 255 in 1972. What happened to the other 29 deaths? Is that a responsible way for the management of one of our largest conglomerates to approach the disclosure of information? It does not display much concern for the public.
Canadian National Railways
I am concerned about the disclosure of information, I am concerned about faulty management and I am concerned enough to wonder sometimes why we should sit here and give Air Canada $140 million and CNR another $100 million. The hon. member for Regina-Lake Centre (Mr. Benjamin) said that they made operating profits in all but three of the last 25 years. That is fine; but I wonder about the Department of Transport through whom this august body reports to parliament. I wonder about their attitude to CNR and their obvious lack of concern for faulty or bad management. In the editorial of the Evening Patriot of December 22 the following account is to be found:
On Thursday of this week, a light civilian aircraft landed on a runway at the Charlottetown airport across the path of Eastern Provincial Airways flight 112 incoming from Montreal. This incredibly dangerous incident happened before the eyes of a startled group of passengers in the airport lounge-
The final paragraph of the editorial reads as follows:
This is the capital city of a province of Canada. We no longer live in a horse-and-buggy age. This newspaper is demanding immediate action on the part of the Department of Transport to correct this situation for the sake of the safety of all passengers who use the Charlottetown airport facilities.
What they are complaining about is the absence of a landing tower manned by somebody who says, "Come on in; it is safe to land" or, "It is safe to take off; the wind is blowing at such and such a velocity, the altimeter is reading so and so, your visibility is such and such". Those are simple safety procedures. I can understand now why the government does not give a damn about what the CNR does. I suppose a government that would permit the principal airport in a province of Canada to remain without a manned tower for safety's sake does not give a darn about what procedures are followed with respect to safety measures or investigations of accidents in any form of transportation. This is what I regret about the management of CNR, the management of Air Canada and the management of all other forms of transportation in Canada.
I regret their failure to bring pressure to bear on this government to correct the very obvious and glaring errors in our approach to safety in transportation in Canada. It is a simple thing to do. I sometimes wonder whether the government, recognizing that this is a principle which should be put into practice, is reluctant to do so because the suggestion essentially comes from an opposition member of parliament. For years they have neglected to do anything about this most serious situation.
I support the amendment of the hon. member for Mississauga (Mr. Blenkarn) because it condemns the management of the CNR. It pinpoints areas where that management has failed. I will continue to support the amendment until the management of Crown corporations like CNR and Air Canada begin to demonstrate a little more concern for the responsibilities and authority we give them rather than for mere management and the achievement of operational profits and, I might add, capital losses.
When members of management begin to demonstrate to me that they are concerned about the human aspects and are concerned about ensuring that the users of our transportation systems need not have cause to worry about the possibility of conflict of interest in the investigation of

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Canadian National Railways
accidents, then I will start to change my mind and perhaps be a little bit more willing to give the CNR the amount of money it needs. We need an independent commission of inquiry to conduct impartial accident investigations. The hon. member for St. Boniface (Mr. Guay) agrees that we have done nothing. I leave it to him in his new appointment to face this problem and do something.


Mr. Norval Horner (Battleford-Kindersley):: Mr. Speaker, I am very pleased to be able to speak on the subject of the railways, particularly the CNR. For the past 25 years I have observed the disintegration of CNR services. The CNR was created to provide service to the people of Canada; it was not created to ease the tax burden as a whole. Initially, many concessions were made to the railways to encourage them to build tracks across the country. In terms of real estate, those concessions are now paying off very well for them. Yet we hear the railways say they cannot haul grain, that it is not paying them to haul grain. I point out that they have an obligation to haul grain and to try to keep this country together. It is utter nonsense for them to talk in terms like that.
The CNR is an agency of the federal government and the government is certainly responsible for its actions. In this bill we find the CNR seeking money for capital expenditures, not to improve its railway services, not to slow down the disintegration of those services but to spend on other projects. It has chosen to turn its back on the tracks in order to build needles in the sky. People in railway management know that the rails are disintegrating and that they will not be able to provide service much longer. They are lagging behind in things they should be doing. They should be spending money on the repair of tracks in all parts of Canada so that the CNR can continue to provide the service which it was created to provide.
It seems that people in the CNR do the things they like to do, and any time they are met with a little competition they just ease out and let someone else take over. It is a good example for budding socialists of what happens when government shifts its responsibilities onto Crown agencies and tells them, "Run things the best you can and we will pour in all the money you need." Every year officials of the CNR come before the Standing Committee on Transport and Communications. They admit their failures and their faults, but then go back and continue to commit the same faults. Seemingly, it is a failure of the democratic process that these agencies increase in number, becoming more complex in their operations and thus making it more difficult for the will of the people to be carried out through their instrumentality.
There are three services that the CNR should be providing-carriage of freight, carriage of passengers and the movement of bulk commodities across Canada. But it has almost completely moved out of the freight business. One way it did this was by providing poor living accommodation for its employees. Its passenger business has gone the same way. I once came to Ottawa on the train. Most people you talk to have travelled on the train-once. They don't do it again. In fact, from the time I got on at Saskatoon until I reached Ottawa I had the impression that someone kept asking me was I not aware that I could fly and did not have to travel by train.

Now there is a failure on the part of the CNR to move bulk commodities and grain. We had an election campaign last year. We had "Build for a billion" stickers all across the Prairies. I imagine there are still a few of them around. But the very next year the Wheat Board says "we cannot fulfil contracts for grain because we cannot guarantee to get the wheat into export position." As recorded at page 84 of the minutes of the transport and communications committee of December 11 last, Mr. MacMillan said that their target for the period August 1 to December 8 was 67,628, cars and the actual supply of cars numbered 65,738. On the one hand we have the railways saying they reached their target, and on the other hand we have the minister in charge of the Wheat Board saying that they did not reach their target because cars were tied up with potash and lumber.
Then the joking Minister of Transport (Mr. Marchand) suggested there were too many Canadian cars in the United States and talked about sending an engine down to the United States to pick up loose Canadian cars and bring them back. When he does not know the answer to something, the Minister of Transport makes a joke. We are supposed to put up with that. We are not likely to get good performance from the CNR when we have that minister.
Of course, the Wheat Board said it disagreed with the railways. Here are two agencies of the federal government which negotiate with each other every year, yet they cannot agree on the number of boxcars over the period August 1 to December 8. Mr. Gibbings suggested in committee that the target was 61,000 cars, but only 43,000 cars were delivered. Surely to goodness we have the right to expect a better performance than that from these agencies? Are these people being paid the minimum wage so that we must accept that sort of performance from them? Surely we have the right to expect better than that from the Minister of Transport and from the minister responsible for the Wheat Board? These agencies work together all the time. They sit down together and set targets. Then they come here and report to our standing committee. Of course, they say that the language each one uses is different. The CNR is talking about car equivalents and the Wheat Board is talking about actual cars. We have all this sort of gibberish. Surely the people of Canada can expect better performance from the responsible ministers.
We are faced now with a situation where there is very little grain at the lakehead. The president of the Saskatchewan Wheat Pool says we are 5,000 boxcars short in Vancouver today. Next spring, when the grain is coming into the elevators, we will be back where we started, wondering what happened to the 2,000 boxcars that were supposed to solve the problem. The minister in charge of the Wheat Board, and the government, have been asked to supply more hopper cars to the railways, but we have not received any answers to our requests. Surely the government must take the matter in hand and see that the rolling-stock is provided so that grain and all other commodities in Canada can be moved.
In Saskatchewan, where I come from, we rely tremendously upon the railways. We produce more than we can use and have to export, so we depend upon the railroads. They will have to operate better in order to serve us. The
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answer is not to raise the Crowsnest Pass rate. This year the railways have been able to charge what they like for lumber, but they have not provided the service required by the people in the business. They offer no guarantee to improve the service, but simply ask for more money so they can build more hotels or more towers in places like Toronto.
Mr. Speaker, the CN was created by an act of parliament. We could have another act of parliament just as easily and restructure the CNR. The people involved should be made aware of their obligations and the service that should be provided for those Canadians who need it, and we should see that they carry out their responsibilities.


Mr. Frank Hamilton (Swift Current-Maple Creek):: Mr. Speaker, I have listened to this debate very carefully for the last two days. It is a well-known fact that the railways were declared by parliament to be "works for the general advantage of Canada". I have been very surprised at what I have found since coming to Ottawa. We seem to be faced with a whole series of problems such as the failure of the government to provide auditing of both the CNR and Air Canada's financial operations. We have the problem of the annual ritual of this CNR financing act to delude the public. The financial affairs of Canada's two greatest public utilities are controlled by the government and by the government alone.
We are faced with the problem of discriminatory freight rates and the collective complaints of the western premiers that it is impossible to assess the internal operations of the CNR accurately. We are also faced with the problem of financial mismanagement of the Canadian National, its long-term debt and its loans to Air Canada. Worst of all, we are faced with the failure of this government to develop a comprehensive national transportation policy.
Mr. Speaker, I used to think that the Canadian National had a major obligation to provide service, to carry goods and passengers. In the area that I come from, passenger service is almost non-existent. We deliver grain to a line that has a 20-mile an hour speed limit and where they have been replacing an average of one railway tie per mile per year for the last eight years. In this area the Canadian National receives a subsidy of over $100 for every boxcar of grain that they haul out. That is on top of the freight rate. The boxcars that are delivered are often a disgrace. They require patching and repair by the local grain buyer before loading. The buyer is afraid to reject a car because they are so scarce that he might not get a replacement.
There is a CNR line in my area where they abandoned the last 12 or 13 miles of track to the last elevator, and now Canadian National are paying the trucking costs from the last elevator which is some 20 miles to the city of Swift Current. The transportation of grain in particular in this crop year is a complete fiasco and farm deliveries are 150 million bushels less than this time last year. The Canadian Wheat Board and the railways cannot agree on the grain targets and we still have not received any satisfaction on that question. Officials of the railway companies are questioning the Crowsnest Pass rates, and I have the uncomfortable feeling that they have had some encouragement from the Canadian Wheat Board, from the minister in
Canadian National Railways
charge of the Wheat Board or from Department of Transport officials.
Question after question remains unanswered. Is it the intention of this government to announce, some time in the near future, a comprehensive, long-range rail transportation policy which will provide not only for the effective rationalization of rail operations but also for some logical alternative to the current energy shortage? On what basis does this government justify an annual subsidization of approximately $180 million for uneconomic rail lines, when these funds could be diverted into research concerning both alternate modes of transportation and alternate fuel systems? Why has there been so little research into rail transportation in Canada? Why has there not been research by the appropriate government agencies as well as private interests? Is the lack of government support and initiative, both economically and morally, concerning rail transportation research a major reason for this unrealistic inertia?
Would it not be more economically feasible to shelve the STOL program between Montreal and Ottawa and use the money instead to modernize the already existing rail system between these two cities? By "modernize" I mean not only increasing the frequency of the number of trains between Ottawa and Montreal but also the running times of trains between these two cities. Would not the electrification of the line between Ottawa and Montreal be less expensive than the STOL program?
I should like to know this government's views concerning the use of railways as a means of long-haul passenger transportation in Canada. Have the railways seen their day in this respect? Should transportation by air be encouraged more and more as a means of long-haul passenger transportation in Canada? Many questions such as these remain unanswered.
Let us look at what our neighbours to the south are doing about rail transportation. I should like to quote from an article which appeared in the Wall Street Journal of December 28 which reads:
The Interstate Commerce Commission issued the nation's first set of regulations designed to force improved intercity rail-passenger service.
The rules apply to Amtrak and the railroads that run its trains,...
They mandate a nationwide, toll-free telephone reservations and information system; enough seating space to meet "normal demands" of customers seeking reservations; minimum levels for train-on-time performance, baggage delivery, train connections and station hours, and a range of other standards for food, temperature control, sleeping cars, rest rooms and drinking fountains.
The regulations take effect April 1. ICC chairman George M. Stafford said they are designed "to improve the overall quality of 'America' passenger train service and thereby make rail travel attractive, especially during the current energy crisis."
Newspaper after newspaper in the United States speaks of the updating of the transportation system in that country. According to one report, travel on Amtrak trains will go "right through the roof". Amtrak officials themselves now expect ridership to leap 30 per cent next year, double what they previously predicted. I quote once more from the Wall Street Journal of December 28:
-Amtrak has been flooded with state bids for new routes. Nebraska would like an Omaha-Kansas City train, Colorado a Denver-Kansas City route, Missouri a Kansas City-St. Louis route, and Ohio a Cincin-
9172

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nati-Columbus-Cleveland run. "I've had to put a map on my wall showing all the inquiries and expected inquiries. It looks like a ... spider web," an Amtrak state-relations official says.
What is the general situation in Canada, Mr. Speaker? There are only two passenger rail lines in all of Canada which are not subsidized-the Quebec-North Shore-Labrador line, because it has never applied, and the CPR's Esquimalt-Nanaimo route on Vancouver Island because upon investigation it was found that the rail line had done nothing to improve its services, thus the request for application was denied. The railways need only apply once for abandonment of passenger service. Upon initial application the Canadian Transport Commission undertakes a study of the area to review the effects abandonment would have on the area. If these effects are thought to be detrimental to the population, the service is continued under a subsidy which amounts to 80 per cent of the loss claimed. In the following years an annual claim is made and audited by CTC officials. Each year over $100 million is expended in subsidies allotted to unprofitable railway services. A Canadian Transport Commission spokesman is quoted as saying that there are no passenger train lines in Canada making any money.
The main reason the abandonment procedure operates in this manner is that the 1967 National Transportation Act encourages the diversion of funds into unprofitable operations rather than into the research and development of advanced railway technology. The most logical alternative to the wasting of federal moneys on these unprofitable operations would be to divert a portion of the funds into research for more effective and efficient services. Electrification is a viable consideration. The modernization of railways, as represented by their electrification, has yet to start in Canada. Seventy per cent of gross ton-miles are generated by electric traction in West Germany, France and Japan. The capital investment required by electrification is far outweighted by the resultant service. The benefits entailed from this type of modernization include lower capital and maintenance costs of locomotives, longer life, higher availability, better adhesion, higher speed, better braking performance and superior environmental characteristics.
As I said at the beginning of my remarks, the railways in Canada have been declared to be works which are for the general advantage of the public of Canada. I think the taxpayer of this country is entitled to expect a better shake from the government in the matter of transportation.


Mr. Elias Nesdoly (Meadow Lake):: Mr. Speaker, we are debating the amendments to this bill. My colleagues tell me that it does not much matter whether this bill passes or not, because CN and Air Canada will spend the money anyway. So why are we debating this bill if the money is to be spent? Is this not a mockery of parliament?
The amendment before us seeks to deny Canadian National Railways so many millions of dollars which are to be spent on the huge structure known as the tower in Toronto. I am told that the tower is two-thirds completed. If the amendment passes, will the tower stand two-thirds finished and never be completed, or will it be finished in any event? Therefore I think this debate is ridiculous. We

should pass the bill and get it over with, because the tower is three-quarters finished anyway. Let us not be stupid.
A member to my right talked about the CNR as an example of socialist inefficiency. Apparently CN service is very poor. Well, if those fellows want to talk about socialists, let me tell them some things.


An hon. Member:: You are not a socialist, are you?


Elias (Eli) Nesdoly: You bet I am, and proud of it. They say that Canadian National gives poor service, that it does not do the job. I admit the service is poor and that the railway does not do its job. But the service is not as poor as the service of the CPR. Actually, it is a bit better. The previous speaker mentioned how wonderful are the railway companies in the United States, how well they are doing, and so on. Mr. Speaker, they are going bankrupt left and right and there is no end in sight to the trend of bankruptcies.
I was in Washington during the week of November 26 to November 30. I was at a dinner given in the Canadian embassy. One chap with whom I had the honour of speaking said, "You know, I was in Canada three years ago. My, you guys have a wonderful railroad service." I asked him which railroad he travelled on. He said, "It was one of those government operations." I said, "Was it the Canadian National?" He said, "Yes, that's it" Further, he said that passenger service on the Canadian National was ten times better than anything he had ever seen in the United States. So who do you believe, the man who has travelled on Canadian and American trains or the Wall Street Journal?
The hon. member for Timiskaming (Mr. Peters) said yesterday in his speech that he had fought against the concept of taking the railroad station from downtown Ottawa to the suburbs. He neglected to say that Canadian National was never in favour of the move and that the Conservative government of the day forced the move to the outskirts of Ottawa. So what are members to my right talking about?
Some complain that Canadian National Railways are getting too much into real estate. Some members have mentioned the CN tower in Toronto. I agree with some hon. members on one or two small points. For example, I do not think the Canadian National should hang on to railway rights-of-way which it secured about 40 years ago, rights-of-way on which it has no intention of building rail lines.


Mr. Horner (Crowfoot):: It sold them in Saskatchewan.


Elias (Eli) Nesdoly: I am talking about the right-of-way from St. Walburg to Loon Lake. No railway line has been built. That is to say, the railway is hanging on to the choice piece of property in the village. The village is expanding. It cannot expand more because it is surrounded by an Indian reserve. There are 50 housing lots on the railroad right-of-way, but the railway says, "We do not want to give up property because some day we may build a rail line on it". Big deal! They are trying to abandon 400 miles of line in my constituency, but claim they need this property for possible future lines. That will be the day!
January 8, 1974

One of the problems with CN concerns management. Too often we have appointed to the board of directors, or to the office of vice-president or president, men who know nothing about the railroad, men who were not brought up on the railroad or know how to run one. We have tended to appoint to the big paying positions political hacks. A man may not have done too well in the House of Commons, so he is made president or vice-president of CNR.
I want to tell members to my right a little more. There is a great problem with regard to boxcars and the movement of wheat. I am concerned about the movement of grain. I understand that at the present time CNR is repairing 900 grain cars. Some of them are battered and have greatly depreciated. These repairs are being carried out in Winnipeg and somewhere in Quebec. My inquiries also indicate that Canadian Pacific is doing absolutely nothing about repairing or buying new cars. At least the CNR is making an effort.
The basis of our problems is that we expect CNR to operate like the CPR. CNR is a people's railroad: it must serve the people of Canada but not on the same basis as the CPR. This is what our party will ensure when we form the government some day.


Some hon. Members:: Oh, oh!


Elias (Eli) Nesdoly: That will happen some day. We will operate the CNR and CPR when we take over. We will rationalize the transportation policy of this country. There will no longer be short Air Canada flights between Ottawa and Montreal. By the time a plane gets up 13,000 feet it is time to start coming down. It then takes two hours to get from Dorval to downtown Montreal. It only takes two hours to drive from here to the Queen Elizabeth Hotel. For short run passenger service trains are the only logical answer. We should forget about aeroplanes; they use a lot of energy.


An hon. Member:: Do you know where Montreal is?


Elias (Eli) Nesdoly: Yes, I have been there a few times. There have been complaints about inadequate passenger service. I live in northern Saskatchewan. I travel from Saskatoon on the CNR passenger train. That is a good service. In southern Saskatchewan they do not have good service. That is because CPR runs through Regina. In my area we are satisfied with the passenger service.
I have read many articles and reports on state-operated railways. Some of the most efficient railways in the world today are being operated in France, Germany and Italy.


Robert Lorne Stanfield: What about Japan?


Elias (Eli) Nesdoly: These are state-operated railways. The taxpayer has been underwriting the losses of the CPR for the past 50 or 100 years: let us not be gullible about that. There are many railway companies in the country south of us. They are all going bankrupt. Pennsylvania went bankrupt a while ago. I guess that is a railroad called Pennsylvania. Our railroads also went bankrupt. It is up to the government of Canada to resurrect them. The government
Canadian National Railways
did not bail them out as they bailed out the shareholders, the people who had money in the railroads.
Until the government of Canada has the guts to make the railroad system a people's railroad we will not have a transportation system that will satisfy the needs of the Canadian people.


Mr. Stan Schellenberger (Wetaskiwin):: Mr. Speaker, I rise to speak on the allocation of money to Canadian National Railways and Air Canada, and in particular on the amendments of the hon. member for Mississauga (Mr. Blenkarn) having to do with funds for hotels and towers. I wish to speak briefly about a hotel with which I am somewhat familiar. It is located in a city close to where I live, the Hotel McDonald. The hon. member mentioned that its profits are somewhat low. I know they have a manager problem. They have night managers, day managers, assistant managers, food control managers, beverage control managers, and I suspect they even have a manager who is available in case all those managers happen to be out at the same time. I am familiar with the time it had problems and ten people were fired. Another manager was hired to find out the problem. As the hon. member for Mississauga said, it is no wonder the McDonald made only $15,000 in 1971, and $31,000 in 1972 with an investment of $8.3 million. In addition, this hotel gets most of the convention traffic in the city of Edmonton.
I wish to refer for a moment to Mr. MacMillan's opening remarks when he appeared before the Standing Committee on Transport and Communications. He said:
Our activities today include such things as telecommunications, hotels, trucking, passenger buses, marine services, real estate, industrial location, international consulting, pipeline studies, and the provision of transportation and telecommunications expertise for large-scale resource development. And, without neglecting our basic job of providing good rail transportation, we are expanding in many of these fields and looking towards other fields of diversification.
These amendments single out only two of the things in which the railways are involved, namely, hotels and towers. Air Canada has 21 vice-presidents. I wonder how many vice-presidents are necessary for CNR to handle all the diversification in which they are involved. I have no trouble in supporting these two amendments. Even though CNR has been traditionally involved in hotels, I believe these amendments point out that parliament is concerned about the diversification of the CNR into these many facets. The CNR should have to borrow the money for hotels, TV in hotels and tourist attractions in Toronto from other sources. They should be involved in the encouragement of passenger and freight service and safety as well as providing luxurious hotels and towers.
In committee I asked about the safety record of CNR. I pointed out that I understood it was poor. I received a comparison with the United States. I then pointed out that only $19 million per year was put into improving railway crossings. I stated it should be necessary to put more funds into the updating of railway crossings because 85 per cent of them are not marked with flashing lights. Perhaps this is one reason for the poor safety record of CNR. The answer I received is that it is necessary to accelerate the program but it will be necessary to substantially increase the funds available. I was told these level
26695-68i

January 8, 1974
Canadian National Railways
crossing projects have become very expensive and it will take several million dollars to update them.
The following was pointed out to me by a constituent, and I quote from his letter of July 9:
The daily passenger makes a round trip from Calgary, Drumheller, Camrose and Edmonton. This passenger train does not always blow the whistle. Now, to the best of my knowledge, the said passenger has had two accidents this year about two months apart.
One was near Edmonton where a gravel truck was hit. The other accident, I believe, was between Drumheller and Calgary. It killed all six passengers in the car. This is the CNR.
Soon after he had pointed this out to me by letter-and of course I notified the CNR-he sent me a further letter telling me that a dayliner had hit a truck and two people had been killed. So there are problems and, as my hon. friend from Crowfoot (Mr. Horner) stated, the CTC has also expressed this opinion in a report. Instead of towers, hotels and STOL aircraft providing service between Montreal and Ottawa, perhaps we should be more concerned about passenger train service. We learn that by the end of 1971 the CTC had received 69 applications for discontinuance covering virtually all passenger transportation services in Canada. The significance of this is clear. The railways are not prepared to provide any passenger service whatsoever unless subsidies are available from the government and the government is prepared to provide such subsidies in the public interest.
Another omission which concerns me is the lack of effective research. When the president of the CN was before the committee I asked why the transcontinental train only arrives on schedule 34 per cent of the time. He told me-and I was surprised at his answer-that our winter conditions made it difficult to get these trains across Canada on time. The biggest problem, apparently, was the cold-the icy winds that affect the running of the trains. I asked whether any research had been carried out to overcome this problem, perhaps through the better heating of these cars. Apparently none has been carried out up to this time. I believe the railway should become more deeply involved in researching better means of transporting people across the country.
These, Mr. Speaker, are some of the reasons I feel we should support the amendment before us. I feel the CNR should get away from all this diversification and become more concerned in the handling of freight and passengers. That was its business to start with, and it should continue to be so.


Some hon. Members:: Hear, hear!


Mr. Peter Reilly (Ottawa West):: Mr. Speaker, I shall, of course, ask hon. members to support the amendments before them. At the same time I should like to make a few remarks of my own about both Canadian National and Air Canada. Each of these concerns is a public utility in the true sense of the word. A public utility is created, not as an occasion for self-aggrandizement, not to build empires but to serve the public where it is either impossible or undesirable for private enterprise to do so. And may I say to my demi-semi, pretend-socialist friends-if there are any of them here-that I have not come here to sing the praises of the Canadian Pacific, whose performance I

believe to be as abominable as that of any other transportation company in this country. After having been deeded half the country to provide transportation where it was needed, they goofed, they blew it, they built themselves into a giant multinational corporation, one could almost call it.


Elmer MacIntosh MacKay: Multicorporate corporation, perhaps?


Peter Reilly: Yes, multicorporate corporation, as someone near me says. I would suppose that in the case of Canadian National it would devote itself to the movement of goods from point to point in this country where it was necessary to do so. Instead, what did we see in the annual report? We see not only luxury hotels and communications towers, but satellites, trucking companies and Lord knows what else.
What we do not see is much evidence of the successful movement of people and the moving of goods such as grain and lumber from place to place in this country. And there are people who are being very badly hurt by this failure. In fact, because of the policy of the railroads, which it pleases their highly-paid bosses to call rationalization, which usually means screwing the people in one way or another, entire towns have disappeared from the west. Anyone who knows the Prairies can confirm this. But they do not care about that. In the financial statement we read that in 1972 Canadian National carried record amounts of traffic, earned the highest revenues in its history and "continued its steady improvement in over-all financial results which has taken place in recent years". Then the company's president, Mr. MacMillan, says at the conclusion of his commentary:
The management and board of directors of Canadian National look forward to a continuation of the steady progress toward planned objectives which has taken place in recent years. They recognize the contribution made to this progress by the thousands of men and women who make up Canadian National-
And so on. Then they tell us they lost $17.8 million. I grant you that is a heck of a lot better than the $67.5 million they lost in 1960, but if this is their best year, by my reckoning it is going to take them until 1980 to break even at the rate they are going. That is not what I would call running a company very well.
As to Air Canada, may I say I have travelled hundreds of thousands of miles in aircraft of every conceivable kind, to almost every point in this world, over the last 20 years. I want to tell hon. members I have had better service on Air Congo than I have had on a great many Air Canada flights. Begin with the necessary task of making a reservation in Ottawa to go to Montreal, Toronto, Chicago or wherever. Here we are, in the capital of Canada, the seat of parliament. When ones phones for a reservation, who picks up the phone? Somebody in Montreal. It used to be one could telephone to the airport and some friendly person would say, "Better hang back and not spend the money on a cab to come out here, because the whether is bad and the plane may not get off the ground." You cannot do that now, because in Montreal they don't know what is happening here in Ottawa and they seem to have no way of finding out. Indeed, you are lucky if you can find someone to answer the phone in the first place. But if you surmount that obstacle, if you get a reservation and find there is a reasonable probability that the plane will take
January 8, 1974

off, you board the aircraft. If you are only going to Toronto or Montreal it is not very important, but if you are going out west, as a great many members of this House have to do-


An hon. Member:: Don't go.


Peter Reilly: -or any appreciable distance, sooner or later you will have to eat. And here begins one of the more traumatic experiences a human being has ever been asked to suffer -plastic food served in plastic containers, very often by plastic people. The labour relations of the airline are so bad that when I was considering travelling from here to Toronto next weekend I found myself reflexively thinking, "God, I had better find out whether there is a strike on"-because their history of labour relations has been so turbulent, as the former minister of labour sitting over there knows very well.
I have been fairly harsh on both these Crown corporations, and this is not according to my policy. I do not think that Crown corporations ought to be jumped on when it is not always their fault that things go wrong. The real responsibility lies over there in the empty pew which is sometimes occupied by the Minister of Transport (Mr. Marchand). The real responsibility lies with this government which has failed to come up with any national, rational transportation policy. I see the parliamentary secretary here, but the minister is absent; in any event, his presence would not affect the outcome.


Joseph-Phillippe Guay: You are not here too often yourself.


Peter Reilly: I am here when it is important to be here. As I was saying, the real fault lies with the government, which has failed to give the country a rational policy, which has failed to realize the needs of Canadians from coast to coast, and which has failed consistently to realize how important it is to those people to be able to move themselves and move their manufactures to market.
Every day in this House we hear questions asked by worried members on this side of hon. gentlemen opposite concerning why wheat cannot be moved, why lumber cannot be moved and why other manufactures cannot be moved. Lately, faced with a crucial shortage in eastern Canada of oil and other petroleum products, questions have been directed to our capacity to move oil products. But there simply is no rational transportation policy in this country.
I could go on at some length about the traumatic experience it is to travel by rail. For myself, I would sooner go by bus. Anyone who has travelled on a train in this country knows what it is like to try to find the dining car, to be directed 98 cars to the rear and then to be told by a surly person when you get there that the snackbar is closed and you have to get something from a candy dispenser.
Then, again, anyone who has travelled on our national airline knows how fouled up the computers get; they know that getting from point A to point B is a calamitous business. As one of my colleagues has said, the only thing
Adjournment Debate
on which you can congratulate Air Canada is its non-stop flights between airports.
We will continue to have these problems until this government puts its shoulder to the wheel.


An hon. Member:: Or until it changes.


Peter Reilly: Or, as my hon. friend says, until it changes. But short of that, we will continue to have these problems until the government realizes the vital importance of transportation to this country that spans so broad a distance and is populated by so few people. Some of them are remoter than others, off the main line and off the beaten track, but they are Canadians nevertheless and are entitled to service. Until this government begins to think about these problems and to plan for them, until it gives us a rational transportation policy, Canadians will continue to worry about their industries, the marketing of their produce and the supply of the necessities of life. So far this government has shown no inclination to give thought to these matters.
The performance of the Minister of Transport has gotten to be one of the grislier jokes of the daily question period.


An hon. Member:: "Farce majeure."


Peter Reilly: Yes. There is no apparent willingness on the part of the government to tackle these problems, just as it has failed to tackle other major problems that have been brought before this parliament. The most passion I have ever seen directed by this government toward any piece of legislation was the first amendment it threw at us last January to cover up the fact that because of such high unemployment it was necessary to overspend by $800 million the amount that had been estimated for the unemployment insurance fund.
As I have said, daily we hear questions being asked by worried representatives of the Canadian people, and until the government accepts its responsibility we will continue to worry on behalf of the Canadian people.
May I call it ten o'clock?


Mr. Deputy Speaker:: Does the House agree to call it ten o'clock?


Some hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 40 deemed to have been moved.
[Stage Direction]
January 8, 1974
Adjournment Debate

A. Daniel McKenzie: Mr. Speaker, on December 21 I directed a question to the Minister of State for Urban Affairs (Mr. Basford) concerning whether or not the minister was now considering increasing the 50 per cent federal government cost-sharing formula for rail line relocation in Canadian cities in an effort to promote intercity rail transit in co-operation with the municipalities and provinces.
As could have been expected, the answer from the minister was uninformative. He said that my question would be best answered when legislation is introduced. One has to wonder, however, when any legislation concerning this subject will be forthcoming from the government. In view of the energy crisis, it is indeed surprising that there is no federal policy regarding intercity rail transportation or on any means of urban transportation, for that matter.
Actually, the question I directed to the minister concerns two interrelated subjects: rail line relocation and intercity rail transportation, which may fall more under the realm of the Department of Transport than the Department of Urban Affairs. Many Canadian cities are planning to relocate railway tracks away from downtown areas, thus freeing large amounts of property for urban development. One tremendous advantage inherent in such a relocation is that connections from these could provide a means of transporting people to and from the inner city. With the possiblity of fuel shortages in Canada this winter and the prospect that these shortages may extend for some time to come, it seems imperative that the government give consideration to this and other suggestions which might improve intercity transportation as a means of conserving energy.
Members of this House are only too familiar with those problems which have arisen and will continue to arise from the energy crisis. Shortages of oil and gasoline necessitate that people be encouraged to leave their automobiles at home and use public modes of transport wherever possible. The best way to encourage such a transformation in the public's attitude is by developing public transportation systems which are both more efficient and economical than the private automobile.
Technology has provided us with such rapid transit systems. However, the federal government has done little to improve the current situation. It gives no leadership and has no real policy. The Minister of Transport (Mr. Marchand) summed up the government's attitude regarding urban transportation very well when on December 21 he declared:
We cannot change these things overnight.
The minister added:
There is no doubt this is something that we would like to do and we will do it wherever possible.
The question, of course, is when? I am no expert on the subjects of transportation and energy, but one does not need to have any particular expertise in these fields to realize that Canada, like other countries, has serious petroleum shortages and inadequate urban transportation

facilities. The thing that makes us unique is that we do not even have a coherent set of policies to deal with these problems.
One example of the way in which rapid transit lines could be added to existing or relocated corridors can be seen in a proposal by the Metro Toronto Transportation Commission. A study by the commission and Canadian Pacific Railway shows that the Canadian National main line corridor through east-end Toronto and Scarborough could have a 20-mile long, rapid transit line added to it at a reasonable cost. This line would provide transit for thousands daily and at the same time ease gas shortages and relieve inner-city traffic congestion and pollution. It is proposals such as this that the government should now be considering for all of Canada's urban regions, not just for some.
The federal government's decision, announced on Monday, to provide a $10 million grant to launch a province-operated commuter rail service between Richmond Hill and Toronto's Union Station is a step in the right direction. However, it should be noted that this grant, which will provide long rail service, marks only the first time that the senior level of government has directly financed a commuter service in Canada.
If the federal government is really serious about the need for public transit as an alternative to the automobile, why is it not supplying more money and leadership to the provinces to help speed the provision of new transportation services? In the city of Ottawa, at least, what the government appears to be doing is encouraging people to bring their cars into the core area. I refer to the Department of Public Works and its intention to construct a mammoth underground parking garage in the heart of the downtown area. This will encourage public employees to bring their cars to work rather than seek out public transportation. The logic escapes me.
Logic is what the United States has been using for the past several years in developing policies to deal with urban congestion and pollution. Like us, they have a long way to go, but they do have a head start on most countries. Long before the advent of the energy crisis, the Americans were formulating long-range urban transit policy. The federal government has provided the initiative and the majority of funds which have enabled governments to come to grips with the problem. Instead of building more freeways, they are building more buses and commuter trains. In these regions, particularly New York and New Jersey, new public transportation networks are now being tested as more and more motorists are opting for buses and, to a lesser extent, trains because of high fuel costs. The U.S. government's foresight is now paying off. This is an example we should have followed. I should also mention the fact that with the serious petroleum shortages, the United States is bringing back transcontinental railways in a big way. Railways once again will be trafficking large numbers of people across the country and across the states.
We in Canada should also look to the past for solutions for the future. The railway was responsible for opening up this country and in no small way has contributed toward our development and prosperity. It is perhaps time to resurrect the locomotive and to once again utilize it as a
January 8, 1974

means of ferrying persons across the provinces and across Canada. Such a revitalization of our rail lines would provide Canadians with an alternative means of transportation over relatively long distances, to say nothing of the savings in petroleum.
The passenger services currently being provided by our two national railways are at present neither efficient nor economical and do not operate on a sufficient scale to handle large numbers of people. This situation should be changed. Our railways should be encouraged to expand their passenger operations and lower their fares. As in the case in the United States, the federal government could provide subsidies to the companies to finance such an expansion. Perhaps then Canadians would leave their cars at home when travelling long distances.
In conclusion, then, I believe it is time the government got around to formulating a policy to deal with inner-city transportation. One means of providing a better urban transit system might be via rail lines connected to relocated corridors; but the actual mode chosen is not really that important. As well, the government should consider reviving railways throughout the country. What is important, though, is that something be done soon to deal with the problems which are arising. However, based on what we have seen thus far in the way of policy, I am not optimistic.


Mr. Ian Watson (Laprairie):: Mr. Speaker, to suggest that the government consider amending a proposed costsharing formula on legislation yet to be introduced in this House, although it will be soon, is to ask for a hypothetical response to a hypothetical situation. There is nothing to indicate that the proposed 50 per cent federal cost-sharing in railway relocation projects is not adequate. Moreover, to suggest that the cost-sharing be increased to promote intercity rail transit is to miss entirely the main purpose of the railway relocation legislation.
The proposed measure is intended for intracity, not intercity, application. It is designed, as will be readily apparent when the bill is introduced, to apply to cities where obsolete or underused railway facilities-tracks, yards, terminals-are formidable obstacles to planned and orderly urban development. Essential intercity lines will not be reduced in capacity or efficiency. The provisions in the railway relocation legislation are intended to modify the flow of traffic on lines in cities or to relocate lines entirely in accordance with urban plans formulated by the provinces and their municipalities.
Where a rail line is relocated, the property thus vacated may be put to any number of uses in accordance with the priorities established by such plans. These priorities can include the provision of improved and expanded rapid transit facilities in cities. Railway rights-of-way will, in many cases, provide excellent corridors for rapid public transit systems. It is our hope, in view of the energy crisis and for environmental considerations generally, that the municipalities will give top priorities to rapid transit systems in their urban plans prepared for railway relocation.
Of much more potential importance for intercity transit is the national transportation development corporation which the minister proposed, on behalf of the government, last October in Edmonton at the second and highly suc-
Adjournment Debate
cessful trilevel conference. He stated at the time that the federal government was making the proposal contingent on the kind of response obtained from the provinces. I can report that officials of the Department of Industry, Trade and Commerce, the Department of Transport and officials responsible for urban affairs have since been seeking the views of the provinces on the desirability of such a national corporation, and everywhere that response has been positive. Such a national agency will help marshall our resources to the task of meeting current and future needs in public transportation and will go some way to meeting the further demands created by the energy situation.
The need for such an agency is obvious, both on economic grounds as well as in the light of emerging energy needs. The domestic market for public transportation systems will amount to at least $5 billion over the next two decades, and we have the opportunity now to develop an integrated public transportation system that will meet, in an energy conserving way, the transit needs generated by large cities and small cities, as well as among cities.
I would like to remind hon. members also that the federal government has been carefully examining its overall role in urban transportation as was outlined in the last throne speech, and it will consult the provinces on this when the examination has been concluded. It is prepared to do this to improve and strengthen the urban environment for the future as well as to meet more pressing current needs as illustrated by the energy situation.


IMMIGRATION-TRANSPORTING OF CHILEAN REFUGEES TO CANADA BY GOVERNMENT PLANE-NUMBER INVOLVED-SCREENING-GRANTED OF LANDED IMMIGRANT STATUS
Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, on November 30, 1973, the Minister of Manpower and Immigration (Mr. Andras) announced measures to assist Chilean refugees wishing to come to Canada. At that time the minister announced that in line with Canada's ongoing refugee program, the government would relax selection criteria, would accelerate immigration processing, provide language training and job placement services, assistance to cover transportation costs, financial assistance to provide for accommodation, winter clothing and other such special support to facilitate early establishment. The minister at that time said that as of that date 20 people had arrived in Canada, 50 had received their visas and the applications of 125 others were being processed as quickly as possible.
On December 21, 1973, about one month after his initial announcement to the House, the minister further announced that applications respecting approximately 1,400 persons had been received. He said that 184 visas had been issued and up to 213 additional visas could be issued once applicants had responded to the request that they come forward for their medical examinations. The minister went on to say that all applications received as of that date ought to be completed by January 31, 1974, with many being completed before the end of December, 1973. Well, Mr. Speaker, to date no refugees have landed in Canada since the minister's first announcement of November 30, 1973.

January 8, 1974
Adjournment Debate
There are four groups of persons in Chile who have requested the aid of the Canadian government in leaving that country. These include Chileans who have sought refuge in the Canadian embassy; those who are seeking entry to Canada through normal, but relaxed immigration procedures; another group who are hiding in Santiago and are being hunted by the military junta; and finally those refugees, Chilean and non-Chilean, who are presently sheltered in six specially created United Nations refugee camps. By way of clarification it should be noted that those who have applied for visas on a normal basis have done so with a view to bettering their personal economic positions, as many have lost their jobs since the junta takeover. The large majority of these people have no political problems with the ruling military. On the other end of the spectrum, those who are in hiding have little or no hope of escape. They are in hiding and we do not know who they are or where they are.
The last group, those who are being cared for under the United Nations refugee program, is the group which both needs and at the same time can benefit from the minister's announced accelerated immigration program. United Nations figures of December 27 showed that 509 refugees were in camps on that day, 1,147 foreigners were on UN lists but living in the city, 123 in embassies and 23 in prison.
The minister's statement in the House that Canada was expanding its aid to refugees created a good deal of optimism and hope among UN officials and the refugees. But in actual practice the announced policy was not much relaxed, and on the contrary was found to be very strict. There were lengthy interviews, first about professional capacity, then questioning about political ideology and party affiliation, followed by medical examinations, a check-out with Ottawa and a wait of several weeks. Some later received curt, two-paragraph letters, of which I have a copy here, affirming rejection by Canada because "your admittance to Canada would be contrary to the public interest of the Canadian people." As a matter of fact, the situation has become so confusing and contradictory that Mr. Ernest Schlatter, the UN High Commissioner for Refugees in Santiago, directed a letter to the Canadian ambassador in Chile, Mr. Ross, on December 28 complaining of Canada's policy in the UN operation.
Three common complaints from UN refugee camps have been that the Canadian immigration officials presume the clients to be guilty as criminal terrorists until proven innocent. The refugees have also spoken bitterly of police-type interrogation. Thirdly, the manner in which the Canadian officials have gone about assisting these refugees appears contrary to what the Minister of Manpower and Immigration in his statement referred to as humanitarian considerations. The minister has not cleared up to my satisfaction the disposition of the refugees in the UN camps who have applied for entry to Canada. For example, we do not know how many from the UN camps have applied to come to Canada and what their status will be if the UN camps are closed as scheduled on February 3.
The minister has obfuscated the whole issue by quoting regular immigrant concerns about Canada's winter weather and by using meaningless phrases such as "importing

revolution," "real refugees," "revolutionaries in masquerade" and his classic statement that "all 124 immigrants are clean." Who, in heaven's name, does the minister think overthrew the democratically elected government? The terrorists and revolutionaries are in the military junta, not in the refugee camps. Why does the government regard the Latin-American refugee who has taken a stand against an oppressive, dictatorial, guerrilla regime as a criminal terrorist and not a freedom fighter, a patriot striving to build a world of justice and decency?
In recognizing the military junta diplomatically, the Secretary of State for External Affairs (Mr. Sharp) announced that such recognition did not imply agreement with the junta. Yet his colleague the Minister of Manpower and Immigration appears not to have understood this, for he seems to regard it as his duty to hand over those refugees to the illegal junta, those who have most opposed the junta and who have most to fear at the hands of the military. I cannot help but feel that in the minister's view General Pinochet could fulfil the qualifications he has made necessary for the refugees. I am sure the minister could find him "clean."


The Acting Speaker (Mr. Laniel):: Order, please. I regret to interrupt the hon. member, but the time allotted to him has expired.


Mr. Mark MacGuigan (Windsor-Walkerville):: Mr. Speaker, I think it no exaggeration to say that the statement we have just heard is an abuse of the proceedings on adjournment. Yesterday the hon. member for Nickel Belt (Mr. Rodriguez) raised a supplementary question with respect to whether the government is considering the establishment of scholarships for refugee students who would like to get out of Chile; tonight he lectures us on another question having to do with Chileans coming here, but not scholarships. Other hon. members opposite, when they make an attempt to change the subject on which they originally asked a question, at least refer to the subject matter of the original question. The hon. member opposite has not favoured us with that courtesy this evening.
The Secretary of State for External Affairs (Mr. Sharp) and the Minister of Manpower and Immigration (Mr. Andras) have already adequately replied to the charges made tonight by the hon. member for Nickel Belt. As I have said, the charges are not, in any event, the subject matter which is before us.


LABOUR CONDITIONS-NEGOTIATIONS WITH MARITIME EMPLOYERS' ASSOCIATION ON GUARANTEEING OF LOANS
J. Michael Forrestall: Mr. Speaker, I want to direct a few words to the parliamentary secretary tonight arising out of a situation started many months ago on the Montreal, Trois-Rivieres and Quebec docks with regard to early retirement and an alleged undertaking by the government of Canada to guarantee full employment for the workers. I hope I have not misquoted the minister on this.
On two occasions, first on December 10 and again yesterday, I asked questions of the minister relating to the intentions of the government with respect to the guaranteeing of certain loans incurred by the Maritime Employ-
January 8, 1974

ers' Association to effect the early retirement of slightly over 500 waterfront workers in those three ports. The minister indicated to me on one occasion that he did not really know what I was talking about, and then he recalled that there was a guarantee to assist these people. Yesterday he was not certain what had happened. He was vague about it and indicated that he would try to find out something for me for today.
What we are talking about is the underwriting of loans of approximately $12 million for the Maritime Employers' Association, which is essentially a private group representing private industry and private interests based in Montreal but in fact representing east coast ports as well. I am concerned that a deal was made some time ago. I cannot imagine the Royal Bank of Canada or the Canadian Imperial Bank of Commerce extending to the Maritime Employers' Association something like $9 million or $10 million on the basis of the figures which in less than eight or nine months had proven to be deficient, so I must conclude that some other assurance was given to the banks. There must have been an undertaking given to the banks by the government that it would do everything in its power to effect full employment; that is, a guarantee of work through all these three ports. That is the only way I can imagine the banks would lend that amount of money to the Maritime Employers' Association.
I am sure the government at the time did not in deed or in word, maybe by implication but not by indication, guarantee the loan to the Maritime Employers' Association which is virtually on the brink of bankruptcy: they cannot meet their commitments to the banks.
I have before me a copy of the proceedings of a meeting of the Maritime Employers' Association held in Montreal on Thursday, December 13, at 2.30 p.m. This copy was distributed on December 19, 1973. I want to read one or two parts of this extract. We are dealing here with the report of A. E. Masters, president of MEA, to member companies. This company represents employers such as Atlantic Container Line (Canada) Ltd., Cast North America Limited, Clarke Transportation Canada Ltd., Federal Commerce and Navigation Co. Ltd., Kerr Steamships (Canada) Limited, Montreal Shipping Company Ltd., and so on. I think we all know their names.
In that report to the members, Mr. Masters deals with the total cost of the early retirement program, which was to run about $7 million originally and was financed by the Royal Bank and the Canadian Imperial Bank of Commerce on the basis of cargo projection flows starting in May. These projections have now proved deficient. He deals with the three ways in which that deficiency occurred. There was a decline in cargo handled at the three river ports. The cargo shift from bulk to mechanized methods was taking place at a more rapid rate than had been anticipated and, finally, productivity had increased. That is fine and probably absolutely accurate. What concerns me has to do with the following part of the report which I now quote:
Your board is meeting with officials of the federal government in the Departments of Finance, Treasury Board and Transport immediately after this meeting with a view to finalizing the refinancing of your association's loans.
Adjournment Debate
Mr. Masters then instructed directors of MEA not to ask questions, not to discuss this because meetings were to take place that very afternoon. I am concerned about the impact on the port of Halifax of the 75-cent per ton cargo assessment put on just a few days ago to help offset pension and administration costs. We are concerned about this. Mr. Masters told the meeting not to make a fuss, not to make a noise because they were going to get the federal government to underwrite the loan, so that the cargo assessment will not have to go up for the ports of Montreal, Trois-Rivieres and Quebec. The people of Halifax are understandably concerned.
I am concerned about the confusion and about what the government intends to do. Will it guarantee the loans and permit MEA to function for a month or two after the loans have been guaranteed, and then simply let them fold their tents, declare to the banks their inability to meet the loan and let the Canadian taxpayer pick up the tab? On the one hand there is increased assessment in Halifax and there is increased assessment in the port of Saint John. This will come about quickly. I hope this evening the hon. member who acted previously as parliamentary secretary can tell us of the intentions of the government with respect to these loans.
Is the government to guarantee these loans? Are we in danger of having to repay the loans to the banks? If so, what compensation is to be offered to the ports of Vancouver, Halifax, Saint John, New Brunswick, etc., and to other ports? Finally, I am concerned about the attitude of the Department of Transport, the National Harbours Board and what-have-you about the establishment of the Maritime Employers' Association in the port of Halifax, as that port can operate at a fraction of the cost which is now being charged against administration in Montreal. I know the hon. member will do his best to answer these questions. I suggest to him that his failure to do so tonight will have me on my feet again before the House adjourns.


Joseph-Phillippe Guay: Mr. Speaker, I suggest that the Minister of Transport (Mr. Marchand) yesterday, as recorded at pages 9014 and 9015 of Hansard, answered in a clear manner matters raised by the hon. member for Dartmouth-Halifax East (Mr. Forrestall). The Maritime Employers' Association is a corporation incorporated under part II of the Canada Corporations Act that represents some 85 operators who employ International Longshoremen's Association labour in the major eastern Canadian ports. There are several separate labour agreements, one of which is for the three St. Lawrence River ports of Quebec, Trois-Rivieres and Montreal, for a three-year period ending December 31, 1974.
Difficulty was experienced in the early stages of this contract due to changing cargo patterns, including the high level of containerization and diversion to other ports and the ILA strike in these ports in 1972, finally settled by an act of parliament and by arbitration which cost MEA a great deal of money to support a wage-guarantee program. In May of 1973 a reduction of some 550 men in the work force was accomplished for which MEA borrowed $7.2 million with an undertaking from NHB that the matter would be brought to the attention of the government if results showed that conventional financing was too great a burden for MEA. This present recommendation is there-

January 8, 1974
Adjournment Debate
fore in fulfilment of that undertaking. The repayment program for these funds has not been met and cannot be met within the current labour agreement.
The NHB has proposed to the government that some arrangements be made to guarantee bank loans incurred by MEA for the purpose of the early retirement program for surplus longshoremen. This will remain an MEA obligation entirely and will be repaid out of MEA charges made at Montreal, Trois-Rivieres and Quebec.
There is no relationship between the MEA labour contract in these three St. Lawrence ports and the east coast ports. These are completely separate contracts and neither Halifax nor Saint John could be involved. Funds for each port in the NHB system are kept separate and distinct, and funds from Saint John and Halifax could not be used to pay any obligations in the St. Lawrence ports.
The basis of the funds to support this guarantee is reserved funds invested in government bonds from the three St. Lawrence ports out of prior years' profitable port operations. In the event that the government was ever called on to make good such a guarantee, these reserve funds would be made available by the NHB for this purpose. These total now about $30 million. There are no similar funds of any kind in the port of Halifax, and in fact the government was required to provide $1 million in the 1973 estimates to cover the operating loss of that port. There are only about $2 million of similar funds in the port of Saint John, and the NHB has pledged that this will be used for capital improvements in the port. The government has not yet completely reviewed the NHB proposal, so detailed comments are rather premature.
Motion agreed to and the House adjourned at 10.30 p.m.

Wednesday, January 9, 1974